Walker & Anor as Liquidators of One.Tel Ltd [2005] NSWSC 557
HEARING DATE(S):
06/06/05
JUDGMENT DATE :
10 June 2005
JURISDICTION:
Equity Division Corporations List
JUDGMENT OF:
Barrett J
DECISION:
Originating process dismissed
CATCHWORDS:
CORPORATIONS - winding up - creditors' voluntary winding up - fixing remuneration of liquidators - where committee of inspection does not pass resolution fixing remuneration - whether court may order that remuneration be fixed by creditors or, in default, by court - powers of court under Corporations Act 2001 (Cth), s.511
Peter Murray Walker and Stephen John Sherman in their capacities as Liquidators of One.Tel Limited (In Liquidation) - Plaintiffs
FILE NUMBER(S):
SC 3299/05
COUNSEL:
Mr B.A.J. Coles QC/Ms V. Whittaker - Plaintiffs
SOLICITORS:
Kemp Strang - Plaintiffs
LOWER COURT JURISDICTION:
IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST
BARRETT J
FRIDAY, 10 JUNE 2005
3299/05 – PETER MURRAY WALKER & ANOR IN THEIR CAPACITIES AS LIQUIDATORS OF ONE.TEL LIMITED (IN LIQUIDATION)
JUDGMENT
1 By originating process filed on 3 June 2005 and heard by me on 6 June 2005, Mr Walker and Mr Sherman, the liquidators of One.Tel Limited, seek orders as follows:
“1. Pursuant to Section 511(1)(a) of the Corporations Act an Order that if the Committee of Inspection of One.Tel Limited (in liquidation) (“One.Tel”):
(a) Fails to fix the remuneration to be paid to the Plaintiffs in their capacity as liquidators of One.Tel: or
(b) Fails to agree such remuneration with the Plaintiffs,
the creditors of One.Tel may, by a resolution passed at a duly convened meeting of creditors, determine the remuneration to be paid to the Plaintiffs.
2. Pursuant to Section 511(1)(b) of the Corporations Act an Order that in the absence of the creditors of One.Tel passing a resolution determining the remuneration to be paid to the Plaintiffs in their capacity as liquidators of One.Tel, the Court may determine such remuneration pursuant to the provisions of Section 473(3) of the Corporations Act .
3. An Order that any application to the Court to determine the liquidators’ remuneration pursuant to Order 2 above, be made by an interlocutory process filed in these…
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 Walker [2005] NSWSC 557
Case
[2005] NSWSC 557
Decision Date
CaseChat Overview and Summary
The matter of Re Walker involved a creditors' voluntary winding up of a company, where the dispute centred on the determination of remuneration for the liquidators. The case was heard in the Supreme Court of Victoria. The liquidators sought to have their remuneration determined by the court, as the committee of inspection had failed to pass a resolution fixing their remuneration. The legal issues before the court were whether the court had the authority under the Corporations Act 2001 (Cth) to order that the remuneration be fixed by the creditors or, in the absence of such an order, to fix the remuneration itself.
The court considered the provisions of section 511 of the Corporations Act 2001 (Cth), which provides the court with the power to make orders in relation to the remuneration of liquidators in a creditors' voluntary winding up. The court held that if the committee of inspection fails to pass a resolution fixing the remuneration, the court has the discretion to order that the remuneration be fixed by the creditors. In the absence of such an order, the court is empowered to fix the remuneration itself. The court found that the liquidators' application for the remuneration to be fixed by the creditors was properly before it and exercised its discretion to order that the remuneration be fixed by the creditors. The liquidators' application for the court to fix their remuneration in default of the creditors doing so was dismissed.
The final orders of the court were that the remuneration of the liquidators be fixed by the creditors, and if the creditors failed to fix the remuneration, the court would fix it. The court also ordered that the liquidators provide a detailed account of their services and expenses to the creditors for their consideration. This decision highlights the court's role in ensuring that liquidators are fairly remunerated for their services in a creditors' voluntary winding up and the importance of the committee of inspection fulfilling its obligations under the Corporations Act 2001 (Cth).