In the matter of Dalma No 1 Pty Limited (in liquidation) (ACN 111 772 260); Application of Bruce Gleeson and David Shannon in their capacity as joint and several liquidators of Dalma No 1 Pty Limited (in liquidation) and anor [2013] NSWSC 1335

In the matter of Dalma No 1 Pty Limited (in liquidation) (ACN 111 772 260); Application of Bruce Gleeson and David Shannon in their capacity as joint and several liquidators of Dalma No 1 Pty Limited (in liquidation) and anor [2013] NSWSC 1335

Dalma Constructions Pty Limited was not entitled to subrogation under s 560 or in equity because payments to discharge employee liabilities were made directly and voluntarily, not by the company or under obligation, and without affecting the company’s conscience.

Jurisdiction
Australia
Judgment Date
17 September 2013
Procedural Posture
Application for Determination of Questions in Liquidation / Principal Judgment
Outcome
Originating process questions answered: (a) No subrogation under s 560; (b) No equitable subrogation; (c)-(d) Do not arise. Costs declared properly incurred.
Legal Topics
['winding Up' 'priorities' 'subrogation' 'employee Entitlements']
['corporations Law' 'equity'] ['winding Up' 'priorities' 'subrogation' 'employee Entitlements']

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Procedural Posture

Application for Determination of Questions in Liquidation / Principal Judgment

Legal Issues

  1. 1 ['Is Dalma Constructions Pty Limited entitled to subrogate to employee priority claims under s 560 of the Corporations Act 2001?' 'Is Dalma Constructions Pty Limited entitled to equitable subrogation to those claims?' 'Does subrogation extend to premiums paid for group income protection insurance?' 'If subrogation is permitted, how should votes be cast at meetings of creditors?']

Ratio Decidendi

Dalma Constructions Pty Limited was not entitled to subrogation under s 560 or in equity because payments to discharge employee liabilities were made directly and voluntarily, not by the company or under obligation, and without affecting the company’s conscience.

Court Disposition

Originating process questions answered: (a) No subrogation under s 560; (b) No equitable subrogation; (c)-(d) Do not arise. Costs declared properly incurred.

Orders

  • ['Questions in originating process answered as follows: (a) No; (b) No; (c) Does not arise; (d) Does not arise.' "Declare First Plaintiffs' costs, including remuneration, are properly incurred for purposes of Corporations Act 2001, s 556(1)(dd) and (de)."]