Re CMTC Pty Ltd (in liquidation) - [2018] VSC 350

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMERCIAL COURT
CORPORATIONS LIST

S CI 2018 00989

IN THE MATTER of CMTC PTY LTD (IN LIQUIDATION) (ACN 607 395 004)

TRAVIS JAY PULLEN AS THE ADMINISTRATOR OF CMTC PTY LTD (IN LIQUIDATION) ACN 607 395 004	Plaintiff
v
CMTC PTY LTD (IN LIQUIDATION) ACN 607 395 004	Defendant

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JUDICIAL REGISTRAR:	Matthews JR
WHERE HELD:	Melbourne
DATE OF HEARING:	7 May 2018; further affidavit filed 30 May 2018
DATE OF JUDGMENT:	27 June 2018
CASE MAY BE CITED AS:	Re CMTC Pty Ltd (in liquidation)
MEDIUM NEUTRAL CITATION:	[2018] VSC 350

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CORPORATIONS – External administration – Application by former administrators for determination of remuneration pursuant to s 449E(1)(c) of the Corporations Act 2001 (Cth) – Consideration of transitional provisions in respect of the new Insolvency Practice Schedule (Corporations) as Schedule 2 to the Corporations Act 2001 (Cth) – Remuneration approved.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Zohal Hussaini, solicitor	DSS Law

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NOTE: The plaintiff has served all parties required to be served with notice of the intention to make this application and no such party appeared to oppose or contradict it. In such circumstances and in light of the provisions of r 9.2 of the Supreme Court (Corporations) Rules 2013, it was considered appropriate to deal with the application in the absence of the public and without the necessity for the plaintiff to attend at Court (save as identified in these reasons).

JUDICIAL REGISTRAR MATTHEWS:

Introduction
Nature of the application and material relied upon

The plaintiff, Travis Jay Pullen (‘Administrator’), was appointed as administrator of the defendant, CMTC Pty Ltd (in liquidation) (‘Company’) on 29 May 2017, pursuant to s 436A of the Corporations Act 2001 (Cth) (‘Act’).

Prior to the Administrator’s appointment to the Company, winding up proceedings against the Company had been commenced in the Federal Court of Australia. On 20 June 2017, orders were made by that court that the Company be wound up and Hamish Alan MacKinnon was appointed liquidator of the Company (‘Liquidator’). Accordingly, the administration of the Company came to an end on that day.

By originating process issued 20 March 2018, the Administrator applies, under s 449E(1)(c) of the Act and r 9.2 of the Supreme Court (Corporations) Rules 2013 (‘Rules’), for the approval of his remuneration in relation to the administration of the Company for the period 29 May 2017 to 14 June 2017 in the amount of $12,000 plus GST, and that the Company pay the Administrator’s costs of the application for remuneration approval (‘Application’).

The Application is supported by affidavits from the Administrator sworn 6 February 2018 (‘First Affidavit’) and 25 May 2018 (‘Second Affidavit’), and by an affidavit affirmed 19 March 2018 by Zohal Hussaini of DSS Law, the solicitors for the Administrator. For the reasons set out below, I will approve the Administrator’s remuneration in the amount…

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: [2018] VSC 350
Decision Date: 27 June 2018

CaseChat Overview and Summary

The case of Re CMTC Pty Ltd (in liquidation) involved the liquidators of the company who applied for a determination of their remuneration under section 449E(1)(c) of the Corporations Act 2001. The application was heard in the Federal Court of Australia. The former administrators sought approval for their fees and expenses as liquidators of the company, which had entered into external administration.

The primary legal issue the court had to address was whether the remuneration claimed by the former administrators was reasonable and in accordance with the transitional provisions of the Insolvency Practice Schedule (Corporations) as Schedule 2 to the Corporations Act 2001. This required the court to consider the new schedule's provisions and how they applied to the case at hand.

The court found that the former administrators had acted diligently and in the best interests of the creditors and members of the company. It considered the transitional provisions of the Insolvency Practice Schedule and determined that the claimed remuneration was reasonable. The court approved the remuneration as sought, finding that it was fair and appropriate given the circumstances of the case. The court's decision was based on a comprehensive review of the evidence presented and the applicable legal framework.

As a result of the court's decision, the former administrators were entitled to the approved remuneration for their services as liquidators of CMTC Pty Ltd. The court's approval ensured that the administrators were fairly compensated for their work in managing the company's external administration.

Orders