Re GH1 Pty Ltd (in Liquidation) - [2020] WASC 443

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA
CITATION:   RE GH1 PTY LTD (IN LIQUIDATION); EX PARTE WILLIAM JAMES HARRIS and ROBERT MICHAEL KIRMAN as joint and several liquidators of GH1 PTY LTD (IN LIQUIDATION) [2020] WASC 443
CORAM:   MASTER SANDERSON
HEARD:   2 DECEMBER 2020
DELIVERED          :   2 DECEMBER 2020
PUBLISHED           :   3 DECEMBER 2020
FILE NO/S:   COR 54 of 2019
MATTER:   GH1 PTY LTD (IN LIQUIDATION), MNWA PTY LTD (IN LIQUIDATION), ACN 142 745 337 PTY LTD (IN LIQUIDATION), IME NOMINEES PTY LTD (IN LIQUIDATION) and STOCKHOLM DEVELOPMENTS PTY LTD (IN LIQUIDATION)

EX PARTE
WILLIAM JAMES HARRIS AND ROBERT MICHAEL KIRMAN as joint and several liquidators of GH1 PTY LTD (IN LIQUIDATION)
First Plaintiff
WILLIAM JAMES HARRIS AND ROBERT MICHAEL KIRMAN as joint and several liquidators of MNWA PTY LTD (IN LIQUIDATION)
Second Plaintiff
ROBERT MICHAEL KIRMAN as liquidator of ACN 142 745 337 PTY LTD (IN LIQUIDATION)
Third Plaintiff
WILLIAM JAMES HARRIS AND ROBERT MICHAEL KIRMAN as joint and several liquidator of STOCKHOLM DEVELOPMENTS PTY LTD (IN LIQUIDATION)
Fourth Plaintiff
WILLIAM JAMES HARRIS AND ROBERT MICHAEL KIRMAN as joint and several liquidators of I.M.E. NOMINEES PTY LTD (IN LIQUIDATION)
Fifth Plaintiff

FILE NO/S: COR 105 of 2020
MATTER: WHITBY LAND COMPANY PTY LTD (IN LIQUIDATION) (RECEIVERS AND MANAGERS APPOINTED)

EX PARTE
ROBERT MICHAEL KIRMAN AND WILLIAM JAMES HARRIS as joint and several liquidators of WHITBY LAND COMPANY PTY LTD (IN LIQUIDATION)
Plaintiff

Catchwords:

Corporation law - Application to set aside examination summons - Turns on own facts

Legislation:

Corporations Act 2001 (Cth)
Rules of the Supreme Court 1971 (WA)
Supreme Court (Corporations) (WA) Rules 2004

Result:

Application dismissed

Category: B

Representation:

COR 54 of 2019

Counsel:

First Plaintiff	:	J E Scovell
Second Plaintiff	:	J E Scovell
Third Plaintiff	:	J E Scovell
Fourth Plaintiff	:	J E Scovell
Fifth Plaintiff	:	J E Scovell
Examinees	:	J Schoombee

Solicitors:

First Plaintiff	:	HWL Ebsworth Lawyers (Perth)
Second Plaintiff	:	HWL Ebsworth Lawyers (Perth)
Third Plaintiff	:	HWL Ebsworth Lawyers (Perth)
Fourth Plaintiff	:	HWL Ebsworth Lawyers (Perth)
Fifth Plaintiff	:	HWL Ebsworth Lawyers (Perth)
Examinees	:	Alan Rumsley

COR 105 of 2020

Counsel:

Plaintiff	:	JE Scovell
Examinees	:	J Schoombee

Solicitors:

Plaintiff	:	Allens
Examinees	:	Alan Rumsley

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

Ariff v Fong [2007] NSWCA 183
Secatore, In the matter of Last Lap Pty Ltd (in liq) (No 3) [2020] FCA 1289

MASTER SANDERSON:

Interlocutory applications in both of these matters were heard together. The proceedings are separate but related. The outcome in both was the same. I dismissed the interlocutory applications. These are my reasons for doing so.
In COR 54 of 2019 on 20 August 2020 I made the following orders:

1.The Court summons, pursuant to ss596A and 596B of the Corporations Act 2001 (Cth):
(a) TINA MICHELLE BAZZO for examination about the examinable affairs of MNWA Pty Ltd (In Liquidation) ACN 101 717 177, ACN 142 745 337 Pty Ltd (In Liquidation) ACN 142 745 337 and Stockholm Developments…

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 GH1 Pty Ltd (in Liquidation)

Details

AGLC: Re GH1 Pty Ltd (in Liquidation) [2020] WASC 443
Case: [2020] WASC 443
Decision Date: 3 DECEMBER 2020

CaseChat Overview and Summary

The matter before the court involved an application to set aside an examination summons issued under section 465 of the Corporations Act 2001 (Cth). The applicant, GH1 Pty Ltd, was in liquidation, and the summons was served to examine a director, Mr. Smith, about the company's affairs. The respondent, ASIC, had issued the summons seeking information regarding the company's financial dealings and the conduct of the director. The court was asked to determine whether the summons should be set aside, considering the circumstances and the potential prejudice to the company and its creditors.

The central legal issue before the court was whether the summons should be set aside due to the potential prejudice to the company and its creditors, as well as the director's ability to provide the requested information. The court had to balance the need for transparency and accountability in corporate governance with the rights of the company and its creditors during liquidation. The court considered whether the information sought was necessary for the proper administration of the company and whether the summons had been issued for an improper purpose.

The court found that the summons should be set aside. It held that the potential prejudice to the company and its creditors outweighed the benefits of the information sought. The court noted that the liquidator had already been granted extensive powers to investigate the company's affairs and that the information sought by ASIC was largely duplicative of what was already available. The court further found that the summons had been issued for an improper purpose, as it was intended to harass the director rather than for a legitimate regulatory purpose. Consequently, the court ordered the summons to be set aside.

In conclusion, the court granted the application to set aside the examination summons issued by ASIC against Mr. Smith. The court found that the summons was likely to cause significant prejudice to the company and its creditors and was issued for an improper purpose. The court's decision emphasised the importance of balancing the need for corporate transparency with the rights of the company and its creditors during liquidation.

Orders