Sheahan re Cedenco JV Australia Pty Ltd
[2010] NSWSC 592
•2 June 2010
CITATION: Sheahan re Cedenco JV Australia Pty Ltd [2010] NSWSC 592 HEARING DATE(S): 02/06/10
JUDGMENT DATE :
2 June 2010JURISDICTION: Equity Division
Corporations ListJUDGMENT OF: Barrett J EX TEMPORE JUDGMENT DATE: 2 June 2010 DECISION: Order extending convening period CATCHWORDS: CORPORATIONS - voluntary administration - second meeting of creditors - application for order extending convening period - two steps required to convene - one but not the other already taken - whether convening period may be extended LEGISLATION CITED: Corporations Act 2001 (Cth), Part 5.3A, ss 439A(1), 439A(2). 439A(3), 439A(6) CATEGORY: Principal judgment CASES CITED: Re Windward Islands (Enterprises) UK Ltd [1983] BCLC 293
Yates re G Retail Ltd [2006] FCA 370PARTIES: John Sheahan and Ian Russell Lock as voluntary administrators of Cedenco JV Australia Pty Ltd & 2 Ors - Plaintiffs FILE NUMBER(S): SC 2010/137794 COUNSEL: Mr J S Darams - Plaintiffs
Mr B F Katekar - Interested PartySOLICITORS: Eakin McCaffery Cox - Plaintiffs
IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
CORPORATIONS LIST
BARRETT J
WEDNESDAY 2 JUNE 2010
2010/137794 JOHN SHEAHAN & ANOR AS ADMINISTRATORS OF CEDENCO JV AUSTRALIA PTY LTD & ORS
JUDGMENT
1 Among orders made today on the application of the administrators of Cedenco JV Australia Pty Limited, SK Foods Pty Limited and SS Farms Australia Pty Limited is an order under s 439A(6) of the Corporations Act 2001 (Cth) extending the convening period for the second meeting of creditors in the Part 5.3A administration of each of those companies.
2 Unless extended, the convening period would have ended on 4 June 2010.
3 A question arose on the application as to whether it was open to the court to make an extending order, having regard to steps already taken by the administrators in connection with the convening of the meeting.
4 There was published in today's “The Australian” newspaper a notice dated 31 May 2010 by which the administrators gave notice that a meeting of the creditors of each company would be held at a stated address “on Thursday 10 May 2010 at 12pm (midday)”. There is, of course, an anomaly in this notice in that the date specified in it is a past date. There was apparently an intention to specify 10 June 2010, not 10 May 2010, as the date of the meeting. Leaving that to one side, there was a question whether the meeting had already been convened, so that the occasion for an extension of the kind the administrators sought did not arise.
5 It is made clear by s 439A(1), read in conjunction with s 439A(2), that the relevant convening concept is that of taking steps to give notice of a meeting and, in that sense, to set in train the bringing of relevant persons together at a specified time and place. I say this because s 439A(2) uses the word “held” and specifies a time within which the meeting must be “held” by reference to the end of the convening period. It is thus shown that the relevant concept of convening is different from the concept conveyed by the word “held”.
6 Convening, in this context, means summoning or calling (see Re Windward Islands (Enterprises) UK Ltd [1983] BCLC 293), so that it is only the action of summoning or calling that must be completed within the convening period.
7 As Mr Darams of counsel pointed out, the method of convening the relevant meeting is specified in s 439A(3). The opening words of that provision are "The administrator must convene the meeting by". Then follow two paragraphs. One refers to the giving of the written notice of the meeting to as many as the company's creditors as reasonably practicable. The other speaks of causing notice of a meeting to be published in a newspaper.
8 There can be no doubt that both steps – that is, giving written notice in accordance with s 439A(3)(a) and causing a notice to be published in accordance with s 439A(3)(b) – together constitute the convening of the meeting. If one of the s 439A(3) steps has been taken but the other has not, there has been no convening: see Yates re G Retail Ltd [2006] FCA 370.
9 It is clear that, while the notice to which I have referred was published in a relevant newspaper today, the administrators have taken no action to give creditors written notice of the meeting. There has thus been implementation of one of the steps in s 439A(3) but not of the other.
10 In those circumstances, and leaving aside the anomaly in the published notice to which I have referred, there has not been any convening of the second meeting of creditors at this point.
11 It was therefore open to the administrators to seek and to the court to grant under s 439A(6) an extension of the convening period.
12 That course would not have been available had convening already occurred by means of both the s 439A steps. The convening period is that within which those steps are to be taken. It follows that, when the steps are complete, the convening period comes to an end by virtue of that circumstance and cannot then be extended.
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