In the matter of Metal Storm Ltd (subject to Deed of Company Arrangement) [2015] NSWSC 1698

In the matter of Metal Storm Ltd (subject to Deed of Company Arrangement) [2015] NSWSC 1698

Approval was granted because the Receivers' application was part of the Court-contemplated process for realising the Company's assets, involved complex legal issues and potential challenge rather than a mere commercial choice, and the evidence showed a prudent and careful sale process suited to specialised and regulated assets that was likely to maximise sale proceeds. The non-opposition of the liquidator and trustee for noteholders, and the likely costs, uncertainty and potential diminution in value from restarting the sale process, supported approval. Nunc pro tunc approval for the completed sale of incidental plant and equipment was appropriate because the Court could have granted...

Jurisdiction
Australia
Judgment Date
21 July 2015
Procedural Posture
Application by Receivers Under S 424 of the Corporations Act 2001 (cth) for Approval in Relation to Sale of Assets / Second Amended Interlocutory Process; Ex Tempore Judgment
Outcome
Approval granted to the Receivers for the sale of assets, including nunc pro tunc approval for the prior sale of incidental assets; trustee for noteholders' costs order not made at that time.
Legal Topics
['receivers, Controllers and Managers' 'court Approval of Sale of Assets' "receiver's Power of Sale" 'directions Under S 424 of the Corporations Act 2001 (cth)']
['corporations' 'insolvency'] ['receivers, Controllers and Managers' 'court Approval of Sale of Assets' "receiver's Power of Sale" 'directions Under S 424 of the Corporations Act 2001 (cth)']

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Procedural Posture

Application by Receivers Under S 424 of the Corporations Act 2001 (cth) for Approval in Relation to Sale of Assets / Second Amended Interlocutory Process; Ex Tempore Judgment

Legal Issues

  1. 1 ["Whether the Court had jurisdiction under s 424 of the Corporations Act 2001 (Cth) to give directions or approval to the Receivers in relation to the sale of the Company's assets." 'Whether the Receivers had adopted a prudent and adequate sale process for specialised assets, consistent with their duties when exercising a power of sale.' 'Whether approval should be granted nunc pro tunc for the completed sale of incidental plant and equipment held in storage in Queensland.' "Whether the trustee for noteholders' costs of the application should be ordered as costs in the winding up."]

Ratio Decidendi

Approval was granted because the Receivers' application was part of the Court-contemplated process for realising the Company's assets, involved complex legal issues and potential challenge rather than a mere commercial choice, and the evidence showed a prudent and careful sale process suited to specialised and regulated assets that was likely to maximise sale proceeds. The non-opposition of the liquidator and trustee for noteholders, and the likely costs, uncertainty and potential diminution in value from restarting the sale process, supported approval. Nunc pro tunc approval for the completed sale of incidental plant and equipment was appropriate because the Court could have granted...

Court Disposition

Approval granted to the Receivers for the sale of assets, including nunc pro tunc approval for the prior sale of incidental assets; trustee for noteholders' costs order not made at that time.

Orders

  • ['Approval given to the applicants to complete the agreement for sale of assets with the proposed purchaser dated 2 April 2015.' 'Approval granted nunc pro tunc for the sale of the incidental plant and equipment held in a storage unit in Queensland.' 'The matter stood over for further directions.' "No order was made...