In the matter of Hawden Constructions Pty Limited (in liquidation) and Hawden Property Group Pty Limited (in liquidation)

[2018] NSWSC 1472

Supreme Court

New South Wales

Medium Neutral Citation:	In the matter of Hawden Constructions Pty Limited (in liquidation) and Hawden Property Group Pty Limited (in liquidation) [2018] NSWSC 1472
Hearing dates:	On papers
Decision date:	28 September 2018
Jurisdiction:	Equity - Corporations List
Before:	Black J
Decision:	Orders made for the release of the liquidator and the deregistration of the company.
Catchwords:	CORPORATIONS – winding up – liquidators – order sought for release of liquidator and deregistration of company.
Legislation Cited:	- Corporations Act 2001 (Cth) ss 480, 481, 488
Cases Cited:	- Cherry v Boultbee (1839) 4 My & Cr 442; (1839) 41 ER 171 - Re Hawden Property Group Pty Ltd (in liq) (ACN 003 528 345) [2018] NSWSC 481; (2018) 125 ACSR 355 - Re One.Tel Ltd (in liq) [2014] NSWSC 1892 - Re RR Impex Pty Ltd (in liq) [2013] NSWSC 1667 - Re Sakr Nominees Pty Ltd [2017] NSWSC 668
Category:	Procedural and other rulings
Parties:	David Richard Hawes (and Others) (First Plaintiff) Trevor Laurence Dean (and Others) (First Defendant) Mark Roufeil in his capacity as liquidator of Hawden Property Group Pty Limited (in liquidation) (Applicant)
Representation:	Counsel:   Solicitors: ERA Legal (Applicant)
File Number(s):	2009/290891

Judgment

1. By Interlocutory Process filed on 6 February 2018, the Applicant (“Mr Roufeil”), who is the liquidator of the Third Defendant (“Hawden Property”), sought, inter alia, directions in respect of the application of set off under s 553C of the Corporations Act 2001 (Cth) in respect of various proofs of debt lodged in the liquidation of Hawden Property, the application of the rule in Cherry v Boultbee (1839) 4 My & Cr 442; (1839) 41 ER 171 in relation to the distribution of the surplus assets of Hawden Property and, subject to those directions, leave to distribute the surplus assets to Hawden Property’s contributories.

2. On 20 April 2018, for the reasons set out in his judgment (Re Hawden Property Group Pty Ltd (in liq) (ACN 003 528 345) [2018] NSWSC 481; (2018) 125 ACSR 355), Gleeson JA made orders that, under s 488(2) of the Corporations Act, Mr Roufeil has special leave to distribute the surplus in the winding up of Hawden Property; and stood over paragraphs 4 and 6 of the Amended Interlocutory Process filed 11 April 2018 for further hearing. Mr Roufeil has distributed the surplus in the winding up and now seeks to move on those paragraphs 4 and 6 of the Amended Interlocutory Process, which seek orders for his release as liquidator and that ASIC deregister Hawden Property under s 480(d) of the Act. That application was referred to me as Corporations Judge and the liquidator requested that it be determined in Chambers. I am satisfied that the application can properly be determined in that manner. I have drawn on Mr Roufeil’s helpful written submissions in this judgment.

3. Mr Roufeil relies on his affidavit sworn 2 February 2018 and exhibit “MR-1” to that affidavit and his further affidavit sworn 21 September 2018 in support of the application. Mr Roufeil’s evidence is that all of the debts of the creditors of Hawden Property have been discharged in full (Roufeil 21.9.18 [15(c)]) and that, on 31 August 2018, he declared and paid a fully franked dividend of $241,598.68 to a contributory of Hawden Property, Mr Dean (Roufeil 21.9.18 [16]). No dividend was paid to the other contributory of Hawden Property, the bankrupt estate of Mr Hawes, in accordance with the conclusions reached by Gleeson JA in his earlier judgment.

4. Mr Roufeil addresses the majority of the matters set out in r 7.5 of the Supreme Court (Corporations) Rules 1999 (NSW) in his second affidavit (Roufeil 21.9.18 [10]-[31]). Mr Roufeil makes the statement required by r 7.5(4) of the Supreme Court (Corporations) Rules that, to the best of his belief, there has been no act done or default made by him in the administration of Hawden Property’s affairs or otherwise in relation to his conduct as liquidator which is likely to give rise to any liability to Hawden Property or any creditor or contributory, and that he is not aware of any claim made by any person of such an act or default.

5. Mr Roufeil acknowledges, in his submissions, that his Interlocutory Process did not comply with rr 7.5(2)(a)-(b) which require an interlocutory process seeking an order under s 480(d) of the Corporations Act to include a notice stating that any objection to the release of the liquidator must be made by filing and serving a notice of objection, in the prescribed form, within 21 days after the date of service of the interlocutory process, and also to set out the terms of s 481(3) of the Act. Rule 7.5(6) of the Supreme Court (Corporations) Rules requires a liquidator seeking relief under s 480(d) of the Actto serve a copy of a summary of the liquidator’s receipts and payments in the winding up of the company and the statement of the financial position of the company at the date when the interlocutory process was filed on each creditor who proved a debt in the winding up and on each contributory. Mr Roufeil has not served these documents on each creditor who proved in the winding up.

6. The Court has power under s 14 of the Civil Procedure Act 2005 (NSW) to dispense with requirements of the rules of the Court, including the Supreme Court (Corporations) Rules, if it is satisfied that it is appropriate to do so in the circumstances of the case. Mr Roufeil submits that the Court should dispense with the requirements under rr 7.5(2)(a) and 7.5(2)(b), where the contributories, Mr Dean and the bankrupt estate of Mr Hawes, have notice of this application and either consent or consider it a matter properly left for the determination of the Court (Roufeil 21.9.18 [10]-[12]); all of the claims of the creditors of Hawden Property have been discharged in full (Roufeil 21.9.18 [15](c)); the proposed orders sought under section 480(d) of the Actwill include a statement setting out the terms of section 481(3) of the Act; and (d) any order under section 480(d) of the Actmay be revoked on proof that it was obtained by fraud or by suppression or concealment of any material. I am satisfied that I should dispense with the application of rr 7.5(2)(a)-(b) for these reasons, and also recognising that the substantive issues in respect of the distribution were determined by Gleeson JA in his earlier judgment. Mr Roufeil submits that the Court should dispense with the requirement under r 7.5(6), in circumstances where the debts of the creditors of Hawden Property have been discharged in full. I am satisfied that I should dispense with the application of that rule in respect of service upon creditors) for that reason.

7. As Mr Roufeil notes in submissions, s 480(d) of the Corporations Act provides that, where a liquidator has realised all of a company’s property or so much of that property as can, in his or her opinion, be realised without needlessly protracting the winding up, and has distributed any final dividend to the creditors and adjusted the rights of the contributories among themselves and made any final return to the contributories, he or she may apply to the Court for an order that he or she be released and that ASIC deregister the company.

8. Mr Roufeil submits that the Court should make the order sought under s 480(d) of the Corporations Act where he has addressed the balance of the matters required by r 7.5 and there is no objection to that order by the contributories or the Australian Securities and Investments Commission. I reviewed the relevant authorities in respect of an application for release as a liquidator in Re RR Impex Pty Ltd (in liq) [2013] NSWSC 1667 (“RR Impex”) and subsequently in Re One.Tel Ltd (in liq) [2014] NSWSC 1892 and Re Sakr Nominees Pty Ltd [2017] NSWSC 668 at [34]. As I noted in RR Impex above at [3], s 480(d) of the Corporations Act implies that, once the Court is satisfied that relevant notifications have been given, no creditors or contributories have objected to a liquidator’s release or raised any concern as to the performance of his or her duties, and the other evidence contemplated by the Supreme Court (Corporations) Rules is placed before the Court, then the Court would ordinarily make an order releasing a liquidator unless any reason emerges why it should not do so. I am satisfied that such an order should be made in this case, for those reasons.

9. Accordingly, I make orders 1 and 2 and note paragraph 3 in the Short Minutes of Order initialled by me and placed in the file.

**********

Decision last updated: 04 October 2018