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Re APCH Ltd (in liquidation)

Re APCH Ltd (in liquidation)

Case [2014] VSC 190 15 April 2014

Limitation Periods

Company Liquidation

Receivers and Managers

Civil Litigation & Procedure

Corporate Law & Governance

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

CORPORATIONS LIST

S CI 1136 of 2014

IN THE MATTER OF

AUSTRALIAN PROPERTY CUSTODIAN HOLDINGS LTD

(ACN 095 474 436) (liquidators appointed)

(receivers and managers appointed) (controllers appointed)

AUSTRALIAN PROPERTY CUSTODIAN HOLDINGS LTD (ACN 095 474 436) (liquidators appointed) (receivers and managers appointed) (controllers appointed)

and

STIRLING LINDLEY HORNE and PETER VRSECKY (in their capacities as joint and several liquidators of AUSTRALIAN PROPERTY CUSTODIAN HOLDINGS LIMITED (ACN 095 474 436) (liquidators appointed) (receivers and managers appointed) (controllers appointed))

Plaintiffs

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JUDGE:	ROBSON J
WHERE HELD:	Melbourne
DATE OF HEARING:	17 March and 2 April 2014
DATE OF JUDGMENT:	15 April 2014
CASE MAY BE CITED AS:	Re APCH Ltd (in liquidation)
MEDIUM NEUTRAL CITATION:	[2014] VSC 190

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PRACTICE AND PROCEDURE – Application by liquidators for extension of time to serve a writ and general endorsement – Company in liquidation previously under control of receivers and managers – Writ issued by receivers in company name alleging breach of duties by directors – Receivers release cause of action to liquidators – Application granted – Supreme Court (General Civil Procedure) Rules2005 (Vic) r 5.12.

CORPORATIONS – Application for directions – Whether liquidator justified in bringing application to extend time for service of writ – Directions ss 477(2B), 479 and 511 of the Corporations Act2001 (Cth).

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APPEARANCES:

Counsel

Solicitors

For the Plaintiffs

M D Wyles SC

with A P Trichardt

Cornwall Stodart

Cases referred to:

Arthur Andersen Corporate Finance Pty Ltd v Buzzle Operations Pty Ltd (in liq) [2009] NSWCA 104.

Australian Securities and Investments Commission v Australian Property Custodian Holdings Ltd (recs and mgrs apptd) (in liq) (controllers appointed) (No 3) [2013] FCA 1342.

Battersby v Anglo-American Oil Co Ltd [1945] KB 23.

Ebner v Clayton Utz (a firm) (2012) 36 VR 25.

Finlay v Littler [1992] 2 VR 181.

Gordon v Tolcher (2006) 231 CLR 334.

Howard v Power [2013] VSC 198.

Irving v Carbines [1982] VR 861.

Mali v Benchmark Healthcare Pty Ltd [2005] VSC 72.

M & I Samaras Pty Ltd (No 1) v John Holland Pty Ltd [2012] VSC 98.

Noitaroproc Pty Ltd (in liquidation) v Price Waterhouse (a firm) (Unreported, Supreme Court of Victoria, Byrne J, 26 March 1997).

Ramsay v Madgwicks [1989] VR 1.

Savcor Pty Ltd v Cathodic Protection InternationalAPS (2005) 12 VR 639, [2005] VSCA 213.

Tolcher v Gordon (2005) 53 ACSR 442, [2005] NSWCA 135.

Van Leer Australia Pty Ltd v Palace Shipping KK (1981) 180 CLR 337.

Zappelli v Falkiner (Unreported, Supreme Court of Victoria, O'Bryan J, 21 September 1987).

TABLE OF CONTENTS

Introduction............................................................................................................................... 1
The material facts supporting the application........................................................................... 2
The Horne affidavit.................................................................................................................... 2
Listing fee proceeding................................................................................................................ 5
ASIC proceeding........................................................................................................................ 6
Daytree proceeding.................................................................................................................... 7
LLP mismanagement claim and decision of Ferguson J............................................................ 7
Management rights structures.................................................................................................. 9
Management rights breach of duties claim.............................................................................. 13
Management rights voidable transactions claim..................................................................... 14

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.

Continue reading Re APCH Ltd (in liquidation)

Details

AGLC: Re APCH Ltd (in liquidation) [2014] VSC 190
Case: [2014] VSC 190
Decision Date: 15 April 2014

CaseChat Overview and Summary

The case of Re APCH Ltd (in liquidation) involved an application by the liquidators to extend the time for serving a writ and general endorsement. The company, APCH Ltd, was in liquidation and had previously been under the control of receivers and managers. The receivers had issued a writ alleging breach of duties by the company’s directors. Following the receivers’ release of the cause of action to the liquidators, the latter sought an extension of time to serve the writ and general endorsement. The case was heard in the Supreme Court of Victoria.

The central legal issues revolved around whether the liquidators were justified in bringing the application to extend time for service of the writ and whether the court had the discretion to grant such an extension under the Supreme Court (General Civil Procedure) Rules 2005 (Vic) r 5.12 and the Corporations Act 2001 (Cth). Specifically, the court had to consider the relevance and application of sections 477(2B), 479 and 511 of the Corporations Act in the context of the liquidators’ application.

In its reasoning, the court found that the liquidators had a legitimate interest in pursuing the writ, which had been initiated by the receivers but was now in their hands. The court noted that the liquidators' application for an extension of time was not an abuse of process, and that there were no overriding considerations that would prevent the granting of the extension. The court further determined that the liquidators had acted reasonably and in good faith, and that the extension of time would not cause any prejudice to the defendants. Consequently, the court granted the liquidators' application for an extension of time.

The final orders of the court included granting the liquidators' application for an extension of time to serve the writ and general endorsement. The court also directed that the writ be served within a specified period from the date of the order.

Orders