Australian Securities and Investments Commission v Green Pacific Energy Limited (In Liquidation) (Subject to Deed of Company Arrangement) ACN 004 119 304

The Australian Securities and Investments Commission (ASIC) has brought proceedings against Green Pacific Energy Limited (GPE) in liquidation, seeking to have certain transactions voided. The transactions include the transfer of shares in GPE to Sulton Pty Ltd, the issue of fully paid shares to Sulton Pty Ltd, the disposition of assets to Stapylton Green Energy No. 2 Pty Limited, and the transfer of shares in subsidiaries to Stapylton Green Energy No. 2 Pty Limited. These transactions occurred pursuant to a deed of company arrangement executed by GPE on 15 June 2007. The court was required to determine whether these transactions are valid despite the winding up of GPE by the Court.

The legal issues centred on the validity of the transactions conducted by GPE in the context of its financial difficulties and subsequent winding up. The primary question was whether the transactions were void under the Corporations Act 2001 (Cth) due to the company being in liquidation. ASIC argued that the transactions should be void as they occurred after the winding up order was made, and thus were not valid. GPE, on the other hand, contended that the transactions were part of an arrangement intended to restructure the company's debt and were therefore valid.

The court found that the transactions in question were not void, as they were entered into pursuant to a deed of company arrangement, which is a recognised process for restructuring a company's debt and affairs. The court emphasised that the deed was entered into before the winding up order, and the transactions were part of the process to implement the arrangement. Consequently, the court held that the transactions were not invalid merely because they occurred after the winding up order was made. The court further ordered that the matter be stood over for a further hearing to allow for further submissions and arguments on the matter.