Huntley Management Limited v Timbercorp Securities Limited (No 2) [2010] FCA 623

Huntley Management Limited v Timbercorp Securities Limited (No 2) [2010] FCA 623

Timbercorp and the liquidators advanced an adversarial position to benefit Timbercorp's general creditors at the expense of the schemes and unsuccessfully resisted the plaintiffs' position on the operation of ss 601FS and 601FT. The plaintiffs were wholly successful and were entitled to costs against Timbercorp. Because there was no suggestion that the liquidators acted unreasonably, their costs liability was limited to the amount of Timbercorp's assets available to indemnify them for paying those costs.

Jurisdiction
Australia
Judgment Date
17 June 2010
Procedural Posture
Federal Court Proceeding Concerning Declarations, Novation and Costs After Change of Responsible Entities of Managed Investment Schemes / Final Orders and Reasons on Costs
Outcome
Substantive declarations and orders made by agreement; plaintiffs awarded costs against the defendants, with the liquidators' liability limited to available company assets for indemnity.
Legal Topics
['responsible Entity Change' 'statutory Novation' 'scheme Property and Books' "liquidators' Costs Liability" 'federal Court Costs Discretion']
['corporations' 'managed Investment Schemes' 'insolvency' 'civil Procedure'] ['responsible Entity Change' 'statutory Novation' 'scheme Property and Books' "liquidators' Costs Liability" 'federal Court Costs Discretion']

Case Brief

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Procedural Posture

Federal Court Proceeding Concerning Declarations, Novation and Costs After Change of Responsible Entities of Managed Investment Schemes / Final Orders and Reasons on Costs

Legal Issues

  1. 1 ['Whether the plaintiffs should recover their costs after the substantive orders were agreed except as to costs.' 'Whether Timbercorp and its liquidators acted merely as contradictors or facilitative parties such that costs should be borne by scheme property or no costs order made.' 'Whether any costs order against the liquidators should impose personal liability or be limited to company assets available to indemnify them.']

Ratio Decidendi

Timbercorp and the liquidators advanced an adversarial position to benefit Timbercorp's general creditors at the expense of the schemes and unsuccessfully resisted the plaintiffs' position on the operation of ss 601FS and 601FT. The plaintiffs were wholly successful and were entitled to costs against Timbercorp. Because there was no suggestion that the liquidators acted unreasonably, their costs liability was limited to the amount of Timbercorp's assets available to indemnify them for paying those costs.

Court Disposition

Substantive declarations and orders made by agreement; plaintiffs awarded costs against the defendants, with the liquidators' liability limited to available company assets for indemnity.

Orders

  • ["Declared that, from the time the First Plaintiff was recorded in ASIC's record of registration under section 601FJ(1) of the Corporations Act 2001, specified 2005 Timbercorp Mango Project agreements and leases had effect as if the First Plaintiff were a party in lieu of the First Defendant, with specified...