Strawbridge, in the matter of Virgin Australia Holdings Ltd (administrators appointed) (No 4) [2020] FCA 927

Strawbridge, in the matter of Virgin Australia Holdings Ltd (administrators appointed) (No 4) [2020] FCA 927

It was appropriate to make orders modifying the administrators’ personal liability in respect of liabilities arising under the Sale Deed and related transactions, since the arrangements were in the interests of creditors, consistent with Part 5.3A of the Corporations Act, no prejudice to unsecured creditors was identified, the purchasers agreed to limited recourse, and proper notice to affected parties was ensured. Similarly, the extension of time for registration of new security interests was granted as it caused no relevant prejudice and was just and equitable. Confidentiality orders were warranted to protect commercially sensitive information.

Parties
First Plaintiff: Vaughan Strawbridge, Salvatore Algeri, John Greig and Richard Hughes, in their capacity as joint and several voluntary administrators of each of Virgin Australia Holdings Ltd (administrators appointed); Second Plaintiff: Virgin Australia Holdings Ltd (Administrators Appointed) ACN 100 686 226; Third Plaintiff: Virgin Australia International Operations Pty Ltd (Administrators Appointed) ACN 155 859 608; Fourth Plaintiff: Virgin Australia International Holdings Pty Ltd (Administrators Appointed) ACN 155 860 021; Fifth Plaintiff: Virgin Australia International Airlines Pty Ltd (Administrators Appointed) ACN 125 580 823; Sixth Plaintiff: Virgin Australia Airlines (SE Asia) Pty Ltd (Administrators Appointed) ACN 097 892 389; Seventh Plaintiff: Virgin Australia Airlines Holdings Pty Ltd (Administrators Appointed) ACN 093 924 675; Eighth Plaintiff: VAH Newco No.1 Pty Ltd (Administrators Appointed) ACN 160 881 345; Ninth Plaintiff: Tiger Airways Australia Pty Limited (Administrators Appointed) ACN 124 369 008; Tenth Plaintiff: Virgin Australia Airlines Pty Ltd (Administrators Appointed) ACN 090 670 965; Eleventh Plaintiff: VA Borrower 2019 No. 1 Pty Ltd (Administrators Appointed) ACN 633 241 059; Twelfth Plaintiff: VA Borrower 2019 No. 2 Pty Ltd (Administrators Appointed) ACN 637 371 343; Thirteenth Plaintiff: Virgin Tech Pty Ltd (Administrators Appointed) ACN 101 808 879; Fourteenth Plaintiff: Short Haul 2018 No. 1 Pty Ltd (Administrators Appointed) ACN 622 014 831; Fifteenth Plaintiff: Short Haul 2017 No. 1 Pty Ltd (Administrators Appointed) ACN 617 644 390; Sixteenth Plaintiff: Short Haul 2017 No. 2 Pty Ltd (Administrators Appointed) ACN 617 644 443; Seventeenth Plaintiff: Short Haul 2017 No. 3 Pty Ltd (Administrators Appointed) ACN 622 014 813; Eighteenth Plaintiff: VBNC5 Pty Ltd (Administrators Appointed) ACN 119 691 502; Nineteenth Plaintiff: A.C.N. 098 904 262 Pty Ltd (Administrators Appointed) ACN 098 904 262; Twentieth Plaintiff: Virgin Australia Regional Airlines Pty Ltd (Administrators Appointed) ACN 008 997 662; Twenty First Plaintiff: Virgin Australia Holidays Pty Ltd (Administrators Appointed) ACN 118 552 159; Twenty Second Plaintiff: VB Ventures Pty Ltd (Administrators Appointed) ACN 125 139 004; Twenty Third Plaintiff: Virgin Australia Cargo Pty Ltd (Administrators Appointed) ACN 600 667 838; Twenty Fourth Plaintiff: VB Leaseco Pty Ltd (Administrators Appointed) ACN 134 268 741; Twenty Fifth Plaintiff: VA Hold Co Pty Ltd (Administrators Appointed) ACN 165 507 157; Twenty Sixth Plaintiff: VA Lease Co Pty Ltd (Administrators Appointed) ACN 165 507 291; Twenty Seventh Plaintiff: Virgin Australia 2013-1 Issuer Co Pty Ltd (Administrators Appointed) ACN 165 507 326; Twenty Eighth Plaintiff: 737 2012 No.1 Pty. Ltd (Administrators Appointed) ACN 154 201 859; Twenty Ninth Plaintiff: 737 2012 No. 2 Pty Ltd (Administrators Appointed) ACN 154 225 064; Thirtieth Plaintiff: Short Haul 2016 No. 1 Pty Ltd (Administrators Appointed) ACN 612 766 328; Thirty First Plaintiff: Short Haul 2016 No. 2 Pty Ltd (Administrators Appointed) ACN 612 796 077; Thirty Second Plaintiff: Short Haul 2014 No. 1 Pty Ltd (Administrators Appointed) ACN 600 809 612; Thirty Third Plaintiff: Short Haul 2014 No. 2 Pty Ltd (Administrators Appointed) ACN 600 878 199; Thirty Fourth Plaintiff: VA Regional Leaseco Pty Ltd (Administrators Appointed) ACN 127 491 605; Thirty Fifth Plaintiff: VB 800 2009 Pty Ltd (Administrators Appointed) ACN 135 488 934; Thirty Sixth Plaintiff: VB Leaseco No 2 Pty Ltd (Administrators Appointed) ACN 142 533 319; Thirty Seventh Plaintiff: VB LH 2008 No. 1 Pty Ltd (Administrators Appointed) ACN 134 280 354; Thirty Eighth Plaintiff: VB LH 2008 No. 2 Pty Ltd (Administrators Appointed) ACN 134 288 805; Thirty Ninth Plaintiff: VB PDP 2010-11 Pty Ltd (Administrators Appointed) ACN 140 818 266
Jurisdiction
Australia
Judgment Date
02 July 2020
Procedural Posture
Corporations – Interlocutory Application in Voluntary Administration / Interlocutory Determination of Application for Orders in Administration
Outcome
Application allowed; orders made as sought by Plaintiffs
Legal Topics
Administrators' Personal Liability, Modification of Liability Under Corporations Act, Extension of Time for Security Registration, Confidentiality in Corporate Administrations
Corporations Law Insolvency Administrators' Personal Liability Modification of Liability Under Corporations Act Extension of Time for Security Registration Confidentiality in Corporate Administrations

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Parties

Vaughan Strawbridge, Salvatore Algeri, John Greig and Richard Hughes, in their capacity as joint and several voluntary administrators of each of Virgin Australia Holdings Ltd (administrators appointed)

First Plaintiff

Virgin Australia Holdings Ltd (Administrators Appointed) ACN 100 686 226

Second Plaintiff

Virgin Australia International Operations Pty Ltd (Administrators Appointed) ACN 155 859 608

Third Plaintiff

Virgin Australia International Holdings Pty Ltd (Administrators Appointed) ACN 155 860 021

Fourth Plaintiff

Virgin Australia International Airlines Pty Ltd (Administrators Appointed) ACN 125 580 823

Fifth Plaintiff

Virgin Australia Airlines (SE Asia) Pty Ltd (Administrators Appointed) ACN 097 892 389

Sixth Plaintiff

Virgin Australia Airlines Holdings Pty Ltd (Administrators Appointed) ACN 093 924 675

Seventh Plaintiff

VAH Newco No.1 Pty Ltd (Administrators Appointed) ACN 160 881 345

Eighth Plaintiff

Tiger Airways Australia Pty Limited (Administrators Appointed) ACN 124 369 008

Ninth Plaintiff

Virgin Australia Airlines Pty Ltd (Administrators Appointed) ACN 090 670 965

Tenth Plaintiff

VA Borrower 2019 No. 1 Pty Ltd (Administrators Appointed) ACN 633 241 059

Eleventh Plaintiff

VA Borrower 2019 No. 2 Pty Ltd (Administrators Appointed) ACN 637 371 343

Twelfth Plaintiff

Virgin Tech Pty Ltd (Administrators Appointed) ACN 101 808 879

Thirteenth Plaintiff

Short Haul 2018 No. 1 Pty Ltd (Administrators Appointed) ACN 622 014 831

Fourteenth Plaintiff

Short Haul 2017 No. 1 Pty Ltd (Administrators Appointed) ACN 617 644 390

Fifteenth Plaintiff

Short Haul 2017 No. 2 Pty Ltd (Administrators Appointed) ACN 617 644 443

Sixteenth Plaintiff

Short Haul 2017 No. 3 Pty Ltd (Administrators Appointed) ACN 622 014 813

Seventeenth Plaintiff

VBNC5 Pty Ltd (Administrators Appointed) ACN 119 691 502

Eighteenth Plaintiff

A.C.N. 098 904 262 Pty Ltd (Administrators Appointed) ACN 098 904 262

Nineteenth Plaintiff

Virgin Australia Regional Airlines Pty Ltd (Administrators Appointed) ACN 008 997 662

Twentieth Plaintiff

Virgin Australia Holidays Pty Ltd (Administrators Appointed) ACN 118 552 159

Twenty First Plaintiff

VB Ventures Pty Ltd (Administrators Appointed) ACN 125 139 004

Twenty Second Plaintiff

Virgin Australia Cargo Pty Ltd (Administrators Appointed) ACN 600 667 838

Twenty Third Plaintiff

VB Leaseco Pty Ltd (Administrators Appointed) ACN 134 268 741

Twenty Fourth Plaintiff

VA Hold Co Pty Ltd (Administrators Appointed) ACN 165 507 157

Twenty Fifth Plaintiff

VA Lease Co Pty Ltd (Administrators Appointed) ACN 165 507 291

Twenty Sixth Plaintiff

Virgin Australia 2013-1 Issuer Co Pty Ltd (Administrators Appointed) ACN 165 507 326

Twenty Seventh Plaintiff

737 2012 No.1 Pty. Ltd (Administrators Appointed) ACN 154 201 859

Twenty Eighth Plaintiff

737 2012 No. 2 Pty Ltd (Administrators Appointed) ACN 154 225 064

Twenty Ninth Plaintiff

Short Haul 2016 No. 1 Pty Ltd (Administrators Appointed) ACN 612 766 328

Thirtieth Plaintiff

Short Haul 2016 No. 2 Pty Ltd (Administrators Appointed) ACN 612 796 077

Thirty First Plaintiff

Short Haul 2014 No. 1 Pty Ltd (Administrators Appointed) ACN 600 809 612

Thirty Second Plaintiff

Short Haul 2014 No. 2 Pty Ltd (Administrators Appointed) ACN 600 878 199

Thirty Third Plaintiff

VA Regional Leaseco Pty Ltd (Administrators Appointed) ACN 127 491 605

Thirty Fourth Plaintiff

VB 800 2009 Pty Ltd (Administrators Appointed) ACN 135 488 934

Thirty Fifth Plaintiff

VB Leaseco No 2 Pty Ltd (Administrators Appointed) ACN 142 533 319

Thirty Sixth Plaintiff

VB LH 2008 No. 1 Pty Ltd (Administrators Appointed) ACN 134 280 354

Thirty Seventh Plaintiff

VB LH 2008 No. 2 Pty Ltd (Administrators Appointed) ACN 134 288 805

Thirty Eighth Plaintiff

VB PDP 2010-11 Pty Ltd (Administrators Appointed) ACN 140 818 266

Thirty Ninth Plaintiff

Procedural Posture

Corporations – Interlocutory Application in Voluntary Administration / Interlocutory Determination of Application for Orders in Administration

Legal Issues

  1. 1 Whether orders should be made limiting the personal liability of the administrators for post-appointment liabilities under the Sale Deed and related agreements
  2. 2 Whether time for registration of security interests should be extended under s 588FM of the Corporations Act
  3. 3 Whether confidentiality orders should be made regarding supporting material

Ratio Decidendi

It was appropriate to make orders modifying the administrators’ personal liability in respect of liabilities arising under the Sale Deed and related transactions, since the arrangements were in the interests of creditors, consistent with Part 5.3A of the Corporations Act, no prejudice to unsecured creditors was identified, the purchasers agreed to limited recourse, and proper notice to affected parties was ensured. Similarly, the extension of time for registration of new security interests was granted as it caused no relevant prejudice and was just and equitable. Confidentiality orders were warranted to protect commercially sensitive information.

Court Disposition

Application allowed; orders made as sought by Plaintiffs

Orders

  • The Interlocutory Process made returnable at specified time
  • Confidentiality orders granted regarding specified affidavit, exhibit, and submissions (until 30 June 2021 or further order)