Whitemore Holdings Ltd (in liquidation)

FEDERAL COURT OF AUSTRALIA

Whitemore Holdings Ltd (in liquidation) [2004] FCA 806

CORPORATIONS – warrant for search and seizure – refusal to produce company records – destruction of company records

Corporations Act 2001 (Cth) s 530C

Morton v Robins (1996) 14 ACLR 1197 cited
Critanovic v Kenna & Brown Pty Ltd (1995) 18 ACSR 387 cited
Australian Securities Commission v Samson (1997) 24 ACSR 555 applied

IN THE MATTER OF WHITEMORE HOLDINGS PTY LTD (IN LIQUIDATION) (ACN 050 942 857);  BRUCE JAMES CARTER

No S137 of 2004

FINN J
ADELAIDE
23 JUNE 2004

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	S 137 OF 2004

IN THE MATTER OF WHITEMORE HOLDINGS PTY LTD (IN LIQUIDATION) (ACN 050 942 857)
BRUCE JAMES CARTER PLAINTIFF
JUDGE:	FINN J
DATE OF ORDER:	23 JUNE 2004
WHERE MADE:	ADELAIDE

THE COURT ORDERS THAT:

1.        Orders be in terms of the short minutes of order provided.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	S 137 OF 2004

IN THE MATTER OF WHITEMORE HOLDINGS PTY LTD (IN LIQUIDATION) (ACN 050 942 857)

BRUCE JAMES CARTER
PLAINTIFF

JUDGE:	FINN J
DATE:	23 JUNE 2004
PLACE:	ADELAIDE

REASONS FOR JUDGMENT

1. The circumstances giving rise to this application for a warrant under s 530C of the Corporations Act 2001 (Cth) are, to say the least, unusual. The subject company, Whitemore Holdings Pty Ltd, was wound up on the basis of an unsatisfied judgment debt in the order of $20,000. The winding up was unopposed. At the time Whitemore had over $400,000 in a bank account. It would seem now to have assets in excess of $2.8 million, albeit it has at least one significant creditor, the Australian Taxation Office, which is owed in the order of $1.3 million.

2. From the date of the winding up order (6 April 2004) until mid May 2004 it was represented to the liquidator, Bruce James Carter, by Mr Edward Lawrence (the sole director of Whitemore), by Whitemore’s accountants, and by Mr Wright (the contract manager of Whitemore), that the company’s business had been sold to an entity called All Wright Roofing Ltd (“All Wright”).  Mr Wright is the sole director of All Wright.

3. All Wright appeared to have taken over the employment contracts of Whitemore;  the signage at Whitemore’s premises indicated that All Wright occupied the premises;  All Wright notified suppliers of Whitemore that it had acquired Whitemore’s business;  and it paid certain outgoings and received payments on account of Whitemore (most notably a payment of approximately $110,000 from a trade debtor).  Mr Carter ascertained on 13 May 2004 that Whitemore’s business had not been sold.

4. On 14 April 2004 Mr Carter wrote to Mr Lawrence requesting he produce all books and records of Whitemore and that he complete a Report as to Affairs.  The following day a member of Mr Carter’s office contacted Mr Lawrence seeking details of Whitemore’s bank accounts…