Federal Court of Australia

Goodin, In the matter of Regulated Debtors' Estates [2023] FCA 1325

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to s 90-15 of Schedule 2 to the Bankruptcy Act 1966 (Cth), the appointment of Nicholas Giasoumi and Jonathan Jackson as the joint and several special purpose trustees to each of the regulated debtors’ estates as set out in Schedule 1 be terminated.

2.    Pursuant to s 90-15(1) of Schedule 2 to the Bankruptcy Act, the appointment of Joshua Taylor as the special purpose trustees to each of the regulated debtors’ estates as set out in Schedule 2 be terminated.

3.    Pursuant to s 90-15(1) of Schedule 2 to the Bankruptcy Act, Joshua Taylor cease to be the trustee of each of the regulated debtor’s estates as set out in Schedule 4 and in his place Mr Peter Andrew Goodin (the applicant) be appointed trustee.

4.    A copy of this order be served upon each of the regulated debtors set out in Schedule 4 as soon as practicable by way of email communication or alternatively by ordinary pre-paid post.

5.    Pursuant to r 1.34 of the Federal Court Rules 2011 (Cth) and r 1.04(1) of the Federal Court (Bankruptcy) Rules 2016 (Cth) (the Bankruptcy Rules), compliance with the requirements of rr 8.01(3) and 8.01(4) of the Bankruptcy Rules be dispensed with.

6.    Pursuant to s 90-15 of Schedule 2 to the Bankruptcy Act, the applicant is not required to perform tasks that are required to be performed by section 70-30 of the Insolvency Practice Rules (Bankruptcy) 2016 (Cth) and which have already been performed by Joshua Taylor with respect to those administrations as set out in Schedule 4.

7.    Pursuant to s 90-15(1) of Schedule 2 to the Corporations Act 2001 (Cth), the appointment of Nicholas Giasoumi and Shane Deane as joint and several special purpose administrators, deed administrators or liquidators as the case may be to each of the companies as set out in Schedule 3, other than the two companies specified at items 16 and 17 respectively of Schedule 3, be terminated.

8.    Subject to further order pursuant to s 90-15(1) of Schedule 2 to the Corporations Act, the appointment of Nicholas Giasoumi and Shane Deane as joint and several special purpose liquidators of Dawning Developments Pty Ltd (In liquidation) and Dawning Investments Pty Ltd (In Liquidation) (items 16 and 17 respectively of Schedule 3) be terminated upon the applicant ceasing to be the liquidator of those companies.

9.    Pursuant to s 90-15(1) of Schedule 2 to the Corporations Act, the applicant cease to be the liquidator of Rolco Pty Ltd (item 68 of Schedule 3) and in his place Nicholas Giasoumi and Shane Deane be appointed joint and several liquidators.

10.    There be liberty to apply.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

MCEVOY:

1    Before the court is an application pursuant to the liberty to apply reserved by the Honourable Justice McElwaine in orders made 2 June 2023. On that date his Honour made orders appointing special purpose trustees and special purpose administrators or liquidators to each of the insolvency administrations to which Mr Peter Andrew Goodin (the applicant) had been appointed. The need for such appointment arose from the applicant’s incapacity due to a serious medical episode that rendered him incapable of performing his duties at that time. The originating application dated 31 May 2023 was brought on notice to both the Australian Securities and Investment Commission and the Australian Financial Security Authority, and it was not opposed.

2    It appears that the applicant has now made a full recovery and is ready to resume his professional duties and is able to perform his obligations. Accordingly, the applicant seeks the termination of the appointment of the special purpose appointees. In addition, and due in part to the applicant’s desire to reduce his workload and to address the practical exigencies of several appointments, the applicant and the special purpose liquidators consider that it is in the best interests of creditors in several instances for the relevant matters to remain with the special purpose liquidators moving forward. Further, since his medical episode the business of DCS Group Aust Pty Ltd, of which the applicant remains an employee, is managing ten new appointments to which the special purpose trustee (Mr Joshua Taylor) has been appointed in his own right. Mr Taylor and DCS agree that it is in the interests of creditors in those matters (the day-to-day management of which is undertaken by DCS) that those matters should be transferred to the trusteeship of the applicant. The applicant also seeks incidental relief with respect to this latter appointment, and it is not apparent on the material that any relevant party would be prejudiced by the making of such orders.

3    The applicant relies on the affidavits originally filed in support of the originating application, that is:

(a)    the affidavit of Domenica McDonnell affirmed 30 May 2023 (as to the relationship of the applicant with DCS);

(b)    the affidavit of Mitchell Peter Goodin affirmed 31 May 2023 (the son of the applicant);

(c)    the affidavit of Michael Edward Lhuede sworn 1 June 2023 (the solicitor for the applicant on the record as to his communications with the applicant); and

(d)    two affidavits of Sebastian Alexander Clarke sworn 1 June 2023 (as to service on the regulators).

4    Further to those affidavits the applicant also relies upon the following material:

(a)    the affidavit of the applicant, Peter Andrew Goodin sworn 24 October 2023;

(b)    the affidavit of Nichoals Giasoumi sworn 25 October 2023;

(c)    the affidavit of Domenica McDonnell affirmed 25 October 2023

(d)    the further affidavit of Domenica McDonnell affirmed 26 October 2023; and

(e)    the further affidavit of Sebastian Alexander Clarke as to service sworn 27 October 2023.

Termination of Appointment of Special Purpose Appointees

5    The evidence of the applicant, which there is no reason for me not to accept, is that he has fully recovered and is ready to resume his role as trustee, administrator and liquidator. The applicant was present in court on the hearing of this further application. As the purpose for the appointment of the special purpose appointees has now been met and no longer serves any practical purpose, I accept that such appointments should be concluded.

Transfer of Administrations

6    Turning to the proposed transfer of administrations, the exercise of the Court’s power to replace a bankruptcy trustee under s 90-15(3) of Schedule 2 to the Bankruptcy Act 1966 (Cth) (and by corollary a liquidator in corporate matters) was considered by Jackson J in Frigger v Trenfield [2021] FCA 1500, 397 ALR 24 at 141 [550]- [559].

7    It is submitted and I accept that the purpose of the relevant transfers under Part X of the Bankruptcy Act is to align ultimate responsibility and management of the relevant DCS administrations with a common trustee on the basis that to do so is more efficient.

8    I accept that while Mr Taylor could resign as trustee of personal insolvency agreements, the process for appointment of a trustee thereafter would be determined by a process under s 220 of the Bankruptcy Act which of necessity involves the Official Receiver. Section 90-15 of Schedule 2 to the Bankruptcy Act would not cut across this as it would involve the Court removing and replacing a trustee as opposed to a resignation.

9    It is submitted and I accept that in relation to a controlling trusteeship, Part VIII of the Bankruptcy Act contains a streamlined method for changing a trustee under s 181A of that Act. Section 210 of the Bankruptcy Act states that Part VIII of that Act is to apply with any necessary modifications contained in the Bankruptcy Regulations 2021 (Cth). See in particular s 63 of the Bankruptcy Regulations.

10    I accept that this is a case warranting the exercise of the Court’s powers under s 90-15 of Schedule 2 of the Bankruptcy Act arising from the earlier appointment of the special purpose trustee that will permit the continued efficient conduct of matters.

11    In making such orders it will be necessary for the applicant to be granted relief dispensing with the requirements of service under rr 8.01(3) and 8.01(4) of the Federal Court (Bankruptcy) Rules 2011 (Cth) (the Bankruptcy Rules). These concern the time for service on the trustee and the creditors. In addition to the Bankruptcy Rules, the Federal Court Rules 2011 (Cth) apply to this proceeding: r 1.04(2)(a) of the Bankruptcy Rules. Rule 1.34 of the Federal Court Rules provides that the Court may dispense with compliance with any of the Federal Court Rules either before or after the occasion for compliance arises. See Re Sellers [2023] FCA 370 (O’Sullivan J) at [15] and generally Horne, Re Horne [2022] FCA 753 (McEvoy J).

12    The applicant also seeks relief dispensing with the requirements of issuing a fresh notice under s 70-30 of the Insolvency Practice Rules pursuant to r 1.34 of the Federal Court Rules. Mr Taylor has consented to orders to give effect to this relief. Moreover, the evidence is that no creditor could be prejudiced by such orders.

13    The applicant also submits that he, Mr Deane and Mr Giasoumi are in the process of applying to the Supreme Court of Victoria to have the special purpose appointees appointed as liquidators of Dawning Developments Pty Ltd (In liquidation) and Dawning Investments Pty Ltd (In Liquidation). The Supreme Court has apparently also appointed the applicant receiver of trust property. The applicant submits that while this Court has power to make such orders, it would be more appropriate that any relevant application be made in the Supreme Court as the termination of the special purpose appointment in these companies is subject to such orders being made. It is said that this will be on notice to relevant stakeholders in that matter.

14    It is also submitted that Mr Deane and Mr Giasoumi should replace the applicant as liquidator of Rolco Pty Ltd, one of the companies to which the applicant had been appointed liquidator prior to his medical episode. It is said that it is in the interests of creditors that Mr Deane and Mr Giasoumi should remain sole liquidators due to the work they have undertaken since their appointment as special purpose administrators.

15    The applicant does not seek any other ancillary relief resulting from those orders.

16    In all the circumstances I am satisfied that it is appropriate to make the orders sought by the applicant, which are set out at the commencement of these reasons.

Associate:

Dated:    2 November 2023

SCHEDULE 1

SCHEDULE 2