D Pty Ltd (in liq) v Calas (Trustee), in the matter of D Pty Ltd (in liq)

In the matter of D Pty Ltd (in liq), the liquidator sought a declaration that a transaction was an unreasonable director-related transaction, pursuant to s588FA of the Corporations Act 2001 (Cth). The transaction was a consent order made by the Family Court of Australia, pursuant to which a charge was created over property owned by D Pty Ltd, as security for the husband's obligations. The liquidator contended that the charge was an unreasonable director-related transaction, pursuant to s588FB of the Corporations Act 2001 (Cth). The court was required to determine whether the consent order created a charge, and if so, whether a reasonable person in the company's position would not have entered into the transaction. The court found that the consent order did create a charge, and that a reasonable person in the company's position would not have entered into the transaction. The court noted that the charge was created as part of a settlement agreement between the husband, the company, and the wife, and that the charge was intended to secure the wife's entitlement to half of the company's interest in the property. The court found that the charge was not commercially reasonable, as it was effectively a gift to the wife, and that the director who authorised the charge did not act in good faith.

The court declined to make the declarations sought by the liquidator, as it would conflict or appear to conflict with the orders of the Family Court. The court noted that the Family Court had found that the wife had a caveatable interest in the property, and that the charge was intended to secure that interest. The court found that making the declarations sought by the liquidator would undermine the authority of the Family Court, and would be contrary to the principle of comity between courts. The court noted that the Family Court had made findings of fact that were binding on the court, and that the court was not entitled to re-litigate those findings. The court also noted that making the declarations sought by the liquidator would have the effect of setting aside the charge, which would result in the wife losing her security for her entitlement to half of the company's interest in the property. The court found that this would be an unjust outcome, and that it was not appropriate to make the declarations sought by the liquidator.