Re Hutchins, P.G. v Ex parte Borden Australia P/L

[1993] FCA 709

709      9 3

-. JUDGMENT No. ........ ....-../ ... ..... ,,

IN THE FEDERAL-COURT -OF AUSTRALIA ) -

)

VICTORIA DISTRICT REGISTRY	)	No. VP 632 of 1993
1
GENERAL DIVISION	1
B E T W E E N :

Re: PETER GRAEME HUTCHINS

Judgment Debtor

Ex Parte: BORDEN AUSTRALIA PTY LIMITED

Judgment Creditor

JUDGE:	Heerey J
m:	8 September 1993
PLACE :	Melbourne

REASONS FOR JUDGMENT

The debtor applies under Ruling 33 of the Bankruptcy Act 1966 for an adjournment of the hearing of the petition. The ground for such application arises from a meeting under Part X of the Act which was held on 16 August 1993. At that meeting the debtor proposed a composition which in essence involved paying $20,000 to the trustee. His statement of affairs disclosed unsecured creditors of $7,237,040 and assets of $7,526.

was in the best interest of the creditors. The composition,	however, failed to carry the requisite statutory majority.
Those voting in favour were 19 and against 11, that is 63.3 per cent in number, which satisfied the requirement. But the requirement of three-quarters in value failed narrowly; 73.3 per cent voted in favour.
The critical vote was that of the Deputy Commissioner of Taxation for a value of $954,106.06. If that creditor had voted in favour the majority would have been 87.5 per cent. Even if that creditor had abstained, the requisite 75 per cent in value would have been achieved. The debtor has made an application under the Administrative Decisions (Judicial Review) Act 1977 (The AD(JR) Act) for the reasons of the Deputy Commissioner in deciding to vote against the composition. Under that Act the reasons would be due on 20 September and there would be a further 28 days which the debtor would have to apply for review of the decision.
The debtor in that setting asks that the petition be adjourned
until the proceedings under the AD(JR) Act can be completed. He said that he is not able to advance any grounds as to why that review would succeed as he has not yet got the reasons.
I do not think it would be a proper case to grant an adjournment. As far as the vote of a creditor at a meeting under Part X is an exercise in the commercial judgment of that creditor, it is in no sense the exercise of any fiduciary obligation and it is not subject to review in this court.
Accepting for the purposes of argument that there is
jurisdiction to review a decision to vote in a particular way at a Part X meeting under the AD(JR) Act, I am not persuaded that there is any realistic possibility of a court exercising its discretion to make any order. Of course, apart from anything else there is the fact that the meeting has been convened, held and concluded and I do not see any legal basis on which this court, either in its bankruptcy jurisdiction or exercising jurisdiction under the AD(JR) Act, could have the meetlng re-convened.
The hard fact is that the composition was put up to the meeting, it almost achieved the statutory majority but it did not. So for those reasons I refuse the application for an adjournment.

The controlling trustee provided a detailed report and recommended the acceptance of the composition. In reviewing the debtor's proposal the controlling trustee concluded that were the debtor to become bankrupt there would be no return to unsecured creditors and as such the offer made by the debtor

I certify that this and the preceding two (2) pages are a true copy of the reasons for judgment of his Honour

Mr Justice Heerey.

D a m : 8 September 1993

ADvearances
Counsel for the judgment debtor: In person
Solicitor for the judgment debtor: In person

Counsel for the judgment creditor: Mr Ellls

Solicitor for the judgment	Minter Ellison Morris
creditor:	Fletcher
Date of hearing:	8 September 1993