In the matter of Paris Ricki Pty Limited

Supreme Court

New South Wales

Medium Neutral Citation: In the matter of Paris Ricki Pty Limited [2015] NSWSC 2048
Hearing dates: 20 April 2015
Date of orders: 20 April 2015
Decision date: 20 April 2015
Jurisdiction: Equity - Corporations List
Before: Brereton J
Decision:
Winding up terminated; liquidator to make payments ordered out of balance of moneys held in the liquidation.

Catchwords: CORPORATIONS – winding up – liquidators – liquidator’s remuneration – approval of liquidator’s remuneration by court – requirement of meeting of creditors to approve remuneration to be convened before court approval can be given – doctrine of unanimous assent – where sole creditor has indicated approval of proposed remuneration in advance of meeting of creditors – held, resolution of creditors passed for the purposes of (Cth) Corporations Act 2001, s 473(3)(b)(i).
Legislation Cited: (Cth) Corporations Act 2001, s 473(3), s 473(4)
Cases Cited: Re Interchase Corporation Ltd (in prov liq) (1993) 11 ACSR 569
Category: Procedural and other rulings
Parties: Malcolm Downie (applicant)
Schreiber Hamilton Architecture Pty Ltd (first respondent/plaintiff)
Brad William Morelli in his capacity as liquidator of Paris Ricki Pty Ltd (in liquidation) (second respondent)
Paris Ricki Pty Ltd (in liquidation) ACN 089 935 099 (third respondent/defendant)
Representation:
Counsel:
R D Marshall (applicant)
A Kozary (second respondent)
Solicitors:
Bowles Lawyers Pty Ltd (applicant)
Keystone Lawyers (respondents)

File Number(s): 2013/314415

Judgment (ex tempore)

HIS HONOUR: The company Paris Ricki Pty Limited was wound up by order of the Court made on 29 November 2013. By application filed on 24 February 2015, its sole director Malcolm Downie applies for an order terminating the winding up. The evidence establishes that the winding up appears to have resulted from the failure of those of the registered office to inform the controlling minds of the company of the service of the documents that initiated the winding up process. The evidence establishes that the company is amply solvent and that, as a result of the orders proposed to be made, the only creditor will be paid in full and the liquidator's remuneration will also be paid.
The liquidator's remuneration has not yet been approved, and the Court is asked to approve that remuneration. The difficulty is that (Cth) Corporations Act 2001, s 473(3), has the effect of requiring that, before the Court can approve remuneration, the creditors must be given an opportunity to do so at a meeting of creditors, and that such a meeting must be convened in accordance with s 473(4). As Drummond J said in Re Interchase Corporation Ltd (in prov liq) (1993) 11 ACSR 569 (at 574):

Before the Court can act under s 473(3)(b)(ii) the liquidator must first have acted in accordance with s 473(4) to convene a meeting of creditors for the purpose of fixing his remuneration. If no creditor attends either in person or by proxy, or if a meeting actually takes place but the prescribed resolution is not passed, the pre-condition to the court being empowered to act will be satisfied. But unless that occurs the court, in my opinion, has no power to fix the liquidator's remuneration.

In this case, a meeting has been convened for Monday 27 April, and the requisite notice sent to the only creditor. That creditor has communicated that it agrees to the remuneration sought in the amount of $58,864.85. It is improbable, if the creditor is paid out as a result of these orders, that it will be bothered to attend a meeting on 27 April, and it can be foreseen that it is unlikely that such a resolution will then be passed.
However, I think the better view is that the doctrine of unanimous assent can be taken to apply when the sole creditor has indicated, albeit in advance of the meeting, that it agrees to the proposed remuneration. Accordingly, it can be taken that there is a resolution of creditors for the purposes of s 473(3)(b)(i).
The liquidator consents to the orders proposed.
The Court orders that:

The winding up of Paris Ricki Pty Limited (in liquidation) ACN 089 935 099 (“the company”) be terminated on and from 21 April 2015.

From the balance of the moneys held in the liquidation of the company, the liquidator Brad William Morelli is to pay the following amounts today:

$80,205 to Schreiber Hamilton Architects Pty Ltd.

$58,864.85 to Mr Morelli for his remuneration, on the footing that such remuneration has been approved by resolution of the creditors under Corporations Act, s 473(3)(b)(i).

$10,000 to ERA Legal.

$5,000 to Mr Morelli for his disbursement for legal fees.

The balance to Bells Lawyers Statutory Trust Account.

These orders are to be entered forthwith.

**********

Paris Ricki Pty Limited was the subject of a winding-up application, and the matter before the court was the approval of the liquidator's remuneration. The court was required to determine whether the resolution of creditors was validly passed for the purposes of section 473(3)(b)(i) of the Corporations Act 2001. The sole creditor had indicated approval of the proposed remuneration prior to the meeting of creditors, raising questions about the necessity of convening a creditors' meeting under the doctrine of unanimous assent.

The central legal issue was whether the resolution of creditors could be considered passed despite the absence of a creditors' meeting, given the sole creditor's prior approval. The court examined the statutory provisions and case law to ascertain the requirements for a valid resolution under section 473(3)(b)(i) of the Corporations Act 2001. It considered whether the doctrine of unanimous assent mandated a formal meeting or if the sole creditor's pre-meeting approval sufficed to constitute a passed resolution.

The court held that the doctrine of unanimous assent does not necessarily require a formal creditors' meeting if the sole creditor has given their consent in advance. The court found that the resolution of creditors was effectively passed for the purposes of the Act, as the sole creditor's prior approval aligned with the principles of unanimous assent. Consequently, the court approved the liquidator's remuneration without the need for a creditors' meeting to be convened.

The court's decision was that the resolution of creditors was validly passed, and the liquidator's remuneration was approved. This ruling clarified that in cases involving a sole creditor, their prior consent can suffice under the doctrine of unanimous assent, negating the need for a formal creditors' meeting.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established

Medium Neutral Citation:	In the matter of Paris Ricki Pty Limited [2015] NSWSC 2048
Hearing dates:	20 April 2015
Date of orders:	20 April 2015
Decision date:	20 April 2015
Jurisdiction:	Equity - Corporations List
Before:	Brereton J
Decision:	Winding up terminated; liquidator to make payments ordered out of balance of moneys held in the liquidation.
Catchwords:	CORPORATIONS – winding up – liquidators – liquidator’s remuneration – approval of liquidator’s remuneration by court – requirement of meeting of creditors to approve remuneration to be convened before court approval can be given – doctrine of unanimous assent – where sole creditor has indicated approval of proposed remuneration in advance of meeting of creditors – held, resolution of creditors passed for the purposes of (Cth) Corporations Act 2001, s 473(3)(b)(i).
Legislation Cited:	(Cth) Corporations Act 2001, s 473(3), s 473(4)
Cases Cited:	Re Interchase Corporation Ltd (in prov liq) (1993) 11 ACSR 569
Category:	Procedural and other rulings
Parties:	Malcolm Downie (applicant) Schreiber Hamilton Architecture Pty Ltd (first respondent/plaintiff) Brad William Morelli in his capacity as liquidator of Paris Ricki Pty Ltd (in liquidation) (second respondent) Paris Ricki Pty Ltd (in liquidation) ACN 089 935 099 (third respondent/defendant)
Representation:	Counsel: R D Marshall (applicant) A Kozary (second respondent) Solicitors: Bowles Lawyers Pty Ltd (applicant) Keystone Lawyers (respondents)
File Number(s):	2013/314415