FEDERAL COURT OF AUSTRALIA

Deputy Commissioner of Taxation, in the matter of Northview Developments Pty Limited (in liq) (ACN 092 804 254) v Northview Developments Pty Limited (in liq) (ACN 092 804 254) [2005] FCA 1825

CORPORATIONS – insolvency – application for stay of winding up – stay granted on terms

Corporations Act 2001 (Cth),s 473(3), s 473(5), s 482

Anderson v Palmer [2002] NSWSC 192 applied

IN THE MATTER OF NORTHVIEW DEVELOPMENTS PTY LIMITED (IN LIQUIDATION) (ACN 092 804 254)

DEPUTY COMMISSIONER OF TAXATION v NORTHVIEW DEVELOPMENTS PTY LIMITED (IN LIQUIDATION) (ACN 092 804 254)

NSD 1416 OF 2005

GYLES J

16 NOVEMBER 2005

SYDNEY

IN THE MATTER OF NORTHVIEW DEVELOPMENTS PTY LIMITED (IN LIQUIDATION) (ACN 092 804 254)

THE COURT NOTES the undertaking of Christopher Maroon, as sole shareholder of the Plaintiff, that he will personally pay any creditors of the Plaintiff whose debt has not been disclosed on the Report as to Affairs provided by him to the Liquidator of the Plaintiff on or about 18 October 2005, or on any other list of creditors provided to the Liquidator of the Plaintiff, and who would, but for the stay of the winding up, have been entitled to prove in the liquidation of the Plaintiff.

THE COURT ORDERS THAT:

1.         Pending further order of this Court, the winding up of the Defendant be stayed pursuant to s 482 of the Corporations Act 2001 (Cth).

2.         During the period of the stay, Christopher Maroon, the former director of the Defendant, resume management of the company.

3.         Pursuant to s 473(3) and/or s 473(5) of the Corporations Act 2001 (Cth), the fees of the Official Liquidator of the Defendant be determined to be the sum of $16,500.00 inclusive of GST.

4.         The Liquidator be entitled to disburse the funds held in his trust account to pay:

(a)       The Plaintiff in these proceedings; and

(b)      His own remuneration.

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

IN THE MATTER OF NORTHVIEW DEVELOPMENTS PTY LIMITED (IN LIQUIDATION) (ACN 092 804 254)

REASONS FOR JUDGMENT

1                     This is an application for the stay of a winding up order made on 7 October 2005 by a Registrar of this Court.  The Deputy Commissioner of Taxation was the plaintiff in that proceeding.  The official liquidator who was appointed is Mr Daniel Civil. 

2                     The sole shareholder and former director of the company provided evidence regarding the history of the matter, both of the proceedings and of the circumstances of the company.  It appears from that evidence that the proceeding was not defended due to what might be called either a failure of communication or neglect on the part of an external accountant.  The evidence also establishes that the company is, or appears to be, solvent and that the liquidator is in a position to pay out the plaintiff's debt and to pay costs of the liquidation. 

3                     When the matter first came before me, it seemed to me that, on the face of it, it was an appropriate case to grant a stay of the winding up, having in mind the criteria very usefully summarised by Barrett J of the New South Wales Supreme Court in Anderson v Palmer [2002] NSWSC 192 at [5].  However, I was concerned about two things.  The first was that the plaintiff in the proceeding was not present and had not been served with the process.  Secondly, I was concerned that I had no evidence from the liquidator as to the result of his administration. 

4                     After an adjournment, an affidavit was obtained from the liquidator which satisfies me that the state of the administration of the company and the lack of evidence of external creditors is such that a stay on the basis that the amounts in question be paid is the appropriate course.  Furthermore, an undertaking has now also been provided to the Court by Mr Christopher Maroon, the sole shareholder, that he will personally pay any creditors whose debt has not been disclosed in the report as to affairs provided by him to the liquidator, or on any other list, who would have been entitled to prove in the liquidation.  The giving of such an undertaking is a course which has been adopted in other matters. 

5                     It has been established that the plaintiff has been advised about the proceeding and the application for a stay and is satisfied with the extinguishment of the debt out of the monies currently held in a liquidator's trust account.  The plaintiff neither consents to nor opposes the application to stay the winding up. 

6                     In light of these circumstances, I am now satisfied that the appropriate conditions for the making of the proposed orders have been met.  I note the undertaking of Mr Christopher Maroon, which was given in open Court.

Associate:

Dated:              14 December 2005