Deputy Commissioner of Taxation v Portinex Pty Ltd

The taxpayer, Portinex Pty Ltd, was placed in voluntary administration. An attempt to appoint an administrator was deemed invalid. The Deputy Commissioner of Taxation challenged the validity of the administrator's appointment. The matter was brought before the Federal Court of Australia. The primary legal issue before the court was whether the invalid resolution to appoint an administrator could be cured under section 447A of the Corporations Act 2001. Additionally, the court had to consider whether the invalid resolution constituted a procedural irregularity under section 1322(2) and whether the relevant criteria for setting aside a resolution under sections 600A, 445D(1)(a), (f), (g), and 445G were met.

The court determined that the invalid resolution did not constitute a procedural irregularity under section 1322(2) but could be cured under section 447A. The court found that the relevant criteria for applying to set aside the resolution to enter into a deed of company arrangement were satisfied. These criteria included the existence of a substantial possibility that the company's affairs would be managed more advantageously for creditors if the resolution was set aside. The court also concluded that the criteria for terminating or setting aside the deed of company arrangement under sections 445D(1)(a), (f), and (g) and section 445G were met, as there was evidence of unfair prejudice to creditors and other interested parties. Therefore, the court granted the curative order and set aside the invalid resolution.

The court ordered that the invalid resolution to appoint an administrator be cured under section 447A of the Corporations Act. The court also set aside the invalid resolution to enter into the deed of company arrangement and terminated the deed. The court further ordered that the company's affairs be managed by a new administrator to be appointed by the court. The decision underscores the importance of ensuring that all procedural requirements are met when appointing administrators and entering into deeds of company arrangement, and highlights the availability of curative orders and criteria for setting aside such resolutions and deeds.