Minister of State for Health of the Commonwealth of Australia v Trustees on Behalf of the Ancient Order of Foresters Friendly Society in Queensland

[1982] FCA 255

Re: THE MINISTER OF STATE FOR HEALTH OF THE COMMONWEALTH OF AUSTRALIA
And: TRUSTEES ON BEHALF OF THE ANCIENT ORDER OF FORESTERS FRIENDLY SOCIETY IN
QUEENSLAND (1982) 74 FLR 381
No. G 17 of 1981
Winding up of hospital fund and medical fund - Social Security

COURT

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
Sheppard J.(1)

CATCHWORDS

Winding-up of hospital fund and medical fund conducted by Friendly Society - approval of schemes for such winding-up - consideration of what provisions may lawfully be contained in schemes - National Health Act 1953, Part VIA.

Social Security - National health legislation - Medical funds - Winding up - Approval of schemes for winding up - Statutory construction - Whether particular provisions authorised by legislation - National Health Act 1953 (Cth), ss 82Z, 82ZK.

HEADNOTE

Following a report made to the Minister for Health under s. 82W of the National Health Act 1953 (Cth) on the completion of an investigation into the affairs of two registered medical funds, the Minister applied, pursuant to s. 82Z of the Act for an order that the funds be wound up. As required by s. 82Z the Minister forwarded with the application, schemes for the winding up of the funds.

Held: (1) The court must retain, despite the silence of the legislation, an overall supervisory power over the winding up and it must, when it settles or approves a scheme, include in the scheme provisions which will make the winding up work.

(2) The provisions in these schemes purporting to stay proceedings to be brought against the funds are authorised by the legislation.

(3) It is both impracticable and unnecessary in the circumstances of this case to make a provision pursuant to s.82ZK(3) of the Act for the transfer of the business of the funds to another registered fund.

(4) In an application such as this, there must be formal evidence of the fact that the Minister did form the requisite opinion in terms of s.82ZK "that it is necessary or proper" to wind up a fund.

HEARING

Sydney, 1981, July 1, 8; 1982, July 30; November 24. #DATE 24:11:1982

APPLICATION.

Application by the Minister of State for Health of the Commonwealth of Australia brought pursuant to s. 82Z of the National Health Act 1953 (Cth) for an order that two medical funds be wound up.

H. G. Fryberg, for the applicant.

K. W. Rose, (Solicitor), for the scheme administrator.

Cur. adv. vult.

Solicitor for the applicant: B. J. O'Donovan, Commonwealth Crown Solicitor.

Solicitors for the scheme administrator: M. G. Lyons & Co.

F.P.C.

ORDER

1. The Hospital Benefits Fund conducted by the Ancient Order of Foresters Friendly Society in Queensland be wound up in accordance with the scheme set out in the first schedule to this order.

2. The Medical Benefits Fund conducted by the Ancient Order of Foresters Friendly Society in Queensland be wound up in accordance with the scheme set out in the second schedule hereto.

3. All reserved costs of and incidental to the appearances herein of the proposed Scheme Administrator be paid out of the Funds, the amount of such costs to be divided equally between the Funds.

Orders accordingly.

JUDGE1

SUPPLEMENTARY JUDGMENT

On 30 July last I gave reasons indicating that, subject to certain amendments being made in proposed schemes for the winding-up of a medical fund and a hospital fund conducted by the above Friendly Society, I would make orders, pursuant to Part VIA of the National Health Act 1953, for the winding-up of the funds in accordance with the schemes as amended. I also said that I required evidence that the Minister for Health, pursuant to s.82Z of the Act, had formed the opinion referred to therein.

Since the matter was last in the list an affidavit by Mr. R. J. D. Hunt, the former Minister for Health, had been filed. This establishes that the Minister did have the required opinion at the relevant time. The required amendments to the two schemes have been made and short minutes of order, which I am prepared to make, have been filed.

Accordingly, I make orders in terms of the short minutes which I have initialled and dated and placed with the papers. It would seem to me to be necessary that in addition to the orders contained in the short minutes there should be, in the formal orders when they are taken out, a statement of my satisfaction pursuant to s.82ZK(3) that it is impracticable and unnecessary in the circumstances to make the provision there referred to in respect of either fund.

I have appended to this judgment a copy of the oral reasons delivered by me on 30 July, a copy of the short minutes of order and a copy of the scheme for the winding-up of the hospital fund conducted by the Society. When my oral reasons are being read, it is necessary to know that clause 5 of the schemes as originally proposed has been omitted with the result that the clauses referred to in my oral reasons are not now all referred to by their correct numbers. For example, clause 6 there referred to is now clause 5, clause 7 is now clause 6 and so on.

This is an application by the Minister of State for Health of the Commonwealth of Australia, brought pursuant to s.82Z of the National Health Act 1953. The section provides that, where the Minister after consideration of a report made under s.82W of the Act on the completion or determination of an investigation of a registered organisation, is of the opinion that it is necessary or proper to do so, he may apply to the Court for an order that the fund or one or more of the funds conducted by the organisation be placed under judicial management or be wound up. The section further provides that, where the Minister makes application for the winding-up of a fund, he shall forward with the application a scheme for the winding up of the fund.

The application here is that a hospital fund and a medical fund conducted by trustees on behalf of the Ancient Order of Foresters Friendly Society of Queensland be wound up. It is unnecessary to refer further to s.82W, except to say that it provides for the making by an inspector of a report in writing to the Minister on the affairs of a registered organisation. Such a report was made here and is in evidence. It plainly establishes that the Minister would be justified, if he thought it appropriate, to apply to the Court for an order that the funds conducted by the organisation be wound up.

There is regrettably no evidence of the opinion to which s.82Z refers. I have been asked to infer that the Minister must have been of the requisite opinion because he has brought the application. I have considered whether I should take that view or not but I am not prepared, upon due reflection, to do so. I require evidence, formal though it may be, that the Minister, before the application was filed, did form the requisite opinion. The evidence may be either by affidavit of the Minister who then held the portfolio of health, or there may be some memorandum or internal document which is on file which can be produced. Either will be satisfactory. But I am not prepared to act in the way that I have been asked to do by counsel for the Minister.

As required by s.82Z schemes for the winding-up of the two funds accompanied the application. The application is dated 13 May, 1981. It first came into the list before Evatt J. on 25 May, 1981, and it was again in the list before me on 7 July, 1981. I then discussed with the solicitors for the parties a number of difficulties that I saw in the application. The matter was stood over until the following day but it was not further proceeded with. Some further discussion took place and it was adjourned until 7 August, 1981. On that day the matter was not ready to proceed and it was stood over generally.

At the request of the solicitor for the applicant the matter was relisted for today. Fresh advertisements had been placed in certain newspapers advising that the matter would be in the list at 9.30 today. No response to those advertisements was forthcoming but, in addition to counsel for the Minister appearing, there has been, as was the case on previous occasions, an appearance by the solicitor for Alan Richard Taylor, the proposed scheme administrator.

The scheme which was before me on the earlier occasions has undergone some amendment in an attempt apparently to overcome problems which I raised. The advertisements recently published indicate that some variations will be proposed to the schemes at the hearing.

I should next refer to some further provisions of the legislation. Sub-section 82Z(3) provides that where the Minister makes application to the Court under sub-section (1) for the winding-up of a fund, he shall forward with the application a scheme for the winding-up of the fund. Section 82ZK provides, inter alia, that, on an application under s.82Z the Court shall make such order as it considers to be most advantageous for the interests of the contributors to the fund to which the application relates. It further provides that where such an application is for the confirmation of a scheme, the order of the Court may confirm the scheme with or without modification. Although the language of the relevant sections could be clearer, I am of opinion that this application is for the confirmation of the schemes which have been submitted as well as for the winding-up of the two funds.

Sub-section 82ZK(3) provides:

"An order of the Court under sub-section (1) for the winding-up of a fund conducted by a registered organization, shall, unless the Court considers it to be impracticable or unnecessary in the circumstances, make such provision, either in the order or in a scheme confirmed by the order, for the transfer of the business of the fund to a fund conducted by another registered organization that is prepared to accept the transfer as will comply with the requirements set out in sub-section (2) of section 82ZF with respect to a scheme prepared under that section."

I do not find it necessary to refer to s.82ZF.

Section 82ZL provides, inter alia, that an order of the Court under s.82ZK is binding on all persons and has effect notwithstanding anything in the constitution, the articles of association or the rules of the organisation concerned.

Finally s.82ZM provides that the Court has jurisdiction to hear and determine applications under Part VIA of the Act and make orders in respect of those applications. The sections to which I have referred are all in Part VIA of the Act.

As earlier indicated, the evidence establishes, in my opinion, that it is a case where it is appropriate to exercise the jurisdiction to make an order for the winding-up of the two funds. That is subject, of course, to evidence of the relevant opinion of the Minister being provided, but I am prepared to proceed upon the basis that that will be forthcoming.

The questions of difficulty which have arisen exist because of the very sketchy nature of the legislation which the Court needs to apply. There is no spelling out in the legislation of the extent to which the Court is empowered to make sensible and practical provisions to assist a scheme administrator or liquidator in the task of winding-up a fund. The provisions of the legislation are as I have stated them. There is no other relevant provision.

If one were dealing with the winding-up of a company or the sequestration of an estate under the Bankruptcy Act 1966, one would have available the multitude of statutory provisions which operate in a practical and sensible way to spell out to those who are affected by the legislation and those who have to administer it, what may and may not be done and, where there is power, by whom the power is to be exercised. Nothing of this kind is to be found in this legislation. I think it is unfortunate that this is so. As I remarked on the last occasion, it would be easy enough for the legislation to be amended so as to pick up mutatis mutandis provisions, say, of the Bankruptcy Act and the rules made thereunder, or provisions of the Uniform Companies Codes and rules and regulations made pursuant thereto. However, no such legislation exists and one must therefore do the best one can in the circumstances.

The legal representatives for the parties have submitted to me that I ought to take the view that in the circumstances the winding-up referred to is in every sense a winding-up by the Court, that the Court must therefore retain, despite the silence of the legislation, an overall supervisory power over the winding-up, and that it must, when it settles the scheme or, rather, approves the scheme which is provided for in s.82Z(3), include in the scheme provisions which will make the winding-up work.

I am prepared to adopt those submissions and to give, therefore, the legislation as beneficial a construction as can be done. I point out, however, that questions of jurisdiction and power do arise for consideration and that, despite the scheme which I propose to approve, apparently providing for some matters, there may be a real question as to whether certain provisions are properly included and whether they therefore operate to bind strangers and to protect the scheme administrator in what he does. If the legislation were clearer, those problems would not exist.

I propose now to go through the scheme which has been discussed in detail this morning and to indicate in relation to the more important provisions my views on what may or may not be done. I should say that following the discussion which has taken place between the legal representatives of the parties and myself, there is little, if anything, now at issue. It remains only for the evidence of the Minister's relevant opinion to be supplied, for some drafting amendments to be made to the two schemes, and for short minutes of order to be provided and the matter can then be finalised.

There are suggested amendments to the definition of "the scheme contributors" on p.2 of the hospital scheme - and I interpolate to say the medical scheme is indistinguishable - which relate to the dates there specified. In my opinion both dates should be omitted. The solicitor for the scheme administrator has pressed upon me the undesirability of not fixing a date before which no claim can be allowed without the scheme administrator's approval, but on reflection I am not prepared so to limit claims. If they are statute barred or not recoverable for some other reason associated with provisions of the rules of the organisation, then those points can be taken by the scheme administrator in answer to the claims which are made. The definition of the commencement date will, in lieu of what is there now, be the date of the winding-up order to be made in this application.

There was some discussion about the provisions of clause 2 which provides for a moratorium. I am prepared to leave clause 2 in its present form. It has been amended since the matter was last before me, but insofar as it purports to stay proceedings to be brought against the organisation, I think there may be difficulties. I realise that the Court may give leave for proceedings to be brought, but I think there is a very real question as to whether the provision is the sort of provision, desirable though it obviously is, which is authorised by the legislation. I am prepared to take the view that it is so authorised and for that reason the provision will remain unchanged.

The words at the end of clause 4, "and any such claim against a registered organisation shall be extinguished and absolutely barred" are to be omitted. Otherwise clause 4 will remain in its present form.

There will need to be a consequential amendment of clause 5 because of the alteration to the terms of the definition of "the scheme contributors" earlier mentioned.

There was discussion about some of the detailed provisions of clause 6, but in all the circumstances I am prepared to regard them as reasonably incidental to the making of the orders which I have express power to make. There needs to be a power of taking copies added into sub-clause (v) of clause 6 and some re-drafting of sub-clause (iv). There also needs to be a drafting amendment to clause 7.

There was discussion concerning clause 8 in relation to interest and it was decided that the intent of the clause should be to give effect to the rule of practice or convenience which applies in relation to interest in winding-up situations, that rule being referred to in the judgment of the High Court in McKenzie v. Rees (1941) 65 C.L.R. 1. I refer particularly to the judgment of Dixon J. at p.9. I have some reservations about clause 9 but I propose to leave it in. There are some drafting amendments to be made to clause 10.

Clause 11 deals with distributions. It was agreed that the provisions introduced by the words "firstly" and "fourthly" should be omitted. Some redrafting of what appears following the word "sixthly" is also to take place.

In clause 12 in the fourth line the word "may" is to replace the word "shall".

I think clause 13 is justified by reason of the provisions of s.82ZL earlier referred to.

I think clauses 15, 16 and 17 are justified as incidental to the power which I have. There may be some drafting matters to be attended to, but those are matters of detail.

I indicated unhappiness about clause 18(iii) and that will be redrafted in accordance with s.245 of the former Uniform Companies legislation. In particular, it will be the Court only which may give the direction and there will have to be some connection shown between the various items that are referred to and the funds or the organisation.

I have considerable reservation about clause 19 in relation to disclaimer of onerous property, but nevertheless I am prepared to leave it in. It needs also some redrafting which was discussed during the argument.

Finally I am prepared to say, pursuant to s.82ZK(3), that I am satisfied that it is both impracticable and unnecessary in the circumstances of this case to make the provision otherwise required to be provided for by that sub-section.

What I would suggest now is that I stand this matter over generally and that you both agree on the necessary alterations and on short minutes of order and send them down to my associate. I may need to put the matter in the list in Sydney for the purpose of making formal orders, but if I do I will not require either of you to attend, and if anything does arise which is contentious, we will have to work out some way of handling it.

When this judgment is formally published, a copy of the short minutes of order and of one of the schemes I have approved will be appended to it. As I have said, the other scheme is in substantially similar terms.
SCHEDULE

FIRST SCHEDULE

SCHEME FOR THE WINDING UP OF THE HOSPITAL BENEFITS FUND OF THE ANCIENT ORDER OF FORESTERS FRIENDLY SOCIETY IN QUEENSLAND

1. In this Scheme the following expressions shall, unless the context otherwise requires, have the following meanings respectively:

"The Act" - The National Health Act 1953

"The Court" - The Federal Court of Australia

"The Commencement Date" - The commencement date is the date upon which the Court orders the Fund to be wound up.

"The Minister" - The Minister of State for Health of the Commonwealth of Australia.

"Person" - Unless the context otherwise requires the word "person" includes corporations whether corporation sole or corporation aggregate, or any other legal entity or personality and includes the assigns and personal representative of any person.

"The Registered - The Trustees on behalf of the

Organisation"

Ancient Order of Foresters Friendly Society in Queensland

"The Scheme - Any person within the meaning of Contributors"

the word "contributor" as defined in the rules of The Hospital Benefits Fund administered by the Registered Organisation having a claim and who was a financial member of the Fund within the meaning of those rules at the time such claim arose.

"The Scheme Creditors" - Persons (including any trustee) having or claiming to have a claim certain, prospective or contingent (including a claim by the trustees or any of them to be indemnified out of the Fund but excluding a claim by a Scheme Contributor) upon or against the Registered Organisation or the Fund, and arising prior to the Commencement date out of the administration conduct or management of the Fund.

"Secured Creditors" - A Scheme Creditor who would at

the commencement date have been a secured creditor within the meaning of the Bankruptcy Act 1966 as amended of the Commonwealth if the Registered Organisation as Administrator of and/or in right of the Fund had at that date been a debtor within the meaning of that Act, but only to the extent that such creditor's debt would have been so secured.

"The Scheme - ALAN RICHARD TAYLOR and/or any Administrator"

other person who is a qualified accountant and registered company liquidator and who may be appointed by the said ALAN RICHARD TAYLOR to act jointly and severally with him as Scheme Administrator. PROVIDED THAT such appointed person is firstly approved by the Minister for this purpose AND PROVIDED FURTHER that if at any time any person or persons who is or are the Scheme Administrator is or are unable or unwilling to act then the Minister may in writing appoint another person or persons to act in lieu thereof and any person or persons so appointed shall with any remaining person be the Scheme Administrator jointly and severally of this Scheme. Any and all such persons shall act in the interest of the Scheme Creditors and Scheme Contributors and in accordance with the exigencies hereof. Any and all such persons shall be qualified accountants and registered liquidators. "The Trustees" - Every person who at the

commencement date is or at any time since registration under the Act of the Ancient Order of Foresters Friendly Society in Queensland has been or has acted as trustee of the Fund.

"Remuneration" - Remuneration in accordance with

the scale of rates recommended or laid down from time to time by the Bankruptcy Trustee and Liquidators Association of Australia upon a time basis or the appropriate rates customarily charged by Chartered Accountants.

"Interpretation" - Words importing the masculine

gender include the feminine and the neuter, and the singular includes the plural and the plural includes the singular, unless the contrary as to gender or number is expressly provided.

MORATORIUM

2. As from the commencement date, all action and proceedings in respect of any claim made by a person in his capacity as a Scheme Contributor or as a Scheme Creditor in any court of competent jurisdiction (including any writ of execution or other process issuing in respect of any judgement or order consequent thereon) shall be stayed and not be proceeded with except by leave of the Court and on such terms, if any, as the Court may order.
3. The Scheme Administrator shall cause to be published on the same day once in each of a daily newspaper published and circulated throughout Australia and Queensland respectively, an advertisement requiring all persons who have any debts due by or claims against the Registered Organisation as Scheme Creditors or Contributors or otherwise and who have not by the date of approval hereof lodged claims or notices thereof, whether certain furture or contingent arising by virtue of contracts, guarantees, warranties, or obligations made given or incurred prior to the commencement of the Scheme to lodge with the Scheme Administrator within 21 days of the date of publication thereof a Statutory Declaration or the usual claim form (whichever may be appropriate) as set out in Schedules I and II hereof together with supporting documentation setting forth particulars of their respective debts or claims.
4. Any person failing to lodge such Statutory Declaration or claim form and supporting documentation within the said period of 21 days or such further time, if any, as the Scheme Administrator may in his absolute discretion allow, shall not be entitled to participate in the distribution of, or have any claim against or upon the Scheme Fund in respect of any such debt or claim.
5. With regard to Scheme Creditors and/or Scheme Contributors who lodge or have lodged Statutory Declarations, claim forms or claims in some other form and/or subject to any order of the Court in respect of any claim by any Scheme Creditor or Scheme Contributor,
(i) The Scheme Administrator may admit such debts or claims in whole or in part.
(ii) The Scheme Administrator may require any claimants to give evidence or further evidence by Statutory Declaration or otherwise in support of their debt or claim as he shall think fit.
(iii) Whether or not the Scheme Administrator calls for such further evidence and whether or not such evidence or further evidence is made available to the Scheme Administrator, he may reject any such debt or claim either in whole or in part.
(iv) In the event that the Scheme Administrator rejects any debt or claim in whole or in part, the Scheme Creditor and/or Scheme Contributor may make application to the Court within 60 days thereafter for a review of such decision and the making of such order as to the Court seems appropriate. Notice of every such application shall be given to the Scheme Administrator.
Any person who fails to apply for a review within the said period or within such extended time as the Scheme Administrator or the Court shall allow, shall not be entitled to any distribution hereunder in respect of a debt or claim rejected as aforesaid.
In the event that any Scheme Creditor and/or Scheme Contributor shall have commenced proceedings against the Registered Organization prior to the commencement date in respect of a claim provable in the winding up of the Fund, the Scheme Creditor and/or Scheme Contributor may with the leave of the Court first had and obtained elect to continue such proceedings to judgment and the Scheme Administrator shall have the conduct of any defence thereof and determination of any such claim by judgment in such proceedings shall entitle the Scheme Creditor and/or Scheme Contributor to the rights herein set forth, but save as herein provided he shall not be entitled to enforce the said judgment.
A claimant in whose favour an order is made upon a review as aforesaid or for whom judgment is given in any proceedings continued by leave of the Court shall be entitled to participate for all distributions hereunder after the date of such Judgement and for the purposes of the calculation of any distribution payable hereunder he shall be treated as a Scheme Creditor or Scheme Contributor to the extent of such order or judgement inclusive of any costs which may be awarded in his favour in such review or proceedings.
The Scheme Administrator and any claimant whose debt or claim has been rejected in whole or in part by the Scheme Administrator under paragraph (iii) above may agree on any other mode or proceeding to establish the alleged debt or claim or part thereof in question whether by proceedings in the Court or by arbitration or otherwise. In that event, the Scheme Administrator and such claimant shall be at liberty to adopt such mode of proceedings so agreed upon and the amount of the debt or claim in dispute whether in whole or in part determined by or as a result of the adoption of such agreed course of procedure shall be the amount in respect of which such claimant shall be entitled to be paid distribution hereunder.
(v) The Scheme Administrator may inspect and take copies of such records of the Ancient Order of Foresters Friendly Society in Queensland as he deems necessary to determine the position of the assets and liabilities of the fund.
(vi) The Scheme Administrator shall prepare and maintain a list of the Scheme Creditors and Scheme Contributors who shall have established their claims and their rights to payment of distribution hereunder and the said list shall be prima facie evidence of the right of any Scheme Creditor or Scheme Contributor whose name appears thereon to participate in such distribution to the extent of the amount set opposite his name. The said list of Scheme Creditors and Scheme Contributors shall set out the amounts in respect of which each such Scheme Creditor or Scheme Contributor is admitted to rank for dividend hereunder.
(vii) If the Scheme Administrator shall for any reason be unable to trace or pay a Scheme Creditor or Scheme Contributor he shall retain the sum to which such Scheme Creditor or Scheme Contributor is entitled in a separate account until the completion of the Scheme as hereunder provided whereupon he shall pay the money in such account to the Ancient Order of Foresters Friendly Society in Queensland which shall hold same in a suspense account for the person or persons entitled thereto until and unless the court otherwise orders and shall cease to be under any obligation or liability in respect thereof. Such retention and payment or dealing as the court may order shall be deemed to be payment of the distribution pursuant to the provisions of this Scheme.
(viii) Notwithstanding anything else herein or elsewhere contained or implied the Scheme Administrator shall have an absolute and unfettered discretion to admit claims by Scheme Contributors or Scheme Creditors even though such claim may not have been lodged in the form or in the period or periods set out in this Scheme.
(ix) The Scheme Administrator may make provision as he shall think fit for the purpose of avoiding fractions of the dollar notwithstanding that loss may be occasioned thereby to the Scheme Creditor or Scheme Contributor.
THE SCHEME CREDITORS AND CONTRIBUTORS
6. The Scheme Creditors and Contributors who shall be entitled to participate in distributions hereunder shall, subject to Clause 12 hereof, be:
(a) Those Scheme Creditors who, at the commencement date already have lodged claims together with supporting documentation and which claims are in due course accepted by the Scheme Administrator or determined by the Court to be entitled to participate as hereinafter provided for; and those Scheme Creditors who at the commencement date have not lodged claims but who wish to do so and to that end lodge notification of such claims in the Statutory Declaration form prescribed in Schedule I hereto together with supporting documentation (if any) setting forth particulars of the claims and which claims are in due course accepted by the Scheme Administrator or determined by the Court to be entitled to participate as herein provided for.
(b) Those Scheme Contributors who, at the commencement date have already lodged claims against the Fund in the usual form together with supporting documentation all of which claims are in due course accepted by the Scheme Administrator or determined by the Court to be entitled to participate as hereinafter provided for; and those Scheme Contributors who at the commencement date have not lodged claims but who wish to do so and to that end lodge notification of such claims in the usual form prescribed, a copy of which is set out in the Schedule II hereto, together with supporting documentation (if any) setting forth particulars of the claims and which claims are in due course admitted by the Scheme Administrator or determined by the Court to be entitled to participate as herein provided for.
INTEREST
7. For the purpose of ascertaining the amount for which a Scheme Creditor or Scheme Contributor is entitled to prove in the winding up of the Fund no debt owed by or claim made against the Registered Organisation to or by any Scheme Creditor or Scheme Contributor shall bear or shall be deemed to have borne interest after 29 March 1978.
PRIORITY CREDITORS
8. Nothing in this Scheme will affect or is intended to affect the rights and liabilities of employees in respect of their claims for wages, long service leave and holiday pay against the Registered Organisation.
SCHEME FUND
9. The Scheme Fund shall comprise the Hospital Benefits Fund conducted by the Registered Organization under the Act, and shall include all assets and money from time to time paid or payable to, received by, acquired with, or standing to the credit of, the Hospital Benefits Fund. All such money and, when realised, assets shall be paid by the Scheme Administrator into a Bank account or accounts to be opened by him. Such account or accounts shall be either a current account or a savings account with the Commonwealth Bank. The Scheme Administrator is hereby authorised to invest any money so paid into the Scheme Fund account on fixed deposit with such Bank for any period considered by him to be appropriate having regard to his obligations hereunder.

DISTRIBUTION OF THE SCHEME FUND
10. The Scheme Administrator shall pay out of the Scheme Fund Account the following amounts to the following classes of persons in the following order:
FIRSTLY To ALAN RICHARD TAYLOR, his remuneration in accordance with the provisions of this Scheme for work done in his capacity as proposed Scheme Administrator in convening, conducting and reporting upon the meetings referred to in the Order of His Honour Mr Justice Evatt made herein on 25 May 1981 as evidenced by an account rendered by the said ALAN RICHARD TAYLOR in respect of such work together with an amount equal to all proper liabilities incurred by him in connection therewith including the engagement by him of such other person or persons as he deemed appropriate to assist him to carry out such duties.
SECONDLY To the Scheme Administrator, his remuneration in accordance with the provisions of this Scheme, for work done in that capacity, up to the date of such payment as evidenced by an account rendered by the Scheme Administrator in respect of such work together with an amount equal to all proper liabilities incurred by the Scheme Administrator in and about the carrying out of his duties and the exercise of his powers hereunder including the engagement by him of such other person or persons as he may deem appropriate to assist him to carry out such duties and to exercise such powers.
THIRDLY To each Scheme Creditor and to each Scheme Contributor: as to each Scheme Creditor other than the Ancient Order of Foresters Friendly Society in Queensland - the pro rata amount in the dollar available from the Scheme Fund in relation to the amount determined by the Scheme Administrator as owing by the Registered Organisation to each such Scheme Creditor pursuant to Clause 6 hereof and in respect whereof the amount owing to such Scheme Creditor has been placed on the list of Scheme Creditors by the Scheme Administrator in accordance with the said Clause; and as to each Scheme Contributor - the pro rata amount in the dollar available from the Scheme Fund in relation to the amount determined by the Scheme Administrator as owing by the Registered Organisation to each Scheme Contributor pursuant to Clause 6 hereof and in respect whereof the amount owing to such Scheme Contributor has been placed on the list of Scheme Contributors by the Scheme Administrator in accordance with the said Clause. The Scheme Administrator may pay amounts from time to time to such Scheme Creditors and/or Scheme Contributors or to any of them, on account of the total amount payable to them or any of them under the provisions of this Clause but whenever any such payment on account is made, the Scheme Administrator shall be obliged to pay each such Scheme Creditor and/or Scheme Contributor pro rata in accordance with the amount of his, her or its debt so determined as aforesaid.
FOURTHLY To the Ancient Order of Foresters Friendly Society in Queensland the pro rata amount in the dollar available from the Scheme Fund in relation to the amount determined by the Scheme Administrator as owing to the Ancient Order of Foresters Friendly Society in Queensland from the Fund pursuant to Clause 6 hereof and in respect whereof the amount owing to the Ancient Order of Foresters Friendly Society in Queensland has been placed on the list of Scheme Creditors by the Scheme Administrator in accordance with the said Clause.
SECURED CREDITORS
11. If at any time the Scheme Administrator is in a position to pay distributions to Scheme Creditors or Scheme Contributors from the Scheme Fund and a Secured Creditor has not realised his security he may, within 21 days of being called upon to do so by the Scheme Administrator, value the security and if such value is accepted by the Scheme Administrator, he shall rank for dividend to the full amount of his debt less the amount of such value, but otherwise he shall have no claim provable in the winding up of the Fund.
BINDING EFFECT OF SCHEME
12. This Scheme shall be binding on all persons including each and every of the Scheme Creditors and Scheme Contributors.
MEETINGS OF SCHEME CREDITORS AND/OR SCHEME
CONTRIBUTORS DURING ADMINISTRATION OF SCHEME
13. Should the Scheme Administrator deem it adviseable so to do for any reason during the administration of the Scheme he may convene a meeting of the Scheme Creditors or Scheme Contributors. The Scheme Administrator shall in every respect determine all matters of procedure in respect of the convening of the said meeting and its conduct and in every case, the Scheme Administrator shall be entitled to chair the said meeting. In any meeting of Scheme Contributors convened by the Scheme Administrator, each Contributor shall be entitled to one vote and in any meeting of Scheme Creditors convened by the Scheme Administrator, each Scheme Creditor shall be entitled to that number of votes equal to the value of his claim, expressed to the nearest whole dollar.
APPLICATION TO THE COURT
14. The Scheme Administrator may at any time or from time to time apply to the Court or a Judge thereof by Application in the existing proceedings relating to this Scheme either ex parte or after notice thereof upon a party interested (as may be appropriate) for advice or directions as to or to otherwise resolve any questions or matter relating to or arising out of the discharge of his duties and powers hereunder and the said Court or Judge may upon such application make any Order declaratory or otherwise in relation to such questions or matter and the costs thereof as it or he shall see fit which said Order shall be binding on the parties affected thereby.
15. Any party who may be aggrieved by any act or determination of the Scheme Administrator in the course of the discharge by him of his duties or the exercise by him of any power conferred upon him hereunder may apply to the Court or a Judge thereof upon Application in the existing proceedings in relation to this Scheme served upon the Scheme Administrator for a review of such act or determination and thereupon the said Court or Judge may make such Order or give such direction to the Scheme Administrator in the circumstances as it or he shall deem just and equitable and expedient; and the Scheme Administrator and all parties interested shall be bound thereby and shall act in accordance with the said Order. 16. Subject to any Order of the Court or a Judge to the contrary, any Order or directions of the Court or Judge as referred to in this Section shall be deemed to be and have always been part of an alteration or condition imposed upon this Scheme pursuant to Section 82ZK of the Act and to be and form part of this Scheme accordingly as from the commencement date.

SPECIFIC POWERS OF THE SCHEME ADMINISTRATOR
17.
(i) The Scheme Administrator may:-

(a) Upon offering to the Registered Organisation such an indemnity as may be required by it and agreed or in default of agreement as may be directed by the Court:-
(1) Bring or defend in the name of the Registered Organisation any action or other legal proceedings relating to the Fund;
(2) Sell the real and personal property and things in action of the Fund by public auction public tender or private contract with power to transfer the whole thereof to any person or company or to sell the same in parcels;
(3) Compromise any debt due to the Fund or any claims by or against the Registered Organisation which relate to the Fund;
(4) For the purposes of Clause 18(i)(a) hereof do all necessary acts and execute in the name and on behalf of the Registered Organisation all necessary deeds, receipts, and other documents and for that purpose use where necessary the Registered Organisation's seal or documentation.
(b) Engage a solicitor to do all such acts and things and to prepare all such documentation normally undertaken by Solicitors as may be necessary for the effective administration of the Scheme.
(c) Prove rank and claim in the bankruptcy or winding up of any Scheme Contributor or debtor or other person for any balance outstanding against his estate and receive dividends in the bankruptcy or winding up in respect of that balance as a separate debt due from the bankruptcy and rateable with the other separate creditors.
(d) Appoint an agent or other person to do any business which the Scheme Administrator is unable to do himself.
(e) Do all such other things as are necessary for winding up the Fund in accordance with this Scheme.

(ii) Without in any way derrogating from the Scheme Administrator's right to apply to the Court for directions in relation to any particular matter arising in the carrying out of his duties under this Scheme, the Scheme Administrator shall be at liberty to use his own discretion in the management of the affairs and property of the Registered Organisation which relate to the Fund and the distribution of the Fund.
(iii) On the application of the Scheme Administrator the Court may direct, any Scheme Creditor, member, trustee, receiver, banker, agent or officer of the Registered Organisation to pay, deliver, convey, surrender or transfer to the Scheme Administrator forthwith or within such time as the Court directs any money, property, books and papers in his hands which prima facie relate to the Fund and to the carrying into effect of this Scheme by the Scheme Administrator. The Registered Organisation shall supply to the Scheme Administrator all books of account, records of transactions and files retained by the Registered Organisation relating to the management and administration of the Fund.
(iv) The Ancient Order of Foresters Friendly Society in Queensland shall from time to time afford opportunity to the Scheme Administrator to inspect all property, books, papers, files and records of the Ancient Order of Foresters Friendly Society in Queensland for the purpose of his ascertaining if any of the same relate to the Fund.

DISCLAIMER OF ONEROUS PROPERTY
18. Where any part of the property of the Registered Organisation relating to the Fund consists of -

(a) any estate or interest in land which is burdened with onerous covenants;
(b) shares or stock in corporations;
(c) unprofitable contracts; or
(d) any other property that is unsaleable or not readily saleable, by reason of its binding the possessor thereof to the performance of any onerous act, or to the payment of any sum of money;

the Scheme Administrator, notwithstanding that he has endeavoured to sell or has taken possession of the property or exercised any act of ownership in relation thereto, may, with the leave of the Court and on such terms as the Court may direct, disclaim such property or determine such contracts, and thereupon such property and all rights under such contracts shall be deemed excluded from the Scheme Fund.

COMPLETION
19. When the Scheme Administrator shall have fully distributed the Scheme Fund, he shall so certify in writing to the Registered Organisation and shall within 14 days thereafter file in the Court a Notice in the following form:-

"NOTICE OF COMPLETION OF SCHEME"

I, ALAN RICHARD TAYLOR Scheme Administrator under the Scheme for the winding up of the Hospital Benefits Fund conducted by the Ancient Order of Foresters Friendly Society in Queensland approved by the Federal Court of Australia on

1982 HEREBY CERTIFY that the provisions of the said Scheme have been fully performed and carried into effect.

DATED at Brisbane this day of 1982.

Scheme Administrator

ALAN RICHARD TAYLOR

1. The Scheme Administrator shall also attach to and file with the said Notice a summary of receipts and payments relating to the administration of the Scheme certified by the Scheme Administrator as being true and correct.

SCHEDULE I - DECLARATION IN THE MATTER OF THE HOSPITAL BENEFITS FUND CONDUCTED BY THE ANCIENT ORDER OF FORESTERS FRIENDLY SOCIETY IN QUEENSLAND SCHEME FOR WINDING UP UNDER SECTION 82Z OF THE NATIONAL HEALTH ACT 1953. I, of in the State of do solemnly and sincerely declare:

1. That the abovenamed Fund was at the date

of commencement of the winding up (namely the

day of , 1981) and still is justly and

truly indebted to in the amount of

dollars cents for as shown

by the account endorsed hereon/following account, namely:-

1. That neither the above *Scheme Creditor/Scheme Contributor, nor any person by the order and for the use of the abovementioned *Scheme Creditor/Scheme Contributor, has to my knowledge and belief received any manner or satisfaction or security for the amount or any part of the amount referred to in paragraph I, save and except the following:-

1. That I am in the employ of the abovementioned *Scheme Creditor/Scheme Contributor, that I am duly authorised by that *Scheme Creditor/Scheme Contributor to make this statutory declaration, that it is within my own knowledge that the debt declared to in this ------------------------------------------------------------------------------ -

FIRST SHEET

Deponent A Justice of the Peace declaration was incurred for the consideration stated, and that the debt, to the best of my knowledge and belief still remains unpaid and unsatisfied.

1. That I am duly authorised, under the seal of the company in this Statutory Declaration named as *Scheme Creditor/Scheme Contributor, to make this proof of debt on its behalf.

AND I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of the "Oaths Acts, 1867 to 1960".

TAKEN AND DECLARED before me at )

this )

day of 198 . ) . . . . . . . . . . . . . . . . . . . . .

Justice of the Peace

* Delete whichever is not applicable.

BENEFIT CLAIM FORM OMITTED