Jamieson Louttit v Kolln

The case of Jamieson Louttit versus Kolln involved an application by an administrator of a company, Kolln, under the Corporations Act 2001 (Cth). The court was asked to determine the extent of the administrator's powers under a deed of company arrangement, specifically whether these powers included the ability to declare a dividend or to facilitate loans to enable a shareholder to purchase the shares of another shareholder. The matter was heard in the Federal Court of Australia.

The primary legal issues before the court were the scope of the powers of a deed administrator under a company arrangement and the appropriateness of an application to modify the operation of Part 5.3A of the Corporations Act 2001 (Cth) when the company was clearly solvent. The court had to decide whether the administrator could declare a dividend and if the administrator had the authority to effectuate loans to facilitate a shareholder buyout. Additionally, the court needed to consider whether the sought modification to the Act would be consistent with its objects and whether it would operate fairly.

In its decision, the court held that the deed administrator did not have the power to declare a dividend, as this was not an express power granted under the deed of company arrangement. However, the court did find that the deed administrator had the power to effect loans to enable a shareholder to purchase the shares of another shareholder, as this power was implied from the deed. Furthermore, the court rejected the application to modify the operation of Part 5.3A of the Act, finding that such a modification would be inconsistent with the objects of the Act and would not operate fairly given the solvency of the company.

The court's final orders were that the administrator did not have the power to declare a dividend, but had the power to effectuate loans to facilitate a shareholder buyout. The application to modify the operation of Part 5.3A of the Corporations Act was dismissed.