Gothard (Administrator), in the matter of Jeanswest Corporation Pty Ltd (administrators appointed) [2020] FCA 148

Gothard (Administrator), in the matter of Jeanswest Corporation Pty Ltd (administrators appointed) [2020] FCA 148

The extension was warranted because the Administrators were continuing to trade the business, pursuing a sale of the Jeanswest business as a going concern, and needed further time to complete the sale process and investigations so as to report to creditors and make informed recommendations, in circumstances where the business was complex, restructuring steps had already been taken, the major secured creditor had not objected, no creditors or employees had expressed opposition, and creditors retained liberty to apply.

Jurisdiction
Australia
Judgment Date
10 February 2020
Procedural Posture
Application by Administrators for Extension of Convening Period for Second Meeting of Creditors Under Corporations Act 2001 (cth) Ss 439 A(6) and 447 A(1) / Urgent Application Heard and Determined; Orders Made Extending the Convening Period
Outcome
Application allowed; extension of the convening period and consequential orders granted.
Legal Topics
['voluntary Administration' 'extension of Convening Period' 'second Meeting of Creditors' 'sale of Business as a Going Concern' 'moratorium Under Part 5.3 A']
['corporations' 'insolvency'] ['voluntary Administration' 'extension of Convening Period' 'second Meeting of Creditors' 'sale of Business as a Going Concern' 'moratorium Under Part 5.3 A']

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Procedural Posture

Application by Administrators for Extension of Convening Period for Second Meeting of Creditors Under Corporations Act 2001 (cth) Ss 439 A(6) and 447 A(1) / Urgent Application Heard and Determined; Orders Made Extending the Convening Period

Legal Issues

  1. 1 ['Whether the period within which the plaintiffs must convene the second meeting of creditors of the Companies should be extended under s 439A(6) of the Corporations Act 2001 (Cth).' 'Whether consequential orders should be made under s 447A(1) of the Corporations Act 2001 (Cth) so that Part 5.3A operates to permit the second meeting to be held during, or within 5 business days after, the extended convening period.']

Ratio Decidendi

The extension was warranted because the Administrators were continuing to trade the business, pursuing a sale of the Jeanswest business as a going concern, and needed further time to complete the sale process and investigations so as to report to creditors and make informed recommendations, in circumstances where the business was complex, restructuring steps had already been taken, the major secured creditor had not objected, no creditors or employees had expressed opposition, and creditors retained liberty to apply.

Court Disposition

Application allowed; extension of the convening period and consequential orders granted.

Orders

  • ['Pursuant to section 439A(6) of the Corporations Act 2001 (Cth), the period within which the Plaintiffs must convene the second meeting of creditors of each of the Companies is extended to and includes 1 June 2020.' 'Pursuant to section 447A(1) of the Act, Part 5.3A of the Act is to operate in relation to each of...