Re ACN 059 849 017 Pty Ltd and the Corporations Law

[1999] NSWSC 576

CITATION:	Re ACN 059 849 017 Pty Ltd & The Corporations Law [1999] NSWSC 576
CURRENT JURISDICTION:	Equity Division
FILE NUMBER(S):	2588/99
HEARING DATE(S):	03/06/99
JUDGMENT DATE:	3 June 1999
PARTIES :	ACN 059 849 017 Pty Limited
JUDGMENT OF:	Young J

COUNSEL :	Solicitor for Plaintiff: M Hayter (ex parte)
SOLICITORS:
CATCHWORDS:	Corporations [209]; Winding up; A company may be wound up in insolvency under Part 5.4 of Corporations Law even if no valid statutory demand served
ACTS CITED:	Corporations Law ss 459P, 459R, 459S, 532, Pt 5.4 Corporations Regulations Form 154B
CASES CITED:	Deputy Commissioner of Taxation v Guy Holdings Pty Ltd (1994) 14 ACSR 580
DECISION:	See para 8

THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

YOUNG, J

THURSDAY 3 JUNE 1999

2588/99 - RE ACN 059 849 017 PTY LTD & THE CORPORATIONS LAW

JUDGMENT
1 HIS HONOUR : This is an application to wind up the company ACN 059 849 017 Pty Ltd. The summons was filed in court this morning. The company is one of a group of companies which is a subsidiary of Allied Meridian Pty Ltd. That company and its subsidiaries, including the present company, were allegedly under administration, Mr Lewis being the administrator, but in proceedings 1990/99 I declared that the administration was invalid.
2 Mr Lewis has, however, done considerable work in respect of the company ACN 059 849 017 and prepared a report for creditors which shows that it is hopelessly insolvent.
3 The present application is made by Mr Gordon, who is one of the directors of the company, so that Mr Lewis can continue his work in another guise.
4 The application seems to be commercially sensible, but it is necessary to steer one's way through Pt 5.4 of the Corporations Law.
5 First it should be remarked that as the administrator was invalidly appointed there is no barrier under s 532 of the Corporations Law to Mr Lewis being appointed liquidator. Secondly, a director may only make an application for winding up in insolvency under s 459P with leave, and that leave is to be given if there is a prima facie case that the company is insolvent, and not otherwise. The voluntary administrator's report to creditors of 27 April 1999 provides that evidence.
6 There is then the question as to whether on its proper construction Pt 5.4 only applies when a statutory demand has been given. Although the prime focus of the Part is on giving a statutory demand, the phraseology in ss 459R and 459S show that winding up following a statutory demand is not the exclusive way of approaching insolvency and that view is confirmed, at least obliquely, by cases such as Deputy Commissioner of Taxation v Guy Holdings Pty Ltd (1994) 14 ACSR 580.
7 The application has not been advertised. It is essential for the commercial community that there be a public advertisement. In the instant case I am prepared to dispense with advertisements that should have been placed before today on the basis that all the creditors have already been identified under the invalid administration. However, there should be an advertisement that this order has been made, so that the mercantile agencies and others who rely on advertisements can be appraised of what has happened.
8 Accordingly, I make orders 1 to 4 in the summons. I dispense with all the advertisements prescribed by the Regulations, provided that an advertisement in Form 154B mutatis mutandis is published in

the prescribed newspaper within ten days.

o O o

Last Modified: 06/10/1999