Onefone Australia Pty Limited v One.Tel Limited [2010] NSWSC 401

Reported Decision : 78 ACSR 98

New South Wales Supreme Court

CITATION : Onefone Australia Pty Limited v One.Tel Limited [2010] NSWSC 401

HEARING DATE(S) : 12/04/10, 29/04/10

JUDGMENT DATE : 7 May 2010

JURISDICTION : Equity Division Corporations List

JUDGMENT OF : Barrett J

1. Direct that the special purpose liquidator serve on Australian Securities and Investment Commission within seven days: (a) a copy of the interlocutory process filed on 15 February 2010; (b) a copy of the amended interlocutory process filed on 29 March 2010; (c) a copy of the amended interlocutory process filed on 29 April 2009; DECISION : (d) a copy of each affidavit read upon the hearing on 12 and 29 April 2010 and the exhibits thereto; (e) a copy of the written submissions of the special purpose liquidator and of the committee members furnished to the court before, at and after the hearing on 12 and 29 April 2010; (f) a copy of the transcript of the hearing on 12 and 29 April 2010; and (g) a copy of these reasons. 2. Direct that the present application stand over before me at 9.30am on 28 May 2010.

CATCHWORDS : CORPORATIONS - winding up - creditors voluntary winding up - remuneration of liquidator - power of committee of inspection to fix remuneration - where committee does not act - procedures of committee - requirement that committee act through meeting - where meeting made no decision and supposedly "adjourned" while liquidator sought individual approvals of remuneration from committee members - power to adjourn "from time to time" - no permitted procedure contemplates what was actually done - individual approvals did not in any event "fix" remuneration - no legal basis for payment received by liquidator - application to validate actions - where ASIC conducting "review" of liquidator's remuneration - where application for order removing liquidator pending - ASIC to be given notice of proceedings - proceedings adjourned

Australian Securities and Investments Commission Act 2001 (Cth), s 30 LEGISLATION CITED : Corporations Act 2001 (Cth), Chapter 5, ss 248A, 499(3), 504, 511, 536, 549(3), 1322, 1330 Corporations Regulations 2001 (Cth), regulations 5.6.11(2)(a)(iii), 5.6.12 to 5.6.36A Supreme Court (Corporations) Rules 1999, rule 2.13(1)(c)

CATEGORY : Principal judgment

Edwards v United States 286 US 482 (1932) CASES CITED : Onefone Australia Pty Ltd v One.Tel Ltd [2009] NSWSC 1231; (2009) 74 ACSR 716 Re Montana Frocks Pty Ltd [1967] 2 NSWR 584 R v The Mayor Burgesses and Commonalty of Carmarthen (1813) 1 M&S 697; 105 ER 260

Onefone Australia Pty Limited - First Plaintiff DCA Resources Australia Pty Limited - Second Plaintiff Pacific Finance Group Pty Limited - Third Plaintiff PARTIES : Concept Systems (Australia) Pty Limited - Fourth Plaintiff One.Tel Limited - First Defendant Steven Sherman - Second Defendant Peter Walker - Third Defendant Paul Gerard Weston - Special Purpose Liquidator - Applicant

FILE NUMBER(S) : SC 2003/086446

COUNSEL : Mr N A Cotman SC/Mr R D Glasson - Applicant Mr D J Walter - Committee of Inspection

SOLICITORS : O'Neill Partners Commercial Lawyers - Special Purpose Liquidator Baker & McKenzie - Committee of Inspection

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST

BARRETT J

FRIDAY 7 MAY 2010

2003/086446 ONEFONE AUSTRALIA PTY LTD v ONE.TEL LIMITED JUDGMENT 1 I am dealing with an application by the special purpose liquidator of One.Tel Limited concerning his remuneration. Before me is a further amended interlocutory process filed on 29 April 2010 which supersedes an interlocutory process filed on 15 February 2010 and an amended interlocutory process filed on 29 March 2010. 2 The special purpose liquidator applies for an order determining his remuneration in the sum of $261,135 plus GST for the period of four months from 1 July 2009 to 31 October 2009 and in the sum of $182,199 plus GST for the period of four months from 1 November 2009 to 28 February 2010. A single composite order is sought. 3 Other relief sought will be mentioned presently. 4 Counsel for the special purpose liquidator and the solicitor for three members of the committee of inspection in the winding up of One.Tel made submissions when the special purpose liquidator's claim came before the court on 12 April 2010 and again on 29 April 2010. By leave, each also filed written submissions. 5 As has been noted on earlier occasions (most recently in Onefone Australia Pty Ltd v One.Tel Ltd [2009] NSWSC 1231; (2009) 74 ACSR 716), the court may, under s 511 of the Corporations Act 2001 (Cth), deal with the quantification of a liquidator's remuneration in a creditors voluntary winding up such as this governed by s 499(3) as it stood before 31 December 2007, where the remuneration fixing mechanism created by s 499(3) has broken down and proved unworkable. Ordinarily, where (as here) there is a committee of inspection, the committee alone has power to fix remuneration; but if it is shown that that mechanism is incapable of operating to determine remuneration, the situation is one in which a question that s 511 allows the court to answer has arisen in the winding up. 6 On this occasion as on several earlier occasions, the special purpose liquidator maintains that the s 499(3) mechanism has broken down and proved unworkable. He has placed before the court evidence of his requests made to the committee of inspection with respect to quantification of remuneration and deliberations of the committee in relation to those requests. 7 Before turning to the evidence about meetings and deliberations of the committee of inspection, it is necessary to note that, by virtue of regulation 5.6.11(2)(a)(iii) of the Corporations Regulations 2001 (Cth), regulations 5.6.12 to 5.6.36A of the regulations apply to a meeting of the committee of inspection in a Part 5.5 winding up such as the present. Of particular relevance, for present purposes, are regulations 5.6.13A and 5.6.13B concerning meetings by telephone. In the absence of any submission to the contrary, I proceed on the basis that telephone conferences referred to in the evidence occurred in accordance with those provisions and are properly regarded as meetings of the committee of inspection. 8 It is convenient to consider first the evidence concerning remuneration sought by the special purpose liquidator for the later of the two periods, that is, the period from 1 November 2009 to 28 February 2010. A meeting of the committee of inspection held on 15 March 2010 considered and voted on two proposed resolutions with respect to remuneration of the special purpose liquidator for that period. All five members of the committee were present, either in person or by telephone. Neither resolution was approved by a majority of the votes cast at the meeting. There was accordingly no determination of the committee fixing remuneration. 9 The evidence shows that there was wide ranging discussion at the meeting of 15 March 2010 on a number of specific questions and concerns about various aspects of the work for which remuneration was sought. 10 I consider next the evidence concerning attempts to have remuneration fixed for the earlier period 1 July 2009 to 31 October 2009 in the sum of $261,135 plus GST. The special purpose liquidator's request that such remuneration be approved and authorised was considered by the committee of inspection at meetings held on 4 December 2009 and 8 December 2009 (the latter is described in at least one document as an adjournment of the former). Committee members' participation in each meeting was by telephone. No resolution fixing remuneration at $261,135 plus GST or any other sum was passed while members of the committee were in the course of consulting together at either meeting. It is said by the special purpose liquidator, however, that the committee adopted a "circular resolution" as follows on 14 December 2009: "THAT the SPL be entitled to receive payment of 75% (seventy-five percent) of his remuneration claim for the period 1 July 2009 to 31 October 2009 being $195,851, plus GST. The SPL is to apply to Court for determination of his entire remuneration for the period 1 July 2009 to 31 October 2009 in the sum of $261,135, plus GST. Noted that in the event that the Court determines the SPL's remuneration payable is less than 75% (seventy-five percent) of his total remuneration claim for the period, then the SPL is to repay the difference." 11 It appears that three out of the five members making up the committee signified, in writing (or, more precisely, by email to the special purpose liquidator), assent to this proposition but that no such assent was forthcoming from the other two members. The assents of the three members were signified outside the confines of any meeting, in the sense that a plurality of persons was not in mutual contact at the times the assents were given. The special purpose liquidator maintains that the written expressions of assent made by three committee members nevertheless represent a valid and effective determination of the committee. The argument proceeds as follows: 1. Section 549(3) provides that a committee of inspection "may act by a majority of its members present at a meeting" and that it "must not act unless a majority of its members are present". 2. Where, as here, a committee has five members, a meeting at which three were present could act and a resolution supported by two of the three and opposed by the third would be effective. 3. At the meeting of the committee held on 8 December 2009, three members were present (all by telephone) and the matter of the special purpose liquidator's remuneration was discussed. Before the telephone connection was terminated on that day, the special purpose liquidator "indicated he would circulate the resolution concerning his remuneration, seeking a response within twenty four hours". This followed a consensus of committee members present that a resolution should be put by email circular so that the two absent members would have an opportunity to vote. 4. The committee of inspection thereby "acted" at the meeting of 8 December 2009 in conformity with s 549(3) to specify the email circular method as the vehicle for determining the will of the committee. 5. The result, by means of email, of the solicitation from all five committee members of statements whether or not they were in favour of the circulated resolution was thereby itself given the character of an act of the committee. 12 Before addressing this argument, it is necessary to say more about the facts. 13 The document recording what purport to be the "minutes" of what is described therein as "adjourned COI meeting reconvened on 8 December 2009" refers to discussion on the question of the special purpose liquidator's remuneration for the period 1 July 2009 to 31 October 2009. Then follows a record of a matter mentioned briefly at point 3 above: "There being no further questions, the SPL proposed to put the resolution concerning his remuneration, however COI members present expressed a preference for the resolution to be put by email circular to give GP and BS, who were not present, the opportunity to vote." 14 The next entry in the document is "Adjournment of Meeting Having dealt with the general business and there being no further issues, the SPL indicated he would circulate the resolution concerning his remuneration, seeking a response within twenty four hours. At 12.55pm, the SPL declared the meeting adjourned." 15 The document records that, after the declaration at 12.55pm on 8 December 2009 that the meeting was "adjourned", the special purpose liquidator proposed to the committee members by emails sent to them individually that they adopt a resolution fixing his remuneration for the period 1 July 2009 to 31 October 2009 at $261,135 plus GST. This is the proposal that was to be circulated within twenty-four hours. It appears that each of three committee members indicated by email reply to the special purpose liquidator disapproval of that proposal and that two indicated neither approval nor disapproval, at which point, the minutes document says: "The SPL declared the resolution not carried." 16 The document then goes on to refer to another email sent by the special purpose liquidator to committee members on 11 December 2009 soliciting approval of a proposal in the following terms (referred to as the "Compromise Resolution"): "To consider and, if thought fit, approve the remuneration of the SPL for the four month period 1 July 2009 to 31 October 2009 in the amount of $248,078 plus GST representing 90% (ninety percent) of the fees incurred during this period. Noted that the balance of 10% (ten percent) of the SPL's remuneration for this period in the sum of $26,113.50 plus GST is to be written off." 17 As an alternative to this, the special purpose liquidator put forward in the same email a proposal in the terms set out at paragraph [10] above. This was designated the "Alternative Resolution". 18 The minutes document records the following: "The SPL requested COI members to submit their email vote on the two resolutions by 1.00 pm on 14 December 2009." 19 The "two resolutions" thus referred to are clearly the "Compromise Resolution" and the "Alternative Resolution" communicated by the same email of 11 December 2009. 20 The minutes document continues: "By circular email to COI members sent at 7.29pm on 14 December 2009, the SPL advised that in respect of the Compromise Resolution set out above, JD voted against, SL abstained and BS voted in favour. The SPL declared the Compromise Resolution had not passed. In respect of the Alternative Resolution set out above, JD voted against, SL and BS had voted in favour. The Alternative Resolution was therefore declared passed by the majority of COI members voting. The SPL noted that at approximately 1.30 pm on 14 December 2009, after the deadline for voting on the resolutions had passed, Daniel Cooksley had left telephone messages for GP, BG and SS (as proxy for BG) requesting their response to the SPL's email letter dated 11 December 2009, but no response had been received by 7.29 pm that day. The SPL's email letter further informed COI members of his intention to seek payment from the GP of 75% (seventy-five percent) of his remuneration for the period 1 July 2009 to 31 October 2009 in the sum of $195,851, plus GST and that he would need to make application to the Court for determination of his fees for the period and would advise the COI accordingly." 21 The document then concludes: "Following despatch of the SPL's email on 14 December 2009 at 7.29pm, there being no further business, the SPL closed the meeting." 22 I return to the argument outlined at paragraph [11] above. I reject the argument. I do so for the simple reason that a committee of inspection can only operate as the Corporations Act and the Corporations Regulations allow and that no legislative provision allows a committee itself to create decision-making procedures capable of bringing about legally effective results. 23 Had Parliament intended that a committee of inspection might fix for itself methods of effective decision-making, it would have said so; and had Parliament intended that a committee of inspection might decide to act by written resolution apart from and outside a meeting, it would have enacted some equivalent of s 248A. What Parliament has actually said in s 549(3) is that a committee of inspection can only act at and through a meeting, so that a meeting is, by the legislation, made the sole decision-making vehicle (compare, for example, Re Montana Frocks Pty Ltd [1967] 2 NSWR 584); and while regulations 5.6.13A and 5.613B allow the contact and interaction essential to a meeting to be by telephone, they do not sanction decision making by a series of separate but parallel actions of certain of the committee members orchestrated remotely by a liquidator. 24 No meeting of the committee of inspection was in existence after the telephone link among participating members was terminated at 12.55pm on 8 December 2009. The statement in the document purporting to be minutes that, at that point, the special purpose liquidator "declared the meeting adjourned" is meaningless. The relevant power to adjourn is created by regulation 5.6.18. The chairperson may with the consent of the meeting (and must, if the meeting directs) "adjourn the meeting from time to time and from place to place". A valid decision to adjourn involves determination and communication of the time and place at which the adjourned meeting will resume, in the sense that the members of the body will come together again "to conclude such business as they had already begun", to use the words of Le Blanc J in R v The Mayor Burgesses and Commonalty of Carmarthen (1813) 1 M&S 697; 105 ER 260. The words "from time to time" mean that an adjournment must be to a specified time in the future. It cannot be indefinite or sine die. The distinction between adjournment "sine die or to a day named" is referred to in Edwards v United States 286 US 482 (1932). A decision to adjourn sine die is a decision to terminate and is beyond the scope of regulation 5.6.18. 25 The intention behind regulation 5.6.18 is, obviously enough, that those present at the time of the chairperson's exercise of the power to adjourn will be told where and when they must again attend in order to continue their participation. Where, as here, participation may be by telephone, that form of participation may be chosen upon the resumption. 26 There was no meeting of the committee extant after 12.55pm on 8 December 2009. To the extent that the so-called minutes purport to record things that happened at the meeting after that time, they are not, in terms of regulation 5.6.27 "minutes of the proceedings". Relevant events after 12.55pm on 8 December 2009 represented no more than a series of unilateral and bilateral actions taken apart from any meeting. 27 After the meeting of 8 December 2009 had come to an end upon termination of the telephone link at 12.55pm, the special purpose liquidator communicated individually with committee members, albeit in a way that often involved simultaneous transmission of the same message to all of them; and individual members, in turn, communicated on a one-to-one basis with the special purpose liquidator although again sometimes in a way that caused messages they sent to be received also by one or more other committee members. That series of contacts produced no legally effective result. 28 There are, in any event, disturbing features of the process apparently adopted with a view to decision making by "circular resolution". They are exemplified by the following passage in an email of 14 December 2009 from the special purpose liquidator to the members of the committee of inspection. "Members of the COI will note from my letter dated 11 December 2009 that the deadline for response to the Compromise and Alternative resolutions set out in that letter passed at 1pm today. I note that Daniel Cooksley of this office has left telephone messages for Gary Phillips, Barbara Galloon and also Stuart Salier (as proxy for Barbara Galloon) at approximately 1.30pm this afternoon, requesting their response to my letter. No response has as yet been received. As at the time of this email, I have received votes from a majority of the COI (that is 3 of the 5 members) being John Deloughery, Sue Laver and Ben Sharma. Accordingly, the results of the resolutions set out in my letter dated 11 December 2009 are as follows:" 29 It thus appears that the special purpose liquidator saw fit to adopt a process involving the fixing by him of a "deadline" by which committee members were required to submit their "votes". 30 In a later email to one member, the special purpose liquidator referred to the fact that "it was necessary to impose on COI members a reasonably short deadline for a decision on the resolution as put". One member (or rather the "proxy" of a member) said to another member in an email: "I was disappointed that Paul [ie, the special purpose liquidator] was so quick to act on his self-imposed deadline without more than a call to each of Barbara and myself." 31 It is no part of the function of a liquidator to prescribe time limits within which members of a committee of inspection must act in relation to decision-making. Had the correct course been followed and the proposed resolutions been submitted for consideration at a meeting of the committee, it would have been for the committee itself to take such time as it required over discussion and deliberation without being browbeaten by the liquidator to come to a decision by a particular time. The power to adjourn the meeting would also have been in the hands of the meeting itself, in the sense that the meeting could have directed that the chairperson adjourn the meeting to some specified later time in the way already noticed. 32 Other aspects of the so-called "circular resolution" also call for comment. The applicable version of s 499(3) empowers a committee of inspection "to fix the remuneration to be paid to the liquidator". The circular resolution does not "fix" remuneration. It contemplates quite clearly that the "entire remuneration" for the relevant period is to be "determined" – that is, fixed – by the court (no doubt on the basis related to s 511 already noted). It also addresses the possibility that the determination by the court may be in a sum less than 75% of the remuneration claim of $261,135 plus GST and "notes" that, in that event, the special purpose liquidator is to "repay the difference". All this is said in the context of a supposed decision that the special purpose liquidator "be entitled to receive payment" of 75% of the remuneration claim of $261,135 plus GST. 33 A liquidator is "entitled to receive" only such remuneration as is "fixed". He or she has no right to receive some form of contingent payment on account of remuneration to be fixed; nor does a committee of inspection have any right or power to award any payment on account of future remuneration. 34 If, as counsel for the special purpose liquidator suggested, the circular resolution (assuming, contrary to my finding, that it was a resolution) "fixed" remuneration for the particular period at the 75% figure (that is $215,436.10), there would be an entitlement to receive that sum. But there would then be no question for the court to answer under s 511. The remuneration fixing mechanism would have produced a result and there would therefore be no basis for the court to make the determination the resolution envisages. 35 Section 504 as in force before 31 December 2007 was in these terms: "Any member or creditor, or the liquidator, may at any time before the deregistration of the company apply to the Court to review the amount of the remuneration of the liquidator, and the decision of the Court is final and conclusive." 36 If, in a creditors voluntary winding up governed by s 499(3) as it stood before the 2007 amendments, the committee of inspection has fixed the liquidator's remuneration, the court's only power is the power under s 504 to review the amount so determined. That power is exercisable only upon application made by a member or creditor, or by the liquidator. The committee of inspection in which the power to fix remuneration is vested by s 499(3) cannot initiate a review by the court. It would be odd if it could, given that the review it initiated would be a review of its own decision. 37 The special purpose liquidator has been paid $215,436.10 to which he has no legal entitlement.

38 After the possibility of this finding (and the serious implications inherent in it) emerged in the course of the hearing on 12 April 2010, the special purpose liquidator's application was amended to include a prayer for an order that the circular "resolution" of 14 December 2009 and the payment of $215,436.10 to the special purpose liquidator pursuant to the circular "resolution" were "not invalid by reason of any provision of" the Corporations Act. The special purpose liquidator thus seeks validation under s 1322 of the Act. 39 The three members of the committee of inspection who were represented upon the hearing of the special purpose liquidator's application submitted that the question of relief under s 1322 should not be entertained at this point. This was, in substance, an amplification of a submission that the court should not at this point act under s 511 to make the determination the special purpose liquidator seeks. The three committee members refer, in that connection, to two matters. 40 The first is what they described in submissions as an Australian Securities and Investments Commission "investigation into the remuneration and expenses incurred by the SPL in the course of the winding up". The only evidence the court has about anything that might be so described comes from letters of 11 and 21 September 2009 from ASIC to the special purpose liquidator and a letter of 2 December 2009 from ASIC to the special purpose liquidator's solicitor. 41 The letter of 11 September 2009 reads as follows: " One.Tel Limited (In Liquidation) ACN 068 193 153 I refer to the meeting held on 4 September 2009 with yourself, Michael O'Neill of NOT Lawyers and Stefan Dopking and myself of ASIC in respect of your role as Special Purpose Liquidator ('SPL') of the One.Tel Limited (In Liquidation). At the meeting you provided an update of your actions as SPL. As discussed, ASIC wishes to review the SPL remuneration and expenses including legal costs incurred in this matter. Please provide copies of your remuneration invoices and fee schedules and legal costs invoices incurred since the date of your appointment along with the supporting documents. Also provide all supporting documents in order to verify the fee and disbursement claimed including; Fee schedules giving a breakdown of tasks, liquidator and employee time and rates charged; Summaries and narratives of the work performed; Supporting work in progress extracts; and All documents used to seek approval of remuneration and expenses provided to the creditors, committee of inspection and or the Courts. Please provide the requested documents by Tuesday 22 September 2009." 42 The letter of 21 September 2009 enclosed a notice under s 30 of the Australian Securities and Investments Commission Act 2001 (Cth) addressed to the special purpose liquidator requiring production to ASIC of all documents concerning remuneration and expenses of the special purpose liquidator since the date of his appointment. The purposes for which the notice was issued are expressed to include: "the purpose of ensuring compliance with Chapter 5 of the Corporations Act in connection with the Special Purpose Liquidator ('SPL') of One.Tel Limited (In Liquidation)." 43 The letter of 2 December 2009 is in these terms: " Notice issued under Section 30 of the ASIC Act 2001 on Paul Gerard Weston Special Purposes Liquidator of One.Tel Limited (In Liquidation) ACN 068 193 153 I refer to your email dated 19 November 2009 ('the Email') and to the notice dated 21 September 2009 issued under section 30 of the Australian Securities and Investments Commission Act 2001 (Cth) ('the Notice') served on your client. I acknowledge receipt of a further CD containing material in compliance with the Notice enclosed under cover of your letter dated 1 December 2009. ASIC intends to review the material and will advise if it requires further information and/or clarification of the Legal Professional Privilege claim. ASIC notes the reference in the Email to the two decisions of Justice Barrett. ASIC is well aware of those and other relevant decisions relating to your client. ASIC intends to complete its review of your client's remuneration and expenses including legal costs incurred based on the books and records produced pursuant to the Notice. Should ASIC wish to raise any concerns or discuss any issues regarding the remuneration and expenses with your client it will do so in due course. In respect of your request to meet with ASIC to discuss your client's administration and section 533 report, please contact me on XXXX XXXX to arrange a suitable time." 44 It is thus clear that ASIC has seen fit to exercise its coercive powers under s 30 of the Australian Securities and Investments Commission Act to require production of documents by the special purpose liquidator; that documents produced have been (or are to be) the subject of "review" (in an undefined sense) by ASIC; that ASIC has embarked on a "review" (in an undefined sense) of "the SPL remuneration and expenses including legal costs incurred in this matter"; and that the imposition of a requirement that documents be produced was in furtherance of a purpose of ensuring compliance with Chapter 5 of the Corporations Act. 45 The second matter referred to by the three committee members is the pendency of an application by SingTel Optus Pty Limited for an order removing the present special purpose liquidator from office and an order appointing a new special purpose liquidator in his place. The originating process of SingTel Optus was filed on 22 March 2010. Notices of appearance have been filed by the special purpose liquidator (who indicates an intention to oppose the application) and by Telstra Corporation Limited (which indicates an intention to support the application). The proceedings are next due before the court next on 17 May 2010 in the Registrar's list. ASIC appeared by counsel at a directions hearing before the Registrar on 12 April 2010. 46 The three committee members submit that determination of the special purpose liquidator's further amended interlocutory process filed on 29 April 2010 (including the application under s 1322) should be deferred so as to become part of the removal proceedings instituted by SingTel Optus Pty Limited. The committee members say that the circumstances surrounding the passing of the "circular resolution" and reliance on the "circular resolution" by the special purpose liquidator to receive payment from the estate in liquidation may be something that will be raised in the removal proceedings. 47 These submissions are cogent, but I am not persuaded that simple deferral is the best course. 48 The court is on notice that ASIC is conducting some form of "review" of the special purpose liquidator's remuneration for a purpose of ensuring compliance with Chapter 5 of the Corporations Act. Just what that involves cannot be known but it may readily be inferred that ASIC, in undertaking the "review", is acting in the performance or exercise of one or more of its functions and powers. The special purpose liquidator's application now before me directly concerns the general subject matter with which ASIC has concerned itself (I put to one side as excessively technical the possibility that, since ASIC's letter of 11 September 2009 should be taken to have sought only material for periods up to the date of the letter and that the s 30 notice referred to in the 2 December 2009 letter could, of its nature, have sought only material in existence when the notice was served, remuneration for later periods the subject of the present application is beyond the scope of ASIC's "review"). 49 Section 1330 of the Corporations Act is in these terms: "(1) ASIC may intervene in any proceeding relating to a matter arising under this Act.

(2) Where ASIC intervenes in a proceeding referred to in subsection (1), ASIC is taken to be a party to the proceeding and, subject to this Act, has all the rights, duties and liabilities of such a party.

(3) Without limiting the generality of subsection (2), ASIC may appear and be represented in any proceeding in which it wishes to intervene pursuant to subsection (1): (a) by a staff member of ASIC; or (b) by a natural person to whom, or by an officer or employee of a person or body to whom or to which, ASIC has delegated its functions and powers under this Act or such of those functions and powers as relate to a matter to which the proceeding relates; or (c) by solicitor or counsel." 50 The present application is a proceeding of the kind referred to in s 1330(1). ASIC is at present engaged in a "review" of matters related to the subject matter of the application. ASIC has, under s 536 of the Corporations Act and otherwise certain oversight functions in relation to liquidators. ASIC has appeared by counsel at a directions hearing in the separate proceeding instituted against the special purpose liquidator by SingTel Optus Pty Limited. 51 In the course of submissions on the merits of the special purpose liquidator's remuneration claims, counsel for the special purpose liquidator concentrated on a number of individual items singled out for questioning or criticism by the committee of inspection. The approach taken was one of seeking to establish to the court that the particular work was done, that that work was properly connected with the special purpose liquidator's allotted functions, that it was accordingly proper for the special purpose liquidator to undertake the work and that the sum of money allocated to the work represents fair remuneration for it. Implicit in that approach, but not the subject of explicit submission or testing, was the proposition that remuneration should be assessed and fixed progressively by reference to a sequential assessment of work actually done (in terms of time spent) without any qualitative assessment of the significance of any achievement or of the overall worth of the completed body of work compared with the quantum of remuneration to date. The assumption is that demonstrated devotion of time to some relevant task is alone sufficient to merit remuneration, without reference to results achieved or to any global appreciation of the worth of those results. 52 ASIC should be given an opportunity to consider the issues arising upon the present application and to decide whether it wishes to exercise its s 1330(1) power to intervene or, perhaps, to claim the status of "any other interested person" under rule 2.13(1)(c) of the Supreme Court (Corporations) Rules 1999 and on that basis to seek leave to be heard without becoming a party. ASIC may perceive that there are public interest issues at stake in the present application of a kind relevant to the performance of its functions. 53 The appropriate course at this point is to defer further consideration of the present application for a short time and to make the following directions:

1. Direct that the special purpose liquidator serve on Australian Securities and Investments Commission within seven days: (a) a copy of the interlocutory process filed on 15 February 2010; (b) a copy of the amended interlocutory process filed on 29 March 2010; (c) a copy of the amended interlocutory process filed on 29 April 2010;

(d) a copy of each affidavit read upon the hearing on 12 and 29 April 2010 and the exhibits thereto;

(e) a copy of the written submissions of the special purpose liquidator and of the committee members furnished to the court before, at and after the hearing on 12 and 29 April 2010;

(f) a copy of the transcript of the hearing on 12 and 29 April 2010; and

(g) a copy of these reasons.

2. Direct that the present application stand over before me at 9.30am on 28 May 2010. **********

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