Aquila Resources Limited v Spark [2003] FCA 394

Aquila Resources Limited v Spark [2003] FCA 394

Despite the availability of a statutory remedy under s 445D of the Corporations Act, there are serious questions to be tried concerning the creation of new rights by the proposed resolution affecting the Savage Companies; the balance of convenience, including potential hardship from the creation of such rights, weighs in favour of granting interlocutory injunctive relief pending the outcome of the substantive application.

Parties
First Applicant: Aquila Resources Limited; Second Applicant: Aquila EHM Pty Ltd; First Respondent: John M Spark; Second Respondent: Peter D McCluskey; Third Respondent: Savage Resources Limited (Subject to Deed of Company Arrangement); Fourth Respondent: Savage EHM Finance Pty Ltd (Subject to Deed of Company Arrangement)
Jurisdiction
Australia
Judgment Date
27 March 2003
Procedural Posture
Interlocutory Application / Application for Interlocutory Injunction Pending Determination of Substantive Relief
Outcome
Interlocutory injunction granted pending outcome of application; costs reserved.
Legal Topics
Interlocutory Injunctions, Voluntary Administration, Deed of Company Arrangement, Balance of Convenience, Statutory Remedies, Cross Guarantees, Corporate Insolvency
Corporations Law Equity Interlocutory Injunctions Voluntary Administration Deed of Company Arrangement Balance of Convenience Statutory Remedies Cross Guarantees +1 more

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Parties

Aquila Resources Limited

First Applicant

Aquila EHM Pty Ltd

Second Applicant

John M Spark

First Respondent

Peter D McCluskey

Second Respondent

Savage Resources Limited (Subject to Deed of Company Arrangement)

Third Respondent

Savage EHM Finance Pty Ltd (Subject to Deed of Company Arrangement)

Fourth Respondent

Procedural Posture

Interlocutory Application / Application for Interlocutory Injunction Pending Determination of Substantive Relief

Legal Issues

  1. 1 Whether interlocutory injunction should issue restraining certain resolutions affecting third and fourth respondents pending outcome of the application
  2. 2 Whether balance of convenience favours the grant of interlocutory relief despite the existence of statutory remedy under Corporations Act 2001 (Cth)

Ratio Decidendi

Despite the availability of a statutory remedy under s 445D of the Corporations Act, there are serious questions to be tried concerning the creation of new rights by the proposed resolution affecting the Savage Companies; the balance of convenience, including potential hardship from the creation of such rights, weighs in favour of granting interlocutory injunctive relief pending the outcome of the substantive application.

Court Disposition

Interlocutory injunction granted pending outcome of application; costs reserved.

Orders

  • An injunction restraining the first and second respondents from putting forward any resolution to the creditors of the third and fourth respondents as proposed to vary the Deeds of Company Arrangement to permit or require entry into a Deed of Cross Assumption of Claims, so as to bind the third and fourth...
  • Costs reserved.