Federal Court of Australia

Olsen, in the matter of Babyskin Laser & Cosmetic Clinic Pty Ltd (Administrators Appointed) (No 2) [2026] FCA 917

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to s 90-15 of the Insolvency Practice Schedule (Corporations), being Sch 2 to the Corporations Act 2001 (Cth) (Act), the first plaintiffs (Administrators) would be justified and otherwise acting reasonably by finalising a sale of the business and assets (Proposed Sale) of the second plaintiff, Babyskin Laser & Aesthetic Clinic Pty Ltd (Administrators Appointed) (Company):

(a)    as soon as reasonably practicable and without undertaking any public sale and marketing campaign in respect of the same;

(b)    notwithstanding that the purchaser may be associated with one or other of the directors of the Company; and

(c)    at the best available terms, without being confined to any existing offers.

2.    The Administrators take steps to cause notice of these orders to be given, within one business day of making these orders to:

(a)    the creditors of the Company, as identified by them, in the following manner:

i.    where the Administrators have an email address for a creditor, by notifying each such creditor, via email of the making of these orders;

ii.    where the Administrators do not have an email address for a creditor, but do have a mobile telephone number for a creditor, by notifying each such creditor, via text message of the making of these orders and including a link to the Administrators' website on which a copy of these orders can be accessed;

iii.    where the Administrators do not have an email address or mobile telephone number for a creditor, sending a copy of the orders to the postal address of each such creditor, as recorded in the books and records of the Company; and

iv.    publishing the orders on the website portal maintained by the Administrators;

(b)    the Australian Securities and Investments Commission, by its email address.

3.    Subject to further order, and for a period of 60 days from the making of this order, pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth) (FCA Act), on the ground that the order is necessary to prevent prejudice to the proper administration of justice pursuant to s 37AG(1)(a) of the FCA Act, the Confidential Affidavit of Travis Graham William Olsen affirmed 4 June 2026 and filed in this proceeding, Annexure TGWO-3 to that affidavit, and any copies of that affidavit or annexure provided to and retained by the Court, (Documents) are not to be disclosed by publication or otherwise.

4.    The order in para 3 above does not prevent the Administrators, their legal representatives and/or their servants, agents or employees, from disclosing, publishing or accessing the Documents and the information contained therein.

5.    The Administrators' costs of and incidental to this application be costs and expenses in the administration of the Company and be paid out of the assets of the Company.

6.    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 plaintiffs and the Court.

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

REASONS FOR JUDGMENT

VANDONGEN J:

1    These reasons should be read with Olsen, in the matter of Babyskin Laser & Cosmetic Clinic Pty Ltd (Administrators Appointed) [2026] FCA 622 (Olsen) and will use the defined terms adopted in that decision.

2    In Olsen, I made an order extending the period within which the first plaintiff, Travis Graham William Olsen and Matthew Ormsby as the administrators of Babyskin (Administrators), were required to convene the second meeting of creditors under s 439A of the Corporations Act 2001 (Cth). About one month after those orders were made the Administrators applied for orders pursuant to s 90-15(1) of the Insolvency Practice Schedule (Corporations), being Sch 2 of the Corporations Act (Insolvency Practice Schedule), that they would be justified and otherwise acting reasonably by finalising a sale of the business and assets of Babyskin (Application) in certain circumstances.

3    At the hearing of the Application, I formed the view that orders should be made, generally, in the terms sought. I also made orders pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth) (FCA Act) that, subject to any further order, an affidavit affirmed by one of the Administrators and relied on in support of the Application was not to be disclosed by publication or otherwise for a period of 60 days, on the ground that the order was necessary to prevent prejudice to the proper administration of justice pursuant to s 37AG(1)(a). Following are my reasons for making those orders.

Relevant context in which the Application was made

4    The following summary of the relevant background is based on the affidavits on which the Administrators relied, namely:

(1)    three affidavits of Travis Graham William Olsen, one sworn 7 May 2026 and two further affidavits affirmed 4 June 2026; and

(2)    two affidavits of the Administrators' solicitor, Alex Walter Maxwell Myers, affirmed 4 June 2024 and 8 June 2026, respectively.

5    As I explained in Olsen, Babyskin operated a business from a premises in Adelaide that provided cosmetic and aesthetic services, including facial treatments, non-surgical skin treatments, laser and energy-based treatments, doctor-led medical aesthetic treatments and semi-permanent cosmetic treatments.

6    On 14 April 2026, the Administrators were appointed as administrators of Babyskin.

7    After orders were made extending the period within which the second meeting of creditors was required to be convened, the Administrators gave notice of those orders to various interested parties but received no objections. The Administrators then carried out further investigations, took steps to secure Babyskin's assets, finalised outstanding taxation lodgements, and better identified creditors and Babyskin's financial position. The Administrators also liaised with the two directors of Babyskin about offers they had made to purchase Babyskin's business and assets.

8    When the Administrators applied to extend the convening period they were then of the view that the best return to creditors was likely to be achieved from a sale of Babyskin's business and assets. The Administrators believed this approach might see all of Babyskin's creditors paid in full, with a possible return to shareholders. At the time they made the Application the Administrators were still of that view, provided that the sale proceeded on the same or similar terms to those that had been submitted in offers made by the directors of Babyskin and subject to any developments that might result in the Administrators being required to incur costs.

9    The Administrators considered that they could promptly proceed to finalise a sale of Babyskin's business and assets. However, the Administrators were concerned about finalising a sale of Babyskin's business and assets without conducting a public marketing and sale campaign. The Administrators were also concerned about the fact that the two directors of Babyskin had raised several issues about the steps the Administrators had taken and the process they have followed in seeking offers to purchase Babyskin's business and assets, and in considering the terms the directors had proposed. Those issues included whether the Administrators had entertained an unsolicited offer received from one of the directors of Babyskin despite having made representations to the other director that they would negotiate with them on an exclusive basis. Further issues concerned whether the Administrators had failed to negotiate with one of the directors after they had submitted an offer that was not expressed to have been a final offer.

10    It is in this context that the Administrators applied for orders under s 90-15(1) of the Insolvency Practice Schedule that they would be justified and otherwise acting reasonably by finalising a sale of Babyskin's business and assets:

(1)    as soon as reasonably practicable and without undertaking any public sale and marketing campaign in respect of the same;

(2)    to whichever of the two presently interested parties on such terms they consider is in the best interests of Babyskin, its creditors, and its members without any further marketing campaign;

(3)    notwithstanding that the purchaser may be associated with one or other of the directors of Babyskin; and

(4)    at the best available terms, without being confined to any existing offers,

on the basis that this would be in the best interests of Babyskin, its creditors and members.

Relevant legal principles

11    As was noted in Reidy, in the matter of eChoice Limited (Administrators Appointed) [2017] FCA 1582 at [26] to [27], s 90-15(1) of the Insolvency Practice Schedule provides that a court may make such orders as it thinks fit in relation to the external administration of a company, and that directions about a matter arising in connection with the performance or exercise of an administrator's functions or powers fall within the scope of that statutory power.

12    It is established that the principles to be applied in the context of an application for orders under s 90-15(1) are those that were expressed by Goldberg J in Re Ansett Australia Ltd (No 3) [2002] FCA 90; (2002) 115 FCR 409 at [65], in relation to the predecessor to that provision (s 447D(1) of the Corporations Act):

the prevailing principle adopted by the courts, when asked by liquidators and administrators to give directions, is to refrain from doing so where the direction sought relates to the making and implementation of a business or commercial decision, either committed specifically to the liquidator or administrator or well within his or her discretion, in circumstances where there is no particular legal issue raised for consideration or attack on the propriety or reasonableness of the decision in respect of which the directions are sought. There must be something more than the making of a business or commercial decision before a court will give directions in relation to, or approving of, the decision. It may be a legal issue of substance or procedure, it may be an issue of power, propriety or reasonableness, but some issue of this nature is required to be raised. It is insufficient to attract an order giving directions that the liquidator or administrator has a feeling of apprehension or unease about the business decision made and wants reassurance. There must be some issue which arises in relation to the decision. A court should not give its imprimatur to a business decision simply to alleviate a liquidator's or administrator's unease. There must be an issue calling for the exercise of legal judgment.

13    The Administrators did not suggest that the orders sought under s 90-15 of the Insolvency Practice Schedule concerned any legal issue. Instead, the Administrators contended that the orders sought were concerned with an issue of 'propriety or reasonableness'.

14    The Court's attention was drawn to other occasions on which orders have been made under s 90-15 of the Insolvency Practice Schedule that administrators would be justified and otherwise acting reasonably to effect a sale of a company's business and assets without conducting a public marketing and sale campaign: Goyal, in the matter of Cape Technologies Pty Ltd (administrators appointed) [2021] FCA 1654; Deppeler, in the matter of Moulamein Grain Co-Operative Limited (administrators appointed) [2022] FCA 1154; and In the matter of Richstone Plumbing Pty Ltd (administrators appointed) (ACN 104 934 358) [2023] VSC 112.

15    In Deppeler, for example, an order was made pursuant to s 90-15 of the Insolvency Practice Schedule that the administrators in that case were justified and acting reasonably in causing the company to complete a sale of its assets in circumstances where:

(1)    there had been no public advertisement of the assets for sale;

(2)    the period in which the assets were offered for sale was limited;

(3)    the purchaser was an associate of the company;

(4)    the proposed sale had not been put to creditors for a vote; and

(5)    it was not proposed as part of a DOCA.

Why orders were made under s 90-15(1) of the Insolvency Practice Schedule

16    As I have already said, the Administrators held concerns about the propriety or reasonableness of exercising their power under s 437A of the Corporations Act to dispose of the assets of Babyskin in circumstances in which the two directors of that company had raised issues with the Administrators about the sale process they had been undertaking. As Mr Olsen explained in his non-confidential affidavit of 4 June 2026, based on his experience he was:

(1)    concerned that, irrespective of which of the two directors to whom the Administrators may decide they wish to sell the business and assets of Babyskin, the unsuccessful party may take issue with the Administrators' decision;

(2)    conscious of the potential for the Administrators' decision to be criticised by either or both of the directors; and

(3)    concerned that both directors have raised issues about the steps the Administrators have taken and the process they have followed to date in seeking offers for the purchase of Babyskin's business and assets.

17    However, all of these issues had dissolved by the time of the hearing of the Application. On the day before the hearing of the Application, in a letter dated 8 June 2026, the solicitors for one of the directors of Babyskin advised the Administrators that they did not wish to be heard on the Application and did not oppose the relief sought. Further, in an email dated 5 June 2026 the solicitors for the other director of Babyskin advised the Administrators that their client also did not wish to be heard on the Application and that their client continued to consent to the orders sought, insofar as the Court considered that their client's consent was relevant. In those circumstances it was unnecessary for the Court to give any further consideration to the propriety or reasonableness of the Administrators' proposed exercise of their power to dispose of the assets of Babyskin in the context of the various issues referred to at [16] of these reasons.

18    In his evidence Mr Olsen explained that he is a registered liquidator, a member of Chartered Accountants Australia and New Zealand, a professional member of Australian Restructuring Insolvency and Turnaround Association, and a Director of SV Partners SA Pty Ltd. In total, he has over 15 years' experience in corporate insolvency and restructuring. Based on his experience, Mr Olsen expressed the opinion that conducting a public marketing and sale campaign in the context of an administration process occurring under Pt 5.3A of the Corporations Act is typical and is generally appropriate in most cases. However, Mr Olsen also said that public marketing and sale campaigns do not always occur in the context of voluntary administrations and that there are certain circumstances in which it would be unlikely for there to be any material benefit in undertaking such a campaign.

19    Mr Olsen identified the following reasons why Administrators had not conducted a public marketing and sale campaign:

(1)    the relatively modest size of Babyskin's business;

(2)    the strong interest that both directors and their associates had expressed in a potential purchase, which included a DOCA proposal;

(3)    the costs that would be incurred in conducting such a campaign and the time that it would take to arrange;

(4)    the business had ceased trading prior before the Administrators were appointed and there were potential issues with Babyskin's rights of occupation of the premises from which it had been operating; and

(5)    realising the business and assets other than collectively would likely result in an inferior financial outcome when compared to a sale on terms similar to those that had been proposed.

20    According to Mr Olsen, if the Administrators were to conduct a public marketing and sale campaign then:

(1)    for it to have a realistic chance of generating genuine interest from third parties it would likely need to involve advertising and marketing activities being conducted over a period of at least two to four weeks, with offers or expressions of interest to be provided at the end of that time;

(2)    a business broker may need to be engaged to maximise potential advertising reach;

(3)    an information memorandum would need to be prepared with steps taken to protect Babyskin's confidential information;

(4)    the Administrators would need to liaise with potentially interested parties to answer their queries;

(5)    it is likely that after marketing the sale of Babyskin's business and assets a further period of around one to two weeks would be required to consider any offers or expressions of interest, conduct negotiations, and, potentially, seek any final offers; and

(6)    it may cost between about $22,000 and $54,000.

21    Mr Olsen also opined that if no public marketing and sale campaign was undertaken then the Administrators would only need between seven and 14 days from the date of any orders made by the Court on the Application to decide which of the directors of Babyskin they will transact with, and to formally document the terms of any such transaction. In that context, Mr Olsen drew the Court's attention to the fact that a business that was offering the same or similar services to those previously offered by Babyskin, which was using a similar trademark to the one used by Babyskin, appeared to have commenced operating from the premises from which Babyskin had previously operated. Mr Olsen expressed concern that the longer the sale process took, the more this new business might have a negative impact on the value of Babyskin's business and assets.

22    Mr Olsen was also of the view that, if there was no public marketing and sale campaign, the sale of Babyskin's business and assets could be completed by a less expensive process. I also note that Mr Olsen expressed the opinion that, based on his experience, the offers each of the directors and any associated entity have made are generally fair and reasonable, are in the interests of Babyskin's creditors and members and will, if accepted, provide for the company, or as much as possible of its business, to continue in existence and result in the sale of the Babyskin's plant and equipment being realised for amounts reflective of their present value.

23    In my view, the purpose of the Application was not to seek directions in support of the making of a business or commercial decision. Instead, and as Mr Olsen's evidence demonstrates, considerations similar to those that were relevant in Deppeler were present. I accepted Mr Olsen's opinions that, in the circumstances of this case, the generally preferred method of undertaking a public marketing and sale campaign for the sale of Babyskin's business and assets is likely to cost more, take longer and would, in any event, be unlikely to provide a better return to creditors given the terms of the offers that have already been made to the Administrators. In those circumstances, I concluded that the Administrators would be justified, and would otherwise be acting properly and reasonably, in finalising the sale of Babyskin's business and assets to a director of that company, or to an entity associated with such a director, at the best available terms, as soon as reasonably practicable and without conducting any public marketing and sale campaign.

24    The Administrators had not given notice of the Application to Babyskin's creditors. However, Mr Olsen was of the opinion, which I accept, that if the business and assets of Babyskin are sold to one of the two parties who have expressed interest in entering into such a transaction, then it is likely that it will result in the realisation of sufficient funds to meet the claims of all identified creditors. In those circumstances, I did not consider that it was necessary for such notice to have been given.

25    Notice was given to the two directors of Babyskin and to the Australian Securities and Investments Commission.

Orders under s 37AF of the FCA Act

26    One of Mr Olsen's affidavits affirmed on 4 June 2026, and its annexures, contain information that is confidential to the Administators, including information about the offers the directors of Babyskin have made to purchase its business and assets. The Administrators sought orders to preserve the confidentiality of that information to maintain the integrity of the sale process.

27    I was satisfied that it was necessary to prevent prejudice to the proper administration of justice to make an order under s 37AF of the FCA Act, on the ground that the order is necessary to prevent prejudice to the proper administration of justice pursuant to s 37AG(1)(a). Taking into account that a primary objective of the administration of justice is to safeguard the public interest in open justice (s 36AE), I formed the view that it would be inimical to the proper administration of justice for the confidential and commercially sensitive information referred to in Mr Olsen's affidavit to be disclosed because were that to occur it would undermine the very purpose for which the Administrators sought directions under s 90-15 of the Insolvency Practice Schedule.

28    Section 37AJ(2) of the FCA Act requires that in deciding the period for which such an order is to operate, the Court is to ensure that the order operates for no longer than is reasonably necessary to achieve the purpose for which it is made. The purpose for which the suppression order will have been achieved when the sale process is finalised. Based on the information that was before the Court, a period of 60 days from the of making the order appeared to be reasonable. If the sale process is finalised before the end of those 60 days, then the Administrators may be expected to inform the Court accordingly so that the suppression order can be dissolved.

Associate:

Dated:    13 July 2026