Federal Court of Australia

Birch (Administrator), in the matter of Vitrinite Pty Ltd (Receivers and Managers Appointed) (Administrators Appointed) [2026] FCA 435

ORDERS

THE COURT ORDERS THAT:

A. Extension of the convening periods

1.    Pursuant to s 439A(6) of the Corporations Act 2001 (Cth) the period within which the First Plaintiffs (Administrators) must convene the second meeting of creditors under s 439A of the Corporations Act (Second Meetings) of:

(a)    the Seventh and Eighth Plaintiffs be extended to 20 April 2026; and

(b)    each of the Second to Sixth Plaintiffs and the Ninth to Eleventh Plaintiffs be extended to 30 June 2026.

2.    Pursuant to s 447A(1) of the Corporations Act, Part 5.3A of the Corporations Act is to operate in relation to each of the Second to Eleventh Plaintiffs (each a Company and together the Companies) so that, notwithstanding s 439A(2) of the Corporations Act, the Second Meetings may be held at any time during, or within five (5) business days after the end of, the convening period as extended by paragraph 1(a) or 1(b) (as applicable) above.

B. Varying personal liability and entry into documents

3.    Pursuant to s 447A(1) of the Corporations Act and s 90-15 of the Insolvency Practice Schedule (Corporations) (IPS) being Schedule 2 to the Corporations Act, Part 5.3A of the Corporations Act is to operate with respect to the First Plaintiffs and the Seventh Plaintiff as if s 443A(1) of the Corporations Act provides that:

(a)    the liabilities of the First Plaintiffs (in their capacities as joint and several voluntary administrators of the Seventh Plaintiff) incurred with respect to any obligations arising out of, or in connection with, the funding deed between the Second Plaintiff, the Seventh Plaintiff and the First Plaintiffs (in their capacity as joint and several voluntary administrators of the Seventh Plaintiff) dated 27 February 2026 (VMM Funding Deed), including as a result of any variations to it, are in the nature of debts incurred by the First Plaintiffs in the performance and exercise of their functions as joint and several voluntary administrators of the Seventh Plaintiff; and

(b)    notwithstanding that the liabilities referred to in paragraph 3(a) are debts incurred by the First Plaintiffs in the performance and exercise of their functions as joint and several voluntary administrators of the Seventh Plaintiff, the First Plaintiffs will not be personally liable to repay such debts or satisfy such liabilities incurred by them under or in connection with the VMM Funding Deed, to the extent that their rights of indemnity and lien under sections 443D, 443E and 443F of the Corporations Act are insufficient to satisfy such debts and/or liabilities arising out of, or in connection with the VMM Funding Deed.

4.    Pursuant to s 447A(1) of the Corporations Act and s 90-15 of the IPS, that Part 5.3A of the Corporations Act is to operate with respect to the First Plaintiffs and the Eighth Plaintiff as if s 443A(1) of the Corporations Act provides that:

(a)    the liabilities of the First Plaintiffs (in their capacities as joint and several voluntary administrators of the Eighth Plaintiff) incurred with respect to any obligations arising out of, or in connection with, the funding deed between Vitrinite, the Eighth Plaintiff and the First Plaintiffs (in their capacity as joint and several voluntary administrators of the Eighth Plaintiff) dated 27 February 2026 (Holston Funding Deed), including as a result of any variations to it, are in the nature of debts incurred by the First Plaintiffs in the performance and exercise of their functions as joint and several administrators of the Eighth Plaintiff; and

(b)    notwithstanding that the liabilities referred to in paragraph 4(a) are debts incurred by the First Plaintiffs in the performance and exercise of their functions as joint and several voluntary administrators of the Eighth Plaintiff, the First Plaintiffs will not be personally liable to repay such debts or satisfy such liabilities incurred by them under or in connection with the Holston Funding Deed, to the extent that their rights of indemnity and lien under sections 443D, 443E and 443F of the Corporations Act are insufficient to satisfy such debts and/or liabilities arising out of, or in connection with the Holston Funding Deed.

5.    Pursuant to s 447A(1) of the Corporations Act and/or s 90-15 of the IPS that the First Plaintiffs are justified in entering into and giving effect to the VMM Funding Deed and the Holston Funding Deed and the arrangements contemplated by each deed.

C. Confidentiality

6.    Pursuant to ss 37AF(1)(b), 37AG(1)(a) and 37AJ of the Federal Court of Australia Act 1976 (Cth), paragraphs 11 and 12 of the affidavit of Thomas Donald Birch marked "Confidential" and sworn 12 March 2026 (Confidential Birch Affidavit), and the documents identified in the index to the Confidential Birch Affidavit as documents d), e), f) and g) being pages 125-219 of the exhibit marked “TDB-2” to the Confidential Birch Affidavit, are to be marked "confidential" on the electronic Court file and not be published or accessed, except pursuant to an order of the Court, until the earlier of such time that the external administration of the Companies has been finalised and one year.

7.    The order in paragraph 6 above, does not prevent the Plaintiffs, the Plaintiffs' legal representatives or the Plaintiffs' servants, agents or employees, from disclosing, publishing or accessing the Confidential Birch Affidavit and the information contained therein.

8.    The First Plaintiffs are to file a redacted copy of the confidential Birch Affidavit by close of business (AWST) on 20 March 2026.

D. Service and other orders

9.    The Administrators, within two (2) business days of the date of this order, are to take all reasonable steps to send a circular giving notice of these orders to the creditors (or persons who to the knowledge of the Administrators claim to be creditors) of each of the Companies, such circular:

(a)    where the Administrators have an email address for a creditor, by sending a copy of the orders to the creditor by email;

(b)    where the Administrators do not have an email address for a creditor, by sending a copy of the orders to the postal address of the creditor as is recorded in the books and records of the Company; and

(c)    by posting a copy of the orders to the Cor Cordis website at https://creditorsportal.corcordis.com.au/.

10.    Any person who can demonstrate a sufficient interest has liberty to apply to vary or discharge any orders made on three (3) business days' notice being given to the First Plaintiffs and the Court.

11.    The Plaintiffs' costs of and incidental to this application be costs and expenses in the administration of the Companies and be paid out of the assets of the Companies.

12.    Liberty to apply.

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

REASONS FOR JUDGMENT

O’SULLIVAN J:

1    The first plaintiffs together are joint and several Administrators of the second to eleventh plaintiffs inclusive. In these reasons, the second, third, fourth, fifth and sixth plaintiffs are collectively referred to as the ‘Vitrinite entities’, the seventh, eighth, ninth, tenth and eleventh plaintiffs are collectively referred to as the ‘VMM entities’ and together the second to eleventh plaintiffs are referred to as ‘the Companies’.

2    At the heart of the business conducted by the Companies is the operation of a coal mine known as the Vulcan Coal Mine located approximately 35 kilometres south of Moranbah in the Bowen Basin in Queensland.

3    Each of the Companies forms part of the Vitrinite group of companies. The companies were engaged in the business of mineral exploration as well as mining coking coal for profit from the Vulcan Coal Mine.

4    Vitrinite Pty Ltd is the holding company of the third to eleventh plaintiffs, holding 100% of the shares in each of those companies, except for the ninth plaintiff (Vector) and eleventh plaintiff (VSM). VSM is held by Vitrinite through two of its subsidiaries, being the third plaintiff (QCC) and fourth plaintiff (QCA).

5    Vector is part held by Vitrinite Holdings Pty Ltd and Vitrinite Holdings LLC.

6    QCC, QCA, the fifth plaintiff (CCC) and the sixth plaintiff (Togara) are the mining tenement and asset owning entities. The VMM entities are responsible for the extraction, processing, marketing and sale of the coking coal.

7    The Vulcan Coal Mine was acquired by QCC and QCA in or about September 2008, following which the two entities formed an unincorporated joint venture (Vulcan Joint Venture) for the purposes of exploiting the mining and sale of coking coal from the Vulcan Coal Mine.

8    Other entities within the Vitrinite group of companies engage in exploration activities outside the Bowen Basin.

9    The seventh plaintiff (VMM) was appointed to manage and operate the Vulcan Coal Mine in May 2020 by QCC and QCA. That arrangement remained in place until 27 February 2026 at which time the Vulcan Coal Mine was placed into care and maintenance. At that time, 362 employees were made redundant with the workforce reduced to 23 employees who oversee the care and maintenance.

10    VSM was appointed by the Vulcan Joint Venture parties in February 2022 to promote, market, sell and distribute the coal. That arrangement remained in place until January 2026.

11    On 22 February 2026, Trafigura Pty Ltd, a secured creditor, appointed Receivers over the assets and undertakings of the Vitrinite entities. They were also appointed to two of the holding companies: Vitrinite and Vulcan Partners Pty Ltd.

12    Also on 22 February 2026, Trafigura appointed the Administrators over each of the Vitrinite entities. The management of the VMM entities appointed the Administrators to the VMM entities on 25 February 2026.

13    Upon their appointment, the Receivers assumed custody and control of the property of the Vitrinite entities and their broader operation.

14    The first creditors meetings of the Vitrinite entities and the VMM entities were held virtually on 4 March 2026 and 6 March 2026 respectively, at which the Administrators notified the creditors of the intention to make this application.

15    The second meeting of creditors for each of the Vitrinite entities are required to be held by 27 March 2026 with the existing convening periods expiring on 20 March 2026. The second meeting of creditors of each of the VMM entities are required to be held by 1 April 2026 with the existing convening periods expiring on 25 March 2026: s 439A of the Corporations Act 2001 (Cth). Because of the complex structure, the Administrators are still investigating and analysing the financial positions of both the Vitrinite entities and the VMM entities.

16    By an originating process dated 12 March 2026, the Administrators apply to extend the convening period for the second meeting of creditors of the Vitrinite entities and the VMM entities. Insofar as VMM and the eighth plaintiff (Holston) are concerned, the extension sought is to 20 April 2026. In respect of all other companies, the extension sought is to 30 June 2026.

17    The application was listed before me as the Commercial and Corporations Duty Judge on 17 March 2026 and was heard ex parte. Notice of the application was given to the creditors, ASIC and the Department of Employment and Workplace Relations.

18    No creditor appeared at the hearing whether to oppose the application or at all. No objections were received from any other party.

19    At the conclusion of the hearing, I was satisfied that the convening period should be extended in terms sought by the Administrators. I was also satisfied that orders should be made in favour of the Administrators limiting their liability under the two funding deeds, being the VMM Funding Deed and the Holston Funding Deed and that a limited confidentiality order should be made over the affidavit of Thomas Donald Birch affirmed 12 March 2026. These are the reasons for making those orders.

Documents read

20    The Administrators read the affidavits of Thomas Donald Birch sworn 12 March 2026 and David Martin Johnstone affirmed 12 March 2026 in support of the application. A further affidavit sworn by Mr Birch on 12 March 2026 has been marked, in part, as confidential pursuant to s 37AF(1)(b); 37AG(1)(a) and 37AJ of the Federal Court of Australia Act 1976 (Cth) on the basis that the order is necessary to prevent prejudice to the proper administration of justice.

21    There has been an application to wind up VMM in the Queensland Registry of this Court by Minespec Parts Pty Ltd ACN 1864890251 (QUD 62/2026). That matter has been adjourned to 21 April 2026, the day after the proposed date for the second meeting of creditors of VMM and Holston.

Funding deeds

22    On 27 February 2026, the Administrators, in their capacity as joint and several administrators of VMM, entered into a funding deed with Vitrinite (acting by the Receivers) (VMM Funding Deed) as well as in their capacity as joint and several administrators of Holston, entered into a funding deed with Vitrinite (acting by the Receivers) and Holston (Holston Funding Deed).

23    The entry into the funding deeds was necessary for the payment of employee entitlements and to ensure the Administrators could continue to carry out their functions in the short term, preserve the value of the business and of the companies, maximise the chances of the business continuing and being sold or restructured on a going concern basis for the best possible price, as well as fund costs associated with the administration and ongoing care and maintenance of the Vulcan Coal Mine. The latter includes the wages of the 23 employees retained to achieve this purpose during the administration period.

The sale of the Vitrinite entities

24    The Receivers have commenced a sale process for the Vitrinite entities.

25    The matter is complicated because both the Receivers and the Administrators consider that prospective purchasers or those proponents of a recapitalisation process may also want to acquire or gain control over the VMM entities, or some of them using a Deed of Company Agreement.

The periods of the extensions sought

26    In so far as the Administrators seek to have the convening period extended to 20 April 2026 for VMM and Holston, that reflects the fact that those two entities employed most of the staff and that there are priority employee creditor claims in both entities. As employees may suffer prejudice with any extension granted consequent upon a delay in any Entitlements Guarantee entitlements, a shorter period is sought.

27    The Administrators seek an order extending the time for convening the second meeting of creditors for the remaining group entities to 30 June 2026. Mr Birch deposes that the extension sought is in the best interests of the creditors because it will advance a possibility of a better return to creditors from a sale or recapitalisation process as opposed to liquidation. Mr Birch deposes further that the extension:

(a)    causes no material prejudice to the group entities’ creditors; and

(b)    allows further investigations and a report to be made by the Administrators such that creditors can make an informed decision on the future of the companies.

28    I accept that evidence.

29    The Administrators also seek a Daisytek order: In the matter of Daisytek Australia Pty Ltd (Administrators appointed) [2003] FCA 575; (2003) 45 ACSR 446 which provides that the second meeting of creditors may be convened at any time before, or within, five business days after the end of the convening period as extended by the Court. The Administrators seek that flexibility for the purposes of convening a second creditors meeting if it is in the interests of the creditors.

Principles

30    There is an expectation under the legislation that an administration will be taken in a relatively speedy and summary manner but whilst ensuring the administration is not concluded without consideration of sensible and constructive options that may provide better returns to creditors and shareholders or to enable the company to return to limited trading in the interests of creditors and shareholders: Farnsworth v About Life Pty Ltd (Administrator appointed), in the matter of About Life Pty Ltd (Administrator appointed) [2019] FCA 11 at [4] (Thawley J) and the cases cited therein.

31    The exercise of the discretion as to whether to extend the convening period involves a number of considerations:

(a)    The power to extend the period should be exercised infrequently as it is an important objective of Part 5.3A of the Corporations Act that creditors be fully informed about the company’s position as early as possible and have an opportunity to vote on its future as soon as possible;

(b)    The function of the court is to strike an appropriate balance between the legislatures expectation that the administration will be a relatively swift and summary procedure, however undue speed should not be allowed to prejudice sensible and constructive actions directed towards maximising the return for creditors and any return for shareholders;

(c)    Prospects of a better outcome for creditors through a longer period of administration may outweigh the general expectations of a prompt resolution of the administration;

(d)    A factor that counts against the too ready grant of an extension is that whilst the voluntary administration continues, lessors, secured creditors and others are unable to enforce remedies;

(e)    The question is whether an extension is necessary to enable the administrators to prepare and provide the necessary reports and statements and in particular to arrive at an opinion: Insolvency Practice Rules (Corporations) 2016 (Cth) r 75-225, s 439A, so as to be able to inform the creditors adequately, as well as being in a position to decide whether to terminate the administration, execute a DoCA, or place a company in liquidation;

(f)    It is often desirable to include a Daisytek order permitting the meeting to be held at any time during the convening period as extended: About Life at [5] referring to Sylvia, in the matter of Austcorp Group Ltd (Administrators Appointed) [2009] FCA 636 at [18] (Lindgren J) and the cases cited therein; and

(g)    The opinion of the Administrator as to the need for an extension will be given weight in an application such as this: Strawbridge, in the matter of Virgin Australia Holdings Ltd (administrators appointed) (No 2) [2020] FCA 717 at [68]; (2020) 144 ACSR 347 (Middleton J).

See also Dixon (Administrator), in the matter of Demolition Co Pty Ltd (Administrator Appointed) [2026] FCA 222 (Neskovcin J); Algeri (Administrator), in the matter of Murray & Roberts Pty Ltd (Administrators Appointed) (No 2) [2022] FCA 1563 (Banks-Smith J) at [7]-[14].

Consideration

32    This is a complex administration involving a number of companies and the appointment of Receivers to the Vitrinite entities.

33    An unaudited consolidated financial statement for the companies reveals a deficit of assets in the sum of $12.218 million.

34    Within those figures, Trafigura, as the senior secured creditor of the Vitrinite entities, was owed approximately $177,338,080 on the appointment date. In addition, there are 737 creditors with PPSR Registered Securities against the companies, outstanding employee entitlements (including termination payments) of approximately $16,131,597, and claims by unsecured creditors totalling $265,953,542.

35    The Receivers are engaging in a sale process for the Vitrinite entities, but both the Receivers and the Administrators agree that a better return for creditors may well be achieved should the VMM entities, or some of them, be included in any sale or recapitalisation.

36    Although a considerable amount of work has already been done by the Administrators, they require more time because:

(a)    their current view is that they will be unable to make comprehensive or complete recommendations to creditors on the future of the companies in accordance with their obligations under s 439A of the Corporations Act and r 75-225 of the Insolvency Practice Rules such that the creditors will be unable to make an informed decision;

(b)    the complexity of the business requires time for the sale process to be undertaken in accordance with the Administrators’ statutory obligations for potential buyers to be identified and negotiations concerning a potential DoCA to be ascertained;

(c)    an extension of the convening period will allow the Administrators to assess any proposals received by the Receivers through their sale process which may affect or include the VMM entities and will allow consideration of any such proposals in the context of the broader restructuring of the group as a whole;

(d)    an extension to the convening period will enable the sale process to be undertaken within a reasonable time. It will allow for due diligence to be completed and offers made. It will also allow for negotiations leading to the execution and completion of binding agreements whilst maintaining the company’s ability to retain licenses, contracts or other rights that may be unavailable should the companies be placed in liquidation;

(e)    a sale as a going concern is likely to permit the companies’ commercial relationships to continue and thereby maximise the return to creditors; and

(f)    if the companies are placed into liquidation prior to the completion of the sale process, the possible avenues for the sale or restructure of the companies will be limited and will likely to damage the reputation and goodwill of the companies themselves. That is likely to result in the receipt of lower offers than if the companies remained in administration thereby leading to a worse outcome for creditors and stakeholders of the companies.

37    A further factor is because of the size and complexity of the companies and their operations, the Administrators consider it will take longer than the statutory period to address the following matters:

(a)    Determine employee entitlements;

(b)    Review the companies’ accounts;

(c)    Identify, reconcile and determine creditor claims and ascertain asset ownership – that is particularly so where the companies have, in broad terms, operated as a group;

(d)    Respond to ongoing queries from creditors;

(e)    Ascertain the existence of any claims (including intercompany claims); and

(f)    Investigate the business and affairs of each of the companies and consider any claims that may be pursued by a liquidator to assist the Administrators to form their recommendation to creditors at the second meetings.

38    Under those circumstances, the Administrators’ view is that the continuation of the administrations in the ordinary course, with the support of the Receivers sale process, is likely to advance the possibility of the companies being sold or recapitalised resulting in a better return to creditors than would be available if the companies were to enter liquidation prior to the completion of the sale process.

39    A factor to be taken into account is the effect of the proposed extension on creditors. The Administrators do not consider that an extension of time will cause any material prejudice to creditors or other interested stakeholders. That is because absent the successful sale or recapitalisation, the anticipated return to creditors is likely to be limited, or nil.

40    That said, insofar as the employees are concerned, who in the main were employed by VMM and Holston, the extension of a convening period will delay those employees from filing claims under the Fair Entitlements Guarantee with the Department of Employment and Workplace Relations.

41    It is for that reason that the Administrators seek a different extension of the convening period in respect of VMM and Holston to 20 April 2026. The Administrators consider that is sufficient time for the administration to complete their investigations into the financial position of those two entities and determine whether VMM has the benefit of any significant intercompany claims and rights arising in connection with its role as manager of the Vulcan Joint Venture, as well as assessing whether the sale process would result in a better outcome for creditors of both those entities. That will enable the Administrators to consider whether the convening period for VMM and Holston should be extended further (or otherwise).

42    The matters set out above show a clear deficiency to unsecured creditors and the Administrators wish to explore potential options in concert with the Receivers, including a DoCA.

43    The evidence adduced on the application reveal the Administrators acting without delay and taking appropriate steps.

44    It is clearly not in the interests of creditors to convene the second meeting with either VMM and Holston or the remaining companies until such time that the Administrators have had an opportunity to obtain further information and liaise with the Receivers. The Administrators’ intention of concentrating initially on VMM and Holston in view of the position of the employees is soundly based. The extension of the remaining convening period to 30 June 2026 takes into account the complex nature of this administration as well as the sale process being undertaken by the Receivers.

45    It is for the reasons set out above that I was satisfied that there should be an extension of the convening periods.

46    I was also satisfied that a Daisytek order should be made.

47    Further, the plaintiffs will have liberty to apply to the Court for further extensions or variations of the convening period at any time before the extended periods expire. Any application can be considered on its merits at that time.

Relief from personal liability under the funding deeds

48    The Administrators also seek orders pursuant to s 447A of the Corporations Act limiting their personal liability. It is a well-established power which provides the Court with a broad power to make such orders as it thinks appropriate. In Crawford, in the matter of Pro-pac Packaging Ltd (administrators appointed) [2025] FCA 1357, Beach J observed at [61] that the power is to be excised consistently with the purpose of Part 5.3A of the Corporations Act, namely to provide for the business property and affairs of an insolvent company to be administered in a way that maximises the chances of that company or as much as possible of its business continuing in existence or, in the alternative, resulting in a better return for the company’s creditors.

49    In order to achieve those purposes, the Administrators entered into the VMM Funding Deed and the Holston Funding Deed utilising funds provided through Vitrinite by the Receivers.

50    Mr Birch deposed that entry into the funding deeds was necessary to:

(a)    pay employee entitlements accrued or related to the period on or prior to 28 February 2026 which is the date the mine was placed into care and maintenance;

(b)    ensure the Administrators could carry out their functions under Part 5.3A of the Corporations Act in the short term;

(c)    preserve the value of the business and assets of the companies;

(d)    maximise the chances of the business of the companies continuing in existence and being sold or restructured on a going concern basis for the best possible price; and

(e)    fund costs associated with the administration and ongoing care and maintenance of the Vulcan Coal Mine, including the wages of the 23 employees retained to assist the Receivers and Administrators during the administration period.

51    The Administrators are concerned that to the extent that the assets of the companies are insufficient to repay the amounts advanced under the respective funding deeds, that they will be personally liable for any shortfall.

52    That is a risk that the Administrator should not be required to undertake in the particular circumstances of this matter and it is appropriate to protect them from claims. Limiting their personal liability in the manner proposed enables them to access the funding required to preserve and operate the business as a going concern with the intention of maximising the return for creditors.

53    Under those circumstances there will be orders accordingly.

Confidentiality

54    A claim for confidentiality was made over the second Birch affidavit.

55    I am not satisfied the entirety of the affidavit should be made to be the subject of confidentiality orders and there will be limited confidentiality orders made.

Associate:

Dated:    14 April 2026

SCHEDULE OF PARTIES