Sliteris v Ljubic [2014] NSWSC 1632

Sliteris v Ljubic [2014] NSWSC 1632

The administrators were validly appointed as voluntary administrators under s 436A of the Corporations Act. Reasonable notice of the directors' meeting was given to all directors, including by facsimile, and implied consent was established by prior practice and subsequent conduct. The decision to appoint administrators was appropriate given the company's insolvency and imminent creditor action. No relevant fiduciary or advisory duty owed by the third defendant in the circumstances was breached, nor did his conduct evidence lack of good faith or improper purpose. The serious allegations against administrators were unproven and abandoned. Costs were appropriately ordered against the...

Parties
Plaintiff: Viktoras Sliteris; First Defendant: Dragan Ljubic; Second Defendant: Geoffrey Robert Davis; Third Defendant: Nicholas Harrow; Fourth Defendant: Angela Harrow; Fifth Defendant: A V & M J Nominees Pty Ltd
Jurisdiction
Australia
Judgment Date
19 November 2014
Procedural Posture
Corporations/equity / Principal Judgment After Hearing
Outcome
Declaration made; proceedings otherwise dismissed; costs orders specified.
Legal Topics
Voluntary Administration, Validity of Appointment of Administrator, Notice of Directors' Meeting, Directors' Duties, Fiduciary Obligations of Accountants, Costs Orders
Corporations Equity Civil Procedure Voluntary Administration Validity of Appointment of Administrator Notice of Directors' Meeting Directors' Duties Fiduciary Obligations of Accountants +1 more

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Parties

Viktoras Sliteris

Plaintiff

Dragan Ljubic

First Defendant

Geoffrey Robert Davis

Second Defendant

Nicholas Harrow

Third Defendant

Angela Harrow

Fourth Defendant

A V & M J Nominees Pty Ltd

Fifth Defendant

Procedural Posture

Corporations/equity / Principal Judgment After Hearing

Legal Issues

  1. 1 Whether administrators were validly appointed to company under s 436A of the Corporations Act
  2. 2 Whether reasonable notice was given for the directors' meeting at which administrators were appointed
  3. 3 Whether notice by facsimile was effective and consented to

Ratio Decidendi

The administrators were validly appointed as voluntary administrators under s 436A of the Corporations Act. Reasonable notice of the directors' meeting was given to all directors, including by facsimile, and implied consent was established by prior practice and subsequent conduct. The decision to appoint administrators was appropriate given the company's insolvency and imminent creditor action. No relevant fiduciary or advisory duty owed by the third defendant in the circumstances was breached, nor did his conduct evidence lack of good faith or improper purpose. The serious allegations against administrators were unproven and abandoned. Costs were appropriately ordered against the...

Court Disposition

Declaration made; proceedings otherwise dismissed; costs orders specified.

Orders

  • Declaration pursuant to s 447C of the Corporations Act 2001 (Cth) that the first and second defendants were validly appointed as voluntary administrators of the company on 4 April 2014.
  • Proceedings otherwise dismissed.