Chamberlain v RG&H Investments Pty Limited, in the matter of Hardy Bros (Earthmoving) Pty Limited (in liq) (No 3) [2010] FCA 26

Chamberlain v RG&H Investments Pty Limited, in the matter of Hardy Bros (Earthmoving) Pty Limited (in liq) (No 3) [2010] FCA 26

The Hardys, as one of the only three creditors of the Company, should be granted leave to be heard on costs. Mr Chamberlain's delay costs should not be paid out of the Company's assets because s 477(2B) was clear, he was aware of it, his solicitor took the view that Court approval was necessary, he deliberately contravened the provision by entering into the Indemnities before approval, and those unusual circumstances made it difficult to conclude that the additional costs were properly and reasonably incurred.

Jurisdiction
Australia
Judgment Date
02 February 2010
Procedural Posture
Liquidator's Application Under S 477(2 B) of Corporations Act 2001 (cth) for Court Approval Nunc Pro Tunc of Indemnities, With Dispute Concerning Costs / Reasons for Judgment (no 3) and Orders on Costs
Outcome
The plaintiff recovered his costs from the Company's assets except for costs incurred because of his failure to obtain approval before entering into the Indemnities; RG&H Investments Pty Limited and the Hardys recovered their costs from the Company's assets as costs of the winding up.
Legal Topics
['liquidator Powers' 'court Approval Under S 477(2 B)' 'nunc Pro Tunc Approval' 'costs of Winding Up' 'standing to Be Heard Under R 2.13']
['corporations Law' 'insolvency' 'costs'] ['liquidator Powers' 'court Approval Under S 477(2 B)' 'nunc Pro Tunc Approval' 'costs of Winding Up' 'standing to Be Heard Under R 2.13']

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Procedural Posture

Liquidator's Application Under S 477(2 B) of Corporations Act 2001 (cth) for Court Approval Nunc Pro Tunc of Indemnities, With Dispute Concerning Costs / Reasons for Judgment (no 3) and Orders on Costs

Legal Issues

  1. 1 ["Whether Mr Chamberlain's costs to be paid out of the assets of the Company should include costs occasioned by his delay in applying for the Court's approval under s 477(2B) of the Act." 'Whether the Hardys should be granted leave to be heard on the costs issue without becoming parties to the proceeding.']

Ratio Decidendi

The Hardys, as one of the only three creditors of the Company, should be granted leave to be heard on costs. Mr Chamberlain's delay costs should not be paid out of the Company's assets because s 477(2B) was clear, he was aware of it, his solicitor took the view that Court approval was necessary, he deliberately contravened the provision by entering into the Indemnities before approval, and those unusual circumstances made it difficult to conclude that the additional costs were properly and reasonably incurred.

Court Disposition

The plaintiff recovered his costs from the Company's assets except for costs incurred because of his failure to obtain approval before entering into the Indemnities; RG&H Investments Pty Limited and the Hardys recovered their costs from the Company's assets as costs of the winding up.

Orders

  • ['Robert Hardy, Danny Hardy, Evelyn Hardy and Lynette Hardy (the Hardys) have leave to be heard on the issue of costs without becoming parties to the proceeding.' "The plaintiff's costs of the proceeding, with the exception of his costs incurred as a result of his failure to apply for approval under s 477(2B) of the...