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Re Hans Continental Smallgoods Pty Ltd

Re Hans Continental Smallgoods Pty Ltd

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Case Copied 16 December 2008 16 min read

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FEDERAL COURT OF AUSTRALIA
Mentha, in the matter of Hans Continental Smallgoods Pty Ltd (Administrators Appointed) [2008] FCA 1933
CORPORATIONS – extension of convening period for second meeting of creditors of company in administration
Corporations Act 2001 (Cth) ss 439A, 447A
ReDiamond Press Australia Pty Limited [2001] NSWSC 313 applied
Fincorp Group Holdings Pty Limited (2007) 62 ACSR 192 followed
Hayes, in the matter of Estate Property Group Ltd (Administrators Appointed) [2007] FCA 935 referred to
Lehman Brothers Australia Ltd [2008] NSWSC 1132 referred to
Mann v Abruzzi Sports Club Ltd (1994) 12 ACSR 611 referred to
IN THE MATTER OF HANS CONTINENTAL SMALLGOODS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 009 758 258); MARK FRANCIS XAVIER MENTHA, BRIAN KEITH MCMASTER AND JOHN RICHARD PARK IN THEIR CAPACITIES AS JOINT AND SEVERAL ADMINISTRATORS OF HANS CONTINENTAL SMALLGOODS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 009 758 258), SWICKER'S KINGAROY BACON FACTORY PTY LTD (ADMINISTRATORS APPOINTED) (ACN 009 678 693) AND SUN PORK FOODS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 100 494 264)
NSD 1939 of 2008
JACOBSON J
16 DECEMBER 2008
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

NSD 1939 of 2008

IN THE MATTER OF HANS CONTINENTAL SMALLGOODS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 009 758 258)

MARK FRANCIS XAVIER MENTHA, BRIAN KEITH MCMASTER AND JOHN RICHARD PARK IN THEIR CAPACITIES AS JOINT AND SEVERAL ADMINISTRATORS OF HANS CONTINENTAL SMALLGOODS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 009 758 258), SWICKER'S KINGAROY BACON FACTORY PTY LTD (ADMINISTRATORS APPOINTED) (ACN 009 678 693) AND SUN PORK FOODS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 100 494 264)
Plaintiffs

JUDGE:

JACOBSON J

DATE OF ORDER:

16 DECEMBER 2008

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:
1.The Originating Process be made returnable instanter.
2.The Plaintiffs have leave to file in Court the affidavit of Brian Keith McMaster affirmed on 15 December 2008 and the affidavit of Maria Coffill O'Brien affirmed on 16 December 2008.
3.Confidential Exhibit BMK-2 to the affidavit of Brian Keith McMaster sworn on 15 December 2008 and filed in this proceeding be confidential, and no person is to have access to that document without an order of the Court.
4.Pursuant to section 439A(6) of the Corporations Act 2001 (Cth) (Act), order that the convening period for the meetings of creditors of each of Hans Continental Smallgoods Pty Limited (administrators appointed), Swicker's Kingaroy Bacon Factory Pty Limited (administrators appointed) and Sun Pork Foods Pty Ltd (administrators appointed) (Companies and each a Company) required to be held pursuant to section 439A of Act be extended to midnight on 30 March 2009.
5.Pursuant to section 447A(1) of the Act, order that with respect to each Company Part 5.3A of the Act is to operate as if:
(a)section 439A(1) of the Act also provided that the meeting of creditors required by that section may be convened and held within the convening period (including within the convening period as extended pursuant to subsection 439A(6));
(b)section 439A(2) of the Act provided that the meeting…

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: [2008] FCA 1933
Decision Date: 16 December 2008

CaseChat Overview and Summary

The parties involved in this case were the plaintiffs, who sought an extension of time for the convening of creditors' meetings in relation to three companies, Hans Continental Smallgoods Pty Ltd, Swicker's Kingaroy Bacon Factory Pty Ltd, and Sun Pork Foods Pty Ltd. The legal dispute was heard in the Federal Court of Australia, with the primary issue being the extension of the convening period for creditors' meetings as mandated by the Corporations Act 2001 (Cth). The plaintiffs sought this extension under section 439A(6) of the Act, which allows for the extension of the convening period for creditors' meetings when necessary. The court was required to determine whether the plaintiffs' application for an extension was justified and whether the conditions for such an extension were met.

The court considered the application under section 439A(6) of the Corporations Act 2001 (Cth) and examined the affidavits provided by the plaintiffs, Brian Keith McMaster and Maria Coffill O'Brien. The court found that the plaintiffs' application for an extension was reasonable and that the extension was necessary to ensure that the creditors' meetings could be convened and held within the extended period. The court also considered the implications of the extension on the operation of Part 5.3A of the Corporations Act, determining that the extension did not contravene the statutory provisions but rather allowed for compliance with the procedural requirements of the Act.

The court granted the plaintiffs' application for an extension of the convening period for the creditors' meetings of the three companies to midnight on 30 March 2009. It also directed that Part 5.3A of the Act would operate as if certain provisions allowed for the convening and holding of the meetings within the extended period. Additionally, the court ordered that certain documents be treated as confidential and that the plaintiffs' costs of the proceedings be paid pro rata as a cost of the administration of each company. The plaintiffs were also granted liberty to apply for further orders if necessary.

Orders

Orders of the court

1. The Originating Process be made returnable instanter.

2. The Plaintiffs have leave to file in Court the affidavit of Brian Keith McMaster affirmed on 15 December 2008 and the affidavit of Maria Coffill O'Brien affirmed on 16 December 2008.

3. Confidential Exhibit BMK-2 to the affidavit of Brian Keith McMaster sworn on 15 December 2008 and filed in this proceeding be confidential, and no person is to have access to that document without an order of the Court.

4. Pursuant to section 439A(6) of the Corporations Act 2001 (Cth) (Act), order that the convening period for the meetings of creditors of each of Hans Continental Smallgoods Pty Limited (administrators appointed), Swicker's Kingaroy Bacon Factory Pty Limited (administrators appointed) and Sun Pork Foods Pty Ltd (administrators appointed) (Companies and each a Company) required to be held pursuant to section 439A of Act be extended to midnight on 30 March 2009.

5. Pursuant to section 447A(1) of the Act, order that with respect to each Company Part 5.3A of the Act is to operate as if:

(a) section 439A(1) of the Act also provided that the meeting of creditors required by that section may be convened and held within the convening period (including within the convening period as extended pursuant to subsection 439A(6));

(b) section 439A(2) of the Act provided that the meeting must be held within five business days from being convened in accordance with subsections 439A(3) and (4), being a date not necessarily within five business days from the end of the convening period (including the convening period as extended pursuant to subsection 439A(6)); and

(c) section 439A of the Act operated generally to permit the convening and holding of the meeting of creditors of the Company during the convening period (including the convening period as extended pursuant to section 439A(6)) provided the requirements of subsection 439A(3) and (4) are complied with.

6. The Plaintiffs' costs of the proceedings be paid pro rata as a cost of the administration of each Company.

7. The Plaintiffs have liberty to apply.

Note:

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

JACOBSON J

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Ratio Decidendi

Legal Principle Established

Established by: JACOBSON J

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IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1939 of 2008

MARK FRANCIS XAVIER MENTHA, BRIAN KEITH MCMASTER AND JOHN RICHARD PARK IN THEIR CAPACITIES AS JOINT AND SEVERAL ADMINISTRATORS OF HANS CONTINENTAL SMALLGOODS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 009 758 258), SWICKER'S KINGAROY BACON FACTORY PTY LTD (ADMINISTRATORS APPOINTED) (ACN 009 678 693) AND SUN PORK FOODS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 100 494 264) Plaintiffs
JUDGE:	JACOBSON J
DATE OF ORDER:	16 DECEMBER 2008
WHERE MADE:	SYDNEY