In the matter of Section 564 Corporations Law & in the matter of Glenisia Investments Pty Ltd (in liq) & Anor [1995] FCA 1098

In the matter of Section 564 Corporations Law & in the matter of Glenisia Investments Pty Ltd (in liq) & Anor [1995] FCA 1098

The whole of the net proceeds of the recovery proceedings against the Commonwealth Bank of Australia Ltd should be distributed to Plummers Industries Pty Ltd and Barfield Pty Ltd because they financed the initial inquiries, all creditors were given an equal opportunity to contribute and share the advantage, the Contributing Creditors assumed a substantial litigation and costs risk and financed the proceedings and liquidator's expenses, and no unsecured creditor opposed the proposed distribution.

Jurisdiction
Australia
Judgment Date
25 August 1995
Procedural Posture
Application by a Liquidator for an Order Under S.564 of the Corporations Law in a Winding Up / Final Orders and Reasons for Judgment
Outcome
Application granted.
Legal Topics
['winding Up' 'liquidator Recovery Proceedings' 'creditor Indemnity for Litigation Costs' 'priority or Advantage for Contributing Creditors' 'distribution of Recovered Property Under S.564 of the Corporations Law']
['corporations Law' 'insolvency Law'] ['winding Up' 'liquidator Recovery Proceedings' 'creditor Indemnity for Litigation Costs' 'priority or Advantage for Contributing Creditors' 'distribution of Recovered Property Under S.564 of the Corporations Law']

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 1 Authorities cited 2 Party arguments 2 Amounts and remedies 1
Sign in to unlock

Procedural Posture

Application by a Liquidator for an Order Under S.564 of the Corporations Law in a Winding Up / Final Orders and Reasons for Judgment

Legal Issues

  1. 1 ["Whether the Court should make an order under s.564 of the Corporations Law giving Plummers Industries Pty Ltd and Barfield Pty Ltd an advantage over other unsecured creditors because they funded and indemnified the liquidator's recovery proceedings against the Commonwealth Bank of Australia Ltd." 'Whether the whole of the net proceeds recovered from the Commonwealth Bank of Australia Ltd should be distributed rateably to the Contributing Creditors in proportion to the sums owed to them by the Company.']

Ratio Decidendi

The whole of the net proceeds of the recovery proceedings against the Commonwealth Bank of Australia Ltd should be distributed to Plummers Industries Pty Ltd and Barfield Pty Ltd because they financed the initial inquiries, all creditors were given an equal opportunity to contribute and share the advantage, the Contributing Creditors assumed a substantial litigation and costs risk and financed the proceedings and liquidator's expenses, and no unsecured creditor opposed the proposed distribution.

Court Disposition

Application granted.

Orders

  • ['The net proceeds recovered by the applicant as liquidator of Glenisia Investments Pty Ltd (In Liquidation) from Commonwealth Bank of Australia Ltd in application WAG 3030 of 1993 in this Court after payment of any priority debts and the costs and expenses of the winding up be paid rateably to Plummers Industries...