In the matter of New Cap Reinsurance Corporation Limited (in liq) (Subject to a Scheme of Arrangement)

[2014] NSWSC 980

Supreme Court

New South Wales

Medium Neutral Citation:	In the matter of New Cap Reinsurance Corporation Limited (in liq) (Subject to a Scheme of Arrangement) [2014] NSWSC 980
Hearing dates:	21 July 2014
Date of orders:	21 July 2014
Decision date:	21 July 2014
Jurisdiction:	Equity Division - Corporations List
Before:	Brereton J
Decision:	Time for annual general meeting extended
Catchwords:	CORPORATIONS – external administration – winding up – annual general meetings of creditors – extending time for convening annual general meeting
Legislation Cited:	(Cth) Corporations Act 2001, s 508(1), s 509(1), s 1322(4)
Cases Cited:	National Roads and Motorists' Association Limited v Parkin (No 2) (2004) 49 ACSR 501 NRMA Insurance Group Limited v Spragg (2001) 38 ACSR 174
Category:	Procedural and other rulings
Parties:	New Cap Reinsurance Corporation Limited (in liq) (Subject to a Scheme of Arrangement) ACN 075 962 551 (first plaintiff) John Raymond Gibbons in his capacity as liquidator of New Cap Reinsurance Corporation Limited (in liq) ACN 075 962 551 (second plaintiff)
Representation:	Counsel: P Dowdy (plaintiffs) Solicitors: Henry Davis York (plaintiffs)
File Number(s):	2014/188493

Judgment (ex tempore)

1. HIS HONOUR: The plaintiff John Raymond Gibbons is the liquidator of New Cap Reinsurance Corporation Limited, which went into a creditors’ voluntary winding up on 16 September 1999, Mr Gibbons having previously been appointed voluntary administrator of the company on 21 April 1999. The liquidation has been complex and protracted but is now drawing to a close.

2. Pursuant to (Cth) Corporations Act 2001, s 508(1), the liquidator is obliged to convene an annual general meeting of the company by 30 September 2014, the time for convening such a meeting having already been extended by orders made by Santow J on 2 July 2001. The liquidator anticipates that he will soon be in a position to convene the final meeting of creditors and members required by Corporations Act, s 509(1), but that he will not be in a position to do so prior to 30 September 2014. In order to avoid the costs of convening two meetings at this late stage of the liquidation - both an annual general meeting under s 508(1) prior to 30 September 2014 and the final meeting of creditors and members under s 509(1) at some later date - the liquidator seeks by originating process filed on 25 June 2014 an order extending the time for convening the next annual meeting required under s 508(1)(b) to 31 December 2014. In fact, the liquidator anticipates that such meeting will probably not be necessary, as the final meeting will likely have taken place before the extended date.

3. The application is supported by the Committee of Inspection which, at a meeting held on 9 June 2014, resolved that it supported the liquidator making an application for an order extending the time for convening the annual meeting of creditors to 31 December 2014.

4. Corporations Act, s 1322(4), provides that, subject to subsection (6) of that section but without limiting the generality of any other provision of the Act, the Court may on application by any interested person make orders (either unconditionally or subject to such conditions as the Court imposes) of various categories, including (d) an order extending the period for doing any act, matter or thing or instituting or taking any proceedings under this Act or in relation to a corporation, and may make such consequential or ancillary orders as the Court thinks fit. Subsection (6) provides that the Court must not make an order under the section unless it is satisfied that, relevantly, (c) no substantial injustice has been or is likely to be caused to any person.

5. As I have mentioned, s 1322(4)(d) has already been used in these proceedings by Santow J to make what is in effect a standing order extending time for convening the annual general meetings to 30 September of each relevant year during the liquidation. It was further utilised by Black J on 11 September 2012 to extend the time for convening the annual general meeting in 2012 to 31 October 2012.

6. In NRMA Insurance Group Limited v Spragg (2001) 38 ACSR 174, Santow J utilised s 1322(4) to extend the time in which a requisitioned meeting must be convened so as to coincide with an annual general meeting. It was similarly used by Campbell J, as he then was, in National Roads and Motorists' Association Limited v Parkin (No 2) (2004) 49 ACSR 501, in which his Honour held that consideration of such an application involved a two stage process, the first being whether a case had been made out for an extension of time, and the second being whether the extension sought would cause substantial injustice.

7. Interests of economy and efficiency in finalising the winding up make out a case for the extension of time sought. The support of the committee of inspection and the circumstance that a meeting will in any event be held within three months of the date presently fixed indicates that there will be no substantial injustice. Accordingly, I will make the orders sought.

8. The Court orders:

1. Pursuant to Corporations Act, s 1322(4)(d), the time for the convening of the next annual meeting of the first plaintiff's creditors required under Corporations Act, s 508(1)(b), be further extended to 21 December 2014.

2. The plaintiffs and any member of the first plaintiff's committee of inspection be granted liberty to apply on seven days’ notice.

3. The plaintiffs' costs of this application be the costs in the liquidation.

9. The Court directs that:

1. The second defendant circulate a copy of these orders to each member of the first plaintiff's committee of inspections within seven days of the orders being entered.

2. The exhibit may be returned.

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Decision last updated: 04 February 2015