Saker, in the matter of Great Southern Limited [2014] FCA 771

Saker, in the matter of Great Southern Limited [2014] FCA 771

The funds were not held on a statutory trust merely because s 561 of the Corporations Act 2001 (Cth) required their application for priority purposes. The plaintiffs were bound by the statutory regime, particularly s 561, and, subject to satisfying themselves that s 561 had been complied with, would be acting properly in treating the funds as available for unsecured debts and claims in the priority order established by s 556 of the Corporations Act 2001 (Cth).

Jurisdiction
Australia
Judgment Date
24 July 2014
Procedural Posture
Application by Liquidators for Directions in the Winding Up of Great Southern Limited (in Liquidation) / Directions Under Ss 511(1)(a) and 1337 B(1) of the Corporations Act 2001 (cth)
Outcome
Directions made; the questions posed by the plaintiffs were answered affirmatively, subject to the plaintiffs satisfying themselves that s 561 of the Corporations Act 2001 (Cth) has been complied with.
Legal Topics
["liquidators' Directions" 'priority of Employee Claims' 'circulating Security Interests' 'floating Charges' 'trust Obligations in Liquidation' 'priority Payments in Winding Up']
['insolvency' 'corporations Law'] ["liquidators' Directions" 'priority of Employee Claims' 'circulating Security Interests' 'floating Charges' 'trust Obligations in Liquidation' 'priority Payments in Winding Up']

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Procedural Posture

Application by Liquidators for Directions in the Winding Up of Great Southern Limited (in Liquidation) / Directions Under Ss 511(1)(a) and 1337 B(1) of the Corporations Act 2001 (cth)

Legal Issues

  1. 1 ['Whether any trust obligation that existed in respect of the funds remitted by the receivers was at an end.' 'Whether the plaintiffs would be acting properly and otherwise justified in treating those funds as funds to be applied in meeting the unsecured debts of GSL and claims made against GSL in the order of priority established by s 556 of the Corporations Act 2001 (Cth).']

Ratio Decidendi

The funds were not held on a statutory trust merely because s 561 of the Corporations Act 2001 (Cth) required their application for priority purposes. The plaintiffs were bound by the statutory regime, particularly s 561, and, subject to satisfying themselves that s 561 had been complied with, would be acting properly in treating the funds as available for unsecured debts and claims in the priority order established by s 556 of the Corporations Act 2001 (Cth).

Court Disposition

Directions made; the questions posed by the plaintiffs were answered affirmatively, subject to the plaintiffs satisfying themselves that s 561 of the Corporations Act 2001 (Cth) has been complied with.

Orders

  • ['Pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth), and on the ground that the order is necessary to prevent prejudice to the proper administration of justice, Annexure AJS-16 to the affidavit of Andrew John Saker sworn 4 March 2014 (Saker Affidavit) and Annexure DX-2 to the affidavit of Darren Da...