In the matter of DH International Pty Ltd (in liq) (No 2) [2017] NSWSC 871

Supreme Court New South Wales

Medium Neutral Citation: In the matter of DH International Pty Ltd (in liq) (No 2) [2017] NSWSC 871 Hearing dates: 18 May 2017 Date of orders: 30 June 2017 Decision date: 30 June 2017 Jurisdiction: Common Law Before: Gleeson JA Decision: (1) Pursuant to s 551(1) of the Corporations Act 2001 (Cth), grant leave nunc pro tunc to the plaintiff, Mr Darren Challis, to enter into the deed of assignment dated 5 April 2016 between DH International Pty Ltd (in liq) (the company), Mr John Vouris and Mr Bradley Tonks in their capacity as liquidators of the company and Mr Darren Challis, notwithstanding that Mr Challis was a member of the committee of inspection of the company at the time of entering into that transaction. Catchwords: CORPORATIONS – external administration – assignment to member of committee of inspection of any causes of action the company might have for compensation for breach of fiduciary and statutory duties and accessorial liability – application by committee member for leave nunc pro tunc to enter transaction prohibited by s 551, Corporations Act – where transaction approved by unanimous resolution of creditors – where committee of inspection not involved in approval of the transaction – where member of committee of inspection did not advert to restrictions on acquisition of company property when entering into deed of assignment – whether potential partial invalidity of purported assignment infects or otherwise renders whole assignment invalid – whether discretionary factors tend against grant of leave. Legislation Cited: Companies (New South Wales) Code 1981, s 435(1)(a) Corporations Act 2001 (Cth), ss 439C, 446A(2), 477(2)(c), 477(2B), 548, 551(1), 551(2), 555, 556, 556(1)(e), (g), (h), (dd), (de), 564, 1317H, 1322(2) and (4), 1607, 1614, Pt 5.3A, Pt 5.6, ss 80-55, 80-60 of Sch 2 Corporations and Other Legislation Amendment (Insolvency Law Reform) Regulation 2016 (Cth) regs 10.25.01(1), 10.25.02(3)(i) Corporations Law, ss 232, 477(2B) Insolvency Law Reform Act 2016 (Cth), Item 178, Pt 2, Sch 2 Supreme Court (Corporations) Rules 1999 (NSW), r 2.13 Trade Practices Act 1974 (Cth), ss 82, 87 Cases Cited: Emanuele v Australian Securities Commission (1997) 188 CLR 114; [1997] HCA 20 Empire (Aust) Nominees Pty Ltd (in liq) v Vince (as liquidator of Empire (Aust) Nominees Pty Ltd (in liq)) (2000) 35 ACSR 167; [2000] VSC 324 Green (as liquidator of Arimco Mining Pty Ltd) v CGU Insurance Ltd [2008] NSWCA 148 In the matter of DH International Pty Ltd (in liq) [2017] NSWSC 870 In the matter of Golden Sands Hospitality Pty Ltd (in liq) (No 2) [2017] NSWSC 450 MG Corrosion Consultants Pty Ltd v Gilmour (2012) 202 FCR 354; [2012] FCA 383 Mijac Investments Pty Ltd v Graham (No 2) (2009) 72 ACSR 684; [2009] FCA 773 Minister for Immigration and Citizenship v Li (2013) 249 CLR 332; [2013] HCA 18 Onefone Australia Pty Ltd & Others v One.Tel Ltd & Others (2008) 69 ACSR 290; [2008] NSWSC 1335 Owners of Strata Plan 5290 v CGS & Co Pty Ltd [2011] NSWCA 168 Park & Ors v Allied Mortgage Corporation Limited & Ors (1993) ATPR 53,467 Re Bulmer [1937] Ch 499 Re Cant (in his capacity as liquidator of Novaline Pty Ltd (ACN 006 622 933)) (in liq) (2011) 85 ACSR 31; [2011] FCA 898 Re Colorado Products Pty Ltd (in prov liq) (2014) 101 ACSR 233; [2014] NSWSC 789 Re FT Hawkins & Co Ltd [1952] Ch 881 Re Geiger [1915] 1 KB 439 Re Genoa Resources and Investment Limited (in liq) [2005] NSWSC 1145 Re Graziers Butchering Co (1897) 8 QLJ 125 Re Security Directors Pty Limited (in liq) (1997) 24 ACSR 558 Re Standard Insurance Co Ltd (in liq) [1962] NZLR 762 UTSA Pty Ltd (in liq) v Ultra Tune Australia Pty Ltd (1996) 21 ACSR 457 Warne v GDK Financial Solutions [2006] NSWSC 464 Texts Cited: McPherson's Law of Company Liquidation (5th Ed., 2006) Category: Procedural and other rulings Parties: Darren George Challis (Plaintiff) David Henry Hoffmann (First Defendant) DHR International, Inc (Second Defendant) DHR International Asia Limited (Third Defendant) Representation: Counsel: P Braham / MA Karam (Plaintiff) R Gration (Defendants)