Re Queensland Cosmetic Manufacturers Pty Ltd

[2006] QSC 412

[2006] QSC 412

SUPREME COURT OF QUEENSLAND

CIVIL JURISDICTION

WHITE J

No BS3766 of 2006

IN THE MATTER OF QUEENSLAND COSMETIC MANUFACTURERS PTY LTD (ACN 106 206 455) (Administrators Appointed)

GINETTE DAWN MULLER AND LACHLAN STUART McINTOSH as administrators of QUEENSLAND MANUFACTURERS PTY LTD
(ACN 106 206 455) (Administrators Appointed)      Applicant

BRISBANE

..DATE 13/12/2006

ORDER

HER HONOUR:  The application before the Court is by the liquidators of Queensland Cosmetic Manufacturers Pty Ltd - Ginette Dawn Muller and Lachlan Stuart McIntosh.  They were appointed (having earlier been Administrators) as Liquidators on the 23rd of June 2006.  It is unnecessary to dispose of the application to canvass the extensive and complex background facts which have given rise to the proceedings which are the subject of the agreement which the liquidators seek to have leave to enter into. 

The leave sought by the liquidators is resisted on a number of bases but perhaps only one needs to be ventilated, that is a cause of action contained in the proceedings which is sought to be assigned - BS8759 of 2005.  They are proceedings for damages pursuant to the Trade Practices Act on the basis that conduct of the vendors of the business which was purchased by Queensland Cosmetic Manufacturers was false and misleading.

Mr Daubney SC who appears with Mr McCafferty for the liquidators concedes that Trade Practices claims are not assignable.  It would be entirely unsatisfactory to split claims and in any event, the deed of arrangement before the Court purports to assign the whole of the proceedings between the subject parties.

The other matter is that the cause of action is subject to a charge in favour of what is, on those proceedings, Hair Advisory Centre.  It is not, at first blush, something which the liquidators may assign and sell.  The application is accordingly refused. 

There is also an application for costs on the indemnity basis, Mr‑‑‑‑‑

MR SAVAGE:  Yes, your Honour.

HER HONOUR:  ‑‑‑‑‑yes, I thought so - against the applicants.  The liquidators seek to have the costs as costs in the liquidation.  They have deposed through Ms Muller that there is no money in the liquidation which is to a large extent why they have contemplated entering into the deed of arrangement with the persons and entities which stood behind Queensland Cosmetic Manufacturers when it first entered into the business contract with Hair Advisory Centre. 

This is an application like any other and there is no particular reason why the costs order should be in the winding up which would be without any meaning at all so far as the compensation to the respondent is concerned. 

Mr Daubney has indicated that they were not served but merely given the material out of courtesy.  I accept Mr Savage's submission that they ought to have been served.  They had a very real interest as a secured creditor in the disposal of what is effectively the property which the respondent owns. 

The issue of the Trade Practices litigation being not assignable may not have been raised in correspondence but it is a matter which should have been apparent. 

The fact that what was thought to be assigned was the subject of a charge also should have been apparent and people such as liquidators who are officers of the Court ought not to have engaged in the application in that circumstance.  I am of the view that it is an appropriate case for indemnity costs, and I so order.

-----