Rathner v Global Communications Technologies Pty Ltd

The matter of Rathner v Global Communications Technologies Pty Ltd was heard in the Federal Court of Australia. The case involved the applicant, Rathner, who sought directions in relation to a proposed litigation funding agreement between the deed administrator of Global Communications Technologies Pty Ltd, the respondent, and a third party. The central dispute was whether the deed administrator had the authority to enter into the proposed funding agreement under the terms of the deed of company arrangement.

The court had to determine the legal scope of the deed administrator's authority in relation to the proposed litigation funding agreement. Specifically, it had to consider whether the deed administrator had the power to enter into the agreement under section 447D of the Corporations Act 2001, which governs the powers of deed administrators. The court also needed to assess whether the deed itself explicitly or implicitly granted the deed administrator the authority to enter into such agreements.

In delivering the judgment, the court examined the terms of the deed of company arrangement and found that the deed did not expressly or impliedly confer the power on the deed administrator to enter into a litigation funding agreement. The court emphasised that the deed administrator's powers were strictly limited to those specified in the deed, and the proposed funding agreement fell outside those powers. Consequently, the court ruled that the deed administrator did not have the authority to enter into the proposed agreement. The court further clarified that any attempt by the deed administrator to enter into such an agreement would be beyond their statutory powers and would require the approval of the court or the creditors, as stipulated by the deed.