Federal Court of Australia

Arnautovic, in the matter of ACFS Port Logistics Pty Ltd (Receivers and Managers Appointed) (Administrators Appointed) (No 2) [2026] FCA 1669

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to section 90-15 of the Insolvency Practice Schedule (Corporations) (IPS) at Schedule 2 of the Corporations Act 2001 (Cth) (Corporations Act), the First Plaintiffs are justified in causing the Second Plaintiff to enter into the proposed enterprise agreement with the Transport Workers’ Union of Australia substantially in the form that appears at pages 300 to 407 of Exhibit AS-2 to the affidavit of Andrew Sallway affirmed on 4 November 2026 (Proposed TWU Agreement).

2.    Pursuant to section 447A(1) of the Corporations Act and section 90-15 of the IPS, Part 5.3A of the Corporations Act is to operate in relation to the Second Plaintiff as if s 443A(1) of the Corporations Act also provides (in addition to the provision made by order 2 of the orders made on 24 September 2026 in these proceedings) that:

(a)    to the extent that the First Plaintiffs are or become personally liable for any debt or liability of the Second Plaintiff arising under or in connection with the Proposed TWU Agreement, that liability extends only to debts and liabilities accruing during, or attributable to, the period of the voluntary administration of the Second Plaintiff, and does not include:

(i)    any liability that might arise simply by virtue of the Second Plaintiff having proposed or agreed to the Proposed TWU Agreement; or

(ii)    any liability attributable to the period after the voluntary administration of the Second Plaintiff ends; and

(b)    notwithstanding that any such debts and liabilities may be debts incurred by the First Plaintiffs in the performance and exercise of their functions and powers as joint and several administrators of the Second Plaintiff, the First Plaintiffs will not be personally liable to repay such debts or satisfy such liabilities to the extent that the indemnity of the First Plaintiffs under section 443D of the Corporations Act is insufficient to meet them.

3.    The First Plaintiffs must take all reasonable steps to cause notice of these orders to be given, within 2 business days of the making of these orders, to:

(a)    the creditors (including persons or entities claiming to be creditors) of the Second Plaintiff, in the following manner:

(i)    where the First Plaintiffs have an email address for the creditor – by notifying each such creditor, via email, of the making of the orders and providing a link to a website where the creditor may download the orders and the Interlocutory Process;

(ii)    where the First Plaintiffs do not have an email address for a creditor but have a postal address for that creditor (or have received notification of non-delivery of a notice sent by email in accordance with (a)(i) above), by notifying each such creditor, via post, of the making of the orders and providing a link to a website where the creditor may download the orders and the Interlocutory Process; and

(iii)    placing sealed copies of the Interlocutory Process and the orders on the website maintained by the First Plaintiffs at https://www.salea.com.au/ for a period of not less than six (6) months from the making of these orders; and

(b)    ASIC.

4.    Any person who can demonstrate a sufficient interest has liberty to apply to vary or discharge any orders made pursuant to orders 1 to 2 above, on 3 business days’ written notice being given to the plaintiffs and to the Court.

5.    The plaintiffs have liberty to apply on 3 business days' written notice to the Court, by interlocutory process in these proceedings, in relation to any variation of these orders or any other matter generally arising out of the administration of the Second Plaintiff.

6.    The plaintiffs’ costs of this interlocutory process be costs in the administration of the Second Plaintiff.

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

REASONS FOR JUDGMENT

JACKMAN J:

1    By Interlocutory Process dated 5 November 2026, the joint and several voluntary administrators (Administrators) of ACFS Port Logistics Pty Ltd (Receivers and Managers Appointed) (Administrators Appointed) (ACFS) seek a direction under s 90-15 of the Insolvency Practice Schedule (Corporations) (IPS), being Sch 2 to the Corporations Act 2001 (Cth) (Act), that they are justified in causing ACFS to enter into a new enterprise agreement (Proposed TWU Agreement) with the Transport Workers’ Union of Australia (TWU), an order under s 447A(1) of the Act limiting their personal liability under s 443A(1) of the Act in respect of that agreement, and ancillary relief. The Administrators are prepared to cause ACFS to commit to the Proposed TWU Agreement, but only if they have the benefit of a limitation of their prospective personal liability.

2    This is the second application of this kind in these proceedings, the first having been determined on 24 September 2026 in relation to a proposed enterprise agreement between ACFS and the Maritime Union of Australia (MUA): Arnautovic, in the matter of ACFS Port Logistics Pty Ltd (Receivers and Managers Appointed) (Administrators Appointed) [2026] FCA 1423 (Younan J) (Re ACFS No 1).

3    ACFS and its wholly owned subsidiary, ACFS Investments 1 Pty Ltd, operate one of the largest container logistics businesses in Australia (ACFS Business). The ACFS Business has approximately 1,100 employees. The workforce is substantially unionised, with employees generally being members of the TWU or the MUA. On 6 August 2026, ACFS’s first-ranking secured creditor appointed the Administrators, as well as receivers and managers, to ACFS. The receivers have continued to trade the ACFS Business on a business-as-usual basis and they have not made any employees redundant. The receivers are pursuing a sale or recapitalisation of the ACFS Business, and the Administrators provide assistance to the receivers upon request for the purposes of continuing the business.

4    ACFS is party to two enterprise agreements, one with TWU covering approximately 700 employees nationally, and the other with MUA covering approximately 58 employees at ACFS’s Melbourne and Adelaide sites. The TWU agreement passed its nominal expiry date on 30 June 2026. Among the orders which Younan J made on 24 September 2026 was a direction that the Administrators are justified in causing ACFS to enter into the proposed enterprise agreement with the MUA.

5    The Proposed TWU Agreement has a nominal expiry date of 30 June 2029. It provides for wage increases of 4% from July 2026, operative from 1 July 2026 for employees employed at commencement; the greater of 3% or CPI less 1% from July 2027; and the greater of 3.5% or CPI from July 2028. Employees who complete a productivity training course receive a further 1% from July 2027. Superannuation is paid at 2% above the superannuation guarantee rate. The additional labour costs of the Proposed TWU Agreement is estimated at approximately $4.5 million per year, compared to total annual labour costs of approximately $165 million.

6    In Re ACFS No 1, Younan J helpfully set out the relevant principles pertaining to enterprise agreements under the Fair Work Act 2009 (Cth) and directions under s 90-15(1) of the IPS at [26]–[33], and I gratefully adopt that summary. The relevant considerations for the directions sought under s 90-15 in the present case are substantially similar to those considered in Re ACFS No 1 at [39]. They are principally the terms of the Proposed TWU Agreement itself, its cost relevant to the company’s overall labour expenses, and the consequences of not proceeding, being the risk of disruption to a business whose value depends on continuity at a critical stage of the sale process. The receivers are supportive of the Administrators’ approach. The Administrators submit, and I accept, that there is no reason to doubt the prudence of the Administrators’ proposed course and that the direction sought pursuant to s 90-15 should be given.

7    As to the proposed limitation of the Administrators’ liability, I again adopt the helpful summary of principles in Re ACFS No 1 at [44]–[47].

8    I am satisfied that the proposed arrangement is in the interests of creditors and consistent with the objects of Pt 5.3A, in circumstances where:

(a)    a failure to bring the Proposed TWU Agreement into operation swiftly could disrupt operations in an already fragile operating environment, impacting revenue and confidence in the ACFS Business at a critical stage of the sale process;

(b)    it is necessary to move quickly to give employees certainty, noting that the existing agreement with the TWU passed its nominal expiry date more than four months ago;

(c)    the additional cost is modest, at approximately $4.5 million a year against an overall annual labour expense of approximately $165 million;

(d)    entry into the agreement will help avoid crystallising approximately $3.15 million in pay in lieu of notice, and approximately $10.44 million in redundancy obligations in respect of the relevant employees; and

(e)    if the Administrators do not cause ACFS to enter into the agreement, it is likely that operations will be severely disrupted and may eventually cease, with the result that ACFS may be wound up, total employee entitlements of approximately $50 million would crystallise (reducing the prospect of any meaningful dividend to creditors), and approximately 1,100 employees would likely be made redundant.

9    Further, the Proposed TWU Agreement will facilitate the continued trading of the ACFS Business, with a view to its sale or recapitalisation. Mr Sallway, one of the joint and several receivers and managers, describes entry into the Proposed TWU Agreement as critical in order to retain ACFS employees, avoid industrial action and ensure the continuity of business-as-usual operations, and maximise the outcome of the sale process.

10    No creditor is unfairly prejudiced by the proposed order limiting the Administrators’ personal liability. The employees’ claims against ACFS, and their priority under ss 556, 560 and 561 of the Act in any winding up, are unaffected; so too is any liability of the receivers under s 419 of the Act, the Fair Entitlements Guarantee scheme and the secured creditor’s rights. No creditor is subordinated and no creditor’s ranking changes. Notice of the application has been given to creditors, and none has appeared or otherwise expressed any objection to the proposed orders. In any event, the orders reserve liberty to apply to any affected persons. I also give considerable weight to the opinions of Mr Sallway and Mr Arnautovic, each of whom is an experienced insolvency practitioner.

11    In all the circumstances, the relief sought in the Interlocutory Process is appropriate and should be granted.

Associate:

Dated:    6 November 2026