Kelly, in the matter of Halifax Investment Services Pty Ltd (in liquidation) (No 11) [2020] FCA 1282

Kelly, in the matter of Halifax Investment Services Pty Ltd (in liquidation) (No 11) [2020] FCA 1282

The Court granted the indemnity because there was no real likelihood that Mr Loo and his experienced advisers would obtain evidence on issues not genuinely in dispute, and there was a sufficient likelihood that Mr Taylor's proposed report would assist the Court in assessing the feasibility of in specie distributions. Given the magnitude of the issue, Mr Loo's bona fides, and the prospect that the evidence could contribute to cost-effective and timely completion of the liquidation, it was not reasonable to require Mr Loo to bear the expert costs until the end of the proceeding.

Jurisdiction
Australia
Judgment Date
09 September 2020
Procedural Posture
Bankruptcy and Insolvency; Corporations and Corporate Insolvency Application by Representative Defendant for Indemnity in Respect of Costs and Legal Expenses Reasonably Incurred / Interlocutory Process Filed on 21 August 2020, Determined on the Papers
Outcome
Application granted.
Legal Topics
['representative Defendant Indemnity' 'expert Report Costs' 'in Specie Distribution' 'liquidation' 'investor Funds']
['bankruptcy and Insolvency' 'corporations and Corporate Insolvency'] ['representative Defendant Indemnity' 'expert Report Costs' 'in Specie Distribution' 'liquidation' 'investor Funds']

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Procedural Posture

Bankruptcy and Insolvency; Corporations and Corporate Insolvency Application by Representative Defendant for Indemnity in Respect of Costs and Legal Expenses Reasonably Incurred / Interlocutory Process Filed on 21 August 2020, Determined on the Papers

Legal Issues

  1. 1 ['Whether the first defendant should be indemnified from specified investor funds for the costs and legal expenses of instructing Barry Taylor of HLB Mann Judd to prepare an expert report about the feasibility of in specie distributions.' 'Whether there was a sufficient likelihood that the proposed expert report would assist the Court in assessing the feasibility of in specie distributions to justify payment of its cost from investor funds.']

Ratio Decidendi

The Court granted the indemnity because there was no real likelihood that Mr Loo and his experienced advisers would obtain evidence on issues not genuinely in dispute, and there was a sufficient likelihood that Mr Taylor's proposed report would assist the Court in assessing the feasibility of in specie distributions. Given the magnitude of the issue, Mr Loo's bona fides, and the prospect that the evidence could contribute to cost-effective and timely completion of the liquidation, it was not reasonable to require Mr Loo to bear the expert costs until the end of the proceeding.

Court Disposition

Application granted.

Orders

  • ['The first defendant be indemnified in respect of his costs and legal expenses including expert advice reasonably incurred, as agreed by the first and second plaintiffs or taxed and to be paid from the funds in the accounts specified in order 1 of the orders of Gleeson J made on 2 July 2020, of instructing Barry...