Lyford, In the Matter of Plastics Technology Engineering Pty Ltd (In Liquidation) ACN 061 419 403 [2005] FCA 1922

Lyford, In the Matter of Plastics Technology Engineering Pty Ltd (In Liquidation) ACN 061 419 403 [2005] FCA 1922

Given the Committee of Inspection's resolutions, notice to creditors, and the risks assumed by Mr Prior and Vinidex in funding litigation essential for asset recovery, it is just under s 564 to order those creditors receive specified priority payments from recovered assets ahead of other creditors.

Jurisdiction
Australia
Judgment Date
23 December 2005
Procedural Posture
Corporate Insolvency / Application for Order Under S 564 of Corporations Act 2001 (cth)
Outcome
Orders made as sought. Priority payments granted to named funding creditors under s 564; plaintiff's costs applications awarded.
Legal Topics
['distribution of Assets in Liquidation' 'creditor Priority' 'security for Costs' 'litigation Funding']
['corporations Law' 'insolvency'] ['distribution of Assets in Liquidation' 'creditor Priority' 'security for Costs' 'litigation Funding']

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Procedural Posture

Corporate Insolvency / Application for Order Under S 564 of Corporations Act 2001 (cth)

Legal Issues

  1. 1 ['Whether an order should be made under s 564 of the Corporations Act 2001 (Cth) giving certain creditors priority in distribution of assets recovered through litigation funding provided by them']

Ratio Decidendi

Given the Committee of Inspection's resolutions, notice to creditors, and the risks assumed by Mr Prior and Vinidex in funding litigation essential for asset recovery, it is just under s 564 to order those creditors receive specified priority payments from recovered assets ahead of other creditors.

Court Disposition

Orders made as sought. Priority payments granted to named funding creditors under s 564; plaintiff's costs applications awarded.

Orders

  • ["After payment of the plaintiff's fees and costs the following payments be made from the assets of the company, which assets were recovered in litigation in priority to other creditors: (i) $99,000 to Mr Hugh Prior; and (ii) $17,000 to Vinidex Pty Ltd." "The costs of this application be the plaintiff's costs in the...