Michael McCann as Joint and Several Liquidator of ACN 137 233 919 v Elizabeth Anne Molnar
[2017] APO 30
•29 June 2017
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Michael McCann as Joint and Several Liquidator of ACN 137 233 919 v
Elizabeth Anne Molnar [2017] APO 30
Patent Application: 2012206952
Title:Leaf spring system
Patent Applicant: Elizabeth Anne Molnar
Requestor: Michael McCann as Joint and Several Liquidator of
ACN 137 233 919Hearing Officer: Greg Powell
Decision Date: 29 June 2017
Hearing Date: 19 and 26 April 2017 by written submissions.
Catchwords: PATENTS – request under section 36 – whether requestor is entitled to the invention – whether assignment was voidable transaction pursuant to Section 588FE of the Corporations Act 2001 – evidence does not establish that transaction was voidable – costs awarded against the requestor
Representation: Patent applicant: Baxter Patent Attorneys Pty Ltd
Requestor:No representation
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2012206952
Title:Leaf spring system
Patent Applicant: Elizabeth Anne Molnar
Date of Decision: 29 June 2017
DECISION
I decline to make the declaration that Sax Suspension Technology Pty Ltd is an eligible person. The present application will proceed in the name of the current applicant, Elizabeth Anne Molnar.
Costs according to Schedule 8 of the Patents Regulations are awarded against Michael McCann as Joint and Several Liquidator of ACN 137 233 919.
REASONS FOR DECISION
Background
Patent Application 2012206952 was filed by Sax Suspension Technology Pty Ltd (“Sax”) on 13 January 2012 as PCT/AU2012/000025. On 2 October 2015 Sax (via its attorneys Baxter Patent Attorneys Pty Ltd) filed a request to amend the ownership of the present application to Elizabeth Anne Molnar (“the applicant”). The request was accompanied by a Deed of Assignment purporting to transfer ownership of the application from Sax to the applicant. The Deed was signed by the applicant as the authorised officer on behalf of Sax. From evidence elsewhere on the file, it is clear that the applicant was the sole director of Sax. The assignment was recorded and the attorneys informed by a letter dated 16 October 2015.
On 2 February 2016 (by letter dated 29 January 2016), Michael McCann (“the requestor”), as Joint and Several Liquidator of ACN 137 233 919 (which was formerly Sax), wrote stating:
“On 2 October 2015 (prior to the liquidation), the Company's [i.e. ACN 137 233 919] director, Elizabeth Molnar applied to have the interest in the Patent assigned to herself knowing that the Company would be placed into Liquidation in the very near future. This application was filed with your office on 16 October 2015 and subsequently approved on the same date.
The above transaction is considered a voidable transaction pursuant to Section 588FE of the Corporations Act 2001 as the transaction is an unreasonable director-related transaction that occurred immediately before the winding up of the Company. As such, we request that the Company be re-instated as the beneficial owner of the Patent with documentation to be forwarded to our office confirming same.”
The letter also requested that the address for service of the application be changed. This was actioned on 18 July 2016, but was later changed back to Baxter Patent Attorneys Pty Ltd given the circumstances of ownership dispute.
As a small point, I note that this letter is incorrect when it states that the amendment application was filed with the Commissioner on 16 October 2015 and approved on the same date. The amendment request was filed on 2 October 2015 and allowed on 16 October 2015. Nothing turns on this.
On 1 August 2016 the applicant provided a letter (“the 1 August correspondence”) in which she declares certain events. This letter indicates a number of factors in the transfer of ownership of the present application. The letter was accompanied by a number of documents, copies of emails and bank statements. From among the statements made in the letter some points raised include:
- Formal arrangements to purchase the patents from Sax were apparently started on 11 November 2014. I note that in the 1 August correspondence there is a copy of a document titled “Heads of Agreement of sale” and dated 11 November 2014 stating that:
“All Patents and trademarks listed below to be sold to Elizabeth Anne Molnar”
The present application is listed and the agreement states that the sum of $55,000 would be paid over the next eleven months. The agreement notes that:
“All title of ownership will not be transferred till the amount is paid in full”
The agreement is signed by “Elizabeth A. Molnar” as the “Purchaser”, but is not signed by a representative of Sax.
- The final instalment of $ 8,250 was received by Sax on the 20 August 2015. In the 1 August correspondence is what appears below (see paragraph [27]) as the MYOB account transaction records of Sax showing payments made variously labelled as “Purchase Of All Patents”, “Part payment sale of Patents”, “Part payments of patents” and variations on that theme. Also attached is a redacted Westpac statement for an account belonging to the applicant. The statement shows transfers from the account on dates and in amounts that match some (but not all) of the payments in the MYOB list.
- The applicant provided an account of what she sees as a deliberate sabotage of Sax leading it to be forced into insolvency. I note that I do not believe that this part of the letter is relevant to what I have to decide.
On 3 August 2016, a delegate of the Commissioner wrote to both the applicant and the requestor noting the various letters from both parties. The delegate noted that the invitation by the requestor that Sax be recorded as a ‘beneficial owner’ of the patent was not possible since ‘beneficial ownership’ of a patent application was a relationship between parties which was not able to be recorded under the terms of the Patents Act. However, the delegate proposed that, for the next three months, any request to change ownership details made by the applicant would be sent to the requestor and, if the requestor agreed to the change, then the change would be recorded. If the requestor did not agree with the change, the delegate proposed that the matter be resolved through directions from the Commissioner and, if necessary, a hearing of the matter.
The delegate also asked the applicant and the requestor, during this three month period, to determine who had legal ownership of the application, and jointly advise the Commissioner of the outcome.
On 9 October 2016, possibly in response to the delegate’s letter, the applicant filed a document which was the first and last pages of the Deed of Assignment filed with the original request of 2 October 2015.
The section 36 request
On 12 October 2016, the requestor filed the section 36 request that this decision relates to. The grounds for making the request were as follows:
- “On 2 October 2015 (prior to the liquidation), the Company's director, Elizabeth Molnar applied to have the interest in the Patent assigned to herself from Sax Suspension Pty Ltd ("The Company").
- On 8 October 2015 UMC Auto Industries Pvt Ltd placed a winding up application of Sax Suspension Pty Ltd.
- The Patent assignment was filed with your office on 16 October 2015 and subsequently approved on the same date.
- Shaun McKinnon and I, Michael McCann were appointed Joint and Several Official Liquidators of the Company on 19 October 2015 by the Supreme Court of Queensland.
- Ms Molnar has claimed that she paid a total consideration of $55,000 for the Patent Application.
- Our investigations have indicated that she has only paid a total of $22,000, significantly less than the amount claimed by Miss Molnar.
I consider the assignment a voidable transaction pursuant to Section 588FE of the Corporations Act 2001 as a transaction which is an unreasonable director-related transaction that occurred immediately before the winding up of the Company.”
The evidence
Each party was given until 9 January 2017 to file evidence in support and then until 9 February 2017 to file evidence in response to the other party’s evidence in support.
By an email dated 9 January 2017, the requestor informed the Commissioner that their evidence in support was “as per the evidence provided in the Section 36 Report lodged on 12 October 2016.” The applicant filed two declarations made by her.
Relevant law
10. Subsection 36(1) was amended by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (“RTB Act”) which applies in the present case since the section 36 request was filed after the commencement date of the RTB Act.
11. Subsection 36(1) as so-amended provides:
“(1) If:
(a)a patent application has been made and, in the case of a complete application, the patent has not been granted; and
(b)an application for a declaration by the Commissioner is made by one or more persons (the section 36 applicants) in accordance with the regulations; and
(c)the Commissioner is satisfied, on the balance of probabilities, in relation to an invention disclosed in the specification filed in relation to the application for the patent:
(i)that the nominated person is not an eligible person, but that the section 36 applicants are eligible persons; or
(ii)that the nominated person is an eligible person, but that the section 36 applicants are also eligible persons,
the Commissioner may declare in writing that the persons who the Commissioner is satisfied are eligible persons are eligible persons in relation to the invention so disclosed.”
12. The present application clearly satisfies paragraph 36(1)(a). With respect to paragraph 36(1)(b), I note that the request in this case is asking that the application proceed in the name of Sax, which is not the name of the section 36 applicants. It would appear to be a requirement of section 36 that the request be made by the person who wishes to be named as the (or at least one) applicant. This is not, prima facie, the case here. However, I note that the requestor is the liquidator appointed by the Supreme Court of Queensland. A liquidator’s powers are set out in the Corporations Act (see section 477, for example) and include all the powers vested in the company’s directors. As such, once a liquidator is appointed, the directors cease to have any authority. Control of all assets and the conduct of any business or financial affairs transfer to the liquidator.
13. Schedule 1 of the Patents Act defines an “eligible person” in relation to an invention as meaning a person to whom a patent may be granted under section 15. Subsection 15(1) provides:
“(1) Subject to this Act, a patent for an invention may only be granted to a person who:
(a)is the inventor; or
(b)would, on the grant of a patent for the invention, be entitled to have the patent assigned to the person; or
(c)derives title to the invention from the inventor or a person mentioned in paragraph (b); or
(d)is the legal representative of a deceased person mentioned in paragraph (a), (b) or (c).”
14. Thus it is apparent that, if the Commissioner is satisfied on the balance of probabilities that a person derives title from the inventor(s) in relation to an invention disclosed in a patent application (whether those inventors are named in the application or not), the Commissioner may declare in writing that that person is an eligible person either solely or jointly with another person who is similarly found to be entitled.
The section 36 request
15. There is no dispute as to the subject matter or inventorship of the invention of the present application. The alleged facts on which the requestor relies to establish Sax’s entitlement are stated in the section 36 request as indicated above. As such, the law governing disputes over entitlement, which was most recently considered by the Full Federal Court in University of Western Australia v Gray [2009] FCAFC 116; 179 FCR 346, requiring identification of the inventive concept and the person responsible for the inventive concept is not at play in this decision. Rather, it is apparent that the requestor’s core allegation is that the transfer of the application to the applicant offends against section 588FE of the Corporations Act 2001 (“the Corporations Act”).
Consideration
16. Section 588FE of the Corporations Act 2001 states:
“588FE Voidable transactions
(1)If a company is being wound up:
(a)a transaction of the company may be voidable because of any one or more of subsections (2) to (6) if the transaction was entered into on or after 23 June 1993; and
(b)a transaction of the company may be voidable because of subsection (6A) if the transaction was entered into on or after the commencement of the Corporations Amendment (Repayment of Directors’ Bonuses) Act 2003.
(2)The transaction is voidable if:
(a)it is an insolvent transaction of the company; and
(b)it was entered into, or an act was done for the purpose of giving effect to it:
(i)during the 6 months ending on the relation-back day; or
(ii)after that day but on or before the day when the winding up began.
(2A)The transaction is voidable if:
(a)the transaction is:
(i)an uncommercial transaction of the company; or
(ii)an unfair preference given by the company to a creditor of the company; or
(iii)an unfair loan to the company; or
(iv)an unreasonable director-related transaction of the company; and
(b)the company was under administration immediately before:
(i)the company resolved by special resolution that it be wound up voluntarily; or
(ii)the Court ordered that the company be wound up; and
(c)the transaction was entered into, or an act was done for the purpose of giving effect to it, during the period beginning at the start of the relation-back day and ending:
(i)when the company made the special resolution that it be wound up voluntarily; or
(ii)when the Court made the order that the company be wound up; and
(d)the transaction, or the act done for the purpose of giving effect to it, was not entered into, or done, on behalf of the company by, or under the authority of, the administrator of the company.
(2B)The transaction is voidable if:
(a)the transaction is:
(i)an uncommercial transaction of the company; or
(ii)an unfair preference given by the company to a creditor of the company; or
(iii)an unfair loan to the company; or
(iv)an unreasonable director-related transaction of the company; and
(b)the company was subject to a deed of company arrangement immediately before:
(i)the company resolved by special resolution that it be wound up voluntarily; or
(ii)the Court ordered that the company be wound up; and
(c)the transaction was entered into, or an act was done for the purpose of giving effect to it, during the period beginning at the start of the relation-back day and ending:
(i)when the company made the special resolution that it be wound up voluntarily; or
(ii)when the Court made the order that the company be wound up; and
(d)the transaction, or the act done for the purpose of giving effect to it, was not entered into, or done, on behalf of the company by, or under the authority of:
(i)the administrator of the deed; or
(ii)the administrator of the company.
(3)The transaction is voidable if:
(a)it is an insolvent transaction, and also an uncommercial transaction, of the company; and
(b)it was entered into, or an act was done for the purpose of giving effect to it, during the 2 years ending on the relation-back day.
(4)The transaction is voidable if:
(a)it is an insolvent transaction of the company; and
(b)a related entity of the company is a party to it; and
(c)it was entered into, or an act was done for the purpose of giving effect to it, during the 4 years ending on the relation-back day.
(5)The transaction is voidable if:
(a)it is an insolvent transaction of the company; and
(b)the company became a party to the transaction for the purpose, or for purposes including the purpose, of defeating, delaying, or interfering with, the rights of any or all of its creditors on a winding up of the company; and
(c)the transaction was entered into, or an act done was for the purpose of giving effect to the transaction, during the 10 years ending on the relation-back day.
(6)The transaction is voidable if it is an unfair loan to the company made at any time on or before the day when the winding up began.
(6A)The transaction is voidable if:
(a)it is an unreasonable director-related transaction of the company; and
(b)it was entered into, or an act was done for the purposes of giving effect to it:
(i)during the 4 years ending on the relation-back day; or
(ii)after that day but on or before the day when the winding up began.
(7)A reference in this section to doing an act includes a reference to making an omission.”
17. In the present matter, the requestor states that the transfer of the application from Sax to the applicant was:
“an unreasonable director-related transaction of the company”,
that occurred immediately before the winding up of Sax. The reasoning then follows that, as the transfer was voidable, the transfer was a nullity and the ownership did not validly transfer to the applicant.
18. The requirement that transactions may be voidable if they were unreasonable director-related transactions was introduced into the Corporations Act by the Corporations Amendment (Repayment of Directors’ Bonuses) Act 2003 (Cth). The Corporations Act was amended to define the concept of “unreasonable director-related transactions” in section 588FDA of the Corporations Act. Section 588FDA is in the following terms:
“588FDA Unreasonable director-related transactions
(1)A transaction of a company is an unreasonable director-related transaction of the company if, and only if:
(a)the transaction is:
(i)a payment made by the company; or
(ii)a conveyance, transfer or other disposition by the company of property of the company; or
(iii)the issue of securities by the company; or
(iv)the incurring by the company of an obligation to make such a payment, disposition or issue; and
(b)the payment, disposition or issue is, or is to be, made to:
(i)a director of the company; or
(ii)a close associate of a director of the company; or
(iii)a person on behalf of, or for the benefit of, a person mentioned in subparagraph (i) or (ii); and
(c)it may be expected that a reasonable person in the company’s circumstances would not have entered into the transaction, having regard to:
(i)the benefits (if any) to the company of entering into the transaction; and
(ii)the detriment to the company of entering into the transaction; and
(iii)the respective benefits to other parties to the transaction of entering into it; and
(iv)any other relevant matter.
The obligation referred to in subparagraph (a)(iv) may be a contingent obligation.
Note: Subparagraph (a)(iv)—This would include, for example, granting options over shares in the company.
(2)To avoid doubt, if:
(a)the transaction is a payment, disposition or issue; and
(b)the transaction is entered into for the purpose of meeting an obligation the company has incurred;
the test in paragraph (1)(c) applies to the transaction taking into account the circumstances as they exist at the time when the transaction is entered into (rather than as they existed at the time when the obligation was incurred).
(3)A transaction may be an unreasonable director-related transaction because of subsection (1):
(a)whether or not a creditor of the company is a party to the transaction; and
(b)even if the transaction is given effect to, or is required to be given effect to, because of an order of an Australian court or a direction by an agency.”
19. The Explanatory Memorandum accompanying the Corporations Amendment (Repayment of Directors’ Bonuses) Act 2003 states in relation to section 588FDA:
3.6.“The Corporations Act is amended by including new section 588FDA. It provides that a transaction of a company is an “unreasonable director-related transaction” if it is made to a recipient in circumstances where a reasonable person in the company’s circumstances would not have entered into the transaction. The reasonableness of the transaction is determined with regard to the respective costs and benefits to the company, and benefits to the recipient, of entering into the transaction.
3.7.Transactions covered would include payments; conveyances, transfers and other dispositions of property; the issue of securities (including options); and incurring an obligation to enter into these arrangements.
3.8.The recipients covered are directors of the company and close associates of directors. It also includes a person where the transaction is made on behalf of, or for the benefit of, a director or close associate. In Commonwealth statues, references to “person” include bodies corporate.
3.9.Subsection 588FDA(2) provides that the reasonableness of entering into the transaction is determined at the time the company actually enters into the transaction, regardless of its reasonableness at the time the company incurred the obligation to enter the transaction.
3.10.Under subsection 588FDA(3), a transaction may be caught by the new provision regardless of whether a creditor of the company is a party to the transaction, and even if the payment was made pursuant to a court order. This mirrors existing provisions in Part 5.7B in relation to uncommercial transactions entered into by an insolvent company (subsection 588FB(2)).”
20. It, thus, seems apparent that the concept of “unreasonable director-related transaction”, as defined in section 588FDA of the Corporations Act, has three components; namely the meaning of transaction, the identification of recipients, and the test of unreasonableness.
21. With respect to the “transaction”, the assignment of the patent application from Sax to its company director (the applicant in this case) would likely be considered a transaction given that paragraph 588FDA(1)(a)(ii) states that a transaction can be:
“a conveyance, transfer or other disposition by the company of property of the company”
22. It is also beyond doubt that the recipient of the transfer, being the applicant in this case, is a person mentioned in paragraph 588FDA(1)(b)(i) – that is, “a director of the company”. The only further consideration to make is whether the transfer is unreasonable.
23. As noted above, paragraph 588FDA(1)(c) indicates that a transaction is “unreasonable” if it may be expected that a person in the company’s circumstances would not have entered into the transaction, having regard to:
(i)the benefits (if any) to the company of entering into the transaction;
(ii)the detriment to the company of doing so;
(iii)the respective benefits, to other parties to the transaction, of entering into it, and
(iv)any other relevant matter
24. In Kazar, in the matter of Frontier Architects Pty Limited (in liq) [2010] FCA 1381, Flick J stated (at [23]):
“Section 588FDA(2) makes it plain that the test in s 588FDA is to be applied to the transaction taking into account the circumstances as they exist at the time when the transaction was entered into. By way of example, in Slaven v Menegazzo [2009] ACTSC 94 Mansfield J concluded that a contract for the sale of land was an unreasonable director–related transaction for the purposes of s 588FDA. A director of the vendor company was the father of the purchaser. The benefits to the vendor company were “negligible” and the detriment clear as it received “no real consideration”. Although the benefits to other parties to the transaction were “a little more complex”, His Honour concluded that “a reasonable person in the company’s circumstances would not have entered into the transaction”. The contract was declared void. In doing so His Honour observed:
[46] The test of an unreasonable director–related transaction is relevantly expressed in s 588FD(a)(1)(c) [sic] itself. It is unhelpful to paraphrase the test, rather than simply to apply it. Nevertheless, the application of that test may be informed by the purpose of that provision: s 109H of the Act. In Skouloudis Group Pty Ltd (in liq) v Planet Enterprizes Pty Ltd [2002] NSWSC 239; (2002) 41 ACSR 369, Windeyer J took the same approach in considering the application of s 588FB of the Act to the facts of that case. Section 588FB(1) defines an uncommercial transaction in terms identical in relevant respects to s 588FDA(1)(c). The purpose is to prevent companies disposing of their assets through transactions which result in the recipient receiving a benefit from the company of such commercial magnitude that it is not explainable by normal commercial considerations. See also Woodgate v Fawcett [2008] NSWSC 868; (2008) 67 ACSR 611. As in this case, the transaction there considered inured to the substantial benefit of the family members of a director and to the significant prejudice (and at the time of this transaction to the significant potential prejudice) of its unsecured creditors: see per Hammerschlag J at [106].” (my emphasis)
25. Taking (i) above, on the facts of this case, the benefit to Sax of entering into this transaction would be the amount paid for rights in the patent application. The applicant stated that she paid $55,000 in instalments. As noted above, the requestor had stated that their investigations indicated that the applicant had “only paid a total of $22,000”. The applicant, in both the 1 August correspondence and her evidence, supplied bank statements which, she stated, supported her claim that she had paid a “higher figure of $55,000 rather than the alleged $22,000”.
26. The applicant’s evidence on the amount is a bit inconsistent. Her evidence in reply provides the following table showing payments made:
27. The applicant also supplied redacted bank and credit card statements and what she indicated was the “SAX MYOB journal transaction” which indicated payment of $55,000. The alleged MYOB journal entry is as follows:
I note that there is no real information in this document to establish that such a printout could be definitively said to have been made using the MYOB product used by Sax. However, it is well-known that businesses use MYOB and, moreover, the requestor has provided no evidence that casts doubt on the authenticity of the printout. I cannot find that the MYOB printout is not authentic.
28. The redacted bank and credit card statements provided by the applicant show supposed payments to Sax. From the statements, the following transactions named as payments to Sax can be identified:
11 November 2014 – $12,000
5 February 2015 – $5,000
12 February 2015 – $5,000
27 February 2015 – $5,000
15 April 2015 – $6,328
20 May 2015 – $4,500
30 June 2015 – $4,070
29. Thus, there are differences between the payments shown in the MYOB printout and payments shown in the statements. Specifically, there are 5 payments in the MYOB printout that are not present in any statement and there is one payment in the statements that is not listed in the MYOB printout. Nevertheless, there is some degree of consistency between what the applicant asserts and what is shown in both the statements and the MYOB printout. The payments listed also support the assertion by the requestor that $22,000 had been paid. I note in this regard that the first three payments listed in the MYOB printout and the first three payments listed in the statements add up to $22,000.
30. While I find it surprising that the applicant cannot produce evidence showing consistency between the MYOB statement and her bank and credit card statements (they are her statements after all), I think the evidence could be said to establish a relatively large amount of money has been paid to Sax by the applicant; whether it is $22,000, $41,898, $55,000 or another amount.
31. Returning to the consideration of reasonableness, and taking point (ii) above, it is self-evident that the detriment to Sax in this transaction would be the loss of the rights in the patent application. In relation to point (iii), the respective benefits to other parties would be the entitlement of the (now former) director to the patent application. No discussion as to point (iv) can be undertaken. No further matters were brought to my attention by either the requestor or the applicant.
32. Taking these points, and considering the matter as a whole, the question arises whether it would have been considered ‘unreasonable’ for Sax to sell the rights to the patent application for $55,000 (or even the $22,000 argued by the liquidator for that matter). To answer this question I would have to know a reasonable price that could have been attached to the rights sold. In this regard, the onus to establish this falls to the requestor. The requestor has provided no evidence as to this matter. Indeed, they have not even made an explicit statement that $22,000 is not a reasonable price. Rather, I think that this is the inference I am meant to draw from their assertion that they considered the assignment was an unreasonable director–related transaction. As I have no evidence of what would be reasonable, I cannot see how I am in a position to find that it was unreasonable for Sax to sell the rights to the patent application for $55,000 (or even the $22,000 argued by the liquidator for that matter).
33. It follows that I cannot make a declaration that the applicant is not an eligible person.
34. While I am not going to make the declaration sought by the requestor, I have doubts that I could have made it in any case, thereby transferring the rights from the applicant to Sax, even if I believed the transaction was unreasonable. I do not think Section 36 was the appropriate vehicle in this case. There are two reasons why. Firstly, a finding of whether a transaction is a voidable transaction can only be made by a Court. Section 588FF of the Corporations Act makes this quite clear. Secondly, assuming that I was permitted to make such a finding that the transaction was an unreasonable director–related transaction (which is what I was asked by the requestor to do), I note that subsection 588FF(4) states:
“(4)If the transaction is a voidable transaction solely because it is an unreasonable director‑related transaction, the court may make orders under subsection (1) only for the purpose of recovering for the benefit of the creditors of the company the difference between:
(a)the total value of the benefits provided by the company under the transaction; and
(b)the value (if any) that it may be expected that a reasonable person in the company's circumstances would have provided having regard to the matters referred to in paragraph 588FDA(1)(c).”
35. To use the words of Griffiths J when discussing this subsection in Warner v Wong, in the matter of Bellpac Pty Limited (Receivers and Managers Appointed) (In Liq) (No 5) [2015] FCA 784:
“In the case of a transaction which is voidable solely because it is an unreasonable director–related transaction, the Court is empowered to make an order under s 588FF(1) only for the purposes of recovering for the benefit of the creditors of the company the difference between the total value of the benefits provided by the company under the transaction and the value (if any) that it may be expected that a reasonable person in the company’s circumstances would have provided …” (my emphasis)
That is, it is not permissible, having found that the transaction is solely an unreasonable director‑related transaction, to order the property that the company has transferred under the transaction to be transferred back to the company. In my opinion, any declaration by me indicating that Sax was an eligible person would have been, for all intents and purposes, an order transferring the property back to the company from whence it came.
CONCLUSION
36. The evidence does not establish that Sax is an eligible person either solely or in part in relation to the present application. It follows that I do not need to make the declaration sought and I decline to do so. The present application will proceed in the name of the current applicant.
COSTS
37. The requestor has not successfully pursued its section 36 request and I can see no reason why costs should not follow the event. I award costs against Michael McCann as Joint and Several Liquidator of ACN 137 233 919.
Greg Powell
Delegate of the Commissioner of Patents
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