Sherred v McDonald - [2005] QSC 153

SUPREME COURT OF QUEENSLAND

CITATION:

Sherred & Anor v McDonald & Ors [2005] QSC 153

PARTIES:

FRANK RAYMOND SHERRED
(applicant)
TOTAL BUILDING GROUP PTY LTD
(ACN 089 156 927)
(second applicant)
v
GEOFFREY McDONALD AND RICHARD ALBARRAN
(first respondents)
ARTHUR DAVID DEWIS
(second respondent)
CASTLE DEVELOPMENT GROUP PTY LTD
(ACN 100 697 729)

(third respondent)

FILE NO/S:

BS 6855 of 2004

DIVISION:

Trial Division

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court, Brisbane

DELIVERED ON:

3 June 2005

DELIVERED AT:

Brisbane

HEARING DATE:

7 February 2005

JUDGE:

Moynihan J

ORDER:

The administrators’ should have the costs and outlays of the administration fixed at $8,000 and the costs are costs in the winding up of Castle.1.

Dewis indemnify Castle in respect of the costs and outlays paid pursuant to the order in paragraph 1.2.

Dewis pay Sherred and Castle’s costs of the originating application and of the applications of 30 September, 5 October and 2 November 2004, including any reserved costs, assessed on a standard basis. 3.

The administrators’ legal costs reasonably and properly incurred as a consequence of the invalid appointment be assessed and paid as to one half by Dewis.4.

5.         Otherwise I make no orders.

CATCHWORDS:

CORPORATIONS – MISCELLANEOUS CASES – where the administrators filed an application seeking that the costs of the administration be the costs in the winding up of the third respondent – where the first applicant filed an application seeking an order that in the event the court awarded the administrators costs that the second respondent indemnify the third respondent for those costs – where the second respondent filed an application that the administrators’ remuneration be fixed.

Corporations Act (Cth) 2000.

Bovis Lend Lease Pty Ltd v Wily [2003] NSWSC 467;
Sutherland v Take Seven Group Pty Ltd [1998] NSWSC 538;

Wilson v Manna Hill Mining Company Pty Ltd [2004] FCA 1663.

COUNSEL:

Mr S Keim SC for the applicants
Mr J Crowther (sol) for the first respondent

Mr C Coulsen for the second respondent

SOLICITORS:

Campbell Standish Partners for the applicants
Crowther Solicitors for the first respondent

Baker Johnson Lawyers for the second respondent

MOYNIHAN J: I am concerned with applications arising out of a dispute between Frank Raymond Sherred and Arthur David Dewis concerning the affairs of Castle Development Group Pty Ltd.

By an originating application filed on 10 August 2004 the applicants, (Frank Raymond Sherred and Total Building Group Pty Ltd - it is convenient to refer to these applicants as Sherred) applied for declarations that the appointment of the first respondents, Geoffrey McDonald and Richard Albarran (the administrators) as administrators of the third respondent Castle Development Group Pty Ltd (Castle) was void ab initio and for other relief.

The shareholders in Castle were a company controlled by Sherred and a company controlled by Arthur David Dewis (Dewis). It is clear that there was a deadlock in respect of Castle’s affairs prior to and at the time…

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.

Continue reading Sherred v McDonald

Details

AGLC: Sherred v McDonald [2005] QSC 153
Case: [2005] QSC 153
Decision Date: 3 June 2005

CaseChat Overview and Summary

The case of Sherred v McDonald involved a dispute among the administrators of a company, the liquidator, and shareholders regarding the costs associated with the administration of the company. The matter was before the court to resolve several applications concerning the allocation of costs and remuneration. The administrators sought an order that their costs of administration be the costs in the winding up of the company. One of the shareholders also sought an order that if the court awarded costs to the administrators, the second respondent would indemnify the third respondent for those costs. The second respondent, in turn, filed an application that the administrators' remuneration be fixed.

The court was tasked with determining the appropriate allocation of costs and remuneration among the parties involved. The central legal issues revolved around the validity of the administrators' appointment, the entitlement to costs, and the proper allocation of those costs among the parties. The court had to consider whether the administrators' costs should be fixed at a particular amount and whether any party was obligated to indemnify or contribute to those costs. Additionally, the court needed to assess the reasonableness of the administrators' legal costs and determine the appropriate method for their assessment and payment.

In its decision, the court ruled that the administrators' costs and outlays of administration should be fixed at $8,000 and that these costs would be treated as costs in the winding up of the company. The court ordered that one of the shareholders would indemnify the company for the costs and outlays paid in accordance with the order. Furthermore, the court ruled that the shareholder would also pay the costs of the originating application and subsequent applications, including any reserved costs, assessed on a standard basis. The court also ordered that the administrators' legal costs, reasonably and properly incurred as a consequence of the invalid appointment, be assessed and paid by the shareholder. The court made no further orders in the matter.

In summary, the court fixed the administrators' costs at $8,000, required one shareholder to indemnify the company for these costs, and ordered the shareholder to pay various costs associated with the proceedings. The court also directed that the shareholder pay half of the administrators' legal costs. No further orders were made.

Orders

Orders of the court

The administrators’ should have the costs and outlays of the administration fixed at $8,000 and the costs are costs in the winding up of Castle.1.

Dewis indemnify Castle in respect of the costs and outlays paid pursuant to the order in paragraph 1.2.

Dewis pay Sherred and Castle’s costs of the originating application and of the applications of 30 September, 5 October and 2 November 2004, including any reserved costs, assessed on a standard basis. 3.

The administrators’ legal costs reasonably and properly incurred as a consequence of the invalid appointment be assessed and paid as to one half by Dewis.4.

5. Otherwise I make no orders.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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CITATION:	Sherred & Anor v McDonald & Ors [2005] QSC 153
PARTIES:	FRANK RAYMOND SHERRED (applicant) TOTAL BUILDING GROUP PTY LTD (ACN 089 156 927) (second applicant) v GEOFFREY McDONALD AND RICHARD ALBARRAN (first respondents) ARTHUR DAVID DEWIS (second respondent) CASTLE DEVELOPMENT GROUP PTY LTD (ACN 100 697 729) (third respondent)
FILE NO/S:	BS 6855 of 2004
DIVISION:	Trial Division
PROCEEDING:	Application
ORIGINATING COURT:	Supreme Court, Brisbane
DELIVERED ON:	3 June 2005
DELIVERED AT:	Brisbane
HEARING DATE:	7 February 2005
JUDGE:	Moynihan J
ORDER:	The administrators’ should have the costs and outlays of the administration fixed at $8,000 and the costs are costs in the winding up of Castle.1. Dewis indemnify Castle in respect of the costs and outlays paid pursuant to the order in paragraph 1.2. Dewis pay Sherred and Castle’s costs of the originating application and of the applications of 30 September, 5 October and 2 November 2004, including any reserved costs, assessed on a standard basis. 3. The administrators’ legal costs reasonably and properly incurred as a consequence of the invalid appointment be assessed and paid as to one half by Dewis.4. 5. Otherwise I make no orders.
CATCHWORDS:	CORPORATIONS – MISCELLANEOUS CASES – where the administrators filed an application seeking that the costs of the administration be the costs in the winding up of the third respondent – where the first applicant filed an application seeking an order that in the event the court awarded the administrators costs that the second respondent indemnify the third respondent for those costs – where the second respondent filed an application that the administrators’ remuneration be fixed. Corporations Act (Cth) 2000. Bovis Lend Lease Pty Ltd v Wily [2003] NSWSC 467; Sutherland v Take Seven Group Pty Ltd [1998] NSWSC 538; Wilson v Manna Hill Mining Company Pty Ltd [2004] FCA 1663.
COUNSEL:	Mr S Keim SC for the applicants Mr J Crowther (sol) for the first respondent Mr C Coulsen for the second respondent
SOLICITORS:	Campbell Standish Partners for the applicants Crowther Solicitors for the first respondent Baker Johnson Lawyers for the second respondent