Twin Peaks Leisure Pty Limited (in liq), in the matter of Twin Peaks Leisure Pty Limited (in liq) v Workers Compensation Nominal Insurer

The case involves Twin Peaks Leisure Pty Limited, a company in liquidation, and Zead Houchar, a director of the company, who were applicants, and the Workers Compensation Nominal Insurer and Andrew James Barden, the Official Liquidator of Twin Peaks Leisure Pty Limited, who were respondents. The dispute centred around the winding-up order issued by the District Registrar on 5 December 2012, which the applicants sought to set aside. The applicants argued that the company was solvent and that the winding-up order should be rescinded, while the respondents contested this claim. The legal issues before the court were whether the applicants had brought the application promptly, whether notice had been given to the liquidator, whether the petitioning creditor had been notified and had consented to the order sought, and whether there was an explanation for the company's failure to attend the hearing when the winding-up order was made. Additionally, the court had to consider whether the company was solvent and whether there was any reason to prevent the company from trading.

Justice Jacobson found that the application had been brought promptly and that the liquidator and the petitioning creditor had been properly notified. The court was satisfied that the company was solvent based on the balance sheet test and a cash flow forecast, and that there was no reason to prevent the company from continuing to trade. The consent of the petitioning creditor and the support of the largest creditor, Alibi Holdings Pty Limited, were also noted. Given these factors, the court determined that the winding-up order should be set aside, and approved the performance of Mr Houchar of his functions and powers as a director of the company in bringing the application. The court made orders setting aside the winding-up order, approving the payment of certain debts and expenses from the liquidator's personal funds, and allowing the parties liberty to relist the matter with 48 hours' notice. Each party was ordered to bear their own costs of the application.

This decision highlights the importance of prompt action, proper notification to relevant parties, and the need for evidence of solvency in applications to set aside winding-up orders. The court's approval of the director's actions in bringing the application and the agreement among parties regarding debt payments further underscore the collaborative approach taken in resolving such disputes.