Telfer v Astarra Securities Pty Ltd [2010] NSWSC 682

Telfer v Astarra Securities Pty Ltd [2010] NSWSC 682

The Court appointed a provisional liquidator to each defendant because there was a significant likelihood that winding up orders would be made, including because of special resolutions and evidence of insolvency, and because each company was unable to function at board level, creating paralysis and instability requiring temporary administration. The trust deed provisions did not justify refusing appointment because provisional liquidation did not amount to the companies entering into liquidation or the appointment of an administrator, receiver, official manager or receiver and manager.

Jurisdiction
Australia
Judgment Date
21 June 2010
Procedural Posture
Corporations Winding Up Application / Interlocutory Application for Appointment of Provisional Liquidator
Outcome
Provisional liquidator appointed to both defendant companies; originating process stood over; costs reserved.
Legal Topics
['winding Up' 'provisional Liquidator' 'company Insolvency' 'board Paralysis' 'trustee Companies']
['corporations Law' 'insolvency Law' 'equity'] ['winding Up' 'provisional Liquidator' 'company Insolvency' 'board Paralysis' 'trustee Companies']

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Procedural Posture

Corporations Winding Up Application / Interlocutory Application for Appointment of Provisional Liquidator

Legal Issues

  1. 1 ['Whether it was likely that a winding up order would in due course be made in relation to each defendant company.' 'Whether there was jeopardy or instability inimical to maintaining the status quo pending determination of the winding up application.' 'Whether appointment of a provisional liquidator would cause the defendant companies to vacate office as trustees under the trust deeds.']

Ratio Decidendi

The Court appointed a provisional liquidator to each defendant because there was a significant likelihood that winding up orders would be made, including because of special resolutions and evidence of insolvency, and because each company was unable to function at board level, creating paralysis and instability requiring temporary administration. The trust deed provisions did not justify refusing appointment because provisional liquidation did not amount to the companies entering into liquidation or the appointment of an administrator, receiver, official manager or receiver and manager.

Court Disposition

Provisional liquidator appointed to both defendant companies; originating process stood over; costs reserved.

Orders

  • ['Order that Geoffrey Trent Hancock of BDO Kendalls be appointed liquidator of Astarra Securities Pty Limited ACN 109 078 319 provisionally.' 'Order that Geoffrey Trent Hancock of BDO Kendalls be appointed liquidator of Astarra Nominees (Australia) Pty Limited ACN 003 983 917 provisionally.' 'The originating process...