Registrar of Aboriginal Corporations v Wirrajarrai Aboriginal Corp

[1997] FCA 1520

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 3214  of   1997

BETWEEN:	REGISTRAR OF ABORIGINAL CORPORATIONS APPLICANT
AND:	WIRRAJARRAI ABORIGINAL CORPORATION RESPONDENT
JUDGE:	MOORE J
DATE OF ORDER:	31 OCTOBER 1997
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. The Wirrajarrai Aboriginal Corporation be wound up pursuant to the provisions of section 63 of the Aboriginal Councils and Associations Act 1976.

1. Edward Michael Ring of P.O. Box 44 Murwillumbah NSW be appointed liquidator of      the Corporation.

1. The applicant's costs be taxed and paid out of the assets of the Corporation.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 3214 of 1997

BETWEEN:	REGISTRAR OF ABORIGINAL CORPORATIONS APPLICANT
AND:	WIRRAJARRAI ABORIGINAL CORPORATION RESPONDENT

JUDGE:	MOORE J
DATE:	31 OCTOBER 1997
PLACE:	SYDNEY

REASONS FOR JUDGMENT
(Delivered ex tempore)

This is an application under s 31 of the Aboriginal Councils and Associations Act 1976 ("the Act") for an order winding up the Wirrajarrai Aboriginal Corporation ("the Corporation"). The application is made by the Registrar of Aboriginal Corporations ("the Registrar") and is based on three grounds. The first concerns the public interest as that arises under s 61A(b) of the Act. The other grounds arise under s 63(2)(d), that the Corporation is unable to pay its debts, and s 62(2)(h), that it is just and equitable that the Corporation be wound up. The Corporation is represented by counsel and affidavits of the public officer of the Corporation and Mr Copeland, the chairman of the Corporation, are relied on to oppose the Corporation's winding up.

However those affidavits do not, in substance, address the evidence relied upon by the Registrar found in the affidavit of Mr Joe Mastrolombo and annexures to it, which set out both the history of the Corporation and its present financial situation. Having regard to the way the case was developed it is necessary to consider only the ground relating to the solvency of the Corporation.  The Corporation was incorporated in 1980 and, while its objects range over a number of matters, its primary object and principal function, in fact, has been to provide housing for members of the Aboriginal community in Moree.  To that end it has constructed on land owned by another corporation, the Moree Local Aboriginal Land Council, a number of houses which have been occupied for that purpose by Aboriginal people for some period and are presently occupied by them.

The gravamen of the case advanced by the Registrar is that the financial circumstances of the Corporation have been permitted to deteriorate for some considerable time with the result that the present estimated financial position of the Corporation is that its liabilities exceed its debts by the sum of $67,799.  I refer to its present estimated financial position because the financial records of the Corporation have not been maintained in such a way as to reveal its true present financial situation. However, the best evidence is, as I just mentioned, that its liabilities exceed its assets by the sum of $67,799.  A principal contributing factor to the present financial position of the Corporation is a judgment debt arising from proceedings brought by the Moree Local Aboriginal Land Council against the Corporation in the Supreme Court of New South Wales.

Without endeavouring to summarise with great precision the nature of those proceedings, in substance what occurred was that the Corporation failed to pay rates to the local council.  The local council then secured payment of them from the Moree Local Aboriginal Land Council who in turn sued the Corporation and obtained judgment.  That judgment debt is in the sum of $347,415.19.  A submission was made on behalf of the Corporation that, having regard to the evidence of Mr Copeland, there may be sums held by the Moree Local Aboriginal Land Council sufficient to satisfy the Corporation's present liabilities. However that evidence is sufficiently unclear as to be unpersuasive in the light of the more detailed evidence contained in the affidavit of Mr Mastrolombo and the various annexures.

It was further submitted that the position of the Corporation ought to be viewed in the context of the decision that has seemingly been made by the Moree Local Aboriginal Land Council not to pursue the judgment debt. However, from the material that has been annexed to the affidavit of Mr Mastrolombo, it appears to me, and I infer, that that decision is based on what the Moree Local Aboriginal, Land Council views as its right to re-enter the land and regain possession of it and thereby obtain possession of the houses built upon it.  Those houses, I should add, are the principal asset of the Corporation. 

It is unnecessary in these proceedings to express any concluded view about the nature of the property interests, if any, that the Corporation has in those houses. I say that because the evidence discloses that the value of those houses is conservatively in the order of $300,000 which does not represent a sum which would satisfy the judgment debt.  If the conclusion I earlier reached is correct, that is, the Moree Local Aboriginal Land Council's position in not pursuing the judgment debt is contingent upon obtaining the property in the houses, it would seem to follow that either the Corporation will lose its principal asset or the Moree Local Aboriginal Land Council will, if it does not secure possession of the houses, pursue its judgment debt. On either approach the financial position of the Corporation is essentially the same.  That is, its liabilities exceed its assets.

I am satisfied that the Corporation is unable to pay its debts.  Its income has been sporadic at best, and while there is some evidence indicating that members active in the Corporation might seek to alter that position, there is insufficient evidence to sustain a conclusion that it will change materially in the future. Satisfied as I am that the Corporation is unable to pay its debts, and faced with the application of the Registrar based on that ground, it seems to me that the order that should be made is an order winding up the Corporation. Accordingly, I make an order winding up the Wirrajarrai Aboriginal Corporation.

I certify that this and the preceding two (2) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore

Associate:

Dated:            31 October 1997

Solicitor for the Applicant:	Mr M Bezzi of the Australian Goverment Solicitor
Counsel for the Respondent:	Mr R.C. Titterton
Solicitor for the Respondent:	Mr S Percy
Date of Hearing:	31 October 1997
Date of Judgment:	31 October 1997