Westpac Banking Corporation v Forum Finance Pty Limited

Westpac Banking Corporation brought proceedings against Forum Finance Pty Limited in the Federal Court of Australia. The bank sought the winding up of Forum Finance, alleging that the company had been involved in a fraudulent scheme exceeding $250 million. The evidence presented by Westpac was unchallenged, and the alleged mastermind of the fraud, Mr Papas, was believed to be in Europe, with uncertain prospects of his return to Australia. The court was required to decide whether it was just and equitable to wind up the company and, if so, to appoint appropriate liquidators.

The court found that the circumstances justified the winding up of Forum Finance. The unchallenged evidence of fraud and the absence of any credible defence suggested that the company was insolvent. Given the significant losses to creditors and the absence of Mr Papas, the court determined that it was just and equitable to wind up the company. The court appointed Jason Preston and Jason Ireland of McGrathNicol as liquidators, noting their expertise and availability.

The court granted the winding up order and appointed the liquidators, also dispensing with the requirement to advertise the application for liquidation. It extended various freezing orders and allowed the liquidators access to seized documents. The court further ordered the extension of time for compliance with search orders and restrained the respondents from altering certain data. It also set out further procedural directions and case management orders. The orders were to be entered immediately, with further steps to be managed as per the court’s directions.