Livingstone, in the matter of NewSat Ltd (in liq) [2022] FCA 1559

Livingstone, in the matter of NewSat Ltd (in liq) [2022] FCA 1559

Approval of the funding deed and indemnity was justified as being in the best interests of creditors, given exhaustive but unsuccessful attempts to secure alternative funding, clarity and commercial reasonableness of terms, and no evidence of bad faith or error; suppression orders were necessary to avoid prejudice to the administration of justice; leave was properly refused to the creditor COFACE as its participation would not further the interests protected by the court’s discretion under s 477(2B).

Jurisdiction
Australia
Judgment Date
16 December 2022
Procedural Posture
Corporations – Approval of Funding Agreement and Associated Orders in Liquidation / Application for Approval Under S 477(2 B) Corporations Act and Related Orders
Outcome
Orders granted as sought by the liquidator (approval of indemnity and funding deed, suppression orders, refusal of leave to COFACE).
Legal Topics
['liquidators – Funding Agreements' 'court Directions for Liquidators' 'suppression Orders' 'standing of Creditors to Be Heard in Funding Approvals']
['corporations Law' 'insolvency'] ['liquidators – Funding Agreements' 'court Directions for Liquidators' 'suppression Orders' 'standing of Creditors to Be Heard in Funding Approvals']

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Procedural Posture

Corporations – Approval of Funding Agreement and Associated Orders in Liquidation / Application for Approval Under S 477(2 B) Corporations Act and Related Orders

Legal Issues

  1. 1 ['Whether the liquidator should be granted approval, nunc pro tunc, to enter into the deed of indemnity and funding deed under s 477(2B) of the Corporations Act 2001 (Cth)' 'Whether the liquidator is justified under s 90-15 of the Insolvency Practice Schedule (Corporations) 2016 to enter into and perform the funding deed' 'Whether suppression orders should be granted for funding arrangements and related confidential material' "Whether a creditor (COFACE) should be given leave under r 2.13 of the Federal Court (Corporations) Rules 2000 (Cth) to be heard on the liquidator's application"]

Ratio Decidendi

Approval of the funding deed and indemnity was justified as being in the best interests of creditors, given exhaustive but unsuccessful attempts to secure alternative funding, clarity and commercial reasonableness of terms, and no evidence of bad faith or error; suppression orders were necessary to avoid prejudice to the administration of justice; leave was properly refused to the creditor COFACE as its participation would not further the interests protected by the court’s discretion under s 477(2B).

Court Disposition

Orders granted as sought by the liquidator (approval of indemnity and funding deed, suppression orders, refusal of leave to COFACE).

Orders

  • ['Confidential Affidavit of Glenn Ian Livingstone sworn 14 December 2022 and Confidential Exhibit GIL-2, and Confidential Submissions dated 14 December 2022, to be marked confidential until resolution of the Supreme Court of Victoria No. S ECI 2020 02631 and any appeals or further order.' 'Nunc pro tunc approval...