FEDERAL COURT OF AUSTRALIA
Cremin, in the matter of Brimson Pty Ltd (in liq) [2019] FCA 1023
File number: VID 645 of 2019 Judge: MOSHINSKY J Date of judgment: 25 June 2019 Catchwords: CORPORATIONS – insolvency – trustee company – right of indemnity – right of exoneration – where trustee company ceased to be the trustee of a trading trust upon the company going into liquidation – where all liabilities of the company were incurred in its capacity as trustee for the trust – where the liquidator sought orders to enable him to carry on the business and sell the trust property to satisfy debts owing to creditors of the trust Legislation: Corporations Act 2001 (Cth), ss 420, 477, 491, 1318, Sch 2, Insolvency Practice Schedule (Corporations), ss 90-15, 90-20
Federal Court of Australia Act 1976 (Cth), s 57
Trustee Act 1958 (Vic) ss 63, 67
Federal Court (Corporations) Rules 2000, r 2.8
Cases cited: Aced Kang Investments Pty Ltd (in liq), in the matter of Aced Kang Investments Pty Ltd (in liq) [2017] FCA 476
Amirbeaggi, in the matter of Simpkiss Pty Ltd (in liq) [2018] FCA 2121
Apostolou v VA Corporation of Aust Pty Ltd [2011] FCAFC 103
Carter Holt Harvey Woodproducts Australia Pty Ltd v Commonwealth [2019] HCA 20
Re Stansfield DIY Wealth Pty Ltd (in liq) (2014) 291 FLR 17
Re Suco Gold Pty Ltd (in liq) (1983) 33 SASR 99
Staatz v Berry, in the matter of Wollumbin Horizons Pty Ltd (in liq) (No 3) [2019] FCA 924
Taylor v CJ & KL Bond Super Pty Ltd, in the matter of CJ & KL Bond Pty Ltd (in liq) [2018] FCA 1430
Date of hearing: 25 June 2019 Registry: Victoria Division: General Division National Practice Area: Commercial and Corporations Sub-area: Corporations and Corporate Insolvency Category: Catchwords Number of paragraphs: 56 Counsel for the Plaintiffs: Mr CR Brown Solicitor for the Plaintiffs: Harwood Andrews ORDERS
VID 645 of 2019 IN THE MATTER OF BRIMSON PTY LTD (IN LIQ) (ACN 621 156 643) AND THE KANE RETAIL GROUP PTY LTD (IN LIQ) (ACN 147 179 922) AND THE TEAL RETAIL GROUP PTY LTD (IN LIQ) (ACN 165 892 544)
SHANE JUSTIN CREMIN IN HIS CAPACITY AS LIQUIDATOR OF BRIMSON PTY LTD (IN LIQ) (ACN 621 156 643) AND THE KANE RETAIL GROUP PTY LTD (IN LIQ) (ACN 147 179 922) AND THE TEAL RETAIL GROUP PTY LTD (IN LIQ) (ACN 165 892 544)
First Plaintiff
BRIMSON PTY LTD (IN LIQUIDATION) (ACN 621 156 643)
Second Plaintiff
THE KANE RETAIL GROUP PTY LTD (IN LIQUIDATION) (ACN 147 179 922) (and another named in the Schedule)
Third Plaintiff
JUDGE:
MOSHINSKY J
DATE OF ORDER:
25 JUNE 2019
THE COURT ORDERS THAT:
1.Compliance with r 2.8 of the Federal Court (Corporations) Rules 2000 be dispensed with.
2.Pursuant to s 1318 of the Corporations Act 2001 (Cth), the first plaintiff,…
Keep reading for free
Create a free CaseChat account to read Re Cremin, Brimson Pty Ltd (in liq) and more:
- Read every judgment in full
- Ask AI and get answers linked to paragraphs
- See how each paragraph was cited in later cases
- Download judgments as PDF or Word
One click creates your free account or signs you in.
By continuing you agree to the Terms and Privacy Policy.
- Case
- [2019] FCA 1023
- Decision Date
CaseChat Overview and Summary
The primary legal issue was whether the liquidator could be appointed as the receiver and manager of the family trusts' assets and if his actions could be excused for any administrative breaches. The court considered whether the liquidator's appointment would allow for the effective administration of the trusts' assets and the equitable treatment of creditors. Additionally, the court examined if the liquidator, having acted honestly, should be excused from any administrative shortcomings.
The court held that the liquidator could be appointed as the receiver and manager of the trusts' assets, enabling him to carry on the businesses and sell the assets to satisfy creditors. The court also excused the liquidator from any breaches, failures, or omissions relating to the administration of the trusts, as he had acted honestly. The court further granted the liquidator the necessary powers to manage the trusts' assets and prioritize the payment of creditors from the sale proceeds. The court ruled that the liquidator's costs and expenses, including those from the application, should be paid from the trusts' property.
The court's decision allowed the liquidator to proceed with the sale of the trusts' assets to satisfy creditors, providing a clear path for the equitable distribution of the available funds. The orders facilitated the effective administration of the trusts' assets and ensured that the liquidator's actions were excused due to his honest conduct. The court's ruling provided clarity and direction for the future management of the trusts' assets and the resolution of creditor claims.
Orders
Orders of the court
1. Compliance with r 2.8 of the Federal Court (Corporations) Rules 2000 be dispensed with.
2. Pursuant to s 1318 of the Corporations Act 2001 (Cth), the first plaintiff, Shane Justin Cremin, in his capacity as liquidator of the second plaintiff and the fourth plaintiff, acted honestly and ought fairly to be excused for any breaches, failures, or omissions relating to the administration of the second plaintiff in dealing with the property of the Brimson Family Trust and relating to the administration of the fourth plaintiff in dealing with the property of the Teal Retail Group Family Trust.
3. Pursuant to s 57(1) of the Federal Court of Australia Act 1976 (Cth), Mr Cremin, an official liquidator, be appointed without security as receiver and manager over the business and assets of:
(a) the Brimson Family Trust;
(b) the Kane Retail Group Family Trust; and
(c) the Teal Retail Group Family Trust,
(the Receiver).
4. The need for the Receiver to file a guarantee under r 14.21 and r 14.22 of the Federal Court Rules 2011 be dispensed with.
5. The Receiver have, in respect of the business and assets of each trust referred to in paragraph 3, the powers that a receiver has in respect of the business and property of a company under s 420 of the Corporations Act (other than s 420(2)(s), (t), (u) and (w)) as if the reference in that section to “the corporation” were a reference to the trust including without limitation, the power to do all things necessary or convenient to:
(a) carry on the business of the trust;
(b) employ any person in connection with the business of the trust;
(c) sell the assets of the trust;
(d) pay the creditors of the trust from the proceeds of the assets, pursuant to the priorities prescribed under the provisions of the Corporations Act;
(e) compromise any claim made against the second, third or fourth plaintiff in its capacity as trustee of the trust or against any of the trust property on any terms the Receiver sees fit;
(f) bring any claim against any party on behalf of the trust; and
(g) execute any tax returns, financial statements or other documents relating to the trust.
6. The costs, expenses and remuneration incurred by Mr Cremin as liquidator of the second, third and fourth plaintiffs and as the Receiver, including the costs of this application, be paid in priority from the property of the trusts (including any proceeds from the sale of the businesses).
7. There be liberty to apply to any person who can demonstrate sufficient interest to modify or discharge paragraphs 1 to 6 on not less than 48 hours’ written notice to the first plaintiff.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
Full text does not contain this section.
Ratio Decidendi
Legal Principle Established
Full text does not contain this section.