Adelaide Brighton Cement Limited, in the matter of Concrete Supply Pty Ltd v Concrete Supply Pty Ltd (Subject to Deed of Company Arrangement) (No 2)

Concrete Supply Pty Ltd (Subject to Deed of Company Arrangement) applied to the Federal Court for an order that a Deed of Company Arrangement (DOCA) be varied under section 447A of the Corporations Act 2001 (Cth). The application was made by the deed administrators of Concrete Supply Pty Ltd (Subject to Deed of Company Arrangement) against Concrete Supply Pty Ltd. The dispute centred on the proposed variation of the DOCA to allow for the sale of certain assets, specifically a ready mix plant in South Australia and a ready mix plant in Victoria. The court had to decide whether the variation was in the best interests of the creditors and whether it was necessary to return the DOCA to creditors for their consideration under section 445A of the Corporations Act. Additionally, the court considered an application for the proceeding to proceed on pleadings, specifically whether a Points of Claim constituted a pleading under rule 2.4 of the Federal Court (Corporations) Rules 2000 (Cth).

The court noted that the application was made under section 447A(1) of the Corporations Act, which allows for a variation to a DOCA if it is in the best interests of creditors. The court considered the factors outlined in section 447A(1) of the Corporations Act, including the likelihood of the company being able to meet its debts as they fall due and the benefit to creditors of the company continuing to trade as opposed to being wound up. The court found that the proposed variation was in the best interests of creditors and that it was not necessary to return the DOCA to creditors for their consideration. The court also considered the application for the proceeding to proceed on pleadings and found that a Points of Claim did not constitute a pleading under rule 2.4 of the Federal Court (Corporations) Rules 2000 (Cth). The court granted the application for the proceeding to proceed on pleadings, finding that it was in the interests of proper case management and the need for clear identification of issues.

The court ordered that the parties be heard as to the appropriate orders in light of these reasons. The court noted that entry of orders was dealt with in Rule 39.32 of the Federal Court Rules 2011. The court did not make any final orders in this case, instead leaving it to the parties to determine the appropriate orders. This decision provides guidance to parties involved in similar disputes and highlights the importance of considering the interests of creditors when varying a DOCA.