In the matter of Worthbrook Pty Limited (No 2)

[2017] NSWSC 1335

Supreme Court

New South Wales

Medium Neutral Citation:	In the matter of Worthbrook Pty Limited (No 2) [2017] NSWSC 1335
Hearing dates:	29 August 2017 (written submission)
Date of orders:	03 October 2017
Decision date:	03 October 2017
Jurisdiction:	Equity - Corporations List
Before:	Brereton J
Decision:	Orders made as per previous judgment, as corrected by Liquidator’s submission
Catchwords:	CORPORATIONS – external administration – winding up – liquidators – application for directions – correction to previous judgment.
Legislation Cited:	(CTH) Corporations Act 2001, s 479(3)
Cases Cited:	Worthbrook Pty Ltd, Re [2017] NSWSC 1036
Category:	Consequential orders (other than Costs)
Parties:	David Ian Mansfield (plaintiff) Worthbrook Pty Ltd (first defendant) Rolcross Pty Ltd (second defendant)
Representation:	Counsel: A. Martin (plaintiff)   Solicitors: Stacks Champion (plaintiff)
File Number(s):	2017/137921

Judgment

1. On 8 August 2017, for reasons then published,[1] I indicated that I would be inclined to make orders to the effect that:

   1. Re Worthbrook Pty Limited [2017] NSWSC 1036.

1. Pursuant to (CTH) Corporations Act 2001, s 479(3), David Ian Mansfield, in his capacities as liquidator of Worthbrook Pty Limited and as liquidator of Rolcross Pty Limited, would be justified in:

2. proceeding on the basis that the company Worthbrook Pty Limited held its interest in the properties at 22 O’Riordan Street Alexandria, 340A Botany Road Alexandria, and 326-332 Church Street Granville (and in the proceeds of their sale), as trustee of the Giovannini Family Trust, and had no function other than as such trustee;

3. paying his reasonable expenses, and remuneration when duly approved, of the Worthbrook liquidation, from the assets of the Giovannini Family Trust;

4. distributing the funds held in bank account 112-879 127 XX0 511 between Rolcross and Worthbrook as to 50% each, being $108,071.34 each (plus any interest accruing on the principal amount);

5. distributing the funds held in bank account 112-879 428 XX6 625 between Rolcross and Worthbrook as to 50% each, being $96,822.41 each (plus any interest accruing on the principal amount);

6. distributing the assets of the Green Square Partnership and of Benzcorp Partnership, first in payment of all external debts of the relevant partnership, and then in the manner set out in paragraph 8 of the Liquidator’s affidavit sworn 1 May 2017 (plus any interest accruing on the principal amount);

7. admitting Rolcross (as trustee for the Prendergast Family Trust) as a creditor in the liquidation of Worthbrook, in the amount of $1,347,795.49, being the net unsecured claim between the entities; and

8. admitting Mr John Prendergast as a creditor in the liquidations of Rolcross and Worthbrook, in the respective amounts of $6,413,168.67 and $4,208,591.80.

2. However, as this involved a departure in some respects from what had been discussed during the hearing, I at this stage merely published my reasons, in order to afford the Liquidator an opportunity to make further submissions if so desired, and otherwise to bring in short minutes to give effect to them, at a time to be appointed.

3. Proposed order 1(f) was derived from paragraphs 57 and 58 of the judgment, which were as follows:

[57] The Liquidator considers that Worthbrook has a (net) claim against Rolcross for $242,277.35, the effect of admitting which would be to reduce Rolcross’ claim against Worthbrook from $1,841,072 to $1,598,794. This arises from the inabilty of the Rosehill and Vidal partnerships to satisfy partnership debts from partnership assets, referred to above, totaling $493,276.77; less amounts totaling $127,993.34 arising from the claim which the Liquidator considered Rolcross had against Worthbrook for its greater contribution to the 0511 Account and the 6625 Account. For the reasons explained above, I do not consider that provision should be made for such a claim by Rolcross, and accordingly Worthbrook’s claim against Rolcross should be allowed for $493,276.77, not $242,277.35. The result is that the net claim provable by Rolcross in the Worthbrook liquidation should be $1,347,795.49 – not $1,598,794 as proposed by the Liquidator.

[58] Accordingly, the Liquidator would be justified in:

(1) admitting Rolcross (as trustee for the Prendergast Family Trust) as a creditor in the liquidation of Worthbrook, in the amount of $1,347,795.49, being the net unsecured claim between the entities; and

(2) admitting Mr John Prendergast as a creditor in the liquidations of Rolcross and Worthbrook, in the respective amounts of $6,413,168.67 and $4,208,591.80.

4. The liquidator’s counsel made a written submission indicating that the arithmetic had been checked and that it was desired to raise only one matter, arising from para 57, in which respect, as counsel correctly observes, there was an arithmetical error in the table provided by the liquidator, from which the figure of $493,276.77 was derived, for which the sum of $370,270.69 ought to be substituted.

5. Consequentially:

1. Worthbrook’s claim against Rolcross should be allowed for $370,270.69, not $493,276.77 as stated in the previous judgment;

2. the net claim provable by Rolcross in the Worthbrook liquidation should be $1,470,801.57, [2] not $1,347,795.49;

3. accordingly, the Liquidator would be justified in admitting Rolcross (as trustee for the Prendergast Family Trust) as a creditor in the liquidation of Worthbrook, in the amount of $1,470,801.57, being the net unsecured claim between the entities.

   2. $1,841,072.26 - $370,270.69 = $1,470,801.57.

6. The Court therefore orders that:

1. Pursuant to (CTH) Corporations Act 2001, s 479(3), David Ian Mansfield, in his capacities as liquidator of Worthbrook Pty Limited and as liquidator of Rolcross Pty Limited, would be justified in:

1. proceeding on the basis that the company Worthbrook Pty Limited held its interest in the properties at 22 O’Riordan Street Alexandria, 340A Botany Road Alexandria, and 326-332 Church Street Granville (and in the proceeds of their sale), as trustee of the Giovannini Family Trust, and had no function other than as such trustee;

2. paying his reasonable expenses, and remuneration when duly approved, of the Worthbrook liquidation, from the assets of the Giovannini Family Trust;

3. distributing the funds held in bank account 112-879 127 XX0 511 between Rolcross and Worthbrook as to 50% each, being $108,071.34 each (plus any interest accruing on the principal amount);

4. distributing the funds held in bank account 112-879 428 XX6 625 between Rolcross and Worthbrook as to 50% each, being $96,822.41 each (plus any interest accruing on the principal amount);

5. distributing the assets of the Green Square Partnership and of Benzcorp Partnership, first in payment of all external debts of the relevant partnership, and then in the manner set out in paragraph 8 of the Liquidator’s affidavit sworn 1 May 2017 (plus any interest accruing on the principal amount);

6. admitting Rolcross (as trustee for the Prendergast Family Trust) as a creditor in the liquidation of Worthbrook, in the amount of $1,470,801.57, being the net unsecured claim between the entities; and

7. admitting Mr John Prendergast as a creditor in the liquidations of Rolcross and Worthbrook, in the respective amounts of $6,413,168.67 and $4,208,591.80.

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Endnotes

Decision last updated: 04 October 2017