Hurst, in the matter of Liquor National Pty Ltd (in liq)

Liquor National Pty Ltd (in liquidation) sought approval under section 477(2B) of the Corporations Act 2001 (Cth) for a litigation funding agreement to investigate potential claims against ANZ Bank and Mr James. The Court was asked to grant the approval nunc pro tunc to allow the liquidators to enter into the agreement. The liquidators, Mr Hurst and Mr Baird, argued that the agreement was a proper exercise of their powers and that it was necessary to investigate the potential claims, which had significant value.

The court had to decide whether the liquidators should receive approval for entering into the litigation funding agreement after a significant delay. The delay was partly due to ongoing litigation between Mr James and ANZ Bank. The court considered whether the delay was justified and whether the liquidators' decision to enter into the agreement was proper. The court had to balance the liquidators' duty to investigate potential claims against the need to seek approval for the agreement in a timely manner. The court also had to decide whether the information contained in the agreement should be kept confidential.

The Court granted the liquidators' application for approval of the litigation funding agreement nunc pro tunc. The Court found that the delay in seeking approval was explained by the ongoing litigation between Mr James and ANZ Bank. The Court also found that the liquidators' decision to enter into the agreement was proper and that there was no reason to doubt the need to investigate the potential claims. The Court accepted that the information contained in the agreement was confidential and commercially sensitive and granted an order for confidentiality under section 37AF of the Federal Court of Australia Act 1976 (Cth).

The Court made several orders, including authorising the liquidators to enter into the litigation funding agreement, ordering the liquidators to file a redacted version of an affidavit, and directing the liquidators to serve a copy of the orders on the general purpose liquidators and all creditors of the companies listed in the second schedule. The Court also ordered the liquidators to pay their costs of the application out of the property of the companies listed in the second schedule.