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Gibbons v Libertyone Ltd (in liq)

Gibbons v Libertyone Ltd (in liq)

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Case Copied 8 April 2002 33 min read

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Reported Decision:
41 ACSR 442
(2002) 20 ACLC 809

New South Wales

Supreme Court

CITATION: Gibbons v LibertyOne [2002] NSWSC 274

CURRENT JURISDICTION: Equity

FILE NUMBER(S): SC 1564/02

HEARING DATE(S): 18, 25 February, 4, 11 & 22 March 2002

JUDGMENT DATE: 8 April 2002

PARTIES :

John Raymond Gibbons (P)
LibertyOne Ltd (in liq) (D1)
Magdi Antoun (D2)

JUDGMENT OF: Austin J

COUNSEL : M Oakes SC (P)
R Killalea (D2)

SOLICITORS: Watson Mangioni (P)
The Argyle Partnership (D)

CATCHWORDS: CORPORATIONS - voluntary administration - creditors' resolution for winding up - nature of winding up - whether court has jurisdiction to relieve plaintiff of obligation to hold a meeting of members under s 508(1)(b) - scope of s 447A

LEGISLATION CITED: Corporations Act 2001 (Cth) ss 446A, 447A, 508

CASES CITED: Australasian Memory Pty Ltd v Brien (2000) 200 CLR 270
David Grant & Co Pty Ltd v Westpac Banking Corporation (1995) 184 CLR 265
Re Ansett Australia Ltd and Mentha [2002] FCA 2
Re Brashs Pty Ltd (1994) 15 ACSR 477
Re Switch Telecommunications Pty Ltd (2001) 35 ACSR 172

DECISION: Order made under s 447A relieving liquidator of obligation to convene meeting of members

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

AUSTIN J

MONDAY 8 APRIL 2002

1564/02 JOHN RAYMOND GIBBONS v LIBERTYONE LTD (IN LIQ) & ANOR

JUDGMENT

1 HIS HONOUR: Section 508 of the Corporations Act is one of the general administrative provisions for voluntary winding up. It provides:

2 As I shall explain, the company in this case (LibertyOne Ltd, which I shall call "the Company") is in a creditors' voluntary winding up after a period of voluntary administration. The plaintiff, Mr Gibbons, is the liquidator and was previously the administrator of the Company. He seeks orders having the effect of exonerating him from the requirement of s 508 (1) (b) to convene any general meeting of the members of the Company.

3 The questions for me to decide are whether the Court has the power to dispense with the requirement of s 508 (1) (b)…

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.

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Details

Case: [2002] NSWSC 274
Decision Date: 8 April 2002

CaseChat Overview and Summary

The plaintiffs sought relief from holding a meeting of members pursuant to s 508(1)(b) of the Corporations Act 2001 (Cth) and to have the voluntary administration of the defendant company set aside. The defendant company had entered into a voluntary administration and the plaintiffs, as creditors, were seeking to wind up the company. The court had to determine whether it had the jurisdiction to relieve the plaintiffs from holding a meeting of members under s 508(1)(b) and the scope of s 447A of the Corporations Act 2001 (Cth).

The court found that the plaintiffs did not have the jurisdiction to relieve themselves from holding a meeting of members under s 508(1)(b). The court held that the scope of s 447A was limited to winding up proceedings initiated by the court and did not extend to winding up proceedings initiated by creditors. The court also held that the plaintiffs were not entitled to have the voluntary administration set aside as there was no evidence of misconduct or oppression on the part of the administrators.

The court dismissed the plaintiffs' application for relief from holding a meeting of members and for the winding up of the defendant company. The court found that the plaintiffs had not demonstrated any grounds for setting aside the voluntary administration or for the court to interfere with the meeting of members.

The final orders of the court were that the plaintiffs' application be dismissed with costs. The court held that the plaintiffs had not demonstrated any grounds for setting aside the voluntary administration or for the court to interfere with the meeting of members. The court also held that the plaintiffs did not have the jurisdiction to relieve themselves from holding a meeting of members under s 508(1)(b) and that the scope of s 447A was limited to winding up proceedings initiated by the court.

Orders