Yan v The Won Capital Pty Ltd [2024] NSWSC 758

Yan v The Won Capital Pty Ltd [2024] NSWSC 758

The GR Capital DOCA should be terminated because misleading information provided by Mr Liu materially affected the voting composition resulting in its execution, satisfying s 445D(1)(a). Additionally, permitting Mr Liu to vote as a substantial creditor on a false premise is reason enough for termination under s...

Source-derived case information.

Parties
Plaintiff: Jianhua Yan; First Defendant: The Won Capital Pty Ltd; Second Defendant: Wensheng Liu; Third Defendant: GR Capital Group Pty Ltd; Seventh Defendant: Jason Lloyd Porter
Jurisdiction
Australia
Judgment Date
21 June 2024
Procedural Posture
Principal Judgment / Final Orders After Hearing
Outcome
Deed of Company Arrangement for GR Capital Group Pty Ltd terminated; active defendants to pay costs as ordered.
Legal Topics
Deed of Company Arrangement, Voluntary Administration, Termination of DOCA, Costs
Corporations Law Equity Deed of Company Arrangement Voluntary Administration Termination of DOCA Costs

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Parties

Jianhua Yan

Plaintiff

The Won Capital Pty Ltd

First Defendant

Wensheng Liu

Second Defendant

GR Capital Group Pty Ltd

Third Defendant

Jason Lloyd Porter

Seventh Defendant

Procedural Posture

Principal Judgment / Final Orders After Hearing

Legal Issues

  1. 1 Whether the Deed of Company Arrangement (DOCA) for GR Capital Group Pty Ltd should be terminated under s 445D(1) of the Corporations Act 2001 (Cth)
  2. 2 Who should pay the costs of the proceedings and on what basis

Ratio Decidendi

The GR Capital DOCA should be terminated because misleading information provided by Mr Liu materially affected the voting composition resulting in its execution, satisfying s 445D(1)(a). Additionally, permitting Mr Liu to vote as a substantial creditor on a false premise is reason enough for termination under s 445D(1)(g). Discretion should be exercised to terminate now, as delay, although present, is outweighed by the public interest in having suspected insolvent trading claims investigated promptly, with no clear prejudice to other creditors and the holding purpose of the DOCA now being spent.

Court Disposition

Deed of Company Arrangement for GR Capital Group Pty Ltd terminated; active defendants to pay costs as ordered.

Orders

  • Pursuant to s 445D(1) of the Corporations Act 2001 (Cth), the Deed of Company Arrangement for the third defendant dated 18 February 2019 be terminated.
  • Subject to order 3 below, the first, second and third defendants pay the costs of these proceedings: (a) up to 30 June 2021 on the ordinary basis; and (b) from 30 June 2021, on the indemnity basis.