Carter (Liquidator), in the matter of Australian Vocational Learning Institute Pty Ltd (in liq) (No 2) [2020] FCA 729

Carter (Liquidator), in the matter of Australian Vocational Learning Institute Pty Ltd (in liq) (No 2) [2020] FCA 729

Approval was granted because the second funding agreement was the only mechanism by which prospective recoveries could be pursued, did not contain unusual or onerous terms, was unlikely to be bettered, posed no real risk to funds otherwise distributable to creditors, involved no apparent bad faith, error of law or improper exercise of power, served a strong public interest in recovery of monies owed to the Commonwealth, and caused no relevant prejudice. Suppression orders were justified to preserve confidentiality of the funding terms and to avoid prejudice to the proposed proceedings.

Jurisdiction
Australia
Judgment Date
21 May 2020
Procedural Posture
Application by a Liquidator for Approval Under S 477(2 B) of the Corporations Act 2001 (cth) to Enter Into a Funding Agreement and for Suppression Orders Under S 37 AF of the Federal Court of Australia Act 1976 (cth) / Final Orders and Reasons for Judgment
Outcome
Application granted; approval to enter the funding agreement and suppression orders made.
Legal Topics
['liquidator Approval to Enter Funding Agreement' 'company in Liquidation' 'suppression Orders' 'proper Administration of Justice' 'corporate Insolvency']
['corporations' 'practice and Procedure'] ['liquidator Approval to Enter Funding Agreement' 'company in Liquidation' 'suppression Orders' 'proper Administration of Justice' 'corporate Insolvency']

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Procedural Posture

Application by a Liquidator for Approval Under S 477(2 B) of the Corporations Act 2001 (cth) to Enter Into a Funding Agreement and for Suppression Orders Under S 37 AF of the Federal Court of Australia Act 1976 (cth) / Final Orders and Reasons for Judgment

Legal Issues

  1. 1 ['Whether the liquidator should be granted approval under s 477(2B) of the Corporations Act 2001 (Cth) to enter into the second funding agreement on behalf of the company in liquidation.' 'Whether suppression orders should be made under s 37AF of the Federal Court of Australia Act 1976 (Cth) to protect confidential information concerning the funding agreement and proposed recovery proceedings.']

Ratio Decidendi

Approval was granted because the second funding agreement was the only mechanism by which prospective recoveries could be pursued, did not contain unusual or onerous terms, was unlikely to be bettered, posed no real risk to funds otherwise distributable to creditors, involved no apparent bad faith, error of law or improper exercise of power, served a strong public interest in recovery of monies owed to the Commonwealth, and caused no relevant prejudice. Suppression orders were justified to preserve confidentiality of the funding terms and to avoid prejudice to the proposed proceedings.

Court Disposition

Application granted; approval to enter the funding agreement and suppression orders made.

Orders

  • ['Pursuant to s 477(2B) of the Corporations Act 2001 (Cth), the second plaintiff is granted approval to enter into the Funding Agreement in the form exhibited to the confidential affidavit of Moira Kathleen Carter sworn on 18 May 2020.' 'Pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth), on the...