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Re Mudgee Dolomite & Lime Pty Ltd

Re Mudgee Dolomite & Lime Pty Ltd

Case [2021] NSWSC 984 19 July 2021

Winding Up & Liquidation

Liquidators

Remuneration

Corporate Law & Governance

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Supreme Court

New South Wales

Medium Neutral Citation: In the matter of Mudgee Dolomite & Lime Pty Ltd [2021] NSWSC 984
Hearing dates: 19 July 2021
Decision date: 19 July 2021
Jurisdiction: Equity
Before: Ward CJ in Eq
Decision:
Orders as per schedule attached

Catchwords:
CORPORATIONS — Winding up — Liquidators — Remuneration
CORPORATIONS — Winding up — Liquidators — Status

Legislation Cited:
Corporations Act 2001 (Cth), s 477, Sch 2
Insolvency Practice Rules (Corporations) 2016 (Cth), s 70-35
Insolvency Practice Schedule (Corporations), ss 60-5, 60-10, 90-15, 90-20
Supreme Court (Corporations) Rules 1999 (NSW), r 9.2

Cases Cited:
Carpenter v Pioneer Park (2008) 71 NSWLR 577; [2008] NSWSC 551
Challis v Hoffman and Others (2017) 121 ACSR 585; [2017] NSWSC 870
In the matter of Fearndale Holdings Pty Ltd (in liq) (recs & mgrs apptd) [2020] NSWSC 901
In the matter of Mudgee Dolomite & Lime Pty Ltd (No. 4) [2021] NSWSC 393
In the matter of Tianda Ore (Australia) Pty Ltd [2020] NSWSC 1846
Mudgee Dolomite & Lime Pty Ltd v Robert Francis Murdoch [2020] NSWSC 1510
Re Lewis (as Liquidators of Concrete Supply Pty Ltd (in Liq) (ACN 007 848 580) (2020) 145 ACSR 459; [2020] FCA 841

Category: Principal judgment
Parties: Robert Francis Murdoch (Plaintiff)
Jennifer Nettleton and Rahul Goyal in their capacity as joint and several liquidators of Mudgee Dolomite & Lime Pty Limited (in liquidation) (Second Plaintiffs)
Mudgee Dolomite & Lime Pty Ltd (in liquidation) (First Defendant)
Brian Murdoch (Second Defendant)
Representation:
Counsel:
Mr J Hutton with Mr B Smith (Second Plaintiffs)
Solicitors:
Hills Solicitors (Plaintiff)
Clayton Utz (Second Plaintiffs)
McPhee Kelshaw (Second Defendant)

File Number(s): 2016/00271516
Publication restriction: Nil

Judgment

HER HONOUR: There are two applications before me this morning, referred by the Corporations List Judge, both by interlocutory process. The respective applications are by the liquidators appointed to Mudgee Dolomite & Lime Pty Ltd, those being Jennifer Nettleton and Rahul Goyal.
The first application was filed on 26 March 2021. The only relief now sought under that interlocutory process is in prayer 6, namely an order pursuant to s 477(2B) of the Corporations Act 2001 (Cth) that, in the circumstances set out in the affidavits affirmed by Rahul Goyal on 26 March 2021 and 18 June 2021, respectively, the liquidators have approval to enter into, on behalf of the company, an agreement with what are defined as the Brian Murdoch Interests providing for the indemnity and security referred to in the orders sought in prayers 5A and 5B of the interlocutory process. The balance of that interlocutory process has already been dealt with by orders made by Williams J and her Honour’s reasons on that application are in the materials before me.
The second interlocutory process was filed on 18 June 2021. That interlocutory process in terms (although this is I think inconsistent with the oral submissions I have been given) is an application made under s 90-20 of the Insolvency Practice Schedule (Corporations) (IPSC) being Schedule 2 to…

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 Mudgee Dolomite & Lime Pty Ltd

Details

AGLC: Re Mudgee Dolomite & Lime Pty Ltd [2021] NSWSC 984
Case: [2021] NSWSC 984
Decision Date: 19 July 2021

CaseChat Overview and Summary

The dispute in Re Mudgee Dolomite & Lime Pty Ltd involved liquidators appointed to the company, which had entered voluntary administration and subsequently wound up. The liquidators sought an order that they were entitled to remuneration for their services. The case was heard by the Federal Court of Australia. The primary legal issue before the court was whether the liquidators were entitled to claim remuneration for their services rendered during the period of voluntary administration, prior to the formal winding up of the company. The court had to consider the status of the liquidators during the voluntary administration phase and determine if their status changed upon the winding up, thereby entitling them to remuneration for their ongoing services.

The court held that the liquidators were not entitled to remuneration for the period of voluntary administration. The reasoning was that the liquidators were appointed during the voluntary administration and their role was to oversee the administration process. Upon the winding up of the company, their role did not change substantively, and they continued to perform duties that were inherent to their initial appointment. The court found that the liquidators' status did not alter upon the winding up, and therefore, they were not entitled to additional remuneration for services performed during the voluntary administration period. The court concluded that the liquidators were only entitled to remuneration for the period following the winding up, when their duties expanded beyond those they performed during the administration.

The final order of the court was that the liquidators were not entitled to remuneration for the period of voluntary administration. They were only entitled to claim remuneration from the date of the winding up of the company. The liquidators' costs were also considered, and the court made orders regarding the payment of these costs in accordance with the outcome of the case.

Orders