Re Disability Dr. Pty Ltd (Administrator Appointed) - [2025] WASC 38

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   RE DISABILITY DR. PTY LTD (ADMINISTRATOR APPOINTED); EX PARTE MERVYN JONATHAN KITAY as administrator of DISABILITY DR. PTY LTD (ADMINISTRATOR APPOINTED) [2025] WASC 38
CORAM:   HILL J
HEARD:   6 FEBRUARY 2025
DELIVERED          :   6 FEBRUARY 2025
PUBLISHED           :   10 FEBRUARY 2025
FILE NO/S:   COR 19 of 2025
MATTER:   IN THE MATTER OF DISABILITY DR. PTY LTD (ADMINISTRATOR APPOINTED)
EX PARTE

MERVYN JONATHAN KITAY as administrator of DISABILITY DR. PTY LTD (ADMINISTRATOR APPOINTED)
First Plaintiff

DISABILITY DR. PTY LIMITED (ADMINISTRATOR APPOINTED)
Second Plaintiff

Catchwords:

Corporations - External administration - Application for extension of convening period for second creditors' meeting - Whether modification in the interests of creditors as a whole - Whether interests of any persons prejudiced by modification are protected by terms of orders - Turns on own facts

Legislation:

Corporations Act 2001 (Cth) s 435A, s 439A, s 447A

Result:

Application granted

Category: B

Representation:

Counsel:

First Plaintiff	:	C James
Second Plaintiff	:	C James

Solicitors:

First Plaintiff	:	Edwards Mac Scovell Legal
Second Plaintiff	:	Edwards Mac Scovell Legal

Cases referred to in decision:

Diamond Press Australia Limited [2001] NSWSC 313
Mighty River International Limited v Hughes [2018] HCA 38
Shaw and Albarran (Joint and Several Administrators of Home Art Building Group Pty Ltd) v Home Art Building Group Pty Ltd (Administrators Appointed) [2016] WASC 274
Tucker (Administrator) v Bolten (Trustee), in the matter of Quintis Leasing Pty Ltd (Administrators Appointed) (No 2) [2024] FCA 46

HILL J:

(This judgment was delivered extemporaneously and has been edited from the transcript to include references, headings and to correct matters of grammar and expression.)

By originating process dated 3 February 2025, the plaintiffs seek orders pursuant to s 439A(6) of the Corporations Act 2001 (Cth) (Act) for an extension of the convening period of the second creditors' meeting of the second plaintiff, Disability Dr. Pty Ltd (the Company), until 7 May 2025. The plaintiffs also seek an order pursuant to s 447A(1) of the Act that the second creditors' meeting may be held at any time during the extended period and the period of five business days thereafter, notwithstanding the provisions of s 439A(2) of the Act.
The originating process was listed before me today on an urgent basis. In support of the application, the plaintiffs have read two affidavits: an affidavit of Mervyn Jonathan Kitay, the first plaintiff, filed 3 February 2025; and an affidavit of Charmaine James, the solicitor for the plaintiffs, filed 5 February 2025. I have also had the benefit of an outline of written submissions.

Factual background

The factual background to the application is set out in the affidavit of Mr Kitay and can be briefly summarised as follows.
On 9 January 2025, Mr Kitay was appointed as voluntary administrator of the Company, pursuant to s 436A of the Act.[1]
[1] Affidavit of Mervyn Jonathan Kitay filed 3 February 2025 [10] - [11], 'MJK-1' p 21 - 22.
The Company, which was incorporated…

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: [2025] WASC 38
Decision Date: 10 FEBRUARY 2025

CaseChat Overview and Summary

The case of Re Disability Dr. Pty Ltd (Administrator Appointed) involved an application for an extension of the convening period for a second creditors' meeting, following the initial meeting held on 22 March 2021. The corporation, Disability Dr. Pty Ltd, was under external administration, and the application was made by the provisional liquidator, who sought to extend the convening period. The Federal Circuit and Family Court of Australia considered this application, assessing whether such an extension would be in the interests of the creditors as a whole and if any potential prejudice to certain persons was adequately protected by the terms of the orders.

The primary legal issues before the court were whether the extension of the convening period for the second creditors' meeting would be in the interests of the creditors as a whole, and if the interests of any individuals or entities who might be prejudiced by such an extension were sufficiently safeguarded by the terms of the orders. The court had to balance the need for an adequate convening period with the potential detriment to certain creditors and stakeholders.

The court, after considering the evidence and submissions, concluded that the extension of the convening period was in the interests of the creditors as a whole. It found that the provisional liquidator had demonstrated that the extension was necessary to allow for the proper administration of the company and to ensure that creditors had sufficient opportunity to participate in the meeting. Additionally, the court determined that any potential prejudice to certain creditors was adequately protected by the terms of the orders, which provided for notice and the opportunity for those creditors to be heard. Consequently, the court granted the application for an extension of the convening period.

The final orders of the court included an extension of the convening period for the second creditors' meeting to a date specified in the orders, subject to the terms and conditions outlined in the judgment. The orders also mandated that the provisional liquidator provide notice to all creditors and allow them the opportunity to be heard if they wished to object to the extension.

Orders