Kennedy Civil Contracting Pty Ltd (Administrators Appointed) v Richard Crookes Construction Pty Ltd; In the matter of Kennedy Civil Contracting Pty Ltd [2023] NSWSC 99

Kennedy Civil Contracting Pty Ltd (Administrators Appointed) v Richard Crookes Construction Pty Ltd; In the matter of Kennedy Civil Contracting Pty Ltd [2023] NSWSC 99

The DOCA was entered into for the proper purpose of maximising returns to creditors, not to circumvent the Corporations Act or Security of Payment Act. Section 445D(1)(g) should not be used to terminate a DOCA because it interacts with other legislative regimes where the underlying purpose is appropriate. The claim under the SOP Act was not an abuse of process, as KCC was not in liquidation and the rights of the respondent to recover were preserved by the DOCA. Accordingly, KCC is entitled to judgment and the application to terminate the DOCA is dismissed.

Jurisdiction
Australia
Judgment Date
17 February 2023
Procedural Posture
Civil / Judgment
Outcome
Corporations Proceeding dismissed. Judgment for KCC on its SOP Act claim. Orders made for preparation of further orders, submissions, and decision on outstanding issues on the papers.
Legal Topics
['summary Disposal' 'judgment for Plaintiff' 'abuse of Process' 'security of Payment' 'voluntary Administration' 'deed of Company Arrangement']
['civil Procedure' 'corporations' 'building and Construction Law'] ['summary Disposal' 'judgment for Plaintiff' 'abuse of Process' 'security of Payment' 'voluntary Administration' 'deed of Company Arrangement']

Case Brief

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Procedural Posture

Civil / Judgment

Legal Issues

  1. 1 ['Whether the deed of company arrangement should be terminated for improper purpose under s 445D(1)(g) of the Corporations Act 2001 (Cth)' 'Whether the pursuit of Security of Payment Act claims by a company subject to a DOCA but hopelessly insolvent constitutes an abuse of process' 'Whether the DOCA was executed to circumvent s 32B of the Building and Construction Industry Security of Payment Act 1999 (NSW)']

Ratio Decidendi

The DOCA was entered into for the proper purpose of maximising returns to creditors, not to circumvent the Corporations Act or Security of Payment Act. Section 445D(1)(g) should not be used to terminate a DOCA because it interacts with other legislative regimes where the underlying purpose is appropriate. The claim under the SOP Act was not an abuse of process, as KCC was not in liquidation and the rights of the respondent to recover were preserved by the DOCA. Accordingly, KCC is entitled to judgment and the application to terminate the DOCA is dismissed.

Court Disposition

Corporations Proceeding dismissed. Judgment for KCC on its SOP Act claim. Orders made for preparation of further orders, submissions, and decision on outstanding issues on the papers.

Orders

  • ['Within 14 days, the parties to bring in short minutes of order to give effect to the judgment, any agreement in relation to a stay, and if costs can be agreed, their agreement on costs.' 'If parties cannot agree, within 21 days each to provide the Associate with their draft orders and submissions (not exceeding 5...