QBE Insurance (Australia) Limited v Coyne in his capacity as liquidator of Educational World Travel Pty Ltd (in liquidation) [2021] FCA 594

QBE Insurance (Australia) Limited v Coyne in his capacity as liquidator of Educational World Travel Pty Ltd (in liquidation) [2021] FCA 594

Approval was warranted because the proceeding offered a potential return to creditors under the insurance policy, the Protocol Agreement contained a costs arrangement, Mr Coyne undertook not to recover his fees unless there was a cash return to EWT, creditors had not objected, and the failure to obtain prior approval was explained by urgency, involved honest conduct, and caused no substantial injustice.

Jurisdiction
Australia
Judgment Date
02 June 2021
Procedural Posture
Interlocutory Application for Orders Pursuant to S 477(2 B) of the Corporations Act 2001 (cth) to Approve the Entry by a Liquidator Into an Agreement on the Company's Behalf / Determined on the Papers
Outcome
Application granted; confidentiality order made; entry into the Protocol Agreement approved; validation declaration made.
Legal Topics
['liquidator Powers' 'court Approval of Agreement' 'business Interruption Insurance Test Case' 'confidentiality' 'validation of Procedural Irregularity']
['corporations' 'insurance'] ['liquidator Powers' 'court Approval of Agreement' 'business Interruption Insurance Test Case' 'confidentiality' 'validation of Procedural Irregularity']

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Procedural Posture

Interlocutory Application for Orders Pursuant to S 477(2 B) of the Corporations Act 2001 (cth) to Approve the Entry by a Liquidator Into an Agreement on the Company's Behalf / Determined on the Papers

Legal Issues

  1. 1 ["Whether the Court should approve the first respondent liquidator's entry into the Protocol Agreement dated 26 March 2021 under s 477(2B) of the Corporations Act 2001 (Cth)." "Whether the Court should declare under s 1322(4)(a) of the Corporations Act 2001 (Cth) that the Protocol Agreement and the first respondent's entry into it were not invalid because prior approval under s 477(2B) had not been obtained." 'Whether Confidential Annexure DC-2 containing the Protocol Agreement should be protected from disclosure from the Court file without leave.']

Ratio Decidendi

Approval was warranted because the proceeding offered a potential return to creditors under the insurance policy, the Protocol Agreement contained a costs arrangement, Mr Coyne undertook not to recover his fees unless there was a cash return to EWT, creditors had not objected, and the failure to obtain prior approval was explained by urgency, involved honest conduct, and caused no substantial injustice.

Court Disposition

Application granted; confidentiality order made; entry into the Protocol Agreement approved; validation declaration made.

Orders

  • ['Confidential Annexure DC-2 to the affidavit of David Coyne affirmed on 28 May 2021 not be disclosed from the Court file to any person without the prior leave of a judge of the Court.' "Pursuant to s 477(2B) of the Corporations Act 2001 (Cth), the first respondent's entry into the Protocol Agreement dated 26 March...