Federal Court of Australia

Senatore, in the matter of Autotech services (ACT) Pty Ltd (in liq) (No 2) [2024] FCA 213

ORDERS

THE COURT ORDERS THAT:

1.    The requirement for the first plaintiff to file accounts pursuant to the orders of 1 December 2022 and r 14.25 of the Federal Court Rules 2011 (Cth) be dispensed with.

2.    The first plaintiff’s costs of the application be costs of the receivership and, if claimed, they be determined by a Registrar of the Court on a lump sum basis.

3.    Following payment of the first plaintiff’s costs provided by these orders, the first plaintiff be discharged from his appointment as receiver of the assets of The Lee Family Trust.

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

REASONS FOR JUDGMENT

STEWART J:

1    This application concerns tying-up loose ends following the completion of the work of a receiver previously appointed by the Court.

2    On 30 November 2022, I appointed the first plaintiff, Mr Senatore, in his capacity as liquidator of the second plaintiff, Autotech Services (ACT) Pty Ltd, as receiver of all the assets of The Lee Family Trust. I also allowed remuneration for the work undertaken by Mr Senatore up to 27 September 2022 in a specified amount. I directed him to apply to a Registrar of the Court for the approval of costs, expenses and remuneration incurred thereafter. I also ordered that on the completion of his duties as receiver, Mr Senatore file accounts with the Court as required by r 14.25 of the Federal Court Rules 2011 (Cth) and that he apply for orders discharging and releasing him from his appointment as receiver. See Senatore, in the matter of Autotech Services (ACT) Pty Ltd (in liq) [2022] FCA 1450.

3    On 30 August 2023, Mr Senatore filed an interlocutory application seeking, in prayer 1, approval of his costs, expenses and remuneration for the work undertaken by him in his capacity as receiver of the Trust and as a liquidator of the company, and for the following relief:

2.     The requirement for the First Plaintiff to file accounts pursuant to the orders of Justice Stewart dated 1 December 2022 and rule 14.25 of the Federal Court Rules 2011 (Cth) be dispensed with.

3.     The First Plaintiff’s costs of and incidental to this application be costs of the receivership and be paid forthwith from the Trust.

4.     Following payment of the First Plaintiff’s remuneration, costs, and expenses provided by these orders:

(a)     the First Plaintiff be discharged from his appointment as receiver of the assets of the Trust; and

(b)     the First Plaintiff, his firm Eddie Senatore Advisory and its employees and agents, forthwith be discharged and released from any and all claims whatsoever and however arising out of or in connection with their appointment as receivers.

4    The relief sought in prayer 1 was referred to a Registrar who ultimately granted approval of the relevant expenses in the sum of $10,172.50 (plus GST) on 16 February 2024. Mr Senatore has confirmed that no further remuneration will be sought.

5    The interlocutory application was then referred back to me as the original docket judge to deal with the remaining relief.

6    I am satisfied that the interlocutory application and supporting affidavit were served on relevant creditors and interested parties. There is no opposition.

7    All assets of the Trust have been realised and the funds have been paid by Mr Senatore to the creditors of the company. Mr Senatore has produced a record of the receipts and payments which shows that after the payment of his approved expenses there will be a small balance to be paid to “preferential creditors”, which I understand to be the FEG (the Fair Entitlements Guarantee scheme of the Commonwealth).

8    Rule 14.25 provides that a receiver must file accounts at the times ordered by the Court. There are further provisions for service and examination of the accounts. A requirement of the Rules can however be dispensed with under r 1.34.

9    The purpose of filing accounts is to achieve the object of examining accounts, so as to verify that all amounts received in the course of the receivership are accounted for, and that all payments made in the course of the receivership have been properly made and are evidenced: Sampson, in the matter of PWUO Trading Pty Ltd (In Liquidation) (No 2) [2021] FCA 1060 at [8] per Yates J. Justice Yates explained in Sprowles, in the matter of Triumph N Triumph Pty Ltd (in liq) (No 2) [2021] FCA 405 at [13]-[15] that courts have readily made orders dispensing with this requirement where the benefit obtained by adhering to the standard procedure of passing accounts is outweighed by the significant costs and time involved in undertaking the task. See also Golden Star Resources Limited v Keryn Beatrice Rosel [2010] QSC 28 at [24] per White J and Connelly, in the matter of Gregorski Investments Pty Ltd (in liq) v 320 Nominees Pty Ltd as trustee of the Gregorski Property Trust (No 2) [2022] FCA 914 at [10]-[11] per Derrington J.

10    I am satisfied that the cost of preparing final accounts and attending an examination of those accounts would significantly outweigh any benefit. Moreover, summary accounts have been prepared and annexed to Mr Senatore’s affidavit and a further up to date schedule produced on my request, so there has been at least that level of accountability in relation to the performance of his role as receiver. The receivership has been straightforward, and there is no objection by any creditor or interested party to Mr Senatore being excused from the responsibility of filing accounts.

11    The object of the receivership was to realise the assets of the Trust to pay creditors of the company. That object has now been achieved. Mr Senatore has finalised the receivership and liquidation of the company, and there are no further tasks to be undertaken in respect of either appointment except for the final dividend to be paid to the FEG.

12    I therefore make orders that:

(1)    The requirement for the first plaintiff to file accounts pursuant to the orders of 1 December 2022 and r 14.25 of the Federal Court Rules 2011 (Cth) be dispensed with.

(2)    The first plaintiff’s costs of the application be costs of the receivership and, if claimed, they be determined by a Registrar of the Court on a lump sum basis.

(3)    Following payment of the first plaintiff’s costs provided by these orders, the first plaintiff be discharged from his appointment as receiver of the assets of The Lee Family Trust.

Associate:

Dated:    7 March 2024