Re Inon Nominees Pty Ltd (in liquidation) - [2013] VSC 211

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

COMMERCIAL COURT
CORPORATIONS LIST

No. SCI 2011 5191

IN THE MATTER of INON NOMINEES PTY LTD (IN LIQUIDATION) (ACN 005 076 317)

BETWEEEN:

MICHELE GIACOBBE and	Plaintiffs
JOSEPH GIACOBBE
and
ANTHONY GIACOBBE	First Defendant
and
INON NOMINEES PTY LTD (IN LIQUIDATION) (ACN 005 076 317)	Second Defendant

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JUDGE:	FERGUSON J
WHERE HELD:	Melbourne
DATE OF HEARING:	25 March 2013
DATE OF JUDGMENT:	30 April 2013
CASE MAY BE CITED AS:	Re Inon Nominees Pty Ltd (in liquidation)
MEDIUM NEUTRAL CITATION:	[2013] VSC 211

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CORPORATIONS – Family trustee company wound up on the just and equitable ground where irretrievable breakdown – Application by liquidator for directions – Company’s only assets three undeveloped lots of land – Proceeds of sale of one property likely to be sufficient to meet current liabilities – Whether liquidator justified in selling all property – Corporations Act 2001 (Cth) s 479(3), Supreme Court (General Civil Procedure) Rules 2005 (Vic), r 54.02.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr R E T Wodak	Pearsons Barristers & Solicitors
For the First Defendant	In person
For the Second Defendant	Mr C Juebner	SBA Law

HER HONOUR:

On 28 June 2012, the Court ordered that Inon Nominees Pty Ltd be wound up on the just and equitable ground[1] and appointed Luke Christopher Targett and Rachel Elizabeth Burdett‑Baker as liquidators.[2] Inon is the trustee of the Giacobbe Family Trust with the beneficiaries being various members of the Giacobbe family. The trust no longer carries on business and the only remaining assets of the trust are three pieces of undeveloped land at Airport West.[3] Those properties are not generating any income. Inon has outstanding liabilities exceeding $20,000 for rates and taxes and an overdraft liability of about $80,000. In addition, there are the liquidators’ fees and disbursements which exceed $30,000. It is only necessary for one of the properties to be sold to meet those liabilities. However, the liquidators are of the view that all three properties should be sold with the net proceeds of sale to be distributed to the beneficiaries of the trust. They have obtained proposals from two selling agents who value the properties at between $1.2 million and $1.55 million, in part dependent upon whether the properties are sold together or separately. The liquidators have sought directions that they would be justified in taking the course that they propose.
[1]Corporations Act 2001 (Cth), s 461(k).
[2]Giacobbe v Giacobbe & Anor [2012] VSC 285.
[3]There may be some foundations and footings on one of the properties.

At the time that the winding up order was made, the plaintiffs, Michele and Joseph Giacobbe were the directors of Inon. They are father and son. Joseph holds 50 per cent of the shares in Inon with the other 50 per cent being held by his cousin, Anthony. The background to the trust, the role of Inon as trustee and the dispute between the…

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: [2013] VSC 211
Decision Date: 30 April 2013

CaseChat Overview and Summary

In the matter of Inon Nominees Pty Ltd, the Court was presented with a dispute concerning the winding up of a family trustee company on the just and equitable ground, where an irretrievable breakdown had occurred. The application for directions was made by the liquidator, who was tasked with managing the company's affairs during liquidation. The company's only assets consisted of three undeveloped lots of land, and the liquidator sought guidance on whether it was justified to sell all the property, given that the proceeds from the sale of one property were likely to be sufficient to meet the company's current liabilities.

The primary legal issue that the Court had to decide was whether the liquidator was justified in selling all of the company's property. This decision hinged on an assessment of the company's financial situation and the potential consequences of selling all the property. The Court needed to consider whether the just and equitable principle, as provided for in section 479(3) of the Corporations Act 2001 (Cth), supported the liquidator's proposed course of action.

The Court carefully examined the circumstances of the case and the relevant statutory provisions, ultimately concluding that the liquidator was justified in selling all of the company's property. The Court determined that the financial position of the company, along with the likely proceeds from the sale of one property, warranted this decision. The Court further noted that the Supreme Court (General Civil Procedure) Rules 2005 (Vic), rule 54.02, provided the necessary framework for the liquidator's actions. The Court found that the liquidator had acted within their authority and that the proposed sale of the property was in the best interests of the company's creditors and members. The Court granted the liquidator the necessary directions to proceed with the sale of the company's property, ensuring that the process was conducted fairly and in accordance with the relevant legal provisions.

Orders