In the matter of Henry Walker Eltin Group Ltd (Administrators Appointed)

[2005] FCA 316

FEDERAL COURT OF AUSTRALIA

In the matter of Henry Walker Eltin Group Ltd (Administrators Appointed) [2005] FCA 316

Corporations Act 2001 (Cth) s 439A, 447A

Bernsteen Pty Ltd v Newmore Pty Ltd (1995) 13 ACLC 1608 cited
ReDaisytek Australia Pty Ltd [2003] FCA 575 cited
Re Diamond Press Australia Pty Ltd [2001] NSWSC 313 applied

IN THE MATTER OF HENRY WALKER ELTIN GROUP LTD (ADMINISTRATORS APPOINTED)
NSD 224 OF 2005

HELY J
16 FEBRUARY 2005
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 224 OF 2005

BETWEEN:

ANTHONY GREGORY McGRATH
FIRST PLAINTIFF

SCOTT BRADLEY KERSHAW
SECOND PLAINTIFF

JOSEPH DAVID HAYES
THIRD PLAINTIFF

SHAUN ROBERT FRASER
FOURTH PLAINTIFF

HENRY WALKER ELTIN GROUP LTD
FIFTH PLAINTIFF

JUDGE:

HELY J

DATE OF ORDER:

16 FEBRUARY 2005

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

1.Pursuant to s 439(6) of the Corporations Act 2001 (Cth), the period within which the administrators of Henry Walker Eltin Group Limited (Administrators Appointed) and of each of the 25 other companies set out in the Schedule hereto must convene meetings of creditors under s 439A of the Corporations Act 2001 (Cth) is extended up to and including 23 May 2005.

2.Pursuant to s 447A(1) of the Corporations Act 2001 (Cth), the meetings of the creditors of Henry Walker Eltin Group Limited (Administrators Appointed) and each of the 25 other companies set out in the Schedule hereto required by s 439A of that Act may be held at any time during, or within 5 business days after the end of, the convening period, as extended by Order 1 above notwithstanding the provisions of s 439A(2) of the Corporations Act 2001 (Cth).

3.Liberty be granted to the plaintiffs to apply for any further extensions of the convening period referred to in Order 1 at any time prior to 23 May 2005.

4.The costs and expenses of this application be costs and expenses of the administration of Henry Walker Eltin Group Limited (Administrators Appointed) and the 25 other companies set out in the Schedule hereto.

5.Liberty to apply be granted to any person who can demonstrate sufficient interest to modify or discharge the orders on appropriate notice to the plaintiffs.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

SCHEDULE
“HWE Group”
All in administration.

Company  ACN
Henry Walker Eltin Group Limited  007 710 483
Bulumba Pty Limited  008 060 240
Capnorth Developments Pty Limited   009 640 251
Castlemaine Wastewater Treatment Pty Limited   081 417 030
HWE Civil Pty Limited  106 551 302
HWE Finance Pty Limited  009 593 668
HWE Land Pty Limited  009 614 788
HWGL Services Pty Limited  009 615 436
HWIO Pty Limited  072 445 179
Inventive Pty Limited  009 639 310
LSM Projects Pty Limited   106 580 134
Northaust Auto Hire Pty Limited   009 639 490
Simon Engineering (Australia) Holdings Pty Ltd  000 142 165
Simon Engineering (Australia) Pty Limited  000 117 000
Bridge Autos Pty Limited  009 625 816
Dover Investments Pty Limited   009 637 914
ACN 009 366 036 Pty Limited   009 366 036
Castleton Pty Limited   009 210 664
Eltin International Pty Limited   009 211 456
Eltin Open Pit Operations Pty Limited   008 918 278
Eltin Surface Mining Pty Limited   062 450 113
Eltin Underground Operations Pty Limited  008 906 849
Henry Walker Eltin Contracting Pty Limited   009 625 138
Henry Walker Environmental Pty Limited   009 627 490
Henry Walker Underground Pty Limited   007 649 274
HWE Cockatoo Pty Limited   009 639 285

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 224 OF 2005

BETWEEN:

ANTHONY GREGORY McGRATH
FIRST PLAINTIFF

SCOTT BRADLEY KERSHAW
SECOND PLAINTIFF

JOSEPH DAVID HAYES
THIRD PLAINTIFF

SHAUN ROBERT FRASER
FOURTH PLAINTIFF

HENRY WALKER ELTIN GROUP LTD
FIFTH PLAINTIFF

JUDGE:

HELY J

DATE:

16 FEBRUARY 2005

PLACE:

SYDNEY

1. Administrators were appointed to 26 companies which constitute the Henry Walker Eltin Group (‘HWE Group’) on 31 January 2005. On 1 February 2005 those administrators resigned and the plaintiffs were appointed joint voluntary head administrators in their stead. The convening period under s 439A(1) of the Corporations Act 2001 (Cth) expires on 21 February 2005. This is an application under s 439A(6) to extend the convening period to 23 May 2005.

2. Meetings of creditors of the company were held on 8 February 2005 in Darwin, Perth and Sydney.  No resolutions were passed at those meetings for removal of the administrators.  The creditors present at the meetings were informed of the administrators’ intention to make this application and no opposition to that course was voiced at those meetings.  Committees of creditors were appointed to each of the companies and on 15 February 2005 Committee members were notified by a circular of the administrators’ intention to make this application. No objections to the application have been registered.

3. The application is occasioned by the fact that the HWE Group is a very complex group of companies carrying on business both in the States and Territories of Australia as well as in a number of countries overseas.  The businesses conducted by the members of the HWE Group are extensive and multi-faceted.  The HWE Group continued to trade up until 31 January 2005.  The evidence establishes that the administrators need more time to review the viability of the various businesses within the HWE Group to determine the best method of realisation of its assets.

4. For the reasons which are explained in more detail in the affidavit of Mr McGrath, the administrators will not be in a position to prepare an adequate administrative report prior to 21 February 2005.  I accept that the principles applicable on an application such as this are as set out in the document styled ‘Plaintiffs’ submissions’ which I have placed with the papers.

5. Adopting the language of Barrett J in Re Diamond Press Australia Pty Ltd [2001] NSWSC 313 at [10], it seems to me that the balance to which his Honour referred should, in this case, be struck by granting the extension sought. Superficially, the period of the extension is a long one, but in the circumstances it seems to me to be justified. I therefore propose to make orders in accordance with pars 1, 2, 3 and 4 of the document styled ‘Order’ which I have signed and placed with the papers. However, there are a couple of comments I wish to make in relation to those orders. First, this application was made ex parte, as was the application made to Lindgren J in ReDaisytek Australia Pty Ltd [2003] FCA 575. It is not unheard of for applications under the Corporations Act 2001 (Cth) to be made without joining a contradictor even though the jurisdiction being exercised is Federal jurisdiction which requires the existence of a matter which would ordinarily involve a contradictor.

6. The second aspect of the same issue is that there are, at least in point of theory, persons whose interests could be adversely affected by the making of these orders and who might wish to challenge the making of them.  It is the existence of those people and of those interests which demonstrate that the matter is within Federal jurisdiction, even though a contradictor has not been named. It is consistent with principle that I should reserve liberty to any person who can demonstrate a sufficient interest to apply to modify or discharge these orders on appropriate notice to the plaintiffs.

7. Finally, whilst I have reserved liberty to apply, I have done so in a perfunctory fashion and without expressing any view as to what should happen in the event that anybody should seek to take advantage of that liberty, having regard to the terms of s 439A(6) of the Corporations Act 2001 (Cth) and to the decision of Branson J in Bernsteen Pty Ltd v Newmore Pty Ltd (1995) 13 ACLC 1608.

8. I therefore make the following orders, with the direction that they be entered forthwith:

   1.Pursuant to s 439(6) of the Corporations Act 2001 (Cth), the period within which the administrators of Henry Walker Eltin Group Limited (Administrators Appointed) and of each of the 25 other companies set out in the Schedule hereto must convene meetings of creditors under s 439A of the Corporations Act 2001 (Cth) is extended up to and including 23 May 2005.

   2.Pursuant to s 447A(1) of the Corporations Act 2001 (Cth), the meetings of the creditors of Henry Walker Eltin Group Limited (Administrators Appointed) and each of the 25 other companies set out in the Schedule hereto required by s 439A of that Act may be held at any time during, or within 5 business days after the end of, the convening period, as extended by Order 1 above notwithstanding the provisions of s 439A(2) of the Corporations Act 2001 (Cth).

   3.Liberty be granted to the plaintiffs to apply for any further extensions of the convening period referred to in Order 1 at any time prior to 23 May 2005.

   4.The costs and expenses of this application be costs and expenses of the administration of Henry Walker Eltin Group Limited (Administrators Appointed) and the 25 other companies set out in the Schedule hereto.

   5.Liberty to apply be granted to any person who can demonstrate sufficient interest to modify or discharge the orders on appropriate notice to the plaintiffs.

I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Hely.

Associate:

Dated:            30 March 2005

Counsel for the Plaintiff:	M B Oakes SC
Solicitor for the Plaintiff:	Kemp Strang
Date of Hearing:	16 February 2005
Date of Judgment:	16 February 2005