Australian Securities and Investments Commission v Marco (No 16) (Special Purpose Appointment) - [2024] FCA 1000

FEDERAL COURT OF AUSTRALIA
Australian Securities and Investments Commission v Marco (No 16) (Special Purpose Appointment) [2024] FCA 1000

File numbers: WAD 481 of 2018
WAD 40 of 2024

Judgment of: FEUTRILL J

Date of judgment: 2 September 2024

Catchwords:
CORPORATIONS – application to appoint special purpose receivers to unregistered managed investment scheme and special purpose liquidators to scheme operator - special purpose to investigate and pursue claims of scheme members against third parties – consideration of applicable principles

CORPORATIONS – application for Court approval of special purpose receivers and special purpose liquidators entering into litigation funding agreement – application made before appointment – consideration of applicable principles

PRACTICE AND PROCEDURE – application for suppression and non-publication orders – confidential and commercially sensitive information – information subject to legal professional privilege – information disclosed to support appointment of special purpose receivers and managers and special purpose liquidators – information disclosed to support approval of officer of the Court entering into a litigation funding agreement

Legislation:
Corporations Act 2001 (Cth) ss 9, 20(1)(a), 57B, 420, 424, 459B, 461(1)(k), 467B, 477(2)(a)-(b), 477(2B), 511, 556(1)(a), 601ED, 601EE, 601EE(2), 1101B(8), 1324, 1325; Pts 5.4B, 5.6, 5.7B, 5.9

Insolvency Practice Schedule (Corporations) ss 5-30, 60-5, 60-10, 60-10(4), 60-12, 90-A, 90-15, 90-20; Sch 2

Federal Court of Australia Act 1976 (Cth) ss 23, 37AE, 37AF, 37AG, 37AH, 37AH(2), 37AJ, 37M, 51(2), 57(1)

Federal Court Rules 2011 (Cth) rr 1.32, 1.34, 1.35, 2.32(1)(b), 2.32(2), 2.32(3), 2.32(4), 14.24

Trustees Act 1962 (WA) s 92

Cases cited:
Aced Kang Investments Pty Ltd (in liq), in the matter of Aced Kang Investments Pty Ltd (in liq) [2017] FCA 476
Australian Securities and Investments Commission v Letten [2010] FCA 140
Australian Securities and Investments Commission v Letten (No 13) [2011] FCA 1151; 86 ACSR 174
Australian Securities and Investments Commission v Letten (No 22) [2014] FCA 681
Australian Securities and Investments Commission v Marco (No 9) [2021] FCA 1306; 399 ALR 735
Australian Securities and Investments Commission v Marco(No 13) [2023] FCA 83
Australian Securities and Investments Commission v Marco (No 15) [2024] FCA 347
Australian Securities and Investments Commission v Takaran (No 2) [2002] NSWSC 987; 43 ACSR 334
Australian Securities and Investments Commission v Tasman Investment Management Ltd [2006] NSWSC 943; 59 ACSR 113
Banning v Lean (No 3) [2019] WASCA 30; 54 WAR 259
Barnes v Addy (1874) LR 9 Ch App 244
Bastion v Gideon Investments Pty Ltd (in liq) [2000] NSWSC 939; 35 ACSR 466
Deputy Commissioner of Taxation, in the matter of Australian Managed Print Services (Vic) Pty Ltd (in liq) v Australian Managed Print Services (Vic) Pty Ltd (in liq) [2017] FCA 1172
Burt, Boulton and Hayward v Bull [1895] 1 QB 276
Farah Constructions Pty Limited v Say-Dee Pty Limited [2007] HCA 22; 230 CLR 89
Garden Mews-St Leonards Pty Ltd v Butler Pollnow Pty Ltd (1984) 9 ACLR 91
Hogan v Ma [2023] FCA 1383
Honest Remark Pty Ltd v Allstate Explorations NL [2006] NSWSC 735; 234 ALR 765
Hughes, in the matter of Sales Express Pty Ltd (in Liq) [2016] FCA 423
Hundy (liquidator), in the matter of 3 Property Group 13 Pty Ltd (in liquidation) (No 2) [2023] FCA 173
Hutchins, in the matter of Ardenberg Pty Ltd (in liq) (Administrators Appointed) (No 2) [2020] FCA 1424
In reGlasdir Copper Mines Ltd, English Electro-Metallurgical Company Ltd v Glasdir Copper Mines Ltd [1906] 1 Ch 365
Jones v Matrix Partners Pty Ltd [2018] FCAFC 40; 260 FCR 310
Kadam v MiiResorts Group 1 Pty Ltd (No 5); Securities and Exchange Board of India v MiiResorts Group 1 Pty Ltd [2018] FCA 1086; 129 ACSR 74
Letten v Templeton [2014] FCAFC 131; 02 ACSR 425
Lewis v Nortex Pty Ltd (In Liq) [2013] FCAFC 56; 211 FCR 483
McGrath & Anor Re HIH Insurance Ltd [2005] NSWSC 731
Moodemere Pty Ltd (in liq) v Waters [1988] VR 215; 5 ACLC 790
Newling v 77738930144 Pty Ltd (in liq) (formerly known as Commercial Indemnity Pty Limited) [2017] NSWSC 452
Nicholson Street Pty Ltd (receivers and managers appointed) (in liquidation) v Letten [2016] VSCA 157
Onefone Australia Pty Ltd v OneTel Ltd [2008] NSWSC 1335; 69 ACSR 290
Perth Fashion Festival Pty Ltd (in liq) v Fashion Council WA Ltd (in liq) [2022] WASC 210
Re Anglo-Moravian Hungarian Junction Railway Co (1875) 1 Ch D 130
Re AT Air Group Pty Ltd (in liq) [2012] NSWSC 1508
Re Substar Holdings Pty Ltd (in liq) [2020] FCA 1863; 149 ACSR 185
Reidy (atf PR Mining Superannuation Fund) v Contained Gold Pty Ltd (In Liq) [2020] FCA 268; 143 ACSR 260
Scarel Pty Ltd v City Loan & Credit Corporation Pty Ltd (1988) 79 ALR 483; 17 FCR 344
Venetian Nominees Pty Ltd v Conlan (1998) 17 ACLC 301
Westpac Banking Corp v ITS Taxation Services [2004] NSWSC 50; 183 FLR 273
Young v Murphy [1996] 1 VR 279

Division: General Division

Registry: Western Australia

National Practice Area: Commercial and Corporations

Sub-area: Corporations and Corporate Insolvency

Number of paragraphs: 107

Date of hearing: 4 July 2024

Counsel for Napoli Corporate Pty Ltd: Mr MCJ Hoffmann KC

Solicitor for Napoli Corporate Pty Ltd: Johnson Winter & Slattery

Counsel for the Liquidators and Receivers in WAD481/2018: Mr CA Dallimore

Solicitor for the Liquidators and Receivers in WAD481/2018: Ashurst Australia

ORDERS

WAD 481 of 2018

BETWEEN:
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

Plaintiff

AND:
CHRIS MARCO

First Defendant

AMS HOLDINGS (WA) PTY LTD (ACN 164 700 485)

Second Defendant

AMS HOLDINGS (WA) PTY LTD (ACN 164 700 485) AS TRUSTEE FOR AMS HOLDINGS TRUST (and another named in the Schedule)

Third Defendant

ORDER MADE BY:

FEUTRILL J

DATE OF ORDER:

2 SEPTEMBER 2024

THE COURT NOTES THAT:
A.The Court made orders in the proceeding relating to the winding up of the Scheme and appointment of the Receivers and Liquidators, as described in those orders, on 7 December 2020 (Winding Up Orders). The Winding Up Orders made provision for the Receivers to deliver up that part of the Property that is property of the Scheme to the Liquidators (Scheme Property).
B.The Court made orders in the proceeding relating to the pooling of parts of the Property as a single fund (described as the ‘Fund’) and for distribution of the Fund on 13 February 2023 and 9 March 2023 (Pooling and Distribution Orders).
C.Capitalised terms used in these orders are used in the same way and have the same meaning as in the Winding Up Orders and the Pooling and Distribution Orders.
D.Napoli Corporate Pty Ltd, the applicant of the interlocutory process filed 5 March 2024, has identified potential claims against Westpac Banking Corporation (ACN 007 457 141) in relation to alleged involvement in misappropriations of Scheme Property and (or) breaches of trust or fiduciary duty by the operators of the Scheme and (without limiting the foregoing) includes the claims the subject of the draft statement of claim that is confidential exhibit PPJB-1 to the affidavit of Paul Philipus Jacobus Buitendag sworn 5 July 2024 (Claims).

THE COURT ORDERS THAT:
Amendment
1.Napoli Corporate have leave to amend its interlocutory process filed 5 March 2024 in terms of the proposed amended interlocutory process dated 3 July 2024.

Appointment of additional receivers and liquidators for special purpose
2.Pursuant to s 601EE(2) of the Corporations Act 2001 (Cth) and s 23 of the Federal Court of Australia Act 1976 (Cth), Mr Jason Stone and Mr Glenn Franklin of PKF Melbourne be appointed special purpose receivers and managers of Scheme Property (SP Receivers) for the purpose of investigating, commencing, continuing and otherwise pursuing or taking steps to pursue the Claims against Westpac and against any other person who is or may be jointly liable with Westpac in respect of the Claims (Special Purpose).
3.Pursuant to s 90-15(1) of Schedule 2 – Insolvency Practice Schedule (Corporations) of the Corporations Act, Mr Stone and Mr Franklin be appointed special purpose liquidators of the second defendant, AMS Holdings (WA) Pty Ltd (ACN 164 700 485) (receivers and managers appointed) (in liquidation), for the Special Purpose (SP AMS Liquidators).
4.To the extent necessary, pursuant to s 532(2) of the Corporations Act, the SP AMS Liquidators have leave to be appointed as liquidators of AMS notwithstanding their appointment as receivers and managers of Scheme Property that may include ‘property of the company’ within the meaning of s 9 of the Corporations Act.

Powers for special purpose
5.Paragraph 17 of the Winding Up Orders applies to the appointment of the SP Receivers as if the Scheme were a ‘company’ or ‘corporation’ and as if they were appointed special purpose liquidators of that company or corporation and, for the avoidance of doubt, the SP Receivers have the powers of the Liquidators described in paragraphs 17(b) and 17(c) of the Winding Up Orders for the Special Purpose.
6.If and to the extent power is not conferred under paragraph 5 of these orders and (or) the Corporations Act, pursuant to s 601EE(2) of the Corporations Act, s 23 of the Federal Court Act and s 90-15(1) of the IPSC, the SP Receivers and SP AMS Liquidators may bring legal proceedings in respect of the Claims against Westpac and any other person who is or may be jointly liable with Westpac in the names and on behalf of the second defendant (AMS) and third defendant (AMS as trustee of the AMS Holdings Trust) and members of the Scheme.
7.If and to the extent power is not conferred under paragraph 5 and 6 of these orders, the SP Receivers have:
(a)the power to do all things necessary or convenient to be done, in Australia and elsewhere, for or in connection with, or as incidental to the attainment of the objectives for which the SP Receivers are appointed including, without limitation, for the identification, preservation and securing of all of the Special Purpose Property for the benefit of creditors of AMS and members of the Scheme;
(b)the powers set out in section 420 of the Corporations Act provided that wherever in that section the word ‘corporation’ appears, it shall be taken to refer to the Scheme; and
(c)the power to require, by request in writing, the first defendant and any employee, agent, banker, solicitor, stockbroker, accountant, consultant or other professionally qualified person who has provided services or advice to the first defendant, the second defendant or the third defendant to provide such reasonable assistance (including access to any documents, books or records to which the first defendant has a right of access or control) to the SP Receivers as may be required from time to time.

8.The powers conferred on the SP Receivers and SP AMS Liquidators under paragraphs 5, 6 and 7 of these orders shall not in any way derogate from or affect the conferral of powers upon the Receivers or the Liquidators pursuant to the Winding Up Orders.
9.The Receivers and the Liquidators be directed to provide such assistance, documents, and information to the SP Receivers and SP AMS Liquidators as is reasonably required by the SP Receivers and SP AMS Liquidators to pursue and achieve the Special Purpose, subject to the payment by the SP Receivers and SP AMS Liquidators of any reasonable expenses or remuneration incurred by the Receivers or the Liquidators
10.Where the SP Receivers and SP AMS Liquidators request the reasonable assistance of the Receivers and Liquidators pursuant to paragraph 9 of these orders:
(a)such reasonable assistance is to be requested by the SP Receivers and SP AMS Liquidators in writing;
(b)within 5 days of receipt of a written request for reasonable assistance, the Receivers or the Liquidators (as relevant) must provide the SP Receivers and SP AMS Liquidators with an estimate of the reasonable expenses or remuneration to be incurred by the Receivers or the Liquidators in responding to the request for review and any agreement by the SP Receivers and SP AMS Liquidators;
(c)the Receivers and the Liquidators have no obligation to provide the requested assistance unless the SP Receivers and SP AMS Liquidators agree to pay or cause to be paid the Receivers’ or Liquidators’ estimated expenses and remuneration; and
(d)the SP Receivers and SP AMS Liquidators are not obliged to pay the Receivers or the Liquidators any amount in respect of expenses or remuneration that was not previously agreed to in writing by the SP Receivers and SP AMS Liquidators.

Remuneration and indemnity for special purpose
11.The SP Receivers shall be entitled to reasonable remuneration for necessary work properly performed together with all reasonable costs, expenses and disbursements properly incurred in the performance of their duties arising in connection with their appointment and in the exercise of their powers as may be approved by the Court on the application of the SP Receivers.
12.The SP Receivers’ remuneration be calculated on the basis of time reasonably spent by them and any partner or employee of the firm to which the SP Receivers are attached, at the standard rates of the SP Receivers’ firm from time to time for work of that nature.
13.The SP Receivers’ and SP AMS Liquidators’ remuneration and costs, expenses and disbursements are to be paid out of property recovered or other recoveries made from the Claims (Special Purpose Property) and not from any other Scheme Property, property of AMS or the Fund.
14.The SP Receivers and SP AMS Liquidators be indemnified from the Special Purpose Property against any claim, liability, proceedings, cost, charge or expense howsoever arising and whether past, present of future, fixed or ascertained, actual or contingent, known (actually or contingently) or unknown which they may incur or be subject to as a result of or in connection with their appointment.
15.Paragraphs 13 and 14 of these orders are not to affect the rights of any prior encumbrances over the Special Purpose Property, including any rights of any secured creditor.
16.For the avoidance of doubt, the entitlement of the SP Receivers and SP AMS Liquidators to be paid or indemnified from the Special Purpose Property in accordance with paragraphs 13 to 15 of these orders is not restricted or in any way limited by whether they are acting as special purpose receivers and managers of the Scheme or as special purpose liquidators of AMS and they are entitled to treat the Special Purpose Property as a single combined pool of assets for those purposes.

Confidentiality orders
17.Pursuant to s 37AF of the Federal Court Act, and on the ground that it is necessary to prevent prejudice to the proper administration of justice, there be no publication or other disclosure, until further order, of the following documents filed in the proceeding:
(1)Confidential Exhibits “PPJB-1”, “PPJB-13”, “PPJB-14”, “PPJB-15” to the affidavit of Mr Buitendag sworn 2 July 2024;
(2)written submissions filed by Napoli Corporate or by the Receivers and the Liquidators concerning the interlocutory process filed on 5 March 2024, as amended, and (or) the originating process filed in WAD 40 of 2024; and
(3)supplementary written submissions filed by Napoli Corporate or by the Receivers and the Liquidators concerning the draft amended interlocutory process exhibited to the affidavit of Mr Buitendag sworn 3 July 2024 and filed in proceeding WAD 481 of 2018 and the originating process in proceeding WAD 40 of 2024.

other than to:
(a)Napoli Corporate and its legal representatives;
(b)CHC Investment Fund III Pty Ltd (by its officers, employees, servants and agents);
(c)Mr Stone and Mr Franklin;
(d)the Australian Securities and Investments Commission;
(e)Mr Robert Michael Kirman and Mr Robert Conry Brauer of McGrathNicol;
(f)any person who is the administrative or other support staff of a person referred to in the previous sub-paragraphs;
(g)any other person who has obtained the prior written consent of Napoli Corporate; and
(h)all necessary staff of the Court including any associate, any orderly and any court recording officer.

18.The Registrar be directed to mark the documents referred to in paragraph 17(1) to 17(3) as confidential on the Court file.
19.Pursuant to s 37AI of the Federal Court Act, until 4.30pm (AWST) on 16 September 2024 the transcript of the hearing on 4 July 2024, the reasons for these orders and the orders made in proceeding WAD 40 of 2024 and any document filed in accordance with paragraph 20 of these orders, not be disclosed or published other than to the persons referred to in sub-paragraphs 17(a) to 17(h).
20.By 4.30pm (AWST) on 9 September 2024 Napoli Corporate file and serve any minute of proposed orders for making suppression and (or) non-publication orders with respect to the transcript or reasons together with a copy of the relevant part(s) of the transcript and (or) reasons highlighted to identify the part(s) it is contended, if disclosed or published, would reveal confidential information that is the subject of the suppression and non-publication order made in paragraph 17 of these orders and in paragraph 4 of the orders made in proceeding WAD 40 of 2024.

Costs
21.Napoli Corporate’s costs of its interlocutory process filed 5 March 2024, as amended, be paid out of any Special Purpose Property.

Undertaking
22.The operation of paragraphs 2 to 16 and 21 of these orders is subject to and conditional upon Mr Stone and Mr Franklin of PKF Melbourne providing a written undertaking to the Court to the effect that they will not seek payment of any remuneration for work performed, or reimbursement for any costs, expenses or disbursements incurred, as SP Receivers and (or) SP AMS Liquidators, including costs, expenses or disbursements incurred through operation of paragraphs 9 and 10 of these orders, from any Scheme Property, property of AMS or the Fund other than the Special Purpose Property.

Miscellaneous
23.The SP Receivers and SP AMS Liquidators and all other interested parties have liberty to apply on short notice to set aside or vary these orders or for further or other order or directions.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
ORDERS

WAD 40 of 2024

IN THE MATTER OF NAPOLI CORPORATE PTY LTD ACN 612 470 970

BETWEEN:
NAPOLI CORPORATE PTY LTD ACN 612 470 970

First Applicant

JASON STONE
Second Applicant

GLENN FRANKLIN
Third Applicant

ORDER MADE BY:

FEUTRILL J

DATE OF ORDER:

2 SEPTEMBER 2024

THE COURT ORDERS THAT:
1.The proceeding be taken to have been commenced on 2 September 2024.
2.The amended originating process lodged on 3 July 2024 be the originating process in the proceeding.
3.All affidavits and other documents lodged with the Court in respect of the proceeding be taken to have been filed on 2 September 2024.
4.Pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth), and on the ground that it is necessary to prevent prejudice to the proper administration of justice, there be no publication or other disclosure, until further order, of the following documents filed in the proceeding:
(1)Confidential affidavits of Mr Paul Philipus Jacobus Buitendag sworn 5 March 2024, 16 April 2024 and 2 July 2024 and Ms Michelle Clare Silvers sworn 2 July 2024;

(2)written submissions or supplementary written submissions of the applicants in support of the orders sought in the originating process in this proceeding or the interlocutory process for appointment of special purpose receivers and liquidators filed in proceeding WAD 481 of 2018,

other than to:
(a)Napoli Corporate and Mr Jason Stone and Mr Glenn Franklin (applicants) and their legal representatives;
(b)CHC Investment Fund Ill Pty Ltd (by its officers, employees, servants and agents);
(c)the Australian Securities and Investments Commission;
(d)Mr Robert Michael Kirman and Mr Robert Conry Brauer of McGrath Nicol;
(e)any person who is the administrative or other support staff of a person referred to in the previous sub-paragraphs;
(f)any other person who has obtained the prior written consent of the applicants; and
(g)all necessary staff of the Court including any associate, any orderly and any Court recording officer.

5.Paragraphs 2, 3, 4, 6 and 7 of the relief sought in the originating process be stood over and re-listed for further hearing on a date to be fixed.
6.Costs be reserved.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT
FEUTRILL J:
INTRODUCTION

On 7 December 2020 the Court made orders with respect to an unregistered managed investment scheme operated by the first defendant (Mr Marco), the second defendant (AMS Holdings (WA) Pty Ltd) and the third defendant (AMS as trustee for AMS Holdings Trust) and described as the Scheme referred to in the preamble to those orders. The orders made provision for the appointment of Mr Robert Michael Kirman and Mr Robert Conry Brauer of McGrathNicol as joint and several receivers and managers of all property of Mr Marco, AMS and AMS Holdings Trust and the Scheme (Receivers). The orders also made provision for the winding up of AMS and the Scheme and the appointment of Mr Kirman and Mr Brauer as liquidators of AMS and the Scheme (Liquidators).
Napoli Corporate Pty Ltd applies for orders for the appointment of Jason Stone and Glenn Franklin of PKF Melbourne as special purpose receivers and managers of the property of the Scheme and as joint and several special purpose liquidators of AMS for the purpose of investigating and potentially bringing proceedings against Westpac Banking Corporation (ACN 007 457 141) and others for alleged involvement in breaches of trust or fiduciary duties. Separately, Napoli Corporate (as first applicant) and Mr Stone and Mr Franklin (as second applicants) have applied for orders to approve a proposed litigation funding agreement between Napoli Corporate, Mr Stone and Mr Franklin, Johnson Winter & Slattery, AMS and CHC Investment Fund III Pty Ltd.
For the reasons that follow, subject to Mr Stone and Mr Franklin giving certain undertakings to the Court relating to payment of their remuneration and expenses, orders will be made to appoint them as special purpose receivers and managers and special purpose liquidators, but will not, at present, be made to approve the proposed funding agreement. Orders will also be made for suppression and non-disclosure of the certain confidential exhibits and confidential affidavits filed, read and relied upon in the proceedings. In relation to the transcript of the hearing, I will make interim orders to prevent disclosure or publication of the transcript and these reasons, but subject to redaction of all confidential information I intend to make them available to the public. I will hear the parties on the questions of redaction and form of final orders.
THE APPLICATIONS
As already mentioned, there are two applications before the Court. The first is an interlocutory application of Napoli Corporate made in proceeding WAD 481 of 2018 for the appointment of Mr Stone and Mr Franklin as special purpose receivers and managers and liquidators. That is the proceeding in which orders were made to wind up the Scheme and AMS and to appoint the Receivers and Liquidators. The second is an originating process in proceeding WAD 40 of 2024. In that proceeding Napoli Corporate is the first applicant and Mr Stone and Mr Franklin, purportedly in their capacities as joint and several special purpose receivers and managers of the property of the Scheme and as joint and several special purpose liquidators of AMS, are the second applicants. That application, in substance, is for approval for Mr Stone and Mr Franklin to enter into a funding agreement to which AMS would be a party.
WAD 481 of 2018
The power to appoint an additional liquidator, referred to as a special purpose liquidator, to a company in liquidation is derived from s 90-15 of Sch 2 – Insolvency Practice Schedule (Corporations) of the Corporations Act 2001 (Cth). Section 90-15(1) confers power on the Court to make such orders as it thinks fit in relation to the external administration of a company. That power may be exercised on an application under s 90-20. Section 90-20 provides that a person with a financial interest in the external administration of the company may apply for an order under s 90-15. A person has a financial interest in a company if that person is a creditor of the company: s 5-30. For reasons given later, I accept that Napoli Corporate is a contingent creditor of AMS.
The power to appoint an additional receiver and manager is derived from s 601EE of the Act or s 23 of the Federal Court of Australia Act 1976 (Cth). Section 601EE(2) provides that the Court may make any orders it considers appropriate for the winding up of the Scheme. Section 23 of the Federal Court Act confers a broad discretionary power on the Court to make orders of such kinds as it thinks appropriate. There is little doubt that a member of the Scheme has a sufficient interest to apply for orders to be made under s 601EE(2) of the Act or s 23 of the Federal Court Act in the circumstances of this case. I also accept that Napoli Corporate is a Scheme member.
In WAD 481 of 2018, Napoli Corporate moves for orders to be made in terms of a short minute of orders filed on 3 July 2024. These orders are based on an amended interlocutory application also filed on 3 July 2024. To the extent necessary, leave will be granted for Napoli Corporate to amend the appointment application in terms of that document.
In support of the appointment application, Napoli Corporate also read and relies on affidavits of Paul Philipus Jacobus Buitendag sworn 5 March 2024, 19 March 2024 and 2 July 2024 and an affidavit of Charlie Sam Napoli sworn 2 July 2024. Napoli Corporate applies for orders for suppression and non-publication of exhibits PPJB-1, PPJB-13, PPJB-14 and PPJB-15 of Mr Buitendag’s affidavit of 5 March 2024. Additionally, Napoli Corporate expressly relies on a confidential affidavit of Mr Buitendag sworn 5 March 2024 in proceeding WAD 40 of 2024 referred to later. As that confidential affidavit was re-sworn on 16 April 2024, I take it that Napoli Corporate relies on that affidavit. Further, it is implicit, if not explicit, that Napoli Corporate relies on all affidavits read and relied upon in proceeding WAD 40 of 2024 to the extent that these are relevant to the questions before the Court on the appointment application. The application, as amended, and short minute of orders also seeks suppression and non-publication orders to be made in respect of confidential exhibits and other documents filed in the proceedings.
WAD 40 of 2024
Relevantly, s 477(2B) of the Act provides that except with approval of the Court, a liquidator of a company must not enter into an agreement on the company’s behalf if, in substance, the term of the agreement may end or the obligations of a party to the agreement, may according to its terms, be discharged by performance, more than three months after the agreement is made. Having regard to the terms of the proposed funding agreement, approval of the Court is necessary under s 477(2B) before a liquidator of AMS can enter into that agreement.
Insofar as a receiver and manager of the property of the Scheme is concerned, the Court has power to give directions to that person under s 601EE(2). I addressed the nature of the power to give directions to a liquidator in Australian Securities Investments Commission v Marco (No 13) [2023] FCA 83 at [28]-[29] as it applied to the Liquidators, as liquidators of AMS and the Scheme. A similar power exists under s 23 of the Federal Court Act and, where a trustee of trust property is concerned, s 92 of the Trustees Act 1962 (WA): Marco (No 13) at [34]-[35]. The effect of a direction, if made, is that provided the liquidator (or, here receiver and manager) has made full and fair disclosure to the Court of the material facts, that person will be protected from liability for any alleged breach of duty to a Scheme member in respect of anything done in accordance with the direction.
In this case, the December 2020 orders made under s 601EE(2) make Pts 5.4B, 5.6, 5.7B and 5.9 of the Act, including s 477(2B), applicable to the winding up of the Scheme. Therefore, in point of detail, approval of the Court is also necessary for a liquidator of the Scheme to enter into the proposed funding agreement. As explained later in these reasons, although Mr Stone and Mr Franklin will be appointed receivers and managers of property of the Scheme, the label is not as important as the powers conferred on their office. These powers are equivalent to those of the Liquidators, therefore I consider them to be, in substance, also special purpose liquidators of the Scheme and bound by the December 2020 orders.
In WAD 40 of 2024 the applicants move for orders in terms of a short minute of order dated 3 July 2024. These orders are based on an amended originating process also dated 3 July 2024. The applicants read and relied on affidavits of Mr Stone sworn 5 March 2024, Mr Napoli sworn 6 March 2024, Mr Buitendag sworn 19 March 2024 and confidential affidavits of Mr Buitendag sworn 16 April 2024 and 2 July 2024 and Michelle Clare Silvers sworn 2 July 2024. The applicants also apply for orders for suppression and non-publication of the confidential affidavits. The relevant proposed funding agreement is a confidential exhibit to Ms Silver’s affidavit.
Procedural matters
The applications were initially listed for hearing on 19 April 2024. At that hearing it became evident that insufficient notice of the application for suppression and non-publication orders had been given for the purpose of s 37AH of the Federal Court Act to be met. It was also apparent that there were legal and factual aspects of the applications that were not straightforward and that the Court would be assisted by written submissions. Therefore, the application was adjourned and orders made to address these matters.
The applicants filed written submissions on 10 May 2024. After receiving those submissions, the Court listed the applications for final hearing on 19 June 2024 and requested that the applicants be in a position to address certain matters arising from the materials and the written submissions. At the request of Napoli Corporate, the final hearing was vacated and re-listed on 4 July 2024. On 3 July 2024 Napoli Corporate then lodged amended applications, further affidavits, short minutes of requested orders and further written submissions. The amendments and further materials addressed the matters the Court had raised.
Normally an application for approval of entry into an agreement under s 477(2B) is made by the liquidator of the company which is proposing to enter into the agreement. In this case, the approval application is made by Napoli Corporate, a creditor of AMS, and Mr Stone and Mr Franklin, neither of whom, at the time the approval proceeding was commenced, had been appointed special purpose liquidators of AMS. These matters self-evidently raise the question of standing of the applicants in the approval proceedings and the question of whether the proceeding is inchoate or premature as the appointed Liquidators of AMS made no application for approval.
As to the question of standing, there is no reason in principle or practice that Napoli Corporate, as a creditor of AMS, would not have standing to apply ‘after the additional Liquidator had been appointed and in circumstances that he or she had reached a decision to enter into [the agreement]’: Re AT Air Group Pty Ltd (in liq) [2012] NSWSC 1508 at [22] (Black J). Mr Stone and Mr Franklin would also clearly have standing to apply after their appointment as additional liquidators of AMS. However, there is clear authority that approval of an agreement under s 477(2B) cannot be sought before the appointment of a special purpose liquidator: Venetian Nominees Pty Ltd v Conlan (1998) 17 ACLC 301; Re AT Air Group at [22] (Black J); Newling v 77738930144 Pty Ltd (in liq) (formerly known as Commercial Indemnity Pty Ltd) [2017] NSWSC 452 at [24] (Gleeson JA); Reidy (atf PR Mining Superannuation Fund) v Contained Gold Pty Ltd (In Liq) [2020] FCA 268; 143 ACSR 260 at [51]-[52] (Jackson J).
The applicants recognise that the approval proceeding was premature (that is, inchoate) at the time it was commenced. They submit that prematurity is an irregularity and seek an order under s 51(2) of the Federal Court Act to declare the proceeding not invalid by reason of that defect. I am not convinced that prematurity is an irregularity of the kind that may be cured under s 51(2), but, as I indicated at the hearing on 4 July 2024, I intend to approach the question pragmatically and with an eye to s 37M of the Federal Court Act.
Relevantly, the Court has power to make any order that it considers appropriate in the interests of justice, may dispense with compliance with the Rules, and may make orders inconsistent with the Rules: rr 1.32, 1.34, 1.35 of the Federal Court Rules 2011 (Cth). Napoli Corporate, Mr Stone and Mr Franklin have plainly sought to invoke the jurisdiction of the Court to approve an agreement under s 477(2B) of the Corporations Act, subject to an order appointing special purpose liquidators to AMS. In substance, I received the affidavit evidence filed in the approval proceeding as evidence relevant to and in the appointment application and I permitted the proposed applicants in the approval proceeding to make submissions regarding approval of the proposed funding agreement contingent on the appointment of special purpose receivers and managers and liquidators. In those circumstances, I will treat the amended originating process dated 3 July 2024, as filed and regularly commenced proceedings at the time orders are made for the appointment of Mr Stone and Mr Franklin as special purpose receivers and managers and liquidators. I will treat the submissions and affidavits filed and relied on in the approval proceeding as also received at that time. This is a similar approach to that taken by Gleeson JA in Newling. In these circumstances, there is now no point of procedure or practice that would prevent the Court making orders on the approval application at or shortly after an order appointing special purpose receivers and liquidators. Nonetheless, for reasons given later, I am not prepared to make orders approving the proposed funding agreement at this time.
Notice to interested parties
The appointment application and the initial affidavits in support appear to have been served on the Australian Securities and Investments Commission, CHC IF III, Mr Stone and Mr Franklin and the Receivers and Liquidators. The materials except the confidential affidavit and exhibits were also served on Mr Marco’s trustee in bankruptcy. The approval application and initial affidavits in support appear to have been served on ASIC, CHC IF III and the Receivers and Liquidators. Except for the Receivers and Liquidators, none of the interested parties served with the materials appeared on the applications.
Orders of the Court made on 19 April 2024 also made provision for interested parties who wish to be heard on the applications for suppression or non-publication orders to file and serve a notice to that effect. No notice of that nature has been filed.
The Receivers and Liquidators appeared at the hearing on 4 July 2024 but made no substantive submissions. They neither consent nor oppose the orders sought. I take that into account.
BACKGROUND
The background to the matter has been described in a number of previous judgments of the Court and need not be restated. In short, Mr Marco was an operator of the Scheme and AMS was a company of which Mr Marco was director and sole shareholder. AMS was also an operator of the Scheme and was a trustee of the AMS Holdings Trust and, in its trustee capacity, was also an operator of the Scheme.
The Scheme was an unregistered managed investment scheme. Promised returns to existing Scheme members were paid out of funds deposited by new Scheme members. The funds deposited were not used for the investment purposes as represented and were mixed with the funds of other Scheme members, AMS and Mr Marco. Such funds as were invested made little or no returns. Certain of the funds deposited were appropriated to the use of Mr Marco and members of his family and AMS, as trustee. The Scheme was insolvent. Such property of AMS, AMS as trustee, and the Scheme as remained at the time of appointment of the Receivers and Liquidators was deficient and insufficient to repay Scheme members the funds that they had contributed.
Winding up orders
On 7 December 2020 McKerracher J made orders pursuant to s 601EE of the Act to wind up the Scheme and made orders pursuant to ss 467B, 459B, 461(1)(k) of the Act to wind up AMS. Justice McKerracher also made a number of orders to facilitate the winding up of the Scheme and AMS including the appointment of the Receivers and Liquidators.
Relevantly, orders were made in the following terms:
Receivership appointment orders
1.Pursuant to section 1101B(1) of the Corporations Act, Mr Robert Michael Kirman and Mr Robert Conry Brauer of McGrathNicol, Level 19, 2 The Esplanade, Perth, Western Australia, be appointed as joint and several receivers and managers (Receivers), without security, of all property (as defined in the Corporations Act), whether within or outside the State of Western Australia, of:
(a)the first defendant and second defendant;
(b)the third defendant immediately prior to the appointment of voluntary administrators to the third defendant; and
(c)the Scheme,
together, the Property.
…
3.The Receivers have the following powers:
(a)the power to do all things necessary or convenient to be done, in Australia and elsewhere, for or in connection with, or as incidental to the attainment of the objectives for which the Receivers are appointed including, without limitation, for the identification, preservation and securing of all of the Property for the benefit of creditors;
(b)the powers under section 1101B(8) of the Corporations Act;
(c)the powers set out in section 420 of the Corporations Act provided that wherever in that section the word ‘corporation’ appears, it shall be taken to refer to the first defendant, the second defendant, the third defendant and the Scheme; and
(d)the power to require, by request in writing, the first defendant and any employee, agent, banker, solicitor, stockbroker, accountant, consultant or other professionally qualified person who has provided services or advice to the first defendant, the second defendant or the third defendant to provide such reasonable assistance (including access to any documents, books or records to which the first defendant has a right of access or control) to the Receivers as may be required from time to time.
…
Wind[ing] up orders
12.Pursuant to section 601EE(2) of the Corporations Act, the Scheme be wound up.
13.Pursuant to sections 467B, 459B and 461(1)(k) of the Corporations Act, AMS Holdings (WA) Pty Ltd (ACN 164 700 485) be wound up.
14.If and to the extent required, pursuant to section 532 of the Corporations Act, leave be granted for Mr Kirman and Mr Brauer be appointed as joint and several liquidators (the Liquidators) of:
(a)the Scheme; and
(b)AMS Holdings (WA) Pty Ltd (ACN 164 700 485).
…
17.Pursuant to section 601EE(2) of the Corporations Act, and subject to any further orders of the Court:
(a)the winding up of the Scheme be conducted as if the Scheme were a ‘company’ or ‘corporation’ for the purposes of the Corporations Act and the provisions of Parts 5.4B, 5.6, 5.7B and 5.9 of the Corporations Act and Schedule 2 to the Corporations Act (Insolvency Practice Schedule (Corporations)) applied to the winding up (with such modifications as are reasonably necessary in the circumstances);
(b)the Liquidators of the Scheme have power to do, in Australia and elsewhere, all things necessary or convenient to be done for or in connection with the winding up of the Scheme, or incidental to the attainment of the winding up of the Scheme, including the functions and powers set out in Chapter 5 of the Corporations Act (as applicable) as if each reference there to a ‘company’ or ‘corporation’ was a reference to the Scheme (with such modifications as are reasonably necessary in the circumstances); and
(c)without limiting the above, the Liquidators of the Scheme shall have the power to investigate or cause to be investigated any deficiency in the Scheme and to exercise the powers under Part 5.9 Division 1 of the Corporations Act as if the Scheme were a ‘corporation’ being wound up.
…
Pooling and distribution orders

Subsequently, the Receivers and Liquidators applied for various orders and directions relating to the winding up of AMS and the Scheme and distribution of the assets and property of Mr Marco, AMS and the Scheme considered to be property of the Scheme. On 13 February 2023 I made a number of orders on that application.
Relevantly, I ordered that the Liquidators would be acting properly and are justified in: (a) treating the proceeds of realisation of certain property held in the name of Mr Marco as if and on the basis that they are assets and property of the Scheme; (b) treating all of the assets and property of AMS, whether held legally or beneficially, as if and on the basis that they are assets and property of the Scheme; and (c) treating a certain debt payable by AMS to Mr Marco as if and on the basis that it is extinguished.
I also made orders that the Liquidators would be acting properly and are justified in treating the proceeds and the realisation of the assets and property of the Scheme and AMS, whether held legally or beneficially, held by them as if and on the basis that they comprise a single fund (the Fund) and applying and distributing the Fund in accordance with certain priorities with the balance payable to Scheme members in accordance with a distribution method to be the subject of further directions of the Court. The priorities included the discharge of the known outstanding debts or liabilities of AMS (that is, debts due to creditors of AMS). On 9 March 2023 I made orders dealing with the method of distribution of the Fund to the Scheme members.
Investigation of potential claims against third parties
In the meantime, in November 2020, JWS were engaged by Mr Napoli, the sole director and shareholder of Napoli Corporate, to investigate potential claims to recover losses suffered by Napoli Corporate and others that had invested in AMS and (or) the Scheme. The nature of the investigations is described in the confidential affidavit of Mr Buitendag sworn 16 April 2024.
Notwithstanding that suppression and non-publication orders will be made in respect of the confidential affidavits and confidential exhibits, having regard to s 37AE of the Federal Court Act, certain confidential aspects of the confidential affidavits may be published without disclosing confidential information that is subject to legal professional privilege or that is commercially sensitive. The description of the background facts in paras [31]-[46] and the terms of the proposed funding agreement in paras [50]-[59] are taken, in part, from the confidential affidavits and confidential exhibits and, in part, from non-confidential affidavits and information that will otherwise be disclosed upon publication of the orders. The description is necessary to explain the reasons that I am satisfied that orders for the appointment of special purpose receivers and managers and liquidators should be made and, otherwise, that I would be prepared to make orders approving the special purpose receivers and managers and liquidators entering into a funding agreement in the terms of one of the exhibits to Ms Silvers’ confidential affidavit.
JWS instructed an independent expert and a report was obtained in October 2021. The instructions and report are confidential exhibits PPJB-1 and PPJB-2 to Mr Buitendag’s confidential affidavit of 16 April 2024.
In November 2021 JWS and Napoli Corporate entered into a due diligence funding agreement with a litigation funder based overseas. That funder subsequently withdrew from the Australian market but entered into a co-funding agreement with another litigation funder based in Australia. Napoli Corporate was provided with a commitment for co-funding of litigation on certain terms.
Counsel was instructed, advice given, and a draft statement of claim prepared in September 2022. These are confidential exhibits PPJB-4 and PPJB-5 to Mr Buitendag’s confidential affidavit of 16 April 2024. In September 2022 JWS also began communications with the Receivers and Liquidators in relation to investigating potential claims against certain parties. In March 2023 JWS requested the Liquidators to indicate if they would be prepared to participate in potential litigation on the co-funding terms. In April 2023 the Liquidators responded that they were not in a position to participate on those terms.
In the meantime, during March 2023, Mr Stone and Mr Franklin had confirmed that they would be willing to act as special purpose liquidators of AMS on the co-funding terms. Later, Mr Stone and Mr Franklin indicated that they were willing to be appointed as special purpose receivers and managers of the Scheme (SP Receivers) and special purpose liquidators of AMS (SP AMS Liquidators) on those terms.
Ultimately the co-funding proposal between the litigation funders was not completed. Thereafter, JWS commenced negotiations with Court House Capital Pty Ltd. That resulted in CHC IF III entering into a funding agreement dated 1 November 2023. That agreement is confidential exhibit PPJB-16 to Mr Buitendag’s confidential affidavit of 16 April 2024.
In December 2023 another counsel was instructed. Thereafter, advice was given and a draft statement of claim prepared in January 2024. These are confidential exhibits PPJB-6 and PPJB‑3 to Mr Buitendag’s confidential affidavit of 16 April 2024. The draft statement of claim is also confidential exhibit PPJB-1 to the otherwise non-confidential affidavit of Mr Buitendag sworn 5 March 2024.
On 21 February 2024 the funding agreement was varied by an amended funding agreement. The amended agreement is confidential exhibit PPJB-17 to Mr Buitendag’s confidential affidavit of 16 April 2024. Napoli Corporate and Mr Stone and Mr Franklin initially requested that the Court approve that agreement under s 477(2B) of the Act. However, they no longer seek approval of that agreement.
Deficiency in Fund
Napoli Corporate has submitted a proof of debt to the Liquidators along with supporting materials that indicate that it contributed funds that have not been repaid and it is a Scheme member for the purposes of the winding up of the Scheme. Mr Napoli has communicated with various Scheme members (described as investors/creditors of the Scheme) and has discussed with them his engagement and instruction of JWS to investigate the possible recovery for Scheme members.
In March 2023 the Receivers and Liquidators published a circular to Scheme members regarding the declaration of first interim distribution to Scheme members in accordance with distribution methodology the subject of the February and March 2023 pooling and distribution orders.
In May 2023 the Liquidators paid the first interim dividend of $10 million to eligible Scheme members. In June 2023 the Liquidators informed Scheme members that, as at 2 June 2023, cash at bank was $5 million. Napoli Corporate has not received payment of a dividend from the Liquidators.
Mr Buitendag estimates that there is a principal amount of at least $87 million owing to Scheme members for capital contributions to the Scheme as at 29 June 2023. There is a shortfall of 74 cents in the dollar and there will remain a substantial shortfall without any further recoveries.
I accept that the Fund is deficient to a very significant extent and due to the priorities and distribution methodology many Scheme members may not receive any or any significant dividends from the winding up of the Scheme. Napoli Corporate may be a Scheme member in that category.
Standing of Napoli Corporate as a creditor of AMS
Napoli Corporate asserts that it is a creditor of AMS and, as such, has standing to apply under s 90-15 of the IPSC for the orders sought on its interlocutory application in WAD 481 of 2018 and its originating application in WAD 40 of 2024. The applicants have filed and read affidavits of Mr Buitendag and Mr Napoli in which evidence of Napoli Corporate’s contributions and shortfall in repayments is given. However, the difficulty with this affidavit material is that the extent to which Napoli Corporate has or would have a claim against AMS, as a creditor of AMS, is not clear. Napoli Corporate appears to have dealt with Mr Marco and deposited its funds into bank accounts under the control of Mr Marco. Therefore, while it is asserted that Napoli Corporate is a ‘creditor’ of AMS, there is little evidence in support of that assertion.
Nonetheless, for the purposes of this application I am prepared to accept that Napoli Corporate may have a personal equitable claim against AMS for compensation for loss caused by the involvement of AMS in the operation of the Scheme and dissipation of Scheme member’s contributions. Accordingly, I accept that Napoli Corporate may have a claim as a contingent creditor, properly so called, in the winding up of AMS.
Financial capacity of CHC IF III
A question that arises both on the appointment application and the approval application is the extent to which the Fund and other property of the Scheme is or may be exposed to the risk of adverse costs orders in any potential litigation that may be prosecuted for the benefit of Scheme members and creditors of AMS. Napoli Corporate has filed, read and relies on the confidential affidavit of Ms Silvers who is the Chief Executive Officer of Court House Capital which is the manager and controller of CHC IF III. Ms Silvers’ affidavit deposes facts that explain the manner in which the litigation funding business of Court House Capital operates and the capacity of CHC IF III to indemnify the claimant(s) in any litigation against any adverse costs orders and, also, to provide security for costs, if necessary. Based on the facts deposed in that affidavit, I am satisfied that the Fund is not exposed to any real risk of diminution due to adverse costs orders against the claimant in any potential litigation.
Ms Silvers also deposes that CHC IF III intends to execute a further amended funding agreement which is conditional upon the appointment of Mr Stone and Mr Franklin as special purpose receivers and managers and liquidators and on the Court approving that agreement under s 477(2B) of the Act. That proposed funding agreement is confidential exhibit MS-6. The terms of that proposed funding agreement also address certain of the matters the Court raised with respect to the earlier version of the funding agreement for which approval had originally been sought. It also includes the costs agreement for the lawyers to be engaged under the terms of the agreement which had been omitted from the earlier affidavit materials.
Remuneration and expenses of the SP Receivers and SP AMS Liquidators
A question that arose on the materials filed up to 10 May 2024 was the extent to which the Fund was exposed to claims by the SP Receivers and SP AMS Liquidators for payment of their remuneration and expenses. That issue has been addressed, in part, through modification of the orders sought on the appointment application.
In an affidavit of Mr Buitendag sworn 2 July 2024 he states, on information and belief, that Mr Stone and Mr Franklin will execute the proposed further amended funding agreement if appointed and if that agreement is approved. Further they will undertake to the Court that they will not seek to recover any costs or expenses incurred as special purpose receivers and managers and liquidators from the assets of the Scheme or AMS or for costs or expenses of the Receivers and Liquidators assisting them to be paid out of those assets and will only seek recover of such expenses under the terms of the proposed funding agreement.
For the reasons given later, an undertaking in those terms is not quite sufficient to remove the risk that the Fund may be available as a source of the remuneration and expenses, including legal costs. However, subject to the SP Receivers and SP AMS Liquidators giving an appropriate undertaking, I am satisfied that the Fund will not be exposed to that risk.
Terms of the proposed funding agreement
As the terms of the proposed further amended funding agreement (incorporating the lawyers’ costs agreement) are confidential and commercially sensitive and will be the subject of suppression and non-publication orders, these reasons do not describe or identify the express terms of that proposed agreement. However, it is necessary to explain, without disclosing the confidential information, the reasons that I am satisfied that an agreement in those terms should be approved under s 477(2B) of the Act.
In broad outline, the proposed funding agreement makes provision for funding the remuneration and expenses of the special purpose receivers and managers and liquidators including legal costs. In the event that litigation is commenced and prosecuted to resolution, then the funder will be entitled to recover certain funding costs from the resolution sum plus a premium based on the amount of the resolution sum. [REDACTED XXXXX XXXXX X XX XXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XX XXXX]
The amount of remuneration to which the SP Receivers and SP AMS Liquidators would be entitled under the proposed funding agreement is not entirely clear. [REDACTED XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXX XXX XXXX XXXX XXXX XXXX XXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX X] Otherwise, all remuneration appears to be subject to orders of the Court.
[REDACTED XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XX] The proposed funding agreement requires JWS to be appointed on the terms of lawyers’ costs agreement that forms part of the funding agreement. [REDACTED XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX]
[REDACTED XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXX XXX]
Having regard to the payments out of the resolution sum to which the funder, the SP Receivers and SP AMS Liquidators and lawyers would be entitled, a very significant portion of that sum would not become available for distribution amongst the Scheme members. Nonetheless, the cost recovery, premium and uplifts are not manifestly unreasonable and are in line with the terms of comparable arrangements that courts have approved in the context of class actions. However, I have some remaining reservations about the reasonableness of the uplift to which the SP Receivers and SP AMS Liquidators would be entitled even taking into account that they would be taking on a significant risk that will not recover all the remuneration to which they would otherwise be entitled for performing their functions for the special purpose.
Normally, liquidators are entitled to receive reasonable remuneration for necessary work properly performed in relation to the external administration. The Court may determine that remuneration: ss 60-5, 60-10, 60-12 of the IPSC. Where remuneration is worked out wholly or partly on a time-cost basis the determination must include a cap: s 60-10(4). The mechanism for determining the uplift to which the SP Receivers and SP AMS Liquidators would be entitled in the event of resolution is not directly linked to necessary work properly performed and, in effect, is not capped at a set amount. Depending on the amount of any resolution sum, the funding agreement may result in the SP Receivers and SP AMS Liquidators receiving excessive and unreasonable remuneration that does not reflect the value of the work performed or the risk assumed. As a safeguard against that outcome, any approval of a funding agreement in these terms should be conditional upon the Court ultimately determining the remuneration the SP Receivers and SP AMS Liquidators are entitled to receive out of any resolution sum.
I have a similar concern, but less so, in relation to the uplift in the lawyers’ costs agreement. However, legal fees are subject to separate regulation and taxation to keep them within reasonable limits. It may also be possible to review legal fees as costs, expenses and disbursements of the SP Receivers and SP AMS Liquidators should an interested party have concerns about the reasonableness of legal fees charged and payable in the future.
Viewing the SP Receivers and SP AMS Liquidators’ remuneration, costs, expenses and disbursements (including legal fees) as forming part of the ‘funding costs’ and ‘premium’ that will be recovered from any resolution sum, as matters stand, the combined ‘funding costs’ and ‘premium’ do not appear to be manifestly excessive or unreasonable. As already mentioned, funding wholly and performing professional services partly without any guaranteed return is a significant risk. Further, without the funding agreement the Scheme members have little or no prospect of further recovery. Moreover, the remuneration and expenses of the SP Receivers and SP AMS Liquidators and the legal fees of the lawyers, may be subject to a ‘second look’ and further court scrutiny if there is any concern about the reasonableness of these charges in the future.
The proposed funding agreement contains provisions that require the funder to be informed. It also contains a provision for the claimant(s) and SP Receivers and SP AMS Liquidators to direct, conduct and conclude any settlement save that no resolution by agreement of the funded litigation can be made without the written consent of the funder, but such consent cannot be unreasonably withheld. The proposed funding agreement has a dispute resolution mechanism for resolving disputes with the funder. On balance, I am satisfied that these provisions do not give the funder undue control over the conduct or settlement of any litigation that may be commenced.
Further developments
After the Court reserved its decision on 4 July 2024 it received an email communication from Mr Buitendag on 12 August 2024. The email attached yet another version of the funding agreement and a different version of the lawyers’ costs agreement by which JWS was replaced with HFW Australia. Also attached were notices of change of solicitors by which the address for service of Napoli Corporate and Mr Stone and Mr Franklin was changed to HFW Australia. These notices were accepted for filing on 12 August 2024.
No application has been made to re-open the hearing. No application has been made to amend the terms of the approval application. No affidavit has been filed dealing with Mr Stone’s and Mr Franklin’s willingness to enter into the most recent version of the funding agreement. No application has been made to amend the terms of the requisite suppression and non-publication orders to incorporate the most recent version of the funding agreement (including the lawyers’ cost agreement).
Having regard to these matters and the premature nature of the approval application to which reference has been made earlier, although I would be prepared to approve the proposed further amended funding agreement the subject of the application, I am not prepared to approve that agreement or the agreement submitted informally and without leave to the Court via email to my chambers in circumstances in which it is no longer clear what funding agreement is sought to be approved. However, subject to addressing matters of formality and appropriate notice to the Receivers and Liquidators, it may be possible to make orders on the papers without further oral hearing.
APPLICATION FOR THE APPOINTMENT OF SP RECEIVERS AND SP AMS LIQUIDATORS
Applicable principles
In Perth Fashion Festival Pty Ltd (in liq) v Fashion Council WA Ltd (in liq) [2022] WASC 210, in the context of an application for the appointment of special purpose liquidator, Solomon J recently considered and summarised principles applicable to the exercise of the power under s 90-15. I respectfully agree with and gratefully adopt his Honour’s following summary:
…
46.The provision is cast in very broad and unconstrained terms. Clause 90-15(3) is headed 'Examples of orders that may be made'. The examples include, at cl 90-15(3), an order that another registered liquidator be appointed as the external administrator of the company.
47.The principles that guided the power previously contained in s 511 continue to be relevant to the statutory power in cl 90-15, including the previously express requirement that the appointment of a special purpose liquidator must be 'just and beneficial'. That threshold requirement remains germane: GDK Projects Pty Ltd, Umberto Pty Ltd (in liq) v Umberto Pty Ltd (in liq) [[2018] FCA 541 [33] (GDK Projects)]; Lewis v Battery Mineral Resources [[2021] FCA 963; (2021) 156 ACSR 162 [81] - [82]].
48.The principles guiding the exercise of the power to appoint a special purpose liquidator have been considered in many cases. The relevant principles applicable to this application may be summarised as follows:
(a)it is necessary to identify with specificity the special purposes (or powers) for which the appointment of the special purpose liquidator is sought: Re Atlas Construction Group Pty Ltd (in liq) - Fitz Jersey Pty Ltd v Fraser [[2018] NSWSC 1189; (2018) 129 ACSR 238 [90] (Fitz Jersey)]; GDK Projects [[2]];
(b)a special purpose liquidator will not be appointed unless it would be just and beneficial to creditors. The power should not be exercised if the court cannot be satisfied that it would be just and unless the applicant had demonstrated sufficient utility to the external administration: GDK Projects [[33]]; Fitz Jersery [[91]]. That necessarily requires an applicant to demonstrate that the appointment for the specified special purposes could potentially lead to a recovery for the benefit of creditors: Lewis v Battery Mineral Resources [[121]];
(c)a common instance warranting the appointment of a special purpose liquidator is where it has been demonstrated that there are matters that require investigation with a view to possible recovery for creditors in circumstances where it is of utility and just for such matters to be investigated by a different liquidator such as where the current liquidator has insufficient access to funds, and a creditor is prepared to fund only another liquidator. It remains necessary to demonstrate sufficient utility in such a course: see Melham Pty Ltd, Boka Beverages Pty Ltd (in liq) v Boka Beverages Pty Ltd (in liq) [[2019] FCA 1184; (2019) 138 ACSR 95 [57] - [58]]; Shangri-La Construction Pty Ltd v GVE Hampton Pty Ltd (in liq) [[2021] VSC 161; (2021) 152 ACSR 19 [85] (Shangri-La Construction v GVE Hampton)];
(d)it is neither necessary nor appropriate to make findings regarding the potential claims in determining an application for the appointment of a special purpose liquidator: GDK Projects [[36]]; Deputy Commissioner of Taxation v Italian Prestige Jewellery Pty Ltd (in liq) [[2018] FCA 983; (2018) 129 ACSR 115 [37]]. However, an applicant for a special purpose liquidator must demonstrate a reasonable basis for the view that the matters identified warrant investigation and that there is sufficient evidence to support the possibility of an action being brought: Williams & Kersten Pty Ltd v Walton Construction (Qld) Pty Ltd (in liq), re Walton Construction (Qld) Pty Ltd (in liq) [[2019] FCA 1201 [21]]; and
(e)delay in bringing an application for the appointment of a special purpose liquidator weighs against the application and may be fatal: Lewis v Battery Mineral Resources [[129]].
…
50.How a proposed special purpose liquidator will be funded is a matter properly to be taken into account on an application seeking the appointment of a special purpose liquidator: Shangri-La Construction v GVE Hampton [[87]]. If a special purpose liquidator proposes to enter into a funding agreement, then the agreement will require approval of the court under s 477(2B) of the Act. The principles relevant to approval of a proposed funding agreement (which were summarised by Austin J in Re ACN 076 673 875 Ltd) [[2002] NSWSC 578; (2002) 42 ACSR 296], are also relevant to the application to appoint a special purpose liquidator: Re Jabiru Satellite Limited (in liq) v NewSat Limited (in liq) [[2022] NSWSC 459 [41]]. A liquidator, including a special purpose liquidator, may apply for such approval subsequent his or her appointment: see [Reidy ATF PR Mining Superannuation Fund v Contained Gold [2020] FCA 268; (2020) 143 ACSR 260 [45] (Reidy v Contained Gold) [51]].
51.It is not necessary to have the terms of any funding in place as a precondition of an application for the appointment of a special purpose liquidator. The court may approve the appointment without an understanding of the proposed funding arrangements or the specific terms of any such proposed arrangement, although a funding agreement may be disclosed, and its approval sought simultaneously, with the application for appointment.
52.It is therefore not strictly necessary for a funding agreement to be disclosed and approved for the court to be moved to appoint a special purpose liquidator. However, in my view, in circumstances where there is a likelihood or serious prospect that a funding agreement will be required and sought, and the terms of that arrangement are undisclosed or not known at the time of the application for appointment, it may be more difficult for the court to be satisfied of the utility of the appointment. That difficultly is likely to be more acute if the potential recovery is modest.
(Emphasis in original.)

Brereton J described the function of a special purpose liquidator in a winding up vis-à-vis the appointed liquidator in Honest Remark Pty Ltd v Allstate Explorations NL [2006] NSWSC 735; 234 ALR 765 as follows:
61A special purpose liquidator is appointed to co-exist with the existing liquidators, to fulfil a specific purpose which would otherwise form part of the responsibilities of the original liquidator, but which is carved out from those usual responsibilities because of difficulties in the original liquidator performing it. Because the investigation of the conduct of a liquidator is not part of the matters entrusted to a liquidator, but a supervisory function of the court, an investigation by one of several liquidators into the conduct of another in the liquidation does not involve carving out of the liquidation a part of the ordinary responsibilities of the liquidator. To the contrary, it involves circumventing the ordinary and proper procedures for supervision of liquidators, and the protections that attend them.
…
102Where the court appoints a special purpose liquidator or administrator, it excises from the general administration an aspect that would otherwise fall within the responsibility of the original administrators, and entrusts that aspect of the administration to the special purpose administrator.
In contrast to winding up of a company, there is no statutory scheme for winding up an unregistered managed investment scheme. A managed investment scheme (whether registered or unregistered) is not a body corporate or a company. The provisions of Parts 5.2 – 5.9 of the Act and the IPSC have no direct application to a managed investment scheme. Section 601EE(1) provides for the Court to make an order winding up an unregistered managed investment scheme. Section 601EE(2) confers a broad power on the Court to make any orders it considers appropriate for the winding up of the scheme. What orders are considered appropriate will depend on the nature of the unregistered managed investment scheme that is being wound up. As Austin J observed in Australian Securities and Investments Commission v Tasman Investment Management Ltd [2006] NSWSC 943; 59 ACSR 113 at [18]: ‘Care must be taken to avoid any unreflective application of company law ideas to enterprises organised as managed investment schemes, whether registered or unregistered.’ His Honour also observed that the nature of a winding up process depends on what is being wound up and that winding up a trust is different to winding up a company in terms of such matters as the rights of ‘scheme creditors’ or investors. Other analytical frameworks may also apply such as where the scheme operates as a partnership.
Justice Austin also observed, relevantly, that ‘[s]ometimes the person appointed to wind up a registered or unregistered scheme is described as a “liquidator”, a title accurate enough to designate the function to be performed, but not to be confused with the liquidator of a company whose appointment carries with it the statutory consequences’ of that office. Justice Barrett made a similar observation in Australian Securities and Investments Commission v Takaran (No 2) [2002] NSWSC 987; 43 ACSR 334 at [11] before adding that ‘it may be that, recognising that the situation is one in which trust property may be regarded as in a form of jeopardy because being administered otherwise than in accordance with the statutory requirements the court will appoint a receiver to effect the winding up and thereby to ensure that the trust property is preserved and eventually placed in the hands of those entitled to it.’ But, whatever course is adopted and whatever designation or label is given to the person appointed to wind up the scheme, that person appointed is an officer of the Court. Put another way, the designation or label attached to the office may be a distraction. What is important is the functions and powers the Court confers on the office in making the appointment and the orders considered appropriate for the winding up of the scheme. Moreover, the power extends not only to orders made at the time the winding up order is made, but also to further orders made in connection with the due conduct and completion of that winding up: Takaran at [12] (Barrett J).
In this case, the Liquidators were appointed joint and several liquidators of AMS. That is, they are liquidators of a company governed by the provisions of the Act. The Liquidators were also appointed joint and several liquidators of the Scheme. In this respect, the December 2020 orders conferred various functions and powers on them and the orders made in the exercise of the power under s 601EE(2) sought, in effect, so far as was possible, to have the winding up of the Scheme conducted as if it were a winding up of a company. The Receivers were appointed to identify, preserve and secure all the Property for the benefit of the creditors of AMS and the Scheme members. They were also appointed Liquidators to ‘wind up’ the Scheme and, in substance, distribute the property of the Scheme to creditors and scheme members.
Napoli Corporate seeks the appointment of Mr Stone and Mr Franklin as joint and several ‘receivers and managers’ of the property of the Scheme. That requires modification of the December 2020 orders or for further orders to be made in connection with the due conduct and completion of the winding up of the Scheme. In my view, having regard to the nature of the December 2020 orders and the appointment of Receivers and Liquidators of the Scheme, similar considerations to those that apply to the appointment of a special purpose liquidator of a company apply to whether it is appropriate to appoint a special purpose receiver and manager of the property of the Scheme.
Identification of the special purpose
In substance, Napoli Corporate seeks the appointment of special purpose receivers and managers and liquidators for the purpose of investigating, commencing, continuing and otherwise pursuing or taking steps to pursue certain claims against Westpac and against any person who is or may jointly be liable with Westpac in respect of those claims. The relevant claims are claims against Westpac in relation to its alleged involvement in misappropriation of the property of the Scheme and (or) breaches of trust or fiduciary duties by the operators of the Scheme and includes claims the subject of the proposed statement of claim that is a confidential exhibit to the Mr Buitendag’s non-confidential affidavit sworn 5 March 2024. The draft statement of claim describes a cause of action against Westpac for ‘knowing assistance’ in relation to alleged breaches of trust by one or more of Mr Marco and AMS under the second limb of Barnes v Addy (1874) LR 9 Ch App 244 as explained in Farah Constructions Pty Limited v Say-Dee Pty Limited [2007] HCA 22; 230 CLR 89 at [171]-[184].
Proceedings to have a breach of trust redressed may be taken by a beneficiary or a new trustee against a trustee, or a former trustee, or a stranger to the trust. Further, proceedings to redress a breach of trust against a stranger to the trust may extend to liability under the second limb of Barnes v Addy. Where a new trustee commences proceedings to redress a breach of trust, in general, it is not necessary to join the beneficiaries as parties: Young v Murphy [1996] 1 VR 279 at 281 – 282 (Brooking J), 300 (JD Phillips J, to similar effect), 310 (Batt J, agreeing with both). These principles have been applied to a person appointed receiver and liquidator of the operator of an unregistered managed investment scheme in circumstances in which it was alleged that the directors of the corporate scheme operator had knowingly assisted breaches of trust: Nicholson Street Pty Ltd (receivers and managers appointed) (in liquidation) v Letten [2016] VSCA 157 at [75]-[85] (Whelan and Ferguson JJA, Kaye JA agreeing). See, also, Australian Securities and Investments Commission v Letten (No 22) [2014] FCA 681 at [48]-[53] (Gordon J), leave to appeal refused in Letten v Templeton [2014] FCAFC 131; 102 ACSR 425 (Besanko, Davies and White JJ).
As Solomon J observed in Perth Fashion Festival, it is neither necessary nor appropriate to make findings about the merits of the potential causes of action. The applicant has adduced evidence of the opinions of two independent counsel, draft statements of claim and an independent expert. I am satisfied that Napoli Corporate has demonstrated a reasonable basis for the view that the matters identified warrant investigation and that there is sufficient evidence to support the possibility of an action being brought.
Is a special purpose receiver and liquidator just and beneficial to investor creditors?
The December 2020 orders appointed the Receivers as joint and several receivers of all property (as defined in s 9 of the Act) whether within or outside the State of Western Australia of Mr Marco, AMS, in its own right and as trustee of the AMS Holdings Trust, and the Scheme (collectively defined as the Property). The potential causes of action against Westpac fall within the meaning of Property. Insofar as AMS may have a cause of action against a third party for restoration of trust property, although held for the beneficiaries, that cause of action falls within the definition of property (of the company) in s 9 of the Act.
Amongst other things, the December 2020 orders provided that pursuant to s 601EE the winding up of the Scheme be conducted as if the Scheme were a company for the purposes of the Act and that the provisions of Pts 5.4B, 5.6, 5.7B and 5.9 and that the IPSC apply to the winding up. As a consequence, power was conferred on the Liquidators to bring or defend proceedings in the name of and on behalf of the Scheme members: s 477(2)(a) of the Act. Power was also conferred on the Liquidators to investigate any deficiency in the Scheme and to exercise the powers under Pt 5.9 of the Act as if the Scheme were a corporation being wound up.
The December 2020 orders also confer power on the Receivers to do all things necessary or convenient to be done for in connection with, or as incidental to the attainment of the objectives for which the Receivers were appointed including for the identification, preservation and securing all of the Property for the benefit of the creditors, the powers under s 1101B(8) and the powers under s 420 of the Act. However, there may be doubt that the effect of these orders extends to conferring authority on the Receivers to act as agent of the Scheme or AMS or to bring or defend proceedings in the name of the Scheme or AMS: Takaran at [9]-[10]. On the other hand, there is no doubt that the Liquidators of AMS have power to bring or defend proceedings in the company name: 477(2)(a). Further, as mentioned, the orders confer the same power on the Liquidators with respect to the Scheme members.
The potential cause of action is equitable and derives from breach of trust or fiduciary duty in which Mr Marco and AMS were involved as principal or accessory. Underlying the potential cause of action is the aim of restoration of trust property (the funds the Scheme members contributed to the Scheme) Mr Marco and (or) AMS misappropriated. The Court has power to appoint a receiver over property that comprises a chose in action such as a cause of action: see, for example, Garden Mews-St Leonards Pty Ltd v Butler Pollnow Pty Ltd (1984) 9 ACLR 91 at 95; see generally, Scarel Pty Ltd v City Loan & Credit Corporation Pty Ltd (1988) 79 ALR 483; 17 FCR 344 at 351-352 (Gummow J). The Court also has power to permit a receiver so appointed to bring proceedings in the name of the person with title to sue on that cause of action: see, for example, Hogan v Ma [2023] FCA 1383 (Cheeseman J). Therefore, any doubt about the extent of the powers conferred on the Receivers and Liquidators as receivers and liquidators of the Scheme may be overcome by conferring express power on ‘special purpose receivers and managers’ to bring proceedings in the name of the persons with title to sue.
The effect of the December 2020 orders was to appoint Receivers over all property of Mr Marco, AMS and the Scheme, to wind up AMS and the Scheme and to appoint Liquidators to carry out that winding up. The winding up of AMS was, in substance, ancillary to winding up of the Scheme and was a consequence of its involvement in the operation of the Scheme. AMS was wound up on the grounds that it was insolvent (s 459B) and, otherwise, it was just and equitable that it be wound up (s 461(1)(k)). In that context it is instructive that the Receivers’ powers extended to ‘identification, preservation and securing of all of the Property for the benefit of the creditors’. No distinction is drawn between creditors of AMS, creditors of AMS as trustee, creditors of Mr Marco or creditors of the Scheme (creditors of the operators of the Scheme). Broadly speaking, the overall objective of the December 2020 orders was to bring about the winding up of the Scheme and the identification, preservation and securing of Scheme property (irrespective which of Mr Marco or AMS was the legal owner of that property). The identification, preservation and securing of separate property of AMS of which it was the legal and beneficial owner, if any, was to take place within the process of winding up an unlawful managed investment scheme and a company that was one of the operators of that unlawful scheme. That theme was continued when, subsequently, the Court made pooling orders in February 2023. The effect of that order was that the Liquidators were justified in treating certain property, including all assets of AMS (whether held legally or beneficially), as property of the Scheme and the Fund.
Taking into account the facts and matters and the imposition of certain safeguards referred to earlier in these reasons, insofar as the Scheme members are concerned, the proposed appointment may lead to an increased distribution without additional risk or liability. I also take into account that, for the reasons given later, litigation funding has been secured on terms that may be approved under s 477(2B) of the Act. The terms of that agreement form part of the reason I am satisfied that the Scheme members are not exposed to the risk of diminution of their current distribution, if any, under the existing arrangements.
It is also relevant that the Liquidators are not prepared to enter into a funding agreement on the terms proposed. As a consequence, the prospect of the Scheme members making any further recovery in respect of the proposed causes of action, if the orders are not made, is virtually non-existent.
There has been significant delay in bringing the appointment application. However, the delay is explained by the process of investigation, due diligence, negotiating funding, the progress and orders in proceeding WAD 481 of 2018 and dealing with the Liquidators. While the delay means that potential expiry of limitation periods are approaching, I do not consider the delay is fatal or a material factor against making an order in this case.
Regarding the Scheme, in my view, the December 2020 orders confer power on the Liquidators to bring proceedings for the benefit of Scheme members. Although Napoli Corporate seeks orders for the appointment of special purpose receivers and managers of property of the Scheme and not special purpose liquidators of the Scheme, having regard to s 601EE(2) and the purpose of the appointment of the Receivers and Liquidators, the label attached to the appointment is not important. What is important is conferring power on Mr Stone and Mr Franklin, as persons appointed by the Court, to identify, preserve, secure and get in Scheme property. In this case, that includes conferring power on the special purposes receivers and managers to investigate and, if considered appropriate, bring and prosecute proceedings against Westpac and others for the benefit of the Scheme members. Having regard to all the matters to which reference has been made, I am satisfied that it is appropriate to make orders appointing special purpose receivers and managers of the property of the Scheme for that purpose.
Regarding AMS, I initially had some doubts about the extent to which appointment of special purpose liquidators could be considered for the benefit of the creditors, properly so called, of AMS. In my view, it remains doubtful that there is any benefit to the creditors of AMS because the proceeds of any judgment or settlement upon any cause of action AMS may bring must be held on trust for the benefit of Scheme members subject to any right AMS may have as trustee to indemnity or exoneration out of trust assets.
For example, in circumstances in which a company in liquidation is a trustee company, if the company in liquidation remains trustee, the liquidator may preserve, realise or get in trust property for the purpose of exercising the trustee company’s right of indemnity or exoneration out of trust assets: Jones v Matrix Partners Pty Ltd [2018] FCAFC 40; 260 FCR 310 at [33] (Allsop CJ), citing Lewis v Nortex Pty Ltd (In Liq) [2013] FCAFC 56; 211 FCR 483 at [77] (Jagot and Yates JJ). If as a consequence of liquidation the trustee company is automatically removed from office by operation of the applicable trust instrument (as in the case of the AMS Holdings Trust) and, therefore, holds the trust property as bare trustee pending the appointment of a new trustee, the Court may appoint the liquidator as a receiver over trust assets for the purpose of preserving, realising and getting in those assets so as to exercise the former trustee’s right of indemnity out of trust assets: s 57(1) of the Federal Court Act; Re Substar Holdings Pty Ltd (in liq) [2020] FCA 1863; 149 ACSR 185 at [26]-[29] (and the cases cited therein); Deputy Commissioner of Taxation, in the matter of Australian Managed Print Services (Vic) Pty Ltd (in liq) v Australian Managed Print Services (Vic) Pty Ltd (in liq) [2017] FCA 1172 at [25] (Lee J); Aced Kang Investments Pty Ltd (in liq), in the matter of Aced Kang Investments Pty Ltd (in liq) [2017] FCA 476 at [12]-[15] (Moshinsky J).
Therefore, in the circumstances of this case, it is highly improbable that any amount of proceeds recovered from any claim against Westpac and others would be available for distribution amongst the creditors of AMS. In that context, there is no evident utility in appointing special purpose liquidators for the purpose of aiding the creditors in the winding up of AMS. Nonetheless, in the context of orders made more broadly for the purpose of winding up an unregistered managed investment scheme and winding up a company which participated in that scheme on just and equitable grounds, to the extent that distributions to Scheme members may be augmented by the power to investigate, bring and prosecute proceedings, as liquidators, in the name of that company, there is benefit to members of the Scheme and utility to the broader objects of the Act and s 601EE in winding up the Scheme. In my view, that provides a sufficient basis for exercise of the power in s 90-15(1) of the IPSC.
Conditions of appointment
As already mentioned, liquidators are entitled to remuneration for necessary work properly performed and the Court may determine that remuneration under Div 60 of the IPSC. The Court also has power to fix a receiver’s remuneration: r 14.24 of the Rules; Hutchins, in the matter of Ardenberg Pty Ltd (in liq) (Administrators Appointed) (No 2) [2020] FCA 1424. The Court may also order that a receiver’s remuneration, costs and expenses be subject to Court approval: Australian Securities and Investments Commission v Letten [2010] FCA 140 at [45] (Gordon J). It is usual for the Court to order that a receiver’s remuneration, costs and expenses be paid out of the assets included in their appointment: Kadam v MiiResorts Group 1 Pty Ltd (No 5); Securities and Exchange Board of India v MiiResorts Group 1 Pty Ltd [2018] FCA 1086; 129 ACSR 74; Moodemere Pty Ltd (in liq) v Waters [1988] VR 215; 5 ACLC 790.

Court-appointed receivers are personally liable on contracts which they enter into after their appointment in the course of the receivership: Australian Securities and Investments Commission v Letten (No 13) [2011] FCA 1151; 86 ACSR 174 at [63] (Gordon J) citing Burt, Boulton and Hayward v Bull [1895] 1 QB 276 at 280-281. However, a receiver’s personal liability may be expressly or implicitly excluded under the contract: In reGlasdir Copper Mines Ltd, English Electro-Metallurgical Company Ltd v Glasdir Copper Mines Ltd [1906] 1 Ch 365 at 378 (Vaughan Wiliams LJ, Cozens-Hardy J agreeing). Further, receivers have a correlative right to claim an indemnity from the assets included in their appointment: Banning v Lean (No 3) [2019] WASCA 30; 54 WAR 259 at [146] (Buss P, Murphy and Beech JJA); Westpac Banking Corp v ITS Taxation Services [2004] NSWSC 50; 183 FLR 273 at [17] (Austin J).
A liquidator is agent of the company, therefore, it is the company and not the liquidator that is liable on contracts entered into after the liquidator is appointed: Re Anglo-Moravian Hungarian Junction Railway Co (1875) 1 Ch D 130 at 133 (James LJ, Mellish LJ and Baggallay JA, agreeing) and 136 (Brett LJ). A liquidator is also entitled to remuneration to be paid out of the assets of the company: Australian Securities and Investments Commission v Marco (No 9) [2021] FCA 1306; 399 ALR 735 at [54] (McKerracher J), citing Bastion v Gideon Investments Pty Ltd (in liq) [2000] NSWSC 939; 35 ACSR 466 at [70]-[71] (Austin J). A liquidator’s remuneration and other costs and expenses incurred preserving, realising or getting in property of the company are to be paid in priority to all other unsecured debts and claims: s 556(1)(a) of the Act; Onefone Australia Pty Ltd v OneTel Ltd [2008] NSWSC 1335; 69 ACSR 290 at [48]-[49] (Barrett J).
The ‘property of the company’ from which the remuneration, costs, expenses and disbursements of the former administrators and liquidators of AMS and the determination of their remuneration, costs, expenses and disbursements was contentious, as between former administrators and liquidators of AMS and the court-appointed Liquidators, and has been the subject of two previous judgments of the Court: Marco (No 9) and Australian Securities and Investments Commission v Marco (No 15) [2024] FCA 347. The question of the former administrators’ remuneration and expenses has not been completely resolved more than three years after they were removed from office. Therefore, it is important to ensure that there is clarity about the ‘property of the company’ from which any remuneration and costs, expenses and disbursements of the special purpose liquidators of AMS is to be paid.
Mr Buitendag deposes in his affidavit of 3 July 2024, that Mr Stone and Mr Franklin will undertake to the Court that they will not seek to recover costs or expenses incurred as special purpose receivers or liquidators from the assets of AMS or the Scheme nor will they seek that any costs or expenses of the Receivers and Liquidators be paid out of those assets. They will only seek the recovery of such expenses via the proposed funding agreement or otherwise from the proceeds of any judgment or settlement.
There are at least two difficulties with an undertaking in that form. First, it does not deal with remuneration. It is well-established the remuneration and expenses of an external administrator are different: Marco (No 15) at [56]-[57]. Second, it is internally inconsistent. The proceeds of any judgment or settlement would form part of the assets of AMS or the Scheme. An undertaking not to recover from the assets at the same time as asserting an entitlement to recover from part of the assets is plainly inconsistent. At the very least the undertaking is unclear and uncertain.
In my view, it is appropriate that the Court make orders dealing with the SP Receivers and SP AMS Liquidators’ remuneration and expenses. These orders should be in the same terms as the December 2020 orders relating to the remuneration, costs, expenses and disbursements of the Liquidators except that payment should be made only out of any proceeds derived from judgment or settlement of any proceedings against Westpac. Also, the remuneration should be determined and payable and expenses should be incurred and reimbursable without distinction between whether the work was performed or the expenses incurred as special purpose receivers and managers of the Scheme or as special purpose liquidators of AMS. Likewise, all remuneration and expenses should be payable out of a single pooled fund irrespective of whether the recovery was made as liquidator of AMS or receiver and manager of the Scheme, or both. The appointment should also be conditional on the SP Receivers and SP AMS Liquidators giving a written undertaking to the Court not to seek to recover their remuneration or expenses from any property of AMS or the Scheme other than the proceeds of any judgment or settlement of any claims against Westpac and others.
Otherwise, in my view, it is also appropriate that the SP Receivers and SP AMS Liquidators have the equivalent powers to the Receivers and Liquidators regarding property of the Scheme. Those powers should include a clear power to bring proceedings for and on behalf of the Scheme members against Westpac and others.
APPROVAL OF FUNDING AGREEMENT
Applicable principles
Section 477(2B) applies to the liquidators of AMS (whether the Liquidators or SP AMS Liquidators). Paragraph 17 of the December 2020 orders also makes Pt 5.4B, which includes s 477(2B), applicable to the Liquidators of the Scheme. As the proposed funding agreement contemplates obligations discharged by performance more than 3 months after the agreement is entered into, it requires approval under s 477(2B) of the Act and, in effect, para 17 of the December 2020 orders.
As already mentioned, for the purposes of s 601EE the designation is not as important as the powers to be conferred on the office under the order appointing them. Here, the powers conferred on the SP Receivers are equivalent to the powers conferred on the Liquidators as liquidators of the Scheme. Therefore, it is appropriate that the SP Receivers have the benefit and burden of the December 2020 orders as applied to the Liquidators of the Scheme. That includes the requirement for the Court to approve agreements in circumstances in which s 477(2B) would apply if the Scheme were a company.
Approval is regularly given under s 477(2B) for funding agreements between a liquidator and a third party. There are well-settled principles relating to approval applications of that nature and the matters that are commonly relevant on such applications. Justice Edelman summarised these in Hughes, in the matter of Sales Express Pty Ltd (in Liq) [2016] FCA 423 at [20] and Wigney J in Hundy (liquidator), in the matter of 3 Property Group 13 Pty Ltd (in liquidation) (No 2) [2023] FCA 173 at [18]-[23].
The relevant principles and the application of them to the circumstances of this case are as follows.
(1)The reason approval is required in respect of agreements which may operate and involve obligations that extend beyond three months is that such agreements tend to cut across the general expectation that the winding up of a company will proceed expeditiously. In the circumstances of this case, the expectation of expedition must be balanced against the potential to increase the recovery of Scheme members and existing delays in the winding up process. It is also of relevance that prolonging the winding up of the Scheme is unlikely to result in significant increased administration costs due to the terms of the proposed funding agreement and terms of the appointment of the SP Receivers and SP AMS Liquidators.
(2)The requirement to obtain approval of such agreements affords some protection against ill-advised or improper actions on the part of the liquidator bearing in mind the Court’s task is not to second guess the liquidator’s commercial judgment but rather to determine whether there are grounds for suspecting a lack of good faith, some error of law or principle, or some other good reasons to intervene. I do not consider there to be any grounds for considering an absence of good faith or error of law or principle or good reason to intervene in the circumstances of this case.
(3)The Court must be satisfied that there is a good and solid reason for concluding the process of winding up and distribution would be enhanced by the funding agreement compared with the ordinary deployment of surplus funds. For the reasons already given, I am satisfied of that matter.
(4)The Court will rarely approve an agreement which has important terms that are unclear. While there are aspects that could be clearer, I am satisfied that the terms of the proposed funding agreement are sufficiently clear.
(5)The manner in which the funding or indemnity will be provided under the agreement. Here, the manner in which the funding and indemnity will be provided has a degree of complexity in its terms, but, in concept, is relatively straightforward. The proposed funder will pay the remuneration and expenses of the SP Receivers and SP AMS Liquidators and disbursements up to a capped amount, subject to certain terms, and will indemnify the claimant(s) against adverse costs orders. I am satisfied that the funder has the financial capacity to meet its funding and indemnity obligations under the proposed funding agreement.
(6)The extent to which the liquidator has considered other funding options. The affidavit evidence demonstrates JWS and Napoli Corporate undertook a relatively long process to secure a litigation funder. There is no evidence of significant negotiation of the terms or attempts to negotiate more favourable terms between different litigation funders. The evidence, such as it is, leaves the impression that securing a litigation funder on the terms proposed was not easy. The present Liquidators were unwilling to enter into an agreement on the proposed terms, which has resulted in the appointment of the SP Receivers and SP AMS Liquidators. Having regard to these matters, I am satisfied that there is no great prospect of attracting an alternative commercial litigation funder prepared to fund the potential claims on terms more favourable than the current proposal.
(7)The interests of creditors and the extent to which the liquidator has consulted them. The evidence does not demonstrate any wide consultation of the Scheme members. There is some evidence of consultation between Mr Napoli and Scheme members. Scheme members have notice of this application and have not come forward to show any interest in opposing or supporting the outcome. The interests of creditors favour approval and the lack of evidence of consultation is not significant in this case.
(8)The risks involved in the claim (including the amount of costs likely to be incurred in the proposed litigation), the extent to which the funder is to contribute to those costs and the extent to which the funder is to contribute to the costs of the defendant in the event that the action is not successful or towards any other order for security for costs. As already mentioned, the litigation funder assumes all those risks.
(9)Any particular premium or benefit which is promised in consideration of the provision of the funding or indemnity including whether that benefit is proportionate to the risk undertaken by the funder. As already mentioned, I am satisfied that the premium of the funder is proportionate to the risk.
(10)Whether the liquidator is subject to any control over the conduct of litigation, other than the usual obligation to keep the funder fully informed of all matters relating to the action. As already mentioned, I am satisfied that the litigation would not be subject to undue control by the funder.
(11)Whether the agreement provides for a clear mechanism for resolving any dispute between the funder and the liquidator about the compromised liquidation which is funded. As already mentioned, the proposed funding agreement contains a dispute resolution mechanism should there be any dispute between the parties to the agreement.
For these reasons, I am satisfied that it would be appropriate to approve a funding agreement in the terms of the proposed funding agreement attached to the confidential affidavit of Ms Silvers.
SUPPRESSION AND NON-PUBLICATION ORDERS
Applicable principles
Section 37AF of the Federal Court Act provides that the Court may, by making a suppression order or non-publication order on the grounds permitted by Pt VAA, prohibit or restrict the publication or other disclosure of information that relates to proceedings before the Court and is information that comprises evidence or information about evidence or information lodged with or filed in the Court and the Court may make such orders as it thinks appropriate to give effect to such an order.
Section 37AG provides that, amongst others, a suppression order or non-publication order may be made on the ground that it is necessary to prevent prejudice to the proper administration of justice. A suppression order or non-publication order must specify the ground or grounds upon which the order is made. Section 37AJ provides that a suppression order or non-publication order operates for the period decided by the Court and specified in the order. Section 37AE provides that in deciding whether to make a suppression order or non-publication order the Court must take into account that a primary objective of the administration of justice is to safeguard the public interest in open justice.
Section 37AH also sets out a procedure for making a suppression order or non-publication order and provides that certain persons are entitled to appear and be heard by the Court on an application for a suppression order or non-publication order. In this case, as already mentioned, to address the possibility of a person wishing to be heard, orders were made on 19 April 2024 requiring any person entitled to appear or be heard under s 37AH(2) of the Federal Court Act to notify the Court of their intention to do so no later than 4.30 pm (AWST) on 17 May 2024. No such notice was received before the application was heard.
Rule 2.32(1)(b) of the Rules provides that a party may inspect any document in a proceeding except, among other things, a document the Court has ordered to be confidential. Rule 2.32(2) provides that a person who is not a party may, after the first directions hearing or the hearing (whichever is the earlier), inspect certain documents in a proceeding. The documents that a non-party may inspect do not include affidavits or written submissions, but include transcripts of a hearing heard in open court. A non-party is not entitled to inspect a document the Court has ordered is confidential or that is forbidden or restricted from publication to the person or class of persons of which the person is a member: r 2.32(3). A person who is not a party to the proceedings may apply to the Court for leave to inspect a document that the person is not otherwise entitled to inspect: r 2.32(4). The provisions of r 2.32 of the Rules operate together with the provisions of Pt VAA of the Federal Court Act.
It is generally accepted that it is ‘conventional’ or ‘appropriate’ to make suppression or non-publication orders in respect of confidential information a liquidator has disclosed to the Court for the purposes of an application for approval of a litigation funding agreement under s 477(2B) of the Act. ‘That is because the administration of justice is likely to be prejudiced by the disclosure of documents or information which would otherwise be commercially confidential which might result in prejudice to the liquidator in the conduct of the proceedings to which they relate’: Hundy at [35] (Wigney J) and the authorities there cited.
In McGrath & Anor Re HIH Insurance Ltd [2005] NSWSC 731, to which Wigney J made reference in Hundy, Barrett J (at [10]-[13]) drew attention to the competing public interests that arise in the context of applications by liquidators for approval of litigation funding agreements. Justice Barrett observed that, first there is the obvious public interest in the principle of open justice. Second, there is the public interest in the due administration of the insolvent estates of the company in liquidation. That public interest can be particularly pronounced where there are a large number of creditors from all walks of life who have an interest in that administration. Liquidators are entitled to have the Court appropriately facilitate such actions as they may properly take in the interest of creditors in the furtherance of the public interest in the administration of the insolvent estates. Justice Barrett also emphasised that funding agreements in respect of which an application is made under s 477(2B) are agreements concerning the pursuit of litigation and there is a clear public interest in the due administration of justice in that litigation. Liquidators who propose to pursue it for the benefit of a creditor should, as a general matter, have an expectation that they will be able to do so free from distortions of a kind that would not arise if the litigation were pursued by an ordinary litigant in the ordinary way. Unlike ordinary litigants, liquidators are required to come to the Court to seek approval under s 477(2B). If it were not for that requirement and for the supervision of the Court in that respect, the liquidators would, like other litigants, merely go ahead and enter into the agreements which would remain confidential and, generally, the liquidators would not be required, to disclose those agreements to counterparties in litigation. In this respect, Barrett J said (at [13]):
… The special circumstances of the liquidators and the statutory functions they perform, coupled with the need for them to come to court on this occasion to seek leave in a way that an ordinary litigant does not have to seek, sets the case apart in such a way that justice will best be served by an examination of the matters the liquidators are bound to raise with the court in an atmosphere where they can lay them before the court fully and frankly and without any apprehension that the interests they are bound to serve will thereby be prejudiced. …
In this case, there are two classes of confidential information. The first is confidential information that is commercially sensitive or that would or may be of advantage to a potential respondent or disadvantage to the claimant(s), SP Receivers and SP AMS Liquidators, Scheme members and creditors if disclosed to a potential respondent. In general, because liquidators must disclose that information to obtain approval and it would not otherwise be available to potential respondents, the Court routinely makes suppression and non-publication orders in respect of confidential information of that character. I am satisfied that it is appropriate in order to prevent prejudice to the proper administration of justice to make a suppression and non-publication order covering that confidential information.
The second class is confidential information that is prima facie subject to legal professional privilege. Napoli Corporate and Mr Stone and Mr Franklin disclosed confidential information to the Court that includes legal advice, draft pleadings and expert evidence. That was disclosed for the limited purpose, on the appointment application, of demonstrating that there was sufficient merit in the potential claims to warrant the appointment of the SP Receivers and SP AMS Liquidators in the interests of the Scheme members and AMS creditors. That information was disclosed on the approval application for a similar limited purpose of demonstrating that approval is sought in good faith and there is a reasonable prospect that it will deliver a benefit to the Scheme members and AMS creditors. Legal professional privilege is a substantive legal right. Subject to certain exceptions, a client cannot be required to disclose confidential information that is subject to the privilege. Having regard to the limited purpose for which the information was disclosed to the Court, the reasons for ordering suppression and non-publication orders in respect of commercially sensitive confidential information apply a fortiori to privileged information. I am also satisfied that it is appropriate to make an order for suppression and non-publication of the confidential information in order to preserve the proper administration of justice.
CONCLUSION

There will be orders substantially in terms of the short minute of orders Napoli Corporate filed in WAD 481 of 2018. Additional orders will be made in relation to the remuneration and expenses of the SP Receivers and SP AMS Liquidators. Operation of the orders will be made conditional upon the appropriate undertakings about the property from which remuneration and expenses is to be paid.
Orders will not be made, at this time, for approval of the proposed funding agreement. However, I will hear the parties as to which further orders should be made to give effect to these reasons and for approval of a funding agreement.
In the meantime, I am satisfied that it is appropriate to make suppression and non-publication orders with respect to the affidavits and exhibits identified as confidential in the applications. Suppression and non-publication orders will be made substantially in terms of the short minutes of orders dated 3 July 2024 in proceedings WAD 481 of 2018 and WAD 40 of 2024.

I certify that the preceding one hundred and seven (107) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Feutrill.
Associate:
Dated: 2 September 2024
SCHEDULE OF PARTIES

WAD 481 of 2018

Interest Persons

Interested Person ROBERT MICHAEL KIRMAN AND ROBERT CONRY BRAUER AS INTERIM RECEIVERS

Interested Person CAMERON SHAW, RICHARD ALBARRAN AND MARCUS WATTERS, THE JOINT AND SEVERAL ADMINISTRATORS OF AMS HOLDINGS (WA) PTY LTD (RECEIVERS APPOINTED) (ADMINISTRATORS APPOINTED)

Interested Person CAMERON SHAW, RICHARD ALBARRAN AND MARCUS WATTERS, THE JOINT AND SEVERAL ADMINISTRATORS OF AMS HOLDINGS (WA) PTY LTD (RECEIVERS APPOINTED) (ADMINISTRATORS APPOINTED) AS TRUSTEE FOR AMS HOLDINGS TRUST (THE ADMINISTRATORS)

Interested Person GIOVANNI MAURIZIO CARRELLO AS THE TRUSTEE IN BANKRUPTCY OF CHRIS MARCO

Interested Person PATRICIA MAREE MARKOPOULOS

Interested Person TONPOSE PTY LTD AS TRUSTEE FOR MARKS AUTOS SUPERANNUATION FUND ACN 008 850 057

Defendants

Fourth Defendant:

LOUGHTON PATTERSON PTY LTD AS TRUSTEE OF THE LOUGHTON PATTERSON UNIT TRUST

File numbers:	WAD 481 of 2018 WAD 40 of 2024
Judgment of:	FEUTRILL J
Date of judgment:	2 September 2024
Catchwords:	CORPORATIONS – application to appoint special purpose receivers to unregistered managed investment scheme and special purpose liquidators to scheme operator - special purpose to investigate and pursue claims of scheme members against third parties – consideration of applicable principles CORPORATIONS – application for Court approval of special purpose receivers and special purpose liquidators entering into litigation funding agreement – application made before appointment – consideration of applicable principles PRACTICE AND PROCEDURE – application for suppression and non-publication orders – confidential and commercially sensitive information – information subject to legal professional privilege – information disclosed to support appointment of special purpose receivers and managers and special purpose liquidators – information disclosed to support approval of officer of the Court entering into a litigation funding agreement
Legislation:	Corporations Act 2001 (Cth) ss 9, 20(1)(a), 57B, 420, 424, 459B, 461(1)(k), 467B, 477(2)(a)-(b), 477(2B), 511, 556(1)(a), 601ED, 601EE, 601EE(2), 1101B(8), 1324, 1325; Pts 5.4B, 5.6, 5.7B, 5.9 Insolvency Practice Schedule (Corporations) ss 5-30, 60-5, 60-10, 60-10(4), 60-12, 90-A, 90-15, 90-20; Sch 2 Federal Court of Australia Act 1976 (Cth) ss 23, 37AE, 37AF, 37AG, 37AH, 37AH(2), 37AJ, 37M, 51(2), 57(1) Federal Court Rules 2011 (Cth) rr 1.32, 1.34, 1.35, 2.32(1)(b), 2.32(2), 2.32(3), 2.32(4), 14.24 Trustees Act 1962 (WA) s 92
Cases cited:	Aced Kang Investments Pty Ltd (in liq), in the matter of Aced Kang Investments Pty Ltd (in liq) [2017] FCA 476 Australian Securities and Investments Commission v Letten [2010] FCA 140 Australian Securities and Investments Commission v Letten (No 13) [2011] FCA 1151; 86 ACSR 174 Australian Securities and Investments Commission v Letten (No 22) [2014] FCA 681 Australian Securities and Investments Commission v Marco (No 9) [2021] FCA 1306; 399 ALR 735 Australian Securities and Investments Commission v Marco(No 13) [2023] FCA 83 Australian Securities and Investments Commission v Marco (No 15) [2024] FCA 347 Australian Securities and Investments Commission v Takaran (No 2) [2002] NSWSC 987; 43 ACSR 334 Australian Securities and Investments Commission v Tasman Investment Management Ltd [2006] NSWSC 943; 59 ACSR 113 Banning v Lean (No 3) [2019] WASCA 30; 54 WAR 259 Barnes v Addy (1874) LR 9 Ch App 244 Bastion v Gideon Investments Pty Ltd (in liq) [2000] NSWSC 939; 35 ACSR 466 Deputy Commissioner of Taxation, in the matter of Australian Managed Print Services (Vic) Pty Ltd (in liq) v Australian Managed Print Services (Vic) Pty Ltd (in liq) [2017] FCA 1172 Burt, Boulton and Hayward v Bull [1895] 1 QB 276 Farah Constructions Pty Limited v Say-Dee Pty Limited [2007] HCA 22; 230 CLR 89 Garden Mews-St Leonards Pty Ltd v Butler Pollnow Pty Ltd (1984) 9 ACLR 91 Hogan v Ma [2023] FCA 1383 Honest Remark Pty Ltd v Allstate Explorations NL [2006] NSWSC 735; 234 ALR 765 Hughes, in the matter of Sales Express Pty Ltd (in Liq) [2016] FCA 423 Hundy (liquidator), in the matter of 3 Property Group 13 Pty Ltd (in liquidation) (No 2) [2023] FCA 173 Hutchins, in the matter of Ardenberg Pty Ltd (in liq) (Administrators Appointed) (No 2) [2020] FCA 1424 In reGlasdir Copper Mines Ltd, English Electro-Metallurgical Company Ltd v Glasdir Copper Mines Ltd [1906] 1 Ch 365 Jones v Matrix Partners Pty Ltd [2018] FCAFC 40; 260 FCR 310 Kadam v MiiResorts Group 1 Pty Ltd (No 5); Securities and Exchange Board of India v MiiResorts Group 1 Pty Ltd [2018] FCA 1086; 129 ACSR 74 Letten v Templeton [2014] FCAFC 131; 02 ACSR 425 Lewis v Nortex Pty Ltd (In Liq) [2013] FCAFC 56; 211 FCR 483 McGrath & Anor Re HIH Insurance Ltd [2005] NSWSC 731 Moodemere Pty Ltd (in liq) v Waters [1988] VR 215; 5 ACLC 790 Newling v 77738930144 Pty Ltd (in liq) (formerly known as Commercial Indemnity Pty Limited) [2017] NSWSC 452 Nicholson Street Pty Ltd (receivers and managers appointed) (in liquidation) v Letten [2016] VSCA 157 Onefone Australia Pty Ltd v OneTel Ltd [2008] NSWSC 1335; 69 ACSR 290 Perth Fashion Festival Pty Ltd (in liq) v Fashion Council WA Ltd (in liq) [2022] WASC 210 Re Anglo-Moravian Hungarian Junction Railway Co (1875) 1 Ch D 130 Re AT Air Group Pty Ltd (in liq) [2012] NSWSC 1508 Re Substar Holdings Pty Ltd (in liq) [2020] FCA 1863; 149 ACSR 185 Reidy (atf PR Mining Superannuation Fund) v Contained Gold Pty Ltd (In Liq) [2020] FCA 268; 143 ACSR 260 Scarel Pty Ltd v City Loan & Credit Corporation Pty Ltd (1988) 79 ALR 483; 17 FCR 344 Venetian Nominees Pty Ltd v Conlan (1998) 17 ACLC 301 Westpac Banking Corp v ITS Taxation Services [2004] NSWSC 50; 183 FLR 273 Young v Murphy [1996] 1 VR 279
Division:	General Division
Registry:	Western Australia
National Practice Area:	Commercial and Corporations
Sub-area:	Corporations and Corporate Insolvency
Number of paragraphs:	107
Date of hearing:	4 July 2024
Counsel for Napoli Corporate Pty Ltd:	Mr MCJ Hoffmann KC
Solicitor for Napoli Corporate Pty Ltd:	Johnson Winter & Slattery
Counsel for the Liquidators and Receivers in WAD481/2018:	Mr CA Dallimore
Solicitor for the Liquidators and Receivers in WAD481/2018:	Ashurst Australia

ORDER MADE BY:	FEUTRILL J
DATE OF ORDER:	2 SEPTEMBER 2024

WAD 481 of 2018
Interest Persons
Interested Person	ROBERT MICHAEL KIRMAN AND ROBERT CONRY BRAUER AS INTERIM RECEIVERS
Interested Person	CAMERON SHAW, RICHARD ALBARRAN AND MARCUS WATTERS, THE JOINT AND SEVERAL ADMINISTRATORS OF AMS HOLDINGS (WA) PTY LTD (RECEIVERS APPOINTED) (ADMINISTRATORS APPOINTED)
Interested Person	CAMERON SHAW, RICHARD ALBARRAN AND MARCUS WATTERS, THE JOINT AND SEVERAL ADMINISTRATORS OF AMS HOLDINGS (WA) PTY LTD (RECEIVERS APPOINTED) (ADMINISTRATORS APPOINTED) AS TRUSTEE FOR AMS HOLDINGS TRUST (THE ADMINISTRATORS)
Interested Person	GIOVANNI MAURIZIO CARRELLO AS THE TRUSTEE IN BANKRUPTCY OF CHRIS MARCO
Interested Person	PATRICIA MAREE MARKOPOULOS
Interested Person	TONPOSE PTY LTD AS TRUSTEE FOR MARKS AUTOS SUPERANNUATION FUND ACN 008 850 057
Defendants
Fourth Defendant:	LOUGHTON PATTERSON PTY LTD AS TRUSTEE OF THE LOUGHTON PATTERSON UNIT TRUST