Re All In One Contracting Pty Ltd (in liq) - [2023] VSC 330

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMERCIAL COURT
CORPORATIONS LIST

S ECI 2023 00391

IN THE MATTER of ALL IN ONE CONTRACTING PTY LTD (In Liquidation) (ACN 603 071 790)

BETWEEN:

MATTHEW KUCIANSKI in his capacity as Liquidator of ALL IN ONE CONTRACTING PTY LTD (In Liquidation) ACN 603 071 790 & ANOR (according to the attached Schedule)	Plaintiffs
v
NO-RESPONDENT	Defendant

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JUDGE:	Irving AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	31 May 2023
DATE OF JUDGMENT:	16 June 2023
CASE MAY BE CITED AS:	Re All In One Contracting Pty Ltd (in liq)
MEDIUM NEUTRAL CITATION:	[2023] VSC 330

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CORPORATIONS – Bare trustee – Insolvency of corporate trustee – Winding up of trust – Necessary powers – Section 63 of the Trustee Act 1958 (Vic) – Power of sale – Orders and directions – Section 90-15 of Schedule 2 (Insolvency Practice Schedule (Corporations)) to the Corporations Act 2001 (Cth) – Application of Parts 5.5 and 5.6 of the Corporations Act 2001 (Cth) to application and distribution of trust property – Orders made.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr A Segal	Madgwicks
No appearance for the Defendant

HIS HONOUR:

The first plaintiff is the liquidator (Liquidator) of All In One Contracting Pty Ltd (in liq). The Liquidator has applied under s 90-15 of the Insolvency Practice Schedule (Corporations) (IPS), being Schedule 2 of the Corporations Act 2001 (Cth) (Act), s 1318 of the Act and ss 63 and 67 of the Trustee Act 1958 (Vic) (Trustee Act) for the following relief:

(a) A declaration pursuant to s 90-15 of Schedule 2 of the IPS that the Liquidator is justified in conducting the winding up of All in One Contracting Pty Ltd (in liq) (Company) on the basis that:

(i) the Company carried on business in its capacity as trustee of the All In One Unit Trust (Trust) and all assets of the Company are properly characterised as property held by the Company in its capacity as trustee of the Trust (Trust Property);

(ii) the Liquidator is and was entitled to be paid from the Trust Property his remuneration, costs and expenses properly incurred in winding up the Trust which includes, but is not limited to preserving, realising or getting in the assets of the Trust, the Trust Property, or carrying on any business or activities of the Trust, or in conducting any sale of the Trust Property, or in distributing the Trust Property (once realised), or in conducting the winding up of the Company (Remuneration and Expenses); and

(iii) the Remuneration and Expenses include remuneration, costs and expenses of and incidental to this application and are to be paid in accordance with the priority specified in s 556(1) of the Act.

(b) An order pursuant to s 63 of the Trustee Act conferring nunc pro tunc the following powers on the Company as necessary to enable…

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: [2023] VSC 330
Decision Date: 16 June 2023

CaseChat Overview and Summary

All In One Contracting Pty Ltd (in liquidation) was the subject of a dispute concerning the winding up of a trust, with the legal issues centering around the application and distribution of trust property upon the insolvency of a corporate trustee. The matter was heard by the Supreme Court of Victoria. The primary legal issues revolved around the interpretation and application of sections 63 of the Trustee Act 1958 (Vic), concerning the power of sale, and sections 90-15 of Schedule 2 (Insolvency Practice Schedule) to the Corporations Act 2001 (Cth), which pertain to the application and distribution of trust property in the context of corporate insolvency.

The court examined whether the liquidator of All In One Contracting Pty Ltd had the necessary powers to manage and dispose of the trust property effectively. The liquidator argued that certain orders and directions were required to facilitate the sale of the trust assets and the subsequent distribution of the proceeds to creditors. The court considered the interplay between state and federal legislation, specifically the Trustee Act 1958 (Vic) and the Corporations Act 2001 (Cth), to determine the appropriate course of action. The decision hinged on whether the powers granted under section 63 of the Trustee Act 1958 (Vic) were sufficient to allow the liquidator to proceed with the sale of the trust assets, and whether the provisions of the Corporations Act 2001 (Cth) applied to the distribution of trust property in this context.

Ultimately, the court ruled in favour of the liquidator, granting the necessary orders and directions to enable the sale of the trust assets and the distribution of the proceeds in accordance with the relevant legislation. The court found that the liquidator had the requisite powers under section 63 of the Trustee Act 1958 (Vic) to manage the trust property and that the provisions of the Corporations Act 2001 (Cth) applied to the distribution of trust property in this case. The orders provided clarity on the process for selling the trust assets and distributing the proceeds, ensuring that creditors could be appropriately compensated.

Orders