Miller v Millers Tyre Services (WA) Pty Ltd [2010] NSWSC 310

New South Wales Supreme Court

CITATION : Miller v Millers Tyre Services (WA) Pty Ltd [2010] NSWSC 310

HEARING DATE(S) : 19/04/10

JUDGMENT DATE : 19 April 2010

JURISDICTION : Equity Division Corporations List

JUDGMENT OF : Barrett J

EX TEMPORE JUDGMENT DATE : 19 April 2010

DECISION : New liquidator appointed

CATCHWORDS : CORPORATIONS - winding up - members voluntary winding up - company apparently solvent - resignation of liquidator - no arrangements for transition to new liquidator - resignation with apparent consent of members - court asked to appoint new liquidator - no resort by members to their own power to appoint

LEGISLATION CITED : Corporations Act 2001 (Cth), ss 495(3), 502

CATEGORY : Principal judgment

PARTIES : Ellen Terese Miller - Plaintiff Millers Tyre Services (WA) Pty Limited - Defendant

FILE NUMBER(S) : SC 2010/0081259

COUNSEL : Mr D P M Ash - Plaintiff

SOLICITORS : McLean & Associates - Plaintiff

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST

BARRETT J

MONDAY 19 APRIL 2010

2010/81259 ELLEN TERESE MILLER v MILLERS TYRE SERVICES (WA) PTY LIMITED (IN LIQUIDATION)

JUDGMENT

1 This is an application by one of three members of Millers Tyre Service (WA) Pty Limited. 2 The three members hold between them 150 issued shares. Of the three members, one has died. That member held one share. The other two members of whom, as I say, the plaintiff is one wish the Court to grant certain relief consequent upon the resignation of the liquidator of the company. 3 The winding up is a members voluntary winding up. It commenced in 2006. Mr Ellis was appointed liquidator. 4 On 30 March 2009, Mr Ellis filed with ASIC Form 505 "Notification of Appointment or Cessation of an External Administrator". By that form he gave notice of his having been resigned or been removed as liquidator on 25 March 2009. 5 There is evidence that in the period January to early March 2009 the present plaintiff told Mr Ellis that it had been decided to engage the Tamworth accountant "to handle our books in the future". One letter from the plaintiff concluded by thanking Mr Ellis for the great service that he and his father had given for a long time. 6 Mr Ellis responded on 23 January 2009 setting out his costs, as estimated, to conclude the winding up. He asked for the specified amount as soon as possible so that he could proceed with the matter. He said that the alternative, as he understood it, was for the shareholders (at least I think he was referring to the shareholders in his letter) to pay his costs to date as liquidator and that he could arrange for the company to be taken out of liquidation. 7 One can only infer that Mr Ellis was, for financial reasons, unwilling to continue as liquidator and that the plaintiff at least and probably the other shareholder as well were content to see him depart. That seems to be the background to his unilateral action to notify ASIC that on 25 March 2009 he had resigned or been removed. The notification does not distinguish between the two, but it may be inferred that the case was one of resignation. 8 Mr Ellis presided over a winding up having consented to act as liquidator. It is a matter for some concern that any liquidator should unilaterally depart the scene, although I accept that on the basis of the correspondence Mr Ellis' departure was with the consent of those interested in the company and was prompted by them. In saying this, I am conscious of the fact that I have mentioned only members. This is because the evidence shows that there are no creditors and that the company has a single asset in the form of a substantial receivable. The interests of members are therefore alone relevant. 9 The plaintiff now seeks to have the court exercise its power under s 502 of the Corporations Act 2001 (Cth) to appoint a new liquidator. That power is obviously exercisable in the circumstances and it will be appropriate for the Court to make the appointment. 10 One may wonder, however, why the members did not take the easy course of themselves making an appointment under s 495(3). That section applies where a vacancy occurs in the office of liquidator in a members voluntary winding up by death, resignation or otherwise. The company in general meeting may fill the vacancy by the appointment of a liquidator. That would have been an easy and straightforward course and a much less expensive one for the members to have taken in this case. 11 However, they have decided to approach the court and the court will make the order sought. **********