Palmer and Collis and Terraplanet Limited (in liquidation), in the matter of Terraplanet Limited (in liquidation) (No 2) [2008] FCA 582

Palmer and Collis and Terraplanet Limited (in liquidation), in the matter of Terraplanet Limited (in liquidation) (No 2) [2008] FCA 582

The winding up was terminated because the DOCA and Terraplanet Creditors Trust had been approved by creditors, implemented and wholly effected; shareholders had approved the recapitalisation; existing creditors would receive a better return than in a finalised winding up; Terraplanet was released from existing debts; and, given the absence of existing debts and the recapitalisation, the Court inferred that Terraplanet was solvent and able to pay future debts as and when they fell due after recommencing business.

Jurisdiction
Australia
Judgment Date
18 April 2008
Procedural Posture
Corporations Application by Liquidators for an Order Terminating a Winding Up Under S 482 of the Corporations Act 2001 (cth) / Reasons for Judgment After Order Made Terminating the Winding Up Following Implementation and Expiry of a Deed of Company Arrangement
Outcome
Order made terminating the winding up of Terraplanet Limited (in liquidation) on 18 April 2008.
Legal Topics
['termination of Winding Up' 'deed of Company Arrangement' "creditors' Trust" 'recapitalisation' 'voluntary Administration' 'solvency on Recommencement of Business']
['corporations Law' 'insolvency'] ['termination of Winding Up' 'deed of Company Arrangement' "creditors' Trust" 'recapitalisation' 'voluntary Administration' 'solvency on Recommencement of Business']

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Procedural Posture

Corporations Application by Liquidators for an Order Terminating a Winding Up Under S 482 of the Corporations Act 2001 (cth) / Reasons for Judgment After Order Made Terminating the Winding Up Following Implementation and Expiry of a Deed of Company Arrangement

Legal Issues

  1. 1 ['Whether the winding up of Terraplanet Limited (in liquidation) should be terminated under s 482 of the Corporations Act 2001 (Cth).' "Whether the DOCA and creditors' trust adequately protected creditors and produced a better return than finalising the winding up." 'Whether the interests of existing creditors, future creditors, contributories, the liquidators and the public supported termination of the winding up.' 'Whether Terraplanet would be solvent when recommencing commercial life after release from existing debts and recapitalisation.']

Ratio Decidendi

The winding up was terminated because the DOCA and Terraplanet Creditors Trust had been approved by creditors, implemented and wholly effected; shareholders had approved the recapitalisation; existing creditors would receive a better return than in a finalised winding up; Terraplanet was released from existing debts; and, given the absence of existing debts and the recapitalisation, the Court inferred that Terraplanet was solvent and able to pay future debts as and when they fell due after recommencing business.

Court Disposition

Order made terminating the winding up of Terraplanet Limited (in liquidation) on 18 April 2008.

Orders

  • ["The winding up of Terraplanet Limited (in liquidation) be terminated on today's date, 18 April 2008." 'Order 1 be entered forthwith.']