Re Envirostar Energy Ltd

[2002] NSWSC 1246

CITATION:	Re Envirostar Energy Ltd [2002] NSWSC 1246
CURRENT JURISDICTION:	Equity Division
FILE NUMBER(S):	SC 5204/02
HEARING DATE(S):	19/12/02
JUDGMENT DATE:	19 December 2002
PARTIES :	Adrian Stewart Duncan and Nicholas David Seaton in their capacity as Joint Administrators of Envirostar Energy Limited (Administrators Appointed) and Green Energy Stapylton Pty Limited (Administrators Appointed) - Plaintiffs
JUDGMENT OF:	Barrett J

COUNSEL :	Mr D R Stack - Plaintiffs
SOLICITORS:	Deacons - Plaintiffs
CATCHWORDS:	CORPORATIONS - voluntary administration - second extension of convening period - applicable provisions
LEGISLATION CITED:	Corporations Act 2001 (Cth)
CASES CITED:	Australasian Memory Pty Ltd v Brien (2000) 200 CLR 270 Re Old Papa's Holdings Ltd (2001) 24 WAR 229 Re Ricon Constructions Pty Ltd (1997) 43 NSWLR 174 Re Western National Earthmoving Corporation Pty Ltd (1997) 15 ACLC 1665
DECISION:	Convening period extended

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IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

BARRETT J

THURSDAY 19 DECEMBER 2002

5204/02 - ADRIAN STEWART DUNCAN & ANOR IN THEIR CAPACITY AS JOINT ADMINISTRATORS OF ENVIROSTAR ENERGY LTD (ADMINISTRATORS APPOINTED) & ORS

JUDGMENT

1 On 22 October 2002 I made an order pursuant to s.439A(6) of the Corporations Act 2001 extending, until 10 January 2003, the convening period for the second meeting of creditors of Envirostar Energy limited and its two subsidiaries, Green Energy Morwell Pty Ltd and Green Energy Stapylton Pty Ltd. The administrators now seek to have the convening period further extended.

2 In support of that application there has been read the affidavit of Mr Seaton, one of the administrators, sworn on 18 December 2002. He deposes to progress that has been made with attempts to obtain buyers for the business of the companies. It is clear that the administrators have done considerable work in this direction, that more than 50 expressions of interest were received, and that some five parties may properly be regarded at this stage as potential buyers.

3 There has been, however, a complication in that on 6 December Energy Equipment Engineering Pty Ltd, which is the contractor for the supply and installation of electricity generating equipment for the group's two projects, was ordered by the Federal Court to be wound up in insolvency. That is a complication because the administrators now have to consider a number of issues relevant to the prospects of successful completion of the construction and commissioning projects which were not previously in question.

4 Having regard to the evidence and to the potentially more favourable outcome for all concerned if the present process directed towards sale as a going concern can be progressed to a point where some meaningful and concrete proposal can be put before creditors at the second meeting, I consider it appropriate that the convening period be further extended to the date the administrators seek, which is 21 February 2003. I note that it has been said from the bar table that even though such an extension may be granted, the administrators will still proceed diligently to convene the meeting at the earliest opportunity that is both prudent and practicable.

5 When the matter came before me this morning, it was on the basis that the further extension was sought under s.439A(6). The application is now put on a different basis, that is, by reference to s.447A which is the provision creating a far ranging jurisdiction to make orders varying the way in which provisions of Pt 5.3A are to operate in relation to a particular company.

6 Mr Stack has taken me to the decision in Re Western National Earthmoving Corporation Pty Ltd (1997) 15 ACLC 1665, where an order of this very kind was made pursuant to s.447A; see also Re Ricon Constructions Pty Ltd (1997) 43 NSWLR 174 and Re Old Papa's Holdings Ltd (2001) 24 WAR 229. These cases support the application of s.447A in the way now sought. The first two cases were decided before the decision of the High Court in Australasian Memory Pty Ltd v Brien (2000) 200 CLR 270 but that decision, in which the broad operation of the section was confirmed, would only serve to underwrite the correctness of the earlier cases. This was recognised by Owen J in the Old Papa's case.

7 Mr Stack has also referred me to the form of order under s.447A made for like purposes and in like circumstances in relation to Ansett Australia Ltd in Federal Court of Australia proceedings V3079/01. That form of order seems to me to be the correct form in a case of this kind, being an order pursuant to s.447A that s.439A operates “as if the convening period was the period ending on” the date to which the extension is to be made.

8 I now make the orders in the minute of order which has been handed up and which I initial and date.

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Last Modified: 01/06/2003