In the matter of Galtari Pty Limited (ACN 098 823) (in Liquidation) [2016] NSWSC 1972

In the matter of Galtari Pty Limited (ACN 098 823) (in Liquidation) [2016] NSWSC 1972

The creditors could not terminate the DOCAs under s 445C(b) because there was no breach and s 445CA applied, and the specified circumstances in cl 19.1(d) and cl 19.3 did not exist because the deed administrator had not made the required formal determination. However, the companies were insolvent, the deed purposes had been achieved, the creditors unanimously desired winding up, further recoveries required liquidation, no prejudice was identified, and the substance of the deeds' intended transition to winding up had been fulfilled. It was therefore appropriate under s 447A to have Part 5.3A operate as if s 445CA did not apply, so the DOCAs terminated by the creditors' resolutions and the...

Jurisdiction
Australia
Judgment Date
26 February 2016
Procedural Posture
Corporations List Application Concerning Termination of Deeds of Company Arrangement and Winding Up / Interlocutory Process Seeking Confirmation of Termination of Docas, Winding Up of the Companies, and Status of Liquidator After Originating Process Was Dismissed by Consent
Outcome
Relief granted under Corporations Act 2001 (Cth), s 447A; DOCAs declared terminated and companies declared wound up on 11 August 2015.
Legal Topics
['deed of Company Arrangement' 'termination of Deed of Company Arrangement' 'voluntary Administration' 'winding Up' 'liquidator Status' 'corporations Act 2001 (cth), S 447 A']
['corporations' 'insolvency'] ['deed of Company Arrangement' 'termination of Deed of Company Arrangement' 'voluntary Administration' 'winding Up' 'liquidator Status' 'corporations Act 2001 (cth), S 447 A']

Case Brief

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Procedural Posture

Corporations List Application Concerning Termination of Deeds of Company Arrangement and Winding Up / Interlocutory Process Seeking Confirmation of Termination of Docas, Winding Up of the Companies, and Status of Liquidator After Originating Process Was Dismissed by Consent

Legal Issues

  1. 1 ['Whether the DOCAs were invalid or an abuse of process because they deferred rather than avoided winding up.' 'Whether the procedure used to terminate the DOCAs and transition the companies to winding up was defective.' "Whether relief should be granted under Corporations Act 2001 (Cth), s 447A so that s 445CA did not prevent the creditors' resolutions terminating the DOCAs and winding up the companies."]

Ratio Decidendi

The creditors could not terminate the DOCAs under s 445C(b) because there was no breach and s 445CA applied, and the specified circumstances in cl 19.1(d) and cl 19.3 did not exist because the deed administrator had not made the required formal determination. However, the companies were insolvent, the deed purposes had been achieved, the creditors unanimously desired winding up, further recoveries required liquidation, no prejudice was identified, and the substance of the deeds' intended transition to winding up had been fulfilled. It was therefore appropriate under s 447A to have Part 5.3A operate as if s 445CA did not apply, so the DOCAs terminated by the creditors' resolutions and the...

Court Disposition

Relief granted under Corporations Act 2001 (Cth), s 447A; DOCAs declared terminated and companies declared wound up on 11 August 2015.

Orders

  • ['Pursuant to (CTH) Corporations Act 2001, s 447A(1), Part 5.3 operate in relation to Gatari Pty Limited and in relation to Jota Holdings Pty Limited, as if section 445CA did not apply.' 'Upon the true construction of the deeds of company arrangement, and in the events which have happened, including order (1), the...