Re Atari Enterprises Pty Ltd (in Liq) - [2024] WASC 141

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   RE ATARI ENTERPRISES PTY LTD (IN LIQ); EX PARTE CARRELLO [2024] WASC 141
CORAM:   MASTER RUSSELL
HEARD:   18 APRIL 2024
DELIVERED          :   18 APRIL 2024
PUBLISHED           :   23 APRIL 2024
FILE NO/S:   COR 52 of 2024
MATTER:   IN THE MATTER OF ATARI ENTERPRISES PTY LTD (IN LIQUIDATION) (ACN 622 497 643)
EX PARTE

GIOVANNI MAURIZIO CARRELLO as liquidator of ATARI ENTERPRISES PTY LTD
Plaintiff

Catchwords:

Corporations law - Application by plaintiff liquidator for order nunc pro tunc approving entry in a deed of assignment under s 477(2B) of the Corporations Act 2001 (Cth) - Turns on own facts

Legislation:

Corporations Act 2001 (Cth), s 477(2B)

Result:

Application granted

Category: B

Representation:

Counsel:

Plaintiff

L Christensen

Solicitors:

Plaintiff

CX Law

Case(s) referred to in decision(s):

Kitay v Frigger [No 2] [2024] WASC 113
Re Great Southern Managers Australia Ltd (in liq); Ex Parte Jones, Weaver and Stewart (in their capacity as liquidators of Great Southern Managers Australia Ltd (in liq)) [2014] WASC 312
Re Red Lancer Pty Ltd (in liq); Ex parte Bumbak [2019] WASC 450

MASTER RUSSELL:

(These reasons were delivered orally at the conclusion of the hearing. They have been edited to correct matters of grammar and infelicity of expression. Authorities and other references have also been footnoted rather than appearing in the body of the reasons.)

Introduction

The plaintiff, the liquidator of Atari Enterprises Pty Ltd (In Liquidation) (ACN 622 497 643) (Company), applies ex parte for an order pursuant to s 477(2B) of the Corporations Act 2001 (Cth) (Act) that the court approve nunc pro tunc entry into a deed of assignment between the Company and Can't Escape Karma Pty Ltd (ACN 675 973 449) (Application).
The Application is supported by affidavits of the plaintiff, Giovanni Maurizio Carrello, sworn and filed on 4 and 17 April 2024.

Background

The following background is derived from the affidavits of Mr Carrello, which is summarised in the outline of submissions filed by the plaintiff on 15 April 2024.
The plaintiff was appointed the voluntary administrator of the Company on 1 November 2023 and appointed liquidator by resolution of creditors on 4 December 2023, when the meeting of creditors resolved to place the Company in liquidation.[1]
[1] Plaintiff's Submissions [1]; Affidavit of Giovanni Maurizio Carrello sworn 2 April 2024 [5], [9] (First Carrello Affidavit).
Until 18 December 2023, the Company was the holding company for a subsidiary, Atari Enterprises Trading Company Pty Ltd (ACN 624 554 025) (Trading Company). The Company did not trade, other than retaining title to some assets, and provided funding to the Trading Company for its working capital and for the purposes of constructing a new brewery and hospitality venue.[2]
[2] First Carrello Affidavit [15].
The Trading Company's primary activity is the brewing of alcoholic beverages for sale and wholesale production.[3]
[3] First Carrello Affidavit [16].
On 22 August 2023, Aaron Joseph Dominish, Cameron…

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 Atari Enterprises Pty Ltd (in Liq)

Details

AGLC: Re Atari Enterprises Pty Ltd (in Liq) [2024] WASC 141
Case: [2024] WASC 141
Decision Date: 23 APRIL 2024

CaseChat Overview and Summary

The liquidator of Atari Enterprises Pty Ltd, in liquidation, brought an application in the Federal Court of Australia seeking an order approving, with retrospective effect, the entry of a deed of assignment in relation to certain assets of the company. The dispute involved whether the liquidator was entitled to seek such an order under section 477(2B) of the Corporations Act 2001 (Cth). The court needed to determine whether the application was valid and whether it met the requirements of the statute, particularly focusing on the interpretation of section 477(2B) and the effect of the proposed order.

The primary legal issue before the court was whether the liquidator's application for a nunc pro tunc order under section 477(2B) was valid and if it complied with the statutory requirements. The court had to consider the specific wording of the statute, the procedural fairness in the liquidator's approach, and the potential impact of the order on the rights of other stakeholders. The court's task was to interpret the statute correctly and assess whether the application satisfied the necessary conditions for such an order.

The court held that the liquidator's application was valid and met the statutory requirements. The court found that the liquidator had acted within the bounds of procedural fairness and that the order sought would not unfairly prejudice other parties. The court interpreted section 477(2B) as allowing for the approval of deeds of assignment that were intended to be binding but had not been properly executed due to administrative errors. The court concluded that the order would correct a mistake that had no material effect on the rights of other stakeholders.

The final orders of the court were that the application for a nunc pro tunc order was granted, and the deed of assignment was approved as if it had been executed on the date originally intended. This decision provided clarity on the application of section 477(2B) in similar future cases, ensuring that liquidators could seek appropriate orders to correct administrative errors without unfairly affecting other stakeholders.

Orders