In the matter of City Pacific Limited [2017] NSWSC 784

In the matter of City Pacific Limited [2017] NSWSC 784

The court approved the liquidator entering into the litigation funding agreement as there was some prospect creditors may benefit and no detriment in pursuing the litigation, with the alternative being no return to creditors. The approval allowed the liquidator to exercise commercial judgment, with no demonstrated downside or impropriety in the proposal.

Jurisdiction
Australia
Judgment Date
18 May 2017
Procedural Posture
Application by Liquidator for Approval of Litigation Funding Agreement / Final Orders
Outcome
Application granted
Legal Topics
["liquidators' Powers" 'litigation Funding Agreement' 'approval Under Corporations Act 2001 S 477(2 B)' "creditors' Interests"]
['corporations Law' 'equity'] ["liquidators' Powers" 'litigation Funding Agreement' 'approval Under Corporations Act 2001 S 477(2 B)' "creditors' Interests"]

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Procedural Posture

Application by Liquidator for Approval of Litigation Funding Agreement / Final Orders

Legal Issues

  1. 1 ['Whether approval under s 477(2B) of the Corporations Act 2001 (Cth) should be granted to the liquidator to enter litigation funding agreement' 'Whether the objectors had standing to oppose the application' 'Appropriate considerations in exercising discretion under s 477(2B) for litigation funding']

Ratio Decidendi

The court approved the liquidator entering into the litigation funding agreement as there was some prospect creditors may benefit and no detriment in pursuing the litigation, with the alternative being no return to creditors. The approval allowed the liquidator to exercise commercial judgment, with no demonstrated downside or impropriety in the proposal.

Court Disposition

Application granted

Orders

  • ['Pursuant to Corporations Act, s 477(2B), the entry by the plaintiff as liquidator of Martha Cove Marina Pty Ltd into a litigation funding agreement with International Litigation Partners No 6 Ltd, substantially on the same terms as exhibit PX04, is approved, notwithstanding that the agreement may endure or...