Goyal, in the matter of Cape Technologies Pty Ltd (administrators appointed)

The administrators of Cape Technologies Pty Ltd sought orders under the Corporations Act 2001 (Cth) to justify the sale of the company’s assets on certain terms. The company, which had been established to develop a financial operating system, did not have any sources of revenue or funding. The administrators argued that without other funding, they would not be able to realise any material returns from the sale of the company’s assets. They further sought orders to prevent the publication or access of certain documents, except pursuant to an order of the Court, on the basis that it was necessary to prevent prejudice to the proper administration of justice.

The court had to decide whether the administrators would be justified in selling the company’s assets on the terms proposed and whether the documents should be marked confidential and not published or accessed, except pursuant to an order of the Court. The court found that the administrators have a discretion to sell the company’s assets on acceptable terms, and the order proposed by the administrators was justified. The court also found that the order to mark the documents confidential was too wide, certainly as to the length of the restraint that is sought. The court held that there must be something more than the making of a business or commercial decision before a court will give directions in relation to, or approving of, the decision.

The court made orders that the administrators would be justified in causing the company to complete the sale of the assets on the terms proposed, subject to certain conditions. The court also made orders that the documents be marked confidential and not published or accessed, except pursuant to an order of the Court, but this order did not prevent the administrators, their legal representatives and/or their servants, agents or employees, from disclosing, publishing, or accessing the documents and the information contained therein. The court further ordered that the administrators’ costs of and incidental to the originating process be costs in the administration of the company.