In the matter of Belmont Sportsmans Club Co-Operative Limited [2015] NSWSC 2057

Supreme Court New South Wales

Medium Neutral Citation: In the matter of Belmont Sportsmans Club Co-Operative Limited [2015] NSWSC 2057 Hearing dates: 4 May 2015 Date of orders: 04 May 2015 Decision date: 04 May 2015 Jurisdiction: Equity - Corporations List Before: Brereton J Decision: Winding up order made. Catchwords: CORPORATIONS – winding up – winding up in insolvency – winding up of co-operative under Co-Operatives National Law in same circumstances as company under (Cth) Corporations Act 2001 – where current liabilities clearly exceed current assets – where administrators appointed and do not oppose winding up – held, defendant insolvent and to be wound up. Legislation Cited: (Cth) Corporations Act 2001, Pt 5.4, Pt 5.4A, Pt 5.4B, Pt 5.5, Pt 5.6. (NSW) Co-Operatives National Law, s 444(2), s 444(3) Category: Principal judgment Parties: Deputy Commissioner of Taxation (plaintiff) Belmont Sportsmans Club Co-Operative Limited ABN 73 163 215 644 (defendant) Representation: Counsel: A Narayan (plaintiff) J Karolczak (defendant)

Solicitors: Craddock Murray Neumann Lawyers (plaintiff) Minter Ellison (defendant) File Number(s): 2014/342483

Judgment (ex tempore) 1. HIS HONOUR: By originating process filed on 20 November 2014, the plaintiff Deputy Commissioner of Taxation seeks an order that the defendant Belmont Sportsmans Club Co-Operative Ltd (Administrators Appointed) be wound up. 2. The defendant is a co-operative registered under (NSW) Co-Operatives National Law, s 444(2), which provides that a co-operative may be wound up in the same way and in the same circumstances as a company under the (Cth) Corporations Act 2001 may be wound up. Section 444(3) provides that the winding up of a co-operative is declared to be an applied Corporations legislation matter for the purposes of the Corporations application legislation of, relevantly, New South Wales in relation to Parts 5.4, 5.4A, 5.4B, 5.5 and 5.6 of the Corporations Act, subject to a number of irrelevant modifications. 3. The plaintiff is a creditor of the defendant in respect of various taxation liabilities for a sum of $1,051,597, which was due when the winding up summons was filed and remains due and unpaid. 4. The evidence establishes two principal bases upon which insolvency can comfortably be concluded. First, as at September 2013, the defendant had current liabilities of in excess of $4.5 million, current assets of only $171,000, a working capital deficiency of nearly $4.5 million and a current ratio of .0374, plainly indicative of insolvency. Secondly, the defendant appointed administrators on the basis that it was or was likely to become insolvent. No proposal for a deed of company arrangement has been forthcoming. The administrators do not oppose the winding up order. I am satisfied that the defendant is insolvent and ought to be wound up. 5. The evidence establishes that the originating process was served on the plaintiff on 25 November 2014. The matter has been before the Court and adjourned on a number of occasions, no doubt partly in connection with the pendency of the administration. As I have said, the administrators do not oppose a winding up order. 6. The Court orders that: 1. The defendant Belmont Sportsmans Club Co-Operative Ltd be wound up. 2. David Paul Merryweather and William Anthony Honner be appointed liquidators of the defendant. 3. The plaintiff's costs of the proceedings be fixed in the amount of $6,202.46. 1. The exhibits may be returned.