Frederick Charles Perkins and Acarau Pty Ltd (in Liquidation) v Bendale Timber Pty Ltd No. SCGRG 93/208 Judgment No. 4462 Number of Pages 4 Corporations Companies Winding up (1994) 13 Acsr 1

[1994] SASC 4462

COURT IN THE FULL COURT OF THE SUPREME COURT OF SOUTH AUSTRALIA KING CJ(1), BOLLEN(2) AND MULLIGHAN(3) JJ

CWDS
Corporations - companies - winding up - Payments out of company's bank account, after commencement of winding up, in discharge of a creditor company's debt to payee - payments treated in books of both companies as reducing company's debt to creditor company - payments recoverable from payee as void disposition of property. Corporations Laws.468(1).

HRNG ADELAIDE, 14 February 1994 #DATE 30:3:1994

Counsel for appellant:     Mr M B Esau

Solicitors for appellant:    Esau Meister and Associates

Counsel for respondent:     Mr G L Muecke

Solicitors for respondent: Gun and Davey

ORDER
Appeal allowed.

JUDGE1 KING CJ The second appellant (Acarau Pty Ltd) is a company in liquidation. The first appellant is the liquidator. They seek to recover from the respondent the sum of $10,490.59 being the total of seven payments made to the respondent between 4 December 1991 and 14 February 1992 by cheques drawn on an account at the ANZ Bank in the name of the second appellant. The appellants rely upon section 468(1) of the Corporations Law which is as follows:-
    "Any disposition of property of the company other than an
    exempt disposition, and any transfer of shares or alteration
    in the status of the members of the company made after the
    commencement of the winding up by the Court is, unless the
    Court otherwise orders, void."

2. An order for the winding up of the second appellant was made by the Supreme Court on 22 March 1992 on an application dated 2 December 1991. The impugned payments were made therefore after the commencement of the winding up.

3. The second appellant and another company Morven Pty Ltd were associated companies with common directors and shareholders. There was another company, Terrera Pty Ltd, in the group. The second appellant was a furniture retailer. Morven was a supplier of furniture to the second appellant and, in addition, engaged in limited retail selling activity.

4. Prior to September 1991 the three companies operated separate bank accounts. Cheques in payment of their debts were drawn on their respective accounts. The second appellant was Morven's principal customer and debtor. When Morven's bank account needed to be replenished in order to pay accounts, a cheque was drawn on Acarau's bank account and paid into Morven's bank account in reduction of Acarau's debt to Morven.

5. In August 1991 it was decided to "amalgamate" the bank account in order to save duties and fees. The overdraft on the Morven bank account was paid out by means of a cheque on the Acarau bank account and the Morven account was closed. Presumably the same was done with the Terrera bank account. Thereafter receipts from Morven's customers were banked in the Acarau account and Morven's accounts were paid by cheques drawn on that account. This arrangement commenced on 2nd September 1991.

6. The seven cheques in question in this case were drawn pursuant to that arrangement in…