In the matter of Aboriginal Connections Aboriginal Corporation (In Liquidation) and Guri Wa Ngundagar Aboriginal Corporation (In Liquidation)
[2012] NSWSC 491
•14 May 2012
Supreme Court
New South Wales
Medium Neutral Citation: In the matter of Aboriginal Connections Aboriginal Corporation (In Liquidation) and Guri Wa Ngundagar Aboriginal Corporation (In Liquidation) [2012] NSWSC 491 Hearing dates: 4 October 2011, 19 April 2012 Decision date: 14 May 2012 Jurisdiction: Equity Division - Corporations List Before: Barrett JA Decision: Pooling order to be made
Catchwords: CORPORATIONS - winding up - application for "pooling order" in respect of two entities in liquidation - one a company the other an Aboriginal and Torres Strait Islander corporation - whether the windings up of a "group" consisting of corporations of these different types may be pooled under either the Corporations Act 2001 (Cth) or the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth) - held that they may not - the company later obtains re-registration under the Corporations (Aboriginal and Torres Strait Islander) Act and deregistration under the Corporations Act - application renewed under provisions of the Corporations Act applied by the Corporations (Aboriginal and Torres Strait Islander) Act to the windings up of Aboriginal and Torres Strait Islander corporations - consideration on the merits by reference to the six questions identified in Re Kirby Street (Holdings) Pty Ltd [2011] NSWSC 1536 - pooling approved Legislation Cited: Aboriginal Councils and Associations Act 1976 (Cth)
Corporations Act 2011 (Cth), Subdivision B of Division 8 of Part 5.6, ss 9, 118, 579E(1), 579E(2), 579E(10), 579E(11), 579E(12), 579J, 579Q, 601AJ, 1337B
Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth), Division 22 of Part 2-2, ss 42(1), 42.3, 46(a)(iii), 48(3), 50, 526.35(1), 526.35(3), 586.5
Corporations (Aboriginal and Torres Strait Islander) Consequential, Transitional and Other Measures Act 2006 (Cth), para 3(1) of Division 1 of Part 2 of Schedule 3
Corporations Regulations 2001 (Cth), regs 5.6.73(1)(a), 5.673(1)(b), 5.6.73(2)Cases Cited: Allen v Feather Products Pty Ltd [2008] NSWSC 259; (2008) 72 NSWLR 597
Cant v Kirby [2011] NSWSC 1193
R v Toohey; Ex parte Meneling Station Pty Ltd [1982] HCA 69; (1982) 158 CLR 327
Re Australian Hotel Acquisition Ltd [2011] NSWSC 1374
Re Kirby Street (Holding) Pty Ltd [2011] NSWSC 1536; (2011) 87 ACSR 84Category: Principal judgment Parties: In the matter of Aboriginal Connections Aboriginal Corporation (In Liquidation) and Guri WA Ngundagar Aboriginal Corporation (In Liquidation)
Ian James Purchas - PlaintiffRepresentation: J Baird - Plaintiff
TressCox Lawyers - Plaintiff
File Number(s): 2011/00296187
Judgment
This matter first came before me in the Corporations List on 4 October 2011. Mr Baird of counsel appeared and made an application ex parte on behalf of Mr Purchas, the liquidator of the two relevant entities: Aboriginal Connection Pty Ltd ("AC") and Guri Wa Ngundagar Aboriginal Corporation ("GWN"). Each was subject to creditors voluntary winding up.
AC was, at that time, a "company" as defined by s 9 of the Corporations Act 2001 (Cth). It was registered under s 118 of that Act on 16 September 2002 as a proprietary company limited by shares. GWN, on the other hand, was incorporated on 22 May 1998 under the Aboriginal Councils and Associations Act 1976 (Cth) and was taken, by force of paragraph 3(1) of Division 1 of Part 2 of Schedule 3 to the Corporations (Aboriginal and Torres Strait Islander) Consequential, Transitional and Other Measures Act 2006 (Cth), to be registered as an Aboriginal and Torres Strait Islander corporation under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth): see Cant v Kirby [2011] NSWSC 1193 at [4].
The existence of GWN as a juristic person therefore derived from s 42.1 of the last-mentioned Act, which caused it to be a body corporate with perpetual succession.
By his originating process filed on 14 September 2011, Mr Purchas sought an order under s 579E(1) of the Corporations Act determining that AC and GWN are a "pooled group" for the purposes of s 579E.
Section 579E(1) is in the following terms:
"If it appears to the Court that the following conditions are satisfied in relation to a group of 2 or more companies:
(a) each company in the group is being wound up;
(b) any of the following subparagraphs applies:
(i) each company in the group is a related body corporate of each other company in the group;
(ii) apart from this section, the companies in the group are jointly liable for one or more debts or claims;
(iii) the companies in the group jointly own or operate particular property that is or was used, or for use, in connection with a business, a scheme, or an undertaking, carried on jointly by the companies in the group;
(iv) one or more companies in the group own particular property that is or was used, or for use, by any or all of the companies in the group in connection with a business, a scheme, or an undertaking, carried on jointly by the companies in the group;
the Court may, if the Court is satisfied that it is just and equitable to do so, by order, determine that the group is a pooled group for the purposes of this section."
An order by which the court so determines is, in terms of a definition in s 9, a "pooling order". Because of s 579E(2), the effect of a "pooling order" is, in substance, to cause the companies concerned to be treated as a single entity and for their windings up to proceed accordingly, with claims that one has against any of the others extinguished, debts payable by one to any of the others also extinguished and with each company taken to be jointly and severally liable for the debts of the others.
An essential first step in applying s 579E(1) is to identify "a group of 2 or more companies". In this particular context, "group" means nothing more than a collection or plurality and the reference to a "group" does not, of itself, make it necessary to find any relationship or shared characteristic: Allen v Feather Products Pty Ltd [2008] NSWSC 259; (2008) 72 NSWLR 597; Re Australian Hotel Acquisition Ltd [2011] NSWSC 1374; Re Kirby Street (Holding) Pty Ltd [2011] NSWSC 1536; (2011) 87 ACSR 84.
In this case, the identified "group" in respect of which the application was made consisted of GWN and AC. A finding that that group was "a group of 2 or more companies" therefore depended on it being established that each of GWN and AC was a "company" within the s 9 definition of that term.
When the matter first came before me, AC was such a "company" but GWN was not.
Mr Baird submitted, however, that, for the purpose of construing and applying s 579E(1) of the Corporations Act, GWN should be treated as a "company" and that this treatment was justified by s 526.35(1) of the Corporations (Aboriginal and Torres Strait Islander) Act which provides, in part, as follows:
"The Corporations Act winding up provisions apply to the winding up of an Aboriginal and Torres Strait Islander corporation as if the following substitutions were made . . ."
There follows in s 526.35(1) a table of substitutions containing two columns, one headed "For a reference to . . ." and the other headed "substitute a reference to . . .". Against "a company" in the first column appears "an Aboriginal and Torres Strait Islander corporation" in the second. There is thus a direction to substitute a reference to "an Aboriginal and Torres Strait Islander corporation" for each reference to "a company" in the "Corporations Act winding up provisions" or, more accurately, a direction to read the provisions "as if" that substitution were made.
Section 526.35(3) defines "Corporations Act winding up provisions" as follows:
"'Corporations Act winding up provisions' means:
(a) Parts 5.4, 5.4B, 5.5, 5.6, 5.7B, 5.8, 5.8A and 5.9 of the Corporations Act; and
(b) the other provisions of that Act (including Parts 1.2 and 9.4 and Schedule 3 but not including Parts 1.1, 1.1A and 9.4A) to the extent to which they relate to the operation of the Parts referred to in paragraph (a); and
(c) the regulations made under that Act for the purposes of the Parts of that Act referred to in paragraph (a) and the provisions referred to in paragraph (b);
but does not include the excluded winding up provisions of that Act."
The definition of "excluded winding up provisions" may, for present purposes, be ignored.
Section 579E and its related provisions appear in Subdivision B of Division 8 of Part 5.6 of the Corporations Act. They are accordingly within paragraph (a) of the definition of "Corporations Act winding up provisions" in s 526.35(3) of the Corporations (Aboriginal and Torres Strait Islander) Act. By force of s 526.35(1), therefore, s 579E and its related provisions "apply to the winding up of" GWN "as if" each reference in those provisions to a "company" were instead a reference to an "Aboriginal and Torres Strait Islander corporation".
The question that then arose is whether the reference in s 579E(1) to "a group of 2 or more companies" may be read as a reference to a group consisting of one or more companies and one or more Aboriginal and Torres Strait Islander corporations. Only if that was a permitted reading did GWN and AC make up a relevant "group".
Having had an opportunity, after the hearing on 4 October 2011, to consider the submissions of counsel and the terms of the legislation, I formed a tentative view that the court had no authority to make a "pooling" order in relation to a "group" consisting of a company registered as such under the Corporations Act and an Aboriginal and Torres Strait Islander corporation. I therefore invited Mr Baird, through my Associate, to review and make further submissions on the following analysis:
1. Section 526.35(1) of the Corporations (Aboriginal and Torres Strait Islander) Act directs substitution of one term for another when applying the Corporations Act winding up provisions to the winding up of an Aboriginal and Torres Strait Islander corporation. Those provisions are to be read "as if" the substitution were incorporated into them. By force of s 526.35(1), therefore, s 579E of the Corporations Act applies to the winding up of an Aboriginal and Torres Strait Islander corporation as if a reference to "2 or more Aboriginal and Torres Strait Islander corporations" were substituted for a reference to "2 or more companies".
2. The only operation that the applied provisions of the Corporations Act are given by the Corporations (Aboriginal and Torres Strait Islander) Act is an operation in which the word 'company' is invisible and the words 'Aboriginal and Torres Strait Islander corporation' are visible in its place.
3. That is the inevitable effect of substitution, being the process to be undertaken in accordance with the directive in the table in s 526.35(1) to 'substitute a reference to' an Aboriginal and Torres Strait Islander corporation '[f]or a reference to' a company. Meanings of 'substitute', as a transitive verb, in the Oxford English Dictionary (second edition, 1989, online version) include "To put (one) in place of another" and "To take the place of, replace". The principal meaning in the Macquarie Dictionary Online (2012) is 'to put (one person or thing) in the place of another'.
4. It must follow that when one puts a reference to "an Aboriginal and Torres Strait Islander corporation" in the place of every reference to "a company", no reference to "a company" remains.
5. The result, therefore, is that the text of s 579E(1), viewed as part of the Corporations Act, refers to "a group of 2 or more companies"; but that the same text, viewed as part of the 'Corporations Act winding up provisions' defined by s 526.35(3) of the Corporations (Aboriginal and Torres Strait Islander) Act and applied by that Act's s 526.35(1), refers to 'a group of 2 or more Aboriginal and Torres Strait Islander corporations'. Nowhere in the statutory scheme is it possible to find a reference to a group consisting of one or more companies and one or more Aboriginal and Torres Strait Islander corporations.
Mr Baird in due course agreed that s 579E(1) did not, either of its own force as a Corporations Act provision or through the force it has as one of the "Corporations Act winding up provisions" under the Corporations (Aboriginal and Torres Strait Islander) Act, enable the court to make an order in respect of the group consisting of AC (a company) and GWN (an Aboriginal and Torres Strait Islander corporation); and that this was so even though this court is invested with federal jurisdiction under both enactments (Corporations Act, s 1337B; Corporations (Aboriginal and Torres Strait Islander) Act, s 586.5).
An application for the adjournment of the application was then made so that Mr Purchas might investigate the feasibility of obtaining re-registration of one or other of the bodies so that both were of the same type. The adjournment was granted and, on several occasions, extended.
The matter came before me again on 19 April 2012. At that time, Mr Baird led evidence that AC had made both an application under s 601AJ of the Corporations Act for transfer of its registration to registration under the Corporations (Aboriginal and Torres Strait Islander) Act and an application under Division 22 of Part 2-2 of the latter Act for registration as an Aboriginal and Torres Strait Islander corporation; and that both those applications had been granted, with the result that registration of AC under the Corporations Act had ceased on 12 April 2012 and registration of it under the Corporations (Aboriginal and Torres Strait Islander) Act (by the name "Aboriginal Connections Aboriginal Corporation (In Liquidation)") had commenced on 11 April 2012 (whether both forms of registration subsisted concurrently at some point and, if so, what the implications of that might have been is not a question that arises here).
It follows that AC is today an Aboriginal and Torres Strait Islander corporation and is no longer a "company" as defined by the Corporations Act. Further, s 42.3 of the Corporations (Aboriginal and Torres Strait Islander) Act, it may be accepted, preserves the pre-existing winding up of AC and the status of Mr Purchas as liquidator even though, from 11 April 2012, it has been that Act, rather than the Corporations Act, that has governed the winding up.
As a consequence of the transfer of AC's registration and its re-registration as an Aboriginal and Torres Strait Islander corporation, AC and GWN can now be regarded as a "group" of Aboriginal and Torres Strait Islander corporations for the purposes of s 579E and related provisions of the Corporations Act as they apply, by virtue of s 526.35(1) of the Corporations (Aboriginal and Torres Strait Islander) Act, to the winding up of each of AC and GWN - that is, "as if" each reference to "a company" were instead a reference to "an Aboriginal and Torres Strait Islander corporation".
On that basis, I proceed to the merits of the application for a "pooling order" in respect of that "group". In doing so, I refer only to the Corporations Act provisions even though the references are, in reality, to those provisions as they are applied by s 526.35(1) of the Corporations (Aboriginal and Torres Strait Islander) Act.
I have already set out s 579E(1). The following provisions are also relevant:
"Section 579E(10)
(10) The Court must not make a pooling order in relation to a group of 2 or more companies if:
(a) both:
(i) the Court is satisfied the order would materially disadvantage an eligible unsecured creditor of a company in the group; and
(ii) the eligible unsecured creditor has not consented to the making of the order; or
(b) all of the following conditions are satisfied:
(i) a company in the group is being wound up under a members' voluntary winding up;
(ii) the Court is satisfied that the order would materially disadvantage a member of that company;
(iii) the member is not a company in the group;
(iv) the member has not consented to the making of the order.
Note: For eligible unsecured creditor, see section 579Q.
Section 579E(11)
(11) The Court may only make a pooling order on the application of the liquidator or liquidators of the companies in the group.
Section 579E(12)
(12) In determining whether it is just and equitable to make a pooling order, the Court must have regard to all of the following matters:
(a) the extent to which:
(i) a company in the group; and
(ii) the officers or employees of a company in the group;
were involved in the management or operations of any of the other companies in the group;
(b) the conduct of:
(i) a company in the group; and
(ii) the officers or employees of a company in the group;
towards the creditors of any of the other companies in the group;
(c) the extent to which the circumstances that gave rise to the winding up of any of the companies in the group are directly or indirectly attributable to the acts or omissions of:
(i) any of the other companies in the group; or
(ii) the officers or employees of any of the other companies in the group;
(d) the extent to which the activities and business of the companies in the group have been intermingled;
(e) the extent to which creditors of any of the companies in the group may be advantaged or disadvantaged by the making of the order;
(f) any other relevant matters."
In approaching an application for a pooling order, the court must consider the six questions identified in Re Kirby Street (Holding)Pty Ltd (above) at [7]:
1. Is there "a group of 2 or more companies" - or, in this case, Aboriginal and Torres Strait Islander corporations (s 579E(1), introductory words)?
2. Is each corporation in the group being wound up (s 579E(1)(a))?
3. Is at least one of the conditions in sub-paragraphs (i) to (iv) of s 579E(1)(b) satisfied?
4. What does the evidence show with respect to the matters in s 579E(12) as they may affect the answer to the following Question 5?
5. Is it just and equitable that the order sought be made (s 579E(1)(b) concluding words)?
6. Does s 579E(10) preclude the making of a pooling order?
For reasons already stated, Question 1 is now answered in the affirmative.
As to Question 2, I have already noted that s 42.3 of the Corporations (Aboriginal and Torres Strait Islander) Act operated at the time of re-registration of AC under that Act to preserve its pre-existing winding up and the status of Mr Purchas as liquidator. That, coupled with the fact that the winding up of GWN commenced and is continuing under the Corporations (Aboriginal and Torres Strait Islander) Act with Mr Purchas as liquidator, means that Question 2 is answered in the affirmative.
In relation to Question 3, the evidence establishes that each of AC and GWN is a "related body corporate" of the other, so that the condition in paragraph (i) of s 579E(1)(b) is satisfied. The conclusion of "related body corporate" status arises, via s 50, s 46(a)(iii) and s 48(3), from the circumstance that Mr Lockwood, the sole member of AC, holds his shares as a nominee for GWN.
I proceed to Question 4. In deciding whether, according to the concluding words of s 579E(1)(b), it is "just and equitable" that a pooling order be made, the court must, in obedience to s 579E(12), "have regard to" all of the matters specified in s 579E(12). The direction to "have regard to" the specified matters requires that the court "give weight to" those matters "as a fundamental element" in coming to a conclusion: R v Toohey; Ex parte Meneling Station Pty Ltd [1982] HCA 69; (1982) 158 CLR 327 at 333 per Gibbs CJ. The inquiry in the course of which the specified matters must be given that weight is as to what is "just and equitable".
In approaching Question 4 and the matters to which the court must "have regard", I pay particular attention to a report to creditors issued by Mr Purchas and dated 28 July 2011. He explains that, from 30 June 2009, GWN's principal activity was to support its associated entities, being AC and a company called "Aboriginal Connections Employment Services Pty Ltd". AC operated as a building company and traded from GWN's premises at South Kempsey. Mr Purchas ascertained that most of the plant and equipment used by AC was owned by GWN. This was not consistent with financial statements. He also found that there had been a significant intermingling of the entities' assets and liabilities. He spent considerable time attempting to present a financial position of each entity at the time of his appointment but is not at all confident that his attempts have been successful. His efforts were not assisted by the circumstance that, as he sees matters, the entities' books and records were not kept in accordance with statutory requirements. He believes there are significant inaccuracies and inconsistencies in the accounts. Dealing with the particular matters in s 579E(12), Mr Purchas expressed opinions as follows:
Section 579E(12)(a): A number of employees were not aware of the identity of their employer. They did not know whether they were employed by AC or GWN. The records do not accurately reflect various employees' status as permanent, casual or part-time. Key personnel of AC were formally employed by GWN. Child support payments were made by GWN for AC's employees. A number of employees were moved between the entities without documentation of the movement. Creditors were not aware of and did not understand the separation of employment between the entities. Government funding for AC's employees was sometimes paid to GWN and like funding for GWN's employees was sometimes paid to AC.
Section 579E(12)(b): Mr Purchas reported that goods and services used by AC (such as building materials, utilities and insurance) were invoiced to GWN. Government funding intended for GWN employees was used in the AC business, for example, to fund bank guarantees. Motor vehicles and equipment carried in the AC accounts were acquired by GWN. Some creditors informed Mr Purchas or his staff that officers of AC had held out to other persons that AC was a government-backed employer when in fact it was GWN which received government funding. AC's creditors were often paid by GWN and GWN creditors were often paid by AC, depending on where cash was available.
Section 579E(12)(c): According to Mr Purchas's assessment, GWN's main activity after 30 June 2009 was to support AC. As a consequence of the intermingling of accounts and records, the two entities were dependent on each other for their financial viability, so that if one was experiencing financial difficulties, so too was the other. Once GWN was no longer in a position to support AC, AC was unable to continue to trade and winding up followed.
Section 579E(12)(d): As mentioned already, motor vehicles and equipment carried in the books of AC were acquired by GWN. Motor vehicle and equipment lease payments for vehicles and equipment used by AC were made by GWN (without reimbursement). AC did not pay rent to GWN for the occupation of GWN's South Kempsey premises. The use in AC's business of government funding intended for GWN employees has already been noted. Loans to AC were secured against real estate owned by GWN.
Section 579(12)(e): Mr Purchas refers, in this context, to the difficulty of working out what each entity owes to the other. He has no confidence that the accounts accurately reflect the position so as to enable a reconciliation. He refers to the fact that, if any definitive findings ever proved possible, they would necessarily be the product of detailed and expensive analysis undertaken at arm's length. He refers to the possibility of the appointment of a special purpose liquidator. I take this to be an indication that he does not consider it to be feasible to reach any form of reliable reconciliation of the inter-entity position unless the two entities have separate liquidators who are prepared and able to draw formal battle lines regarding demarcation - a matter involving potentially great expense for creditors.
In summary, Mr Purchas paints a picture of virtually insoluble confusion as to the separate rights and obligations of the two entities and the state of the financial account between them, with very significant uncertainty as to which owns what and which owes what and to whom. I say "virtually insoluble" because it may be that a detailed and painstaking investigation, assisted perhaps by information obtained by resort to powers of compulsory examination, might, in time, allow the confusion to be resolved. But Mr Purchas's evidence makes it plain that any such investigation would be very costly and time consuming and, in those ways, would work to the disadvantage of creditors by diminishing the available assets and delaying any distribution.
I turn, therefore, to Question 5, that is, whether, "having regard to" the several specified matters, it is "just and equitable" that a pooling order be made. That question will be approached in the way I indicated in Re Kirby Street (Holding) Pty Ltd (above) at [77] - [78]:
"Numerous cases have considered the significance of the phrase "just and equitable". It is sufficient, I think, to refer to what was said by Sheller JA In Stephenson v State Bank of New South Wales (1996) 39 NSWLR 101 at 113 when considering s 66M of the Conveyancing Act 1919:
"The determination of what is just and equitable in the circumstances is not a matter of unfettered individual opinion, nor does it involve a discretion of an arbitrary kind; see Cominos v Cominos [1972] HCA 54; (1972) 127 CLR 588 at 599 ; [1972-73] ALR 581 at 587-8. As Kitto J observed in R v Commonwealth Industrial Court; Ex parte the Amalgamated Engineering Union, Australian Section [1960] HCA 46; (1960) 103 CLR 368 at 383; [1961] ALR 104 at 112-13, the criteria are of a nature with which Courts are familiar. In Talga v MBC International Ltd [1976] HCA 22; (1976) 133 CLR 622 at 634; 9 ALR 359 at 366 Stephen, Mason and Jacobs JJ dealing with the issue raised for the Court by the Banking Act 1974 of whether it was just and equitable that a transaction should be treated as valid, said:
'... The court will have before it an existing transaction replete with all its surrounding facts and circumstances and in their light will determine what is just and equitable. In doing so it will certainly be exercising a wide discretion that this is a commonplace of the curial process; the court will be bound to act judicially, exercising its discretion by reference only to such considerations affecting the transaction as, on an examination of the legislation, may be seen to be material to the decision which it is called on to make. Irrelevant matters, matters such as the plaintiffs instanced in the course of argument, which have no rational connection with the policy of the regulations but would be expressive only of the personal predilections of the Court cannot be allowed by it to play any part in its decision.'"
Section 579E(12) must therefore be seen as conferring a discretion that, while wide, can only be exercised judicially in the light of the whole of the circumstances surrounding the relevant subject matter."
The factors referred to in s 579E(12) are identified by the legislation as those central to the court's determination of what is just and equitable. The foregoing summary of the evidence in relation to those factors, viewed in the light of the whole of the surrounding circumstances as deposed to by Mr Purchas and the general conclusion stated at [35] above, persuades me that efficiency and saving beneficial to the creditors of both entities will be achieved if a pooling order is made and that the ultimate effectuation of the two windings up as if they together constituted a single winding up will serve the interests of those creditors.
I am therefore satisfied that, subject to the possible intervention of s 579E(10), it is just and equitable that the pooling order sought by the liquidator is made.
It remains, therefore, to consider Question 6 and the matters raised by s 579E(10). As I noted in Re Kirby Street (Holding) Pty Ltd (at [81]), the legislation seems to contemplate, at least on its face, that the court might conclude that it is "just and equitable" that a pooling order be made yet be precluded by s 579E(10) from making the order because it is satisfied that it would produce "material disadvantage" as there mentioned. I would repeat here my view that, if such "material disadvantage" were found, the court could not come to a positive conclusion on the "just and equitable" question. It is for that reason that I have expressed the conclusion at [38] in the terms in which it is expressed.
In turning to the question of "material disadvantage", I note that Mr Purchas wrote to all known creditors of both entities on 16 September 2011, informed them of his intention to seek a pooling order and explained the implications of such an order. His explanation was fair and accurate. There was thus an opportunity as envisaged by s 579J for creditors to make their views known. No creditor has contacted Mr Purchas to raise any question or to express any opposition or reservation.
Section 579E(10) is concerned with "eligible unsecured creditors", an expression defined by s 579Q. Having regard to that definition and to the fact that neither winding up is a members voluntary winding up, that there has been no modification of the kind referred to in regulation 5.6.73(1)(a) of the Corporations Regulations 2001 (Cth) and that the court has not made (or been invited to make) any determination as envisaged by regulation 5.6.73(1)(b) or regulation 5.6.73(2), the only creditors to be taken into account under s 579Q are those mentioned in s 579Q(1)(a) being, in summary terms, unsecured creditors of one or more of the two entities where none of those creditors is itself a group entity.
The steps taken by the liquidator to notify and explain to all such external creditors known to him of his intention to seek a pooling order, coupled with the unanimous lack of opposition or reservation, satisfy me that the liquidator took adequate steps to investigate and to bring to the court's attention matters concerning "eligible unsecured creditors" with which s 579E(10)(a)(i) is concerned; and that there is no demonstrated basis for a conclusion that the pooling order sought would materially disadvantage any such creditor.
The conclusion is, therefore, that Mr Purchas, as liquidator of both GWN and AC, has demonstrated to the satisfaction of the court all matters necessary to justify the making of a pooling order in respect of those two entities pursuant to s 579E of the Corporations Act, as applied by the Corporations (Aboriginal and Torres Strait Islander) Act to the "group" consisting of those two Aboriginal and Torres Strait Islander corporations. Such an order will be made.
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Decision last updated: 14 May 2012
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