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Beatty v Brashs Pty Ltd

Beatty v Brashs Pty Ltd

Case [1998] FCA 128 19 February 1998

Statutory Interpretation

Contract Formation

Breach of Contract

Corporate Law & Governance

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FEDERAL COURT OF AUSTRALIA

CORPORATIONS - Part 5.3A - deed of company arrangement - validity of appointment of administrator to company already subject to deed of company arrangement

STATUTES - statutory construction - whether implication of a provision should be made

Corporations Law: ss 513B(b) and (c)

Austereo Ltd v Trade Practices Commission (1993) 41 FCR 1 followed
Chorlton v Lings (1868) 4 CP 374 referred to
Cooper Brookes (Woollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297 referred to
Mark Francis Xavier Mentha & Ors v G E Capital & Anor (Federal Court, unreported, 12 December 1997, Finkelstein J) referred to
Salomon v Salomon & Co [1897] AC 22 referred to
Tokyo Mart Pty Ltd v Campbell & Anor (1988) 15 NSWLR 275 applied

DAVID JOHN BEATTY & ANOR v BRASHS PTY LTD & ORS
VG 3045 of 1998

FINKELSTEIN J
MELBOURNE
19 FEBRUARY 1998

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

GENERAL DIVISION
VG 3045 of 1998

BETWEEN:

DAVID JOHN BEATTY
(in his capacity as Deed Administrator)
Applicant

AND:

BRASHS PTY LTD;
(administrators appointed) (subject to deed of company arrangement)
LINDSAY PHILIP MAXSTED
(In his capacity as administrator appointed); and
MICHAEL JOSEPH DWYER
(in his capacity as administrator appointed)
Respondents

JUDGE:

FINKELSTEIN J

DATE OF ORDER:

19 FEBRUARY 1998

WHERE MADE:

MELBOURNE

THE COURT DECLARES THAT:

The appointment by Brashs Pty Ltd (administrators appointed) (subject to deed of company arrangement) on 7 February 1998 of Lindsay Philip Maxsted and Michael Joseph Dwyer to be its administrators is valid.

THE COURT FURTHER ORDERS THAT:

The second applicant cease to be an applicant pursuant to Order 6 Rule 9 of the Federal Court Rules and that the title of the proceedings be amended accordingly.

The further hearing of this application be adjourned to 1 April 1998.

The costs of the application to date are reserved.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

GENERAL DIVISION
VG 3045 of 1998

BETWEEN:

DAVID JOHN BEATTY
(In his capacity as Deed Administrator)
Applicant

AND:

BRASHS PTY LTD
(administrators appointed) (subject to deed of company arrangement);
LINDSAY PHILIP MAXSTED
(In his capacity as administrator appointed); and
MICHAEL JOSEPH DWYER
(In his capacity as administrator appointed)
Respondents

JUDGE:

FINKELSTEIN J

DATE:

19 FEBRUARY 1998

PLACE:

MELBOURNE

REASONS FOR JUDGMENT

The applicant (the deed administrator) is the administrator of a deed of company arrangement executed under Part 5.3A of the Corporations Law by Brashs Pty Ltd (administrators appointed) (subject to deed of company arrangement), the first respondent, (Brashs) and its then administrators, the deed administrator and Michael James Humphris. The applicant seeks a declaration under s 447C(2) of the Corporations Law whether or not Lindsay Philip Maxsted, the second respondent, and Michael Joseph Dwyer, the third respondent, were validly appointed as the administrators of Brashs. The deed administrator also seeks directions under s 447D as follows, (a) whether he should defer calling a…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Beatty v Brashs Pty Ltd

Details

AGLC: Beatty v Brashs Pty Ltd [1998] FCA 128
Case: [1998] FCA 128
Decision Date: 19 FEBRUARY 1998

CaseChat Overview and Summary

Beatty v Brashs Pty Ltd is a case concerning the validity of an appointment of administrators to a company that was already subject to a deed of company arrangement. The case was heard by Justice Finkelstein in the Federal Court of Australia. The legal issues involved the interpretation of provisions in the Corporations Law concerning the appointment of administrators to insolvent companies and whether such an appointment is permissible when the company is already subject to a deed of company arrangement. Justice Finkelstein found that there is no prohibition in the Corporations Law against the appointment of administrators to a company under a deed of company arrangement and that such an appointment is valid. The Court granted a declaration that the appointment of the administrators, Lindsay Philip Maxsted and Michael Joseph Dwyer, was valid and dismissed the application for directions. The costs of the application to date were reserved.

Orders