Wight, in the matter of Verve Portraits Pty Ltd (administrators appointed) [2023] FCA 1014

Wight, in the matter of Verve Portraits Pty Ltd (administrators appointed) [2023] FCA 1014

Given the company became a bare trustee on administration and lacks power of sale, it is appropriate to appoint the administrators as receivers and managers to effect a sale of business as a going concern and ensure the proper application of trust assets to meet liabilities, with expenses and remuneration properly sourced from trust assets.

Jurisdiction
Australia
Judgment Date
24 August 2023
Procedural Posture
External Administration – Voluntary Administration / Interlocutory Application for Directions and Appointment of Receivers
Outcome
Orders made appointing the administrators as joint and several receivers and managers of the Verve Portraits Unit Trust and granting associated powers and directions.
Legal Topics
['voluntary Administration' 'appointment of Receivers' 'trading Trusts' "trustee's Right of Indemnity" 'sale of Business as Going Concern']
['corporations Law' 'insolvency'] ['voluntary Administration' 'appointment of Receivers' 'trading Trusts' "trustee's Right of Indemnity" 'sale of Business as Going Concern']

Case Brief

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Procedural Posture

External Administration – Voluntary Administration / Interlocutory Application for Directions and Appointment of Receivers

Legal Issues

  1. 1 ['Whether administrators of a company which was trustee of a trading trust should be appointed as receivers and managers of the trust assets' 'Whether administrators are justified in treating the property in the name of the company as property of the trust' 'Whether orders should be made to effect a sale of the business as a going concern and deal with employee entitlements']

Ratio Decidendi

Given the company became a bare trustee on administration and lacks power of sale, it is appropriate to appoint the administrators as receivers and managers to effect a sale of business as a going concern and ensure the proper application of trust assets to meet liabilities, with expenses and remuneration properly sourced from trust assets.

Court Disposition

Orders made appointing the administrators as joint and several receivers and managers of the Verve Portraits Unit Trust and granting associated powers and directions.

Orders

  • ['First and second plaintiffs appointed as joint and several receivers and managers over all assets and undertaking of the Verve Portraits Unit Trust without security.' 'Receivers have powers under s 437A of the Corporations Act 2001 (Cth) in relation to trust assets, including to effect a sale.' 'Plaintiffs are...