Reidy v Deputy Commissioner of Taxation, in the matter of Forseasons Pty Limited

[2007] FCA 1330

FEDERAL COURT OF AUSTRALIA

Reidy v Deputy Commissioner of Taxation, in the matter of Forseasons Pty Limited [2007] FCA 1330

CORPORATIONS – failure by administrator to serve and publish notices of a second creditors’ meeting within statutory time limit – query whether a prospective declaration of validity may be made under s 1322(4) – time limits extended

Corporations Act 2001 (Cth), s 1322

IN THE MATTER OF FORSEASONS PTY LIMITED ACN 107 517 993

GEOFFREY PHILIP REIDY and FORSEASONS PTY LIMITED (IN ADMINISTRATION) ACN 107 517 993 v DEPUTY COMMISSIONER OF TAXATION
NSD 1745 OF 2007

GYLES J
21 AUGUST 2007
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1745 OF 2007

IN THE MATTER OF FORSEASONS PTY LIMITED ACN 107 517 993

BETWEEN:

GEOFFREY PHILIP REIDY
First Plaintiff

FORSEASONS PTY LIMITED (IN ADMINISTRATION) ACN 107 517 993
Second Plaintiff

AND:

DEPUTY COMMISSIONER OF TAXATION
Defendant

JUDGE:	GYLES J
DATE OF ORDER:	21 AUGUST 2007
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.For the purposes of s 439A of the Corporations Act 2001 (Cth) the convening period for a meeting of creditors of the second plaintiff to be held on 22 August 2007, be extended to 16 August 2007.

2.For the purposes of s 439A(3) of the Corporations Act 2001 (Cth):

(a)   Service of the notice of meeting dated 15 August 2007 be extended to 16 August 2007; and

(b)   Publication of the notice of meeting dated 15 August 2007 be extended to 16 August 2007.

3.The costs of this application be paid by the first plaintiff personally.

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	NSD 1745 OF 2007

IN THE MATTER OF FORSEASONS PTY LIMITED ACN 107 517 993

BETWEEN:

GEOFFREY PHILIP REIDY
First Plaintiff

FORSEASONS PTY LIMITED (IN ADMINISTRATION ) ACN 107 517 993
Second Plaintiff

AND:

DEPUTY COMMISSIONER OF TAXATION
Defendant

JUDGE:	GYLES J
DATE:	21 AUGUST 2007
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1. This is an application by Geoffrey Philip Reidy, the administrator of the second plaintiff Forseasons Pty Limited ACN 107 517 993 (the Administrator), for relief under s 1322 of the Corporations Act 2001 (Cth) (the Act) to deal with some irregularities which have occurred in relation to the calling of a second meeting by the Administrator. There are two irregularities. The first relates to service of a notice of the meeting upon creditors. That was a day late, assuming the mail was delivered the following day, informal service having taken place on the correct day. The second is that notice of the meeting was not published in the newspapers until a day after it should have been. The meeting is fixed for tomorrow. The evidence is that the only creditors of which there is any evidence have both acknowledged receipt of the notice of meeting and consent to and approve the regularisation of the matter. I am quite satisfied that the irregularities arose due to inadvertence.

2. The irregularities are essentially of a procedural nature, bearing in mind the relevant definitions. There is no doubt that the persons concerned in the contravention acted honestly and, in my opinion, no substantial injustice has been, or is likely to be, caused to any person by making the order sought. Indeed, a failure to regularise the matter would lead to delay and further cost to the creditors. Therefore, everything points to making the appropriate order. I might say that I am satisfied that s 1322 applies, notwithstanding the existence of s 447A.

3. The initial application was for a declaration of validity of the meeting which is to take place tomorrow. I rather doubt whether that declaration can be made in advance, having in mind the wording of s 1322(4)(a) notwithstanding some commentary to which I have been referred. In any event, the application is now for orders extending the two relevant periods concerned to 16 August 2007, the effect of which will be that there will be no breach and there should, therefore, be no doubt about the validity of the meeting. If any residual difficulty is felt, then an application can be made at that stage to have the appropriate declaration made. I am not suggesting that would be necessary.

4. I am also satisfied that notice has been given to the appropriate persons.

5. It will be a condition of the grant of relief that the costs and expenses associated with this application should be borne by the Administrator personally and not the creditors.

I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gyles.

Associate:

Dated:        17 September 2007

Solicitor for the Plaintiffs:	Mr MJ Fitzgerald
Date of Hearing:	21 August 2007
Date of Judgment:	21 August 2007