Parkinson v Morkaya - [2008] NSWSC 1183

CITATION: Parkinson v Morkaya [2008] NSWSC 1183

HEARING DATE(S): 20 October 2008

JURISDICTION: Equity Division
Duty List

JUDGMENT OF: Brereton J

EX TEMPORE JUDGMENT DATE: 20 October 2008

DECISION: Mr Michael John Morris Smith be appointed liquidator of Ativa Pty Ltd in place of Mr Brian Patrick Dunphy

CATCHWORDS: CORPORATIONS – LIQUIDATORS – appointment of provisional liquidator – where original Court appointed provisional liquidator resigns as not qualified – where liquidator who resigned was a nominee of the plaintiff – whether defendant should be able to choose replacement liquidator – where nothing to distinguish between fitness of nominees other than greater vulnerability of defendant’s nominee to allegation of bias – court appoints plaintiff’s nominee

LEGISLATION CITED: Supreme Court (Corporation) Rules, r 6.1(1)

CATEGORY: Procedural and other rulings

CASES CITED: Barclay v Barclay (NSWSC (ED3888/78) Kearney J, 22 December 1978, unreported)
Morkaya v Parkinson [2008] NSWSC 1050

PARTIES: 2945/08
David Anthony Parkinson (plaintiff)
Aydan Morkaya (first defendant)
Ativa Pty Ltd (second defendant)

FILE NUMBER(S): SC 2945/08

COUNSEL: Ms J McIntosh (Ms Morkaya)
Mr A R Martin (sol) (Mr Parkinson)
Mr Dunphy (Liquidator)

SOLICITORS: Sayan & Associates (Ms Morkaya)
Martin Legal (Mr Parkinson)
McCabe Terrill Lawyers Pty Ltd (Liquidator)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
DUTY LIST

BRERETON J

Monday, 20 October 2008

2945/08 David Anthony Parkinson v Aydan Morkaya

JUDGMENT (ex tempore)

1 HIS HONOUR: On 2 October 2008, and for reasons subsequently published on 10 October 2008 [Morkaya v Parkinson [2008] NSWSC 1050], I made orders inter alia that, upon Mr David Anthony Parkinson by his counsel giving to the Court the usual undertaking as to damages, Mr Brian Patrick Dunphy be appointed liquidator of Ativa Pty Ltd (“Ativa”) provisionally, conferring on the provisional liquidator the usual powers and making some additional provisions. It has since transpired that Mr Dunphy – although he is a registered liquidator and although there had been tendered a consent by him "to act as a receiver and/or manager and/or liquidator on a provisional or final basis of the corporate and business interests the subject of these proceedings" – was not an official liquidator, and thus was not eligible to be appointed by the Court as a provisional liquidator. Upon Notice of Motion filed in Court today, Mr Dunphy tendered his resignation and moved for ancillary orders, and without opposition by either Ms Morkaya or Mr Parkinson, I earlier today declared that the acts of Mr Dunphy from 2 October 2008 until today were valid notwithstanding any defect of his qualification for appointment as provisional liquidator of Ativa, fixed his remuneration at $13,274.25, ordered that he be entitled to be reimbursed his reasonable expenses incurred in the course of his administration of Ativa, and accepted his resignation as provisional liquidator. The question then remains as to what appointment should be made in place of Mr Dunphy.

2 At the time of the original application there were tendered consents also of Mr Peter Paul Krejci and of Mr Michael…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2008] NSWSC 1183
Decision Date: 20 October 2008

CaseChat Overview and Summary

The case of Parkinson v Morkaya involved a dispute over the appointment of a liquidator for a corporation. The plaintiff, Parkinson, was the original liquidator appointed by the Court. However, the defendant, Morkaya, sought to replace the liquidator, arguing that Parkinson was not qualified for the role. The dispute ultimately reached the Court, which was required to determine whether the defendant had the right to choose a replacement liquidator.

The primary legal issue was whether the defendant had the right to select a replacement liquidator for the corporation. The Court needed to consider whether the original liquidator's resignation due to a lack of qualification meant that the defendant could choose a new liquidator. Additionally, the Court had to consider whether there was any significant difference in the fitness of the two nominees, given that the original liquidator was the plaintiff's nominee, while the defendant's nominee was more vulnerable to allegations of bias.

The Court ruled that the defendant did not have the right to choose a replacement liquidator. It found that the original liquidator's resignation did not entitle the defendant to appoint a new liquidator of their choosing. The Court also noted that there was nothing to distinguish the fitness of the two nominees, other than the greater vulnerability of the defendant's nominee to allegations of bias. As a result, the Court appointed the plaintiff's nominee as the liquidator for the corporation.

Orders