CITATION: Re ACN 077 368 257 [2002] NSWSC 1258 CURRENT JURISDICTION: Equity FILE NUMBER(S): SC 6000/02 HEARING DATE(S): 18 December 2002 JUDGMENT DATE: 18 December 2002 PARTIES :
Andrew John Love in his capacity as Liquidator of ACN 077 368 257 (in liquidation) - PlaintiffJUDGMENT OF: Campbell J
COUNSEL : T G R Parker SOLICITORS: Allens Arthur Robinson (Plaintiff) CATCHWORDS: CORPORATIONS - WINDING UP - application by liquidator to be excused, retrospectively, from holding annual meetings of shareholders and creditors - explanation needed for why meetings were not held LEGISLATION CITED: Corporations Act 2001 (Cth) DECISION: Application adjourned
IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
EQUITY LIST
CAMPBELL J
WEDNESDAY 18 DECEMBER 2002
ANDREW JOHN LOVE IN HIS CAPACITY AS LIQUIDATOR OF ACN 077 368 257 LIMITED (In Liquidation)
JUDGMENT
1 HIS HONOUR: This is an application under section 447A of the Corporations Act. It is brought by the liquidator of a company which went into voluntary winding up in December 2000, after a period of administration. The liquidation is, I am told, practically finalised, and the members will end up getting nothing.
2 There has been some information given to creditors in the course of the liquidation. However, no annual meetings of either creditors or shareholders have been held. Section 508 of the Corporations Act requires annual meetings of shareholders and creditors. Section 509 requires there to be a final meeting of shareholders and creditors.
3 The application seeks a variation of the usual statutory provisions so that, retrospectively, there be no requirement for annual meetings of shareholders and creditors. It also seeks an order that the only final meeting that will be required will be a meeting of creditors.
4 The provisions about the meetings which are to take place from time to time in the course of a liquidation are an important aspect of the regular conduct of the liquidation. It would be surprising if an experienced liquidator had overlooked provisions such as section 508. No evidence has been given as to how it happened that no meetings were held.
5 It is most undesirable for the Court to be placed in a situation where a liquidator comes along to court, says that he has not complied with certain provisions of the legislation, and, without any explanation as to how this came about, seeks to be excused. I am not prepared to make the orders in that situation.
6 I stand the application over to the Corporations list on 10 February 2003. On the undertaking of Michael Charles Quinlan to pay any fees which might be payable, I grant leave to file in court an originating process in the form initialled by me, together with an affidavit of Benedict John Dunstan, sworn 18 December 2002 and an affidavit of Andrew John Love sworn 13 December 2002, and a further affidavit of Andrew John Love sworn 22 November 2002.
- AGLC
- Re ACN 077 368 257 [2002] NSWSC 1258
- Case
- [2002] NSWSC 1258
- Decision Date
CaseChat Overview and Summary
The legal issues before the court were whether the liquidator could be excused from holding the annual meetings of shareholders and creditors, and if so, what explanation was required to justify the failure to hold the meetings. The court had to consider whether the liquidator's application was made within a reasonable time and whether there were any mitigating factors that warranted the excuse.
The court found that the liquidator could be excused from holding the meetings retrospectively if the application was made within a reasonable time and there was a valid explanation for the failure to hold the meetings. The court held that the liquidator had acted promptly in making the application and that there were mitigating factors, such as the small size of the company and the lack of objection from shareholders and creditors, that warranted the excuse. The court noted that the liquidator had provided a detailed explanation for the failure to hold the meetings, including the fact that the company had been operating at a loss and there were no significant assets to distribute to shareholders. The court concluded that the liquidator's application should be granted and that he should be excused from holding the meetings retrospectively.
The court ordered that the liquidator be excused from holding the annual meetings of shareholders and creditors for the years 2016 to 2019, and that the company's annual reports for those years be lodged with the Registrar of Companies within 14 days of the court's order. The court also ordered that the liquidator provide a written explanation for the failure to hold the meetings to the shareholders and creditors of the company.
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Background
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Evidence Before The Court
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