Tall Trees Tanah Merah Pty Ltd v Trust Company (PTAL) Limited as Custodian for the LM First Mortgage Income Fund [2014] FCA 963

Tall Trees Tanah Merah Pty Ltd v Trust Company (PTAL) Limited as Custodian for the LM First Mortgage Income Fund [2014] FCA 963

The application for interlocutory relief was dismissed because the Court was not satisfied that PTAL and LMI's attendance at the creditors' meeting and voting against a resolution that Mr Usher execute a Personal Insolvency Agreement constituted a breach or threatened breach of cl 3.3(d) of the Bendigo Intercreditor Deed. Although the applicants' contention was arguable, it was not sufficiently arguable in light of the other factors, and the balance of convenience did not favour relief, particularly because restraining PTAL and LMI could foreclose examination of matters relevant to Mr Usher's affairs and other unsecured creditors had not been served or heard.

Jurisdiction
Australia
Judgment Date
05 September 2014
Procedural Posture
Application for Interim or Interlocutory Relief Concerning a Creditors' Meeting Under Pt X of the Bankruptcy Act 1966 (cth) / Interlocutory Application
Outcome
Application for interlocutory relief dismissed; costs reserved.
Legal Topics
['personal Insolvency Agreement' 'controlled Estate Under S 188 of the Bankruptcy Act 1966 (cth)' "creditors' Meeting Under S 204 of the Bankruptcy Act 1966 (cth)" 'intercreditor Deed' 'proof of Debt' 'guarantee and Indemnity' 'balance of Convenience']
['bankruptcy and Insolvency' 'interlocutory Injunctions' 'contract'] ['personal Insolvency Agreement' 'controlled Estate Under S 188 of the Bankruptcy Act 1966 (cth)' "creditors' Meeting Under S 204 of the Bankruptcy Act 1966 (cth)" 'intercreditor Deed' 'proof of Debt' 'guarantee and Indemnity' 'balance of Convenience']

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Procedural Posture

Application for Interim or Interlocutory Relief Concerning a Creditors' Meeting Under Pt X of the Bankruptcy Act 1966 (cth) / Interlocutory Application

Legal Issues

  1. 1 ['Whether the meeting of creditors of Mr Usher should be adjourned.' 'Whether PTAL and LMI should be restrained from voting in the controlled estate of Mr Usher for or against resolutions under s 204 of the Bankruptcy Act 1966 (Cth).' "Whether PTAL and LMI's issue of the Notice of Demand, lodgement of a Proof of Debt and proposed attendance and voting at the creditors' meeting breached or threatened breach of cl 3.3(d) of the Bendigo Intercreditor Deed." "Whether the controlling trustees should be restrained from admitting PTAL's Proof of Debt for voting purposes."]

Ratio Decidendi

The application for interlocutory relief was dismissed because the Court was not satisfied that PTAL and LMI's attendance at the creditors' meeting and voting against a resolution that Mr Usher execute a Personal Insolvency Agreement constituted a breach or threatened breach of cl 3.3(d) of the Bendigo Intercreditor Deed. Although the applicants' contention was arguable, it was not sufficiently arguable in light of the other factors, and the balance of convenience did not favour relief, particularly because restraining PTAL and LMI could foreclose examination of matters relevant to Mr Usher's affairs and other unsecured creditors had not been served or heard.

Court Disposition

Application for interlocutory relief dismissed; costs reserved.

Orders

  • ['Upon the first and second respondents undertaking not to engage in the conduct of voting in favour of a resolution that the fifth applicant be directed to execute a Personal Insolvency Agreement for the purposes of Pt X of the Bankruptcy Act 1966 (Cth), at a meeting of unsecured creditors of the fifth applicant...