White, in the matter of Macro Realty Developments Pty Ltd and Macro Realty Pty Ltd (No 2) [2020] 649

White, in the matter of Macro Realty Developments Pty Ltd and Macro Realty Pty Ltd (No 2) [2020] 649

Approval of the litigation funding agreement nunc pro tunc under s 477(2B) is appropriate where the Macro Funded Entities have insufficient funds, a bona fide claim exists, the funding agreement is necessary to pursue the claim for the benefit of creditors, and the liquidators have acted properly. Confidentiality orders are justified to protect commercially sensitive and privileged material from disclosure, given the potential prejudice to proper administration of justice.

Parties
First Applicants: Hayden Leigh White and Matthew David Woods in their capacity as joint and several provisional liquidators of Macro Realty Developments Pty Ltd (in liquidation) and Macro Realty Pty Ltd (in liquidation); Second Applicants: Hayden Leigh White and Matthew David Woods in their capacity as joint and several liquidators of Macro Realty Developments Pty Ltd (in liquidation) and Macro Realty Pty Ltd (in liquidation)
Jurisdiction
Australia
Judgment Date
14 May 2020
Procedural Posture
Corporations – Liquidators' Application / Application for Approval of Litigation Funding Agreement and Related Orders
Outcome
Application granted in part: litigation funding agreement approved nunc pro tunc under s 477(2B); extension of time and validation granted; confidentiality orders made; partial refusal to grant direction under s 90-15.
Legal Topics
Liquidator's Powers, Approval of Litigation Funding, Extension of Time, Non Publication/confidentiality Orders, Nunc Pro Tunc Orders
Corporations Law Insolvency Practice and Procedure Liquidator's Powers Approval of Litigation Funding Extension of Time Non Publication/confidentiality Orders Nunc Pro Tunc Orders

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Parties

Hayden Leigh White and Matthew David Woods in their capacity as joint and several provisional liquidators of Macro Realty Developments Pty Ltd (in liquidation) and Macro Realty Pty Ltd (in liquidation)

First Applicants

Hayden Leigh White and Matthew David Woods in their capacity as joint and several liquidators of Macro Realty Developments Pty Ltd (in liquidation) and Macro Realty Pty Ltd (in liquidation)

Second Applicants

Procedural Posture

Corporations – Liquidators' Application / Application for Approval of Litigation Funding Agreement and Related Orders

Legal Issues

  1. 1 Whether the liquidators should be granted approval under s 477(2B) of the Corporations Act 2001 (Cth) for entry into a litigation funding agreement after execution (nunc pro tunc)
  2. 2 Whether the court should make an extension of time under s 1322(4)(d) and validate the agreement under s 1322(4)(a) of the Corporations Act 2001 (Cth)
  3. 3 Whether confidentiality/non-publication orders are justified under s 37AF of the Federal Court of Australia Act 1976 (Cth)

Ratio Decidendi

Approval of the litigation funding agreement nunc pro tunc under s 477(2B) is appropriate where the Macro Funded Entities have insufficient funds, a bona fide claim exists, the funding agreement is necessary to pursue the claim for the benefit of creditors, and the liquidators have acted properly. Confidentiality orders are justified to protect commercially sensitive and privileged material from disclosure, given the potential prejudice to proper administration of justice.

Court Disposition

Application granted in part: litigation funding agreement approved nunc pro tunc under s 477(2B); extension of time and validation granted; confidentiality orders made; partial refusal to grant direction under s 90-15.

Orders

  • Liquidators of seven additional entities (the Macro Parties) joined as applicants.
  • Extension of time for approval application under s 477(2B) to 1 May 2020 granted under s 1322(4)(d).