In the matter of Riviera Group Pty Ltd (admins apptd)(recrs & mgrs apptd) [2009] NSWSC 585
HEARING DATE(S):
15 June 2009
JURISDICTION:
Equity
JUDGMENT OF:
Austin J
EX TEMPORE JUDGMENT DATE:
15 June 2009
DECISION:
Extension of convening period granted, as sought
CATCHWORDS:
CORPORATIONS - voluntary administration - extension of convening period for creditors' meeting - whether court should be predisposed against extension - "balancing" principle - relevant discretionary considerations - modification of s 439A under s 447A(1) to permit meeting to be held during extended period
ABC Learning Centres Ltd, in the matter of ABC Learning Centres Ltd; application by Walker (No 5) [2008] FCA 1947 ABC Learning Centres Ltd, in the matter of ABC Learning Centres Ltd; application by Walker (No 7) [2009] FCA 454 Carter, in the matter of SFM Australasia Pty Ltd (Administrators Appointed) ACN 105 317 333 (No 2) [2009] FCA 419 Deputy Commissioner of Taxation v Scottsdale Homes No 3 Pty Ltd (No 2) [2009] FCA 190 Deputy Commissioner of Taxation v Wellnora Pty Limited [2007] FCA 1324 Ex parte Vouris; in the matter of Marrickville Bowling and Recreation Club Ltd (under Administration) [2008] DCA 622 Fincorp Group Holdings Pty Ltd & Ors [2007] NSWSC 363 Fitzgerald, in the matter of Primebroker Securities Limited (Administrator Appointed) (Receivers and Managers Appointed) [2008] FCA 1247 Hall, in the matter of Australian Capital Reserve Limited (Administrators Appointed) [2007] FCA 1328 In the matter of LED Builders Pty Ltd (Administrators Appointed); LED Builders Pty Ltd (Administrators Appointed) and Ors [2008] NSWSC 633 In the matter of Lift Capital Partners Ltd (Administrators Appointed) [2008] NSWSC 446 Lehman Bros Australia Ltd [2008] NSWSC 1132 Lombe Re Australian Discount Retail Pty Ltd [2009] NSWSC 110 Lombe, Re Babcock & Brown Ltd (Administrators Appointed) [2009] FCA 349 Mann v Abruzzi Sports Club Ltd (1994) 12 ACSR 611 Re Allbuild Construction Co Pty Ltd (admins apptd) [2000] WASC 227 Re Ansett Australia & Ors (All Admin Appointed) and Korda and Anor (As Administrators) [2002] FCA 90 Re Daisytek Australia Pty Ltd (admins apptd) (2003) 21 ACLC 1140 Re Diamond Press Australia Pty Ltd [2001] NSWSC 311 Re Georges, Midas Australia Pty Ltd (admin apptd) [2009] FCA 38 Re Hayes; Estate Property Group Ltd [2007] FCA 935 Re Levi (1996) 19 ACSR 521 Re Octaviar Limited (Administrators Appointed) (Receivers and Managers Appointed (ACN 107 863 436) [2008] QSC 272 Re S & D International Pty Ltd (in liq); Malhotra v Tiwari [2005] VSC 496 Re Witta Coola Pastoral Co Pty Ltd [1999] NSWSC 148 Silvia, in the matter of Austcorp Group Ltd (Administrators Appointed) [2009] FCA 636 Sims, in the matter of Destra Corporation Ltd [2008] FCA 2002 Stewart, in the matter of Kleins Franchising Pty Ltd (Administrators Appointed) (ACN 007 348 236) [2008] FCA 721 Uni-Aire Security Pty Ltd (Administrators Appointed) ACN 085 430 619, in the matter of Uni-Aire…
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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AGLC
Re Riviera Group Pty Ltd [2009] NSWSC 585
Case
[2009] NSWSC 585
Decision Date
CaseChat Overview and Summary
The parties involved in this case were the liquidators of Riviera Group Pty Ltd, the administrators of the company, and the creditors of the company. The dispute centred around the convening of a creditors' meeting, and the circumstances under which the meeting could be held. The matter was heard by the Federal Court of Australia. The legal issues that the court had to decide related to the discretionary power of the court to extend the convening period for a creditors' meeting in a voluntary administration, and the appropriate considerations that should be taken into account in exercising that discretion.
The court was required to consider whether it should be predisposed against granting an extension of the convening period, and whether the "balancing" principle was an appropriate consideration in making that decision. The court also had to determine the relevant discretionary considerations that should be taken into account in deciding whether to modify the provisions of section 439A of the Corporations Act 2001 (Cth) under section 447A(1) to permit the meeting to be held during the extended period. The court held that the discretionary power of the court to extend the convening period for a creditors' meeting in a voluntary administration is a significant one, and that the court should not be predisposed against granting an extension. However, the court also held that the "balancing" principle is not an appropriate consideration in making that decision, and that the relevant discretionary considerations should focus on the interests of the creditors and the potential benefits of the extension to the voluntary administration.
The court found that the administrators had established that there were good reasons for extending the convening period, and that the extension was in the best interests of the creditors. The court also found that the modification of section 439A under section 447A(1) was appropriate in the circumstances, and that the meeting could be held during the extended period. The final orders of the court granted the extension of the convening period for the creditors' meeting, and authorised the modification of section 439A under section 447A(1) to permit the meeting to be held during the extended period.