ABCD Corporation Pty Ltd v Sampson

Solicitors: Gillis Delaney (A) Self-represented (R) File Number(s): 2015/ 326742

Judgment

1. By interlocutory process filed on 28 August 2017, the applicant David Henry Sampson, as the Court-appointed receiver of certain assets of the Minasian Superannuation Fund ("MSF") - of which the respondent ABCD Corporation Pty Ltd ("ABCD") is the trustee - seeks approval of his remuneration in respect of the receivership in the sum of $107,585.50 (plus GST), and a direction that his approved remuneration be paid from the proceeds of the sale of Lots 21, 31 and 34 in Strata Plan 21574, which is situate at and known as Suite 602, Level 6, Culwulla Chambers, 67 Castlereagh Street, Sydney ("Suite 602"), the sale of which by Mr Sampson in his capacity as Receiver was completed on or about 24 May 2017. On 7 February 2018, being the second day of the hearing, the claim was amended to add an additional claim for $12,936.00 plus GST for work performed between 28 July 2017 and 23 January 2018, and $5,510.00 for attendance at a pre‑hearing conference and at Court on 2 and 7 February 2018, so that the total remuneration claimed is $126,031.50 (plus GST). Mr Sampson has foreshadowed that once his remuneration is approved, he will move for a further order that his accounts as Receiver be passed, and that the balance of the funds held in the receivership be paid to Australasian Barrister Chambers Pty Ltd (in liquidation) ("ABC"), of which company he is the liquidator pursuant to an order made by the Registrar on 8 December 2015 that it be wound up in insolvency.

Background

1. ABC was wound up on an application made by the plaintiff Owners Strata Plan 21574 - the owners corporation for Culwulla Chambers - for failure to comply with a creditor's statutory demand dated 22 September 2015 which demanded payment of an amount due under a judgment of the Local Court of New South Wales for arrears of strata levies.

Appointment of receiver

1. Until 9 December 2015 - the day after the winding up order was made - ABC was the registered proprietor of the three lots that comprised Suite 602. Pursuant to a Custodian Appointment Deed dated 13 November 2008 ("the Custodian Deed") between ABC and ABCD, ABC held certain assets acquired by it as legal owner - including Suite 602 - as a custodian for ABCD in its capacity as trustee of the MSF, which appears to be a self-managed superannuation fund in which the beneficiaries are Mr Derek Minus and his spouse Ms Armine Minasian. The Custodian Deed makes clear that ABC was a bare trustee, and acknowledges the right of indemnity, which the general law gives a trustee, against the assets of which it was custodian, in respect of liabilities incurred by ABC in its custodian trustee capacity. [1] The directors of ABC had been (until 1 October 2014) Mr Minus and (from 1 October 2014 until 7 December 2015) Ms Minasian; Mr Minus remained in office as secretary; and ABCD was the sole shareholder. Mr Minus and Ms Minasian were the directors of, and the shareholders (as to one share each) in, ABCD.
2. At the date of the winding up order, ABC's liabilities included the debt claimed by the plaintiff Owners Corporation then in excess of $78,000 (which is unquestionably referable to ABC's function as custodian), a related creditor claim for professional fees by Mr Minus - which the liquidator had not admitted - in the order of $632,000 (at least some of which appears to be against the company in its capacity as a custodian trustee), and potential liabilities to the Australian Bar Association and/or the NSW Bar Association pursuant to costs orders made against ABC in proceedings in the Federal Court. [2]
3. On or about 9 December 2015, transfers of the three lots comprising Suite 602, from ABC to ABCD, were registered. They were dated 9 November 2015, and purport to be pursuant to notifications and directions given to ABC by ABCD on 8 November 2015, after the winding up proceedings were instituted on 3 November 2015. Having discovered these transfers and the existence of the Custodian Deed, Mr Sampson as liquidator applied to be appointed as Receiver of the assets of the MSF, for the purpose of enforcing ABC's right of indemnity, as a former trustee of certain of those assets, out of the trust fund. On 25 October 2016, following a contested hearing the previous day, he was appointed without security as Receiver of the three strata lots comprising Suite 602, with the powers that a liquidator has in respect of property of a company under Corporations Act 2001 (Cth) s 477(2)(c), provided that he was not to distribute the assets to creditors or beneficiaries without the further direction of the Court. An order was also made that the respondent ABCD pay the applicant's costs of the application and, to the extent that those costs are not recoverable from the respondent, the costs be costs in the receivership. [3]
4. On the application of Mr Minus - who appeared to oppose the application claiming standing as a creditor, but who had and has a beneficial interest in the underlying assets via his interest in the MSF - the appointment was stayed until 6 December 2016, upon his undertaking that he would not in the meantime cause, permit or suffer the subject assets to be transferred, encumbered or otherwise adversely dealt with. That stay was granted in order to enable the MSF or its members to propose a solution which might avert the need for appointment of a receiver. However, no such solution had materialised by 6 December 2016, and when Mr Minus sought an extension of the stay, it was held that no basis had been established for holding the liquidator out of his legal rights any longer, and the stay lapsed. [4]

Sale of Suite 602 and related proceedings

1. Pursuant to his appointment as Receiver, Mr Sampson took possession of Suite 602 on 7 December 2016 at about 0645. Between then and January 2017, there were some discussions between Mr Minus and Mr Sampson, which are referred to below. However, on 27 January 2017, as Receiver he entered into a contract for sale of Suite 602 to Samanpat Pty Ltd (the owner of a neighbouring suite, and a member of the Owners Corporation), at a price of $618,000. As the respondent stresses, he did so "without taking the property to market or selling it at public auction"; Mr Sampson justifies this course on the basis that it would minimise realisation costs, in circumstances where the offer which exceeded the valuation that he had obtained, and the value which Mr Minus had himself ascribed to the property.
2. On 13 February 2017, Mr Minus and another company which he controlled, Dispute Resolution Associates Pty Ltd ("DRA"), lodged caveats in respect of Suite 602 claiming an interest as equitable lessee. The Receiver caused lapsing notices to be served, and having failed to procure delivery up of the certificates of title, applied to the Court for an order for their production. On 10 March 2017, on the application of Mr Sampson and after a contested hearing, Black J made an order that ABCD and Mr Minus produce to Mr Sampson the certificates of title for the lots comprising Suite 602. [5]
3. On 14 March 2017, Mr Minus paid $90,000 to the Owners' Corporation to satisfy its claim.
4. On 17 March 2017, ABCD sought and obtained leave to bring proceedings against Mr Sampson as Receiver claiming an injunction restraining him from completing the sale of Suite 602, and directions for filing claims for final relief. ABCD subsequently filed points of claim which alleged that the sale was made without advertisement and at an undervalue, and Mr Sampson filed points of defence. On 27 March, ABCD filed an interlocutory process claiming final relief against Mr Sampson, and Black J made directions for the service of evidence. Following a contested interlocutory hearing on 26 April, on 16 May 2017, Black J gave judgment dismissing ABCD's application for an injunction. [6]
5. On 18 May 2017, DRA sought an injunction to restrain Mr Sampson from completing the sale of Suite 602, essentially on the basis that DRA was the equitable lessee of Suite 602, pursuant to an alleged oral agreement said to have been made between Ms Minasian on behalf of ABCD and Mr Minus on behalf of DRA on 10 October 2016. Black J granted leave to institute the proceedings but, after a contested hearing, dismissed DRA's application on 19 May 2017. [7] On Mr Sampson's application, his Honour also made orders restraining Mr Minus, Ms Minasian or their companies, until 1700 on 22 May 2017, from lodging any further caveats in respect of Suite 602 without the Court's leave. On 22 May 2017, after a contested hearing, Basten JA in the Court of Appeal refused to grant ABCD an injunction to restrain Mr Sampson from completing the sale of Suite 602. [8] That afternoon, at 1400, Black J extended the injunction restraining the lodgment of caveats until 1700 on 5 June 2017.
6. At the request of the purchaser, the contract for sale of Suite 602 was novated, by a deed executed by Mr Sampson as receiver, to Critma Investments Pty Ltd, a related entity of the original purchaser, and completed on 24 May 2017, whereupon Mr Sampson as Receiver received the proceeds of $618,000; the transfer was registered on or about 5 June 2017.

Claims against the receiver

1. By now ABCD and DRA had filed several processes claiming damages (pursuant to Corporations Act, s 420A), and an inquiry (pursuant to then Corporations Act, s 423), against Mr Sampson in his capacity as receiver, including the points of claim filed by ABCD on 23 March 2017, the interlocutory process seeking final relief filed by ABCD on 27 March 2017, and the interlocutory process seeking final relief filed by DRA on 18 May 2017. On 5 June 2017, it was ordered that those proceedings continue on pleadings, and ABCD and DRA were directed to file and serve their statement of claim by 15 June 2017. That direction was not complied with, and on 10 July 2017, time for ABCD and DRA to file and serve their statement of claim was extended to 14 August 2017, but a direction was made that in the event that they failed to do so, the proceedings be dismissed upon the Receiver filing an affidavit after 17 August deposing that no statement of claim had been filed.
2. No statement of claim was ever filed. An affidavit of Nicholas Anthony James Dale sworn 18 August 2017 deposed that at the time of its swearing no statement of claim had been filed and served. In his affidavit of 23 August 2017, Mr Sampson deposed that he would not seek to retire as a receiver until such claims had been dismissed or resolved. On 4 September 2017, it was ordered that all outstanding applications for final relief against the Receiver be dismissed (including, without limitation, the three referred to above), and that the applicant named in each of the said processes pay the receiver's costs of those proceedings.

The remuneration application

1. The present application for remuneration came before the Court for directions on 18 September 2017, when the following directions were made: 1. Any notice of objection to the remuneration claimed by the receiver be served by 9 October 2017, any such notice to specify the item or items objected to and the grounds of the objection. 2. The receiver by 23 October 2017 serve any further affidavit evidence in support of the application for remuneration, including, to the extent that the evidence does not already do so, compliance with rule 9.1(6). 3. Any affidavit evidence in opposition to the claim for remuneration and/or in support of the grounds of objection be served by 6 November 2017. 4. The proceedings be adjourned to 13 November 2017 at 10am in the Corporations Judge Directions List.
2. On 13 November 2017, the remuneration application was set down for hearing on 2 February 2018. The Receiver was still in cross-examination at the end of the day, and the proceedings were adjourned part heard to 7 February, when the hearing was completed. Mr Marshall SC, who with Ms Cirillo appeared for the receiver, provided written closing submissions in supplementation of those which had been provided before the hearing. Mr Minus sought an opportunity to lodge further written submissions, and a considerable time in which to do so. The following directions were made on 7 February: 1. By 14 February 2018 the applicant receiver produce to the objector the documents referred to in paragraphs 10, 15 and 16 of the Notice to Produce for inspection dated 6 February 2018. 2. By 21 February 2018 the objector lodge with my associate and serve its written submissions, together with copies of any documents produced pursuant to order 1, which it seeks to tender. 3. By 28 February 2018 the applicant receiver lodge and serve his submissions in reply, including any objections to any documents sought to be tendered by the objector, together with copies of any documents from those produced, pursuant to order 1 which it seeks to tender. 4. Liberty to apply, by arrangement with my associate, in the event of any difficulty arising out of or in connection with these directions.
3. Mr Minus did not lodge any submissions within the time provided for by those directions, but on 21 February informed my chambers that he was awaiting the transcript, and was undergoing a pre-arranged medical procedure, and sought a further seven days to complete his submissions. Ms Cirillo lodged supplementary submissions on 28 February 2018. On 7 March, Mr Minus said that there had been complications and sought a further period of time. On 26 March, in response to the receiver's request that I proceed to determine the matter without further submissions from Mr Minus, he informed my chambers that he was in Canberra to brief a Minister, and that no further orders had been made in relation to his submissions, and that he could complete them by 6 April. He was notified that it was correct that no further orders were made; that he was and remained in default; that I would not determine the matter before 6 April; but that if his submissions were not received by then I would proceed to do so in the absence of further submissions.
4. No further submissions from Mr Minus were ever received.

The remuneration of court-appointed receivers

1. I have recently considered the principles which inform the remuneration of court-appointed receivers in Say Enterprises Pty Ltd [9] and in Gondon Five Pty Ltd, [10] on which the following summary is based.
2. The remuneration of court-appointed receivers is provided for by (NSW) Uniform Civil Procedure Rules 2005, r 26.4, which states that a receiver is to be allowed such remuneration (if any) as may be fixed by the Court. The Court has a very wide discretion in fixing the basis and level of remuneration. [11] Founding on what Young CJ in Eq said in Ide v Ide, [12] but drawing on the qualifications expressed in later cases, [13] the relevant principles may be restated, so far as they are relevant to the present case, as follows: 1. A receiver is entitled to the costs, charges and expenses properly incurred in the discharge of the receiver's ordinary duties, or in the performance of extraordinary services that have been sanctioned by the Court. 2. In fixing remuneration, the objective is to award a sum or devise a formula which will reasonably and fairly compensate the receiver for the time and trouble expended in the execution of his or her duties and the responsibility he or she has assumed. 3. The ultimate question is what amount of remuneration is 'reasonable', and this involves considering (a) whether the work in respect of which remuneration is claimed was reasonably undertaken in the due course of the receivership, and (b) whether the amount claimed for it is a fair and reasonable reward for such work. On those questions, the receiver bears the onus of justifying the reasonableness and prudence of the tasks undertaken for which remuneration is sought, and the reasonableness of the remuneration claimed for them. 4. By analogy, the task involves consideration of the matters referred to in Corporations Act, s 425(8), which applies to receivers appointed under an instrument, [14] namely: (a) the extent to which the work performed by the receiver was reasonably necessary; (b) the extent to which the work likely to be performed by the receiver is likely to be reasonably necessary; (c) the period during which the work was, or is likely to be, performed by the receiver; (d) the quality of the work performed, or likely to be performed, by the receiver; (e) the complexity (or otherwise) of the work performed, or likely to be performed, by the receiver; (f) the extent (if any) to which the receiver was, or is likely to be, required to deal with extraordinary issues; (g) the extent (if any) to which the receiver was, or is likely to be, required to accept a higher level of risk or responsibility than is usually the case; (h) the value and nature of any property dealt with, or likely to be dealt with, by the receiver; (i) whether the receiver was, or is likely to be, required to deal with: (i) one or more other receivers; or (ii) one or more receivers and managers; or (iii) one or more liquidators; or (iv) one or more administrators; or (v) one or more administrators of deeds of company arrangement; (j) the number, attributes and behaviour, or the likely number, attributes and behaviour, of the company's creditors; (k) if the remuneration is ascertained, in whole or in part, on a time basis: (i) the time properly taken, or likely to be properly taken, by the receiver in performing the work; and (ii) whether the total remuneration payable to the receiver is capped; (l) any other relevant matters. 1. Many of those factors - in particular, pars (d)-(e) and (g)-(h) - have as their unifying theme the concept of proportionality (being the relationship of the work done and the remuneration claimed to the value of the estate), which is an important consideration in determining reasonableness. [15] 2. Remuneration may be allowed on the basis of a fixed salary, a commission on receipts, or a quantum meruit having regard to the time, trouble and responsibility involved. It is a matter for the Court to determine what basis is appropriate in the particular case, having regard to the principle that the remuneration must be reasonable. 3. If a time-based approach is adopted, the Court is guided by professional scales of charges, with emphasis on the broad average or general rate charged by persons of the relevant status and qualifications who carry out the relevant type of work. The Court will usually act on time sheets created in the receiver's office, provided that they do significantly more than merely detail the total number of hours spent by the receiver and officers of particular grades of his or her staff. 4. In respect of disbursements, no Court approval or specific order is necessary in the absence of a challenge, although receivers should scrutinise them to ensure that they are reasonable and properly payable. [16] However, the Court has an inherent jurisdiction to review receivers' disbursements as they are officers of the Court. [17] Further, a receiver may seek a direction that he or she would be justified in paying certain disbursements, in order to obtain prior protection in respect of such a disbursement. [18]
3. It is incumbent on an applicant for remuneration to produce sufficiently detailed evidence of the work in respect of which remuneration is claimed as to enable the amounts claimed for the various tasks performed to be dissected and identified. [19] Although, on an application of this kind, it is not the function of the Court to undertake a taxation of the receiver's bill on an item-by-item basis - the exercise involves a more impressionistic, evaluative and "broad-axe" approach - such a requirement would serve no purpose if the Court did not have regard, to some extent at least, to the detail. The categorising of work done according to tasks in the administration enables the Court to ascertain and allow (in whole or in part) - or disallow - the total amount of remuneration claimed in respect of a particular task, according to whether such task was (wholly or partly) - or was not - reasonably undertaken within the proper scope of the administration.

The issues

1. Mr Sampson's affidavit of 23 August 2017 summarised the work performed by the Receiver and his staff under the following descriptions in the respective subparagraphs of par 97, across which he allocated his total remuneration claim of $107,585.50. While I consider these in more detail below, in summary form this provides a useful overview of the claim. [20] 1. 97(a): $9,015.50 for 25.10 hours of work associated with obtaining possession of Suite 602 (and the associated vaults); 2. 97(b): $7,981.50 for 20.80 hours of work associated with preparing Suite 602 for sale; 3. 97(c): $7,952.50 for 20.10 hours of work associated with communications with prospective purchasers, obtaining legal advice and exchanging contracts; 4. 97(d): $4,886.00 for 12.20 hours of work associated with obtaining production of certificates of title and lapsing of caveats; 5. 97(e): $34,571.50 for 84.20 hours of work associated with defending the various claims brought against the receiver; 6. 97(f): $3,747.50 for 7.00 hours of work associated with the application for an injunction to restrain Mr Minus and Ms Minasian and their companies from lodging further caveats, and the appellate proceedings; 7. 97(g): $8,425.00 for 21.00 hours of work associated with the completion of the contract for sale; 8. 97(h): $2,387.00 for 5.70 hours of work associated with communications with the Strata Plan owners and their managing agent and lawyers and the purchaser relating to adjustments on settlement; 9. 97(i): $1,036.00 for 2.70 hours of work associated with communications with the purchaser about the litigation; 10. 97(j): $4,417.50 for 11.80 hours of work associated with statutory and administrative tasks; 11. 97(k): $2,879.50 for 6.90 hours of work being discussions and correspondence with Mr Minus and a consultant engaged by him, Mr Peile; 12. 97(l): $15,350.00 for 32.20 hours of work performed during the operation of the stay between 25 October 2016 and 6 December 2016 when his appointment took effect; 13. 97(m): $4,268.00 for 9.70 hours of work performed in preparing evidence for the remuneration application; and 14. 97(n): $668.00 for 2.00 hours of work performed in bank account administration.
2. As has been noted, in respect of disbursements, no Court approval or specific order is necessary. Mr Sampson did not apply for approval of his disbursements, and it is therefore unnecessary to consider them.
3. The notified objections to the claim, which were reflected in the cross-examination of Mr Sampson, involved complaints that the receiver: 1. took no action other than to sell the property to a member of the Owners Corporation, without advertisement or auction and at an inauspicious time; 2. refused to give a proper accounting of the funds required to avoid a sale; 3. refused to negotiate with a representative of ABCD to avoid a sale; 4. refused to accept an offer on behalf of ABCD of a sum of $170,000 on 7 December 2016; 5. refused to provide bank account details so that ABCD could make a deposit; 6. refused to comply with ABCD's demand for a copy of the contract for sale; 7. failed to advertise the property to the public or relevant sectors (such as the legal profession, who were on vacation in January); and 8. ignored an unsolicited offer from another potential purchaser to pay "above the going rate".
4. To a large extent, these complaints involved attempts to re-litigate complaints which had been raised in the proceedings which ABCD and DRA had brought against the receiver, which had been dismissed for want of prosecution. While I declined to permit Mr Minus to agitate, on the remuneration application, complaints which were or ought to have been raised in the claim for damages or the application for an inquiry - in particular complaints that the Receiver had failed to market Suite 602 before sale, or had failed to get the best price - because they were not relevant to the claim for remuneration, I nonetheless allowed him to advance complaints that the Receiver had failed to make inquires or take steps which would have reduced or avoided costs, even if these involved or overlapped with issues which could have been raised in the dismissed claims, if they were relevant to showing whether work done by the Receiver was unreasonably performed.
5. Essentially, these amounted to an overarching objection, to virtually every category of the Receiver's work, that it was not reasonable for the Receiver to take possession of, and sell, Suite 602. In addition, it was contended that it was not reasonable for the Receiver to sell Suite 602 without a marketing campaign or auction. There were also more specific objections to some categories of work. Further, the Court has a responsibility not merely to rubber-stamp applications for remuneration, but carefully to scrutinise them; this exercise has revealed further issues which, though not raised by Mr Minus were addressed with the Receiver by the bench at the conclusion of his cross-examination.

Was it reasonable for the Receiver to take possession of and sell Suite 602?

1. In posing and answering this question, it is important to bear in mind that I am not here considering a claim for compensation against a receiver for breach of duty; the context is whether work, for which the Receiver claims remuneration, was reasonably undertaken. In considering what it was reasonable for the Receiver to do, the starting point is the object and scope of the appointment. Unlike the appointments in Gondon and in Say Enterprises, this appointment was not an interim receivership to preserve the status quo; it was an appointment by way of equitable execution to enforce ABC's right of indemnity under the Custodian Deed and at general law against certain assets of the MSF, which it had held as custodian trustee (and in respect of which its right of indemnity survived its removal as trustee). At least some of the liabilities of ABC - certainly the outstanding strata fees in the order of $75,000 claimed by the owner's corporation, and potentially at least to some extent the professional fees in the order of $632,000 claimed by Mr Minus personally - were incurred by ABC in its capacity as a custodian trustee. The object of the appointment was to enable the enforcement of the right of indemnity, and thereby the realisation of funds which would enable creditors of ABC to be paid. [21] This is sufficiently apparent from the following passage in the judgment given on the application for appointment of a receiver: [22] 12 The only way in which the liabilities of the company can be satisfied - unless someone, such as the beneficiaries of the superannuation fund, make a contribution that enables the liquidator to do so - is the enforcement of the company's right of indemnity against the assets that it formerly held on trust. Mr Minus submitted that it was a matter for the creditors to determine what was done in this respect, but that is not correct. If Mr Minus were admitted for $632,000 and the petitioning creditor for $60,000 net, Mr Minus would self-evidently carry any meeting of creditors; but Mr Minus has a significant conflict of interest, because while he may be a creditor to that extent - a matter which of course has not been tested and depends on the liquidator's acceptance of his proof of debt - he and his wife are also the beneficiaries of the trust for which the assets are ultimately held, and their interests as beneficiaries are contrary to his interests as creditor. Mr Minus' submissions focused on the detriment that would be occasioned to the beneficiaries of the superannuation fund by making the orders sought, but did not attend to the benefit to the creditors from making that order. And in this context, the interests of the creditors prevail over the interests of the beneficiaries. There is practically no other way in which the creditors can be paid, as it seems to me, than by recourse to enforcing the indemnity. By doing so, the liquidator is not acting on behalf of one creditor only, but in the interests of all creditors; notwithstanding that there is only one unrelated creditor, while the other creditor Mr Minus - being a related creditor or an associate - has an interest as beneficiary inconsistent with his interest as creditor. There is no obligation to call for and adjudicate proofs of debt before getting in the assets, and indeed, particularly where (as here) there have already been dealings with the relevant assets at a time when winding up is imminent, it might be said to be prudent and desirable for the liquidator to take expeditious steps to get in and protect those assets.
2. Accordingly, the Receiver's function was to realise funds in order to enforce ABC's right of indemnity. As the object of the appointment was to enable the enforcement of ABC's right of indemnity against Suite 602, it was entirely within the scope of the appointment to take possession of and sell Suite 602. However, Mr Minus contended that Mr Sampson unreasonably incurred the costs and time involved in selling Suite 602, when alternative simpler, more expedient and less expensive courses were available. He contended that the Receiver should have explored options arising from a contract said to have been made between DRA and the Commonwealth, pursuant to which ABCD might have obtained an income stream by way of rental of Suite 602 to DRA, against which it might have borrowed funds with which the receivership might have been discharged.
3. Much of the cross-examination of Mr Sampson was directed to the proposition that DRA's contract with the Commonwealth would provide a sufficient income stream (described by Mr Minus as "for 2 years beginning on 1 December 2016 to a maximum value of $428,700 (inc GST)"). However, there was no guarantee of how much income DRA would derive under this contract. Even less was there any guarantee of what ABCD might receive by way of rent or otherwise. The contract was not with ABCD, nor a subsidiary of ABCD. The prospect of income from DRA's contract satisfying ABC's right of indemnity was far too remote and speculative to warrant further inquiries. Borrowing against an income stream would have been fraught. It was not incumbent on the Receiver to explore the speculative possibility that funds might become available to the Receiver in this way.
4. As to the suggestion that the Receiver "wrongfully" refused to accept an offer of $170,000 on 7 December 2016, after he and his staff member Ms Nicolle Greentree met with Mr Minus on 7 December 2016, Mr Sampson on 9 December 2017 sent Mr Minus a letter prepared by Ms Greentree, as follows: In order for me to cease my intended course of action, a stay of the winding up would be required. In this regard, the funds as outlined in the attached spreadsheet would be required to be paid to me and an application by you to the Supreme Court of NSW would need to be made for the termination of the winding up. In this regard, your offer of $170,000 to stop me proceeding with the sale is insufficient.
5. The attached spreadsheet set out a total figure of $231,618.91 in order to terminate and cover the costs of the winding-up. The $170,000 offered by Mr Minus - assuming that there was an offer capable of acceptance - was insufficient to satisfy ABC's entitlement under its right of indemnity and pay the costs of the winding up. Provision of the receiver's bank account details to Mr Minus would have made no difference to this. Far from it being incumbent on the Receiver to wait for Mr Minus to assemble the further funds required to terminate the winding-up, it was his duty to take steps to enforce the indemnity.
6. Pursuit of any alternative course would not have achieved the object of the appointment more expeditiously or inexpensively. It was therefore entirely reasonable for the Receiver to think that the best course in order to enforce ABC's right of indemnity was to proceed to sale.
7. Once that conclusion is reached, it follows that it was reasonable for the Receiver to do work and incur costs to sell Suite 602, although there remain questions as to whether all the work done was reasonably undertaken and the remuneration claimed for it reasonably proportionate.

Was the sale of Suite 602 reasonably conducted?

1. The notified objections repeatedly referred to the circumstance that the Receiver sold Suite 602 in reliance on a valuation, without a marketing campaign, without an auction, and without regard to DRA's alleged equitable lease. Such complaints, if well-founded, might have informed a claim for damages (arising from a sale at an undervalue), but in the context of an application for remuneration, their only relevance is that the additional work which would have been involved in a marketing campaign and auction was not required, and need not be remunerated. In other words, the work involved in the sale for which Mr Sampson is entitled to remuneration is less than would have been involved had there been a marketing campaign and auction.
2. It was suggested that the Receiver should have investigated the possibility of sale to Mr Minus, or an associated entity. However, the prospects of a successful sale to Mr Minus or some related entity were insufficient; his capacity to fund a purchase was never demonstrated.
3. The question is whether the work he did was reasonable, having record to the object of the appointment. Given the object as described above, the answer is not affected by whether Mr Sampson contravened s 420A, or wrongfully disregarded a lease, or ought to have conducted a marketing campaign and auction.

Was the work reasonably undertaken?

1. Those conclusions do not mean that all the work in respect of which remuneration is claimed was reasonably undertaken, or that the remuneration claimed for it is proportionate, and as will appear, scrutiny of the claim reveals a number of aspects which I consider unreasonable or excessive. Relevant considerations include whether the work done was necessary to achieve the object of selling Suite 602 in order to realise assets to satisfy ABC's right of indemnity; whether it was conducted efficiently, within reasonable time and at appropriate rates; whether it involved a higher than usual level of complexity or risk; and whether the remuneration claimed is proportionate in terms of the work done relative to the funds recovered.
2. It is convenient to scrutinise the claim and deal with specific issues that have been raised in the context of the 14 heads referred to in par 97 of the Mr Sampson's affidavit of 24 August 2017. The work done on behalf of the Receiver was performed by several of his staff at varying rates; for this purpose I have adopted $400 as an approximate indicative average hourly rate.
3. First, however, in order to gain an appreciation of the amount claimed in the context of what was involved in this receivership, it assists to identify the main tasks of the receivership, and the amount attributable to each. Essentially, these were: 1. work performed during the operation of the stay [item 97(l), total $15,350.00 for 32.20 hours of work]; 2. obtaining possession of and selling Suite 602 [items 97(a), 97(b), 97(c), 97(g) and 97(h), totalling $35,761.50 for 92.70 hours of work]; 3. responding to impediments to the sale created by, litigation commenced by, and issues raised by, Mr Minus and ABCD [items 97(d), 97(e), 97(f), 97(i) and 97(k), totalling $47,120.50 for 113.0 hours of work]; 4. administrative tasks of the receivership [97(j) and 97(n), totalling $5,085.50 for 13.80 hours of work]; and 5. preparing and conducting the remuneration application [97(m), plus the additional claim in the amended application, [23] totalling $22,714.00].
4. As that overview reveals, the sale itself did not incur the majority of the costs - it was removing a series of impediments to the sale, created by Mr Minus, and defending claims brought against the Receiver, that did so. Nonetheless, the sale process itself incurred 67.6 hours of work, for which $26,745.70 is claimed, for the sale of a suite which involved no marketing.

97(a): obtaining possession of Suite 602

1. The Receiver claims remuneration of $9,015.50 for 25.10 hours of work associated with obtaining possession of Suite 602 (and the vaults), including communications with locksmiths and tradesmen. As explained above, as a matter of principle, given the object of the appointment, it was the Receiver's duty to enter into possession of Suite 602, with a view to its realisation. I accept that it was reasonable to change the locks on the vaults, and to commence to arrange a commercial clean when the purchaser requested it, although it did not proceed.
2. However, all this should not have required 25 hours of work, to the value of in excess of $9,000. Most of this work was undertaken by Kylie Bennett, a supervisor, at the hourly rate of $345, and many of her telephone attendances, which were almost invariably claimed as 3 or more units of time (18 minutes), ought to have required only one unit of time (6 minutes). Mr Sampson gave this evidence: HIS HONOUR Q. In the A3 sheets that you have there Mr Sampson could you turn to page 184 which deals with the work under paragraph 97A? A. Yes. Q. Now if you look at line 149 "Kylie Bennett telephone attendance with Jane Edwards" said to be three units of time? A. Yes. Q. That's 18 minutes is it? A. Yes, your Honour. Q. Then the next entry 153 "Telephone attendance with locksmith. Confirm time to change locks" somehow takes 18 minutes? A. Yes, your Honour. Q. Next line "Telephone attendance". There's some email correspondence in there but if you go down to 159, "Telephone attendance with Pierre, building manager re access", that's somehow takes 25 minutes almost? A. Yes, your Honour. Q. Next line 160 "Telephone attendance with Ronnie re access and re keying", another 18 minutes? A. Yes, your Honour. Q. I don't want to go through every single entry in here but I have struggled to find a single telephone or other attendance by Kylie Bennett that has taken less than 18 minutes. Now whether or not it took less than 18 minutes, did you not accept that many of those things should be capable of being done by a competent person in about 6 minutes, not 18 minutes? A. It hasn't occurred to me until just now, your Honour.
3. I am not satisfied that more than $5,000, for approximately 12.50 hours of work, is justified.

97(b): preparing Suite 602 for sale

1. The Receiver claims remuneration of $7,981.50 for 20.80 hours of work associated with preparing Suite 602 for sale, including communications with agents regarding marketing and the commissioning of a valuation; communications with Mr Minus concerning his personal property located in Suite 602 and attempting to persuade him to remove it; and communications with and the engagement of removalists. In principle it was reasonable to undertake work of this kind, in order to ready the property for sale. I also accept that it was reasonable to engage the agent Jayne Edwards at the outset, before it was decided to proceed with a private sale.
2. Again, however, it should not have required in excess of 20 hours of work, to the value of nearly $8,000, to do so, especially given that there was no marketing campaign. It cannot be conceived that a businessperson of ordinary prudence selling such a property, having retained a solicitor to do the conveyancing, would spend 20 hours preparing for the sale in this way. Again, most of the work was attributed to Kylie Bennett who rarely claimed less than 3 units of time for an attendance, though 1 unit should have sufficed. Moreover, two members of the receiver's staff attended at Suite 602 on 6 January 2017 to accompany the valuer, both for 90 minutes, when one would have sufficed; the following evidence was given by Mr Sampson: HIS HONOUR Q. Right. If you go to 97B, that's page 186, line 66 "Kylie Bennett on site meeting with Nick Brady an hour and a half", you see that? A. Yes, your Honour. Q. Line 67 "Nicolle Greentree attends premises with KB and Nick Brady, an hour and a half". Why is it necessary for two people to go along and double the time expended in the costs incurred for something like that? A. Nicolle Greentree is an experienced insolvency practitioner from many years. Kylie Bennett had been at our firm for four years and it occurred to me that this may have Kylie's first on site meeting of this nature so she may have needed supervision or a hand. Q. Why should the cost of that requirement be visited on the company? A. I'm happy to accept that it shouldn't your Honour. Q. On the same page line 59 "Nicolle Greentree attend premises for Minus to remove his belongings". Line 60 "David S attend chambers. Overseas vacation". Why is it necessary for two of you to attend for that? A. I personally wanted to see how the day was rolling out. I think I turned up at lunchtime. It was necessary for me to be informed as to the progress that was making and how the progress was occurring for the vacation of the premises and the orderly removal of equipment and belongings your Honour.
3. I allow $6,000, for approximately 15 hours of work.

97(c): communications with purchasers, legal advice and exchanging contracts

1. The Receiver claims remuneration of $7,952.50 for 20.10 hours of work associated with "communications with prospective purchasers and offers obtained from prospective purchaser before the commencement of advertising, consideration of the valuation, obtaining legal advice on those matters and exchanging contracts with the purchaser". It was reasonable for the Receiver to undertake work of this kind, including obtaining legal advice about selling without a marketing campaign. However, yet again most of the work was attributed to Kylie Bennett who rarely claimed less than 3 units of time for a telephone attendance, where 1 unit should usually have sufficed.
2. Two members of the receiver's staff unnecessarily attended on the exchange of contracts, even though solicitors were acting for the receiver. Mr Sampson's evidence was as follows: Q. Well, it didn't proceed according to the schedule, did it, because Mr James or someone has identified that he can't attend. You see line 116 it says, "Assist Kylie Bennett in attending" - this is Allan Ma - "exchange of contract sale with George James at 11.55 to 12.48pm"? A. Yes, so Alan Ma assisted Kylie Bennett at exchange that day. HIS HONOUR Q. So how many people are going along to exchange then? A. Alan Ma, the senior manager, absent me, and Kylie Bennett. Q. And presumably a solicitor? A. No, I think- Q. Where did you exchange contracts? A. I don't recall because I wasn't there. It was at the offices of Mr Noonan or - I am guessing - it wasn't, or was it in our office? I don't recall exactly where the exchange- Q. You had solicitors acting on the conveyance presumably? A. Yes, we did. Q. And they didn't do the exchange? A. I don't have any knowledge of the exchange because I wasn't there. To be certain I would have to check the bill for Gillis Delaney to see if they attended exchange. Q. Would you, acting prudently on a sale like this, have contracts exchanged other than by solicitors? A. I ordinarily leave it to my lawyers to exchange contracts so- Q. And why would you need two of your staff to go across and supervise the lawyers at an exchange of contracts? A. Well, the exchange of contract was an important thing and a senior manager needed to make sure that the exchange happened in an orderly manner. Q. How is a solicitor for a purchaser and a solicitor for a vendor going to get disorderly? A. Oh, to make sure if there were land tax cheques that were required on settlement or something like that, that was all complete and nothing missing.
3. Although it appears (from an affidavit filed after the completion of the hearing) that the solicitor did not attend, and the receiver's staff conducted the exchange, having two staff attend was an unnecessary indulgence.
4. I allow $4,000, for approximately 10 hours of work.

97(d): obtaining production of certificates of title

1. The Receiver claims remuneration of $4,886.00 for 12.20 hours of work associated with "attending to tasks required for the completion of the sale of the properties including attempting to obtain new certificates of title to the Properties through the lodgement of Requests with LPI, lapsing of caveats which DRA and Mr Minus lodged, and my application for an injunction to compel Mr Minus to produce the certificates of title". Apart from some inefficient duplication arising from multiple members of the receiver's staff updating the others and discussing issues, this work was reasonably done. I allow $4,400, for approximately 11 hours of work.

97(e): defending litigation

1. The Receiver claims remuneration of $34,571.50 for 84.20 hours of work associated with "defending the claims for relief sought against me in the various interlocutory Processes which ABCD and DRA filed in these proceedings …", including providing instructions for affidavits, reviewing about 2,000 documents and collating, copying and producing them pursuant to a notice to produce, and reviewing and providing instructions in respect of affidavits relied on by the opposing parties, and the exhibits to them. The incurring of this time was necessitated by the litigation brought against the Receiver by the entities associated with Mr Minus. There were some inefficiencies and duplications through internal conferences and discussions, and (on 17 March) the attendance of both Mr Sampson and Ms Bennett at court. I allow $30,000, for approximately 75 hours of work.

97(f): application for injunction

1. The Receiver claims remuneration of $3,747.50 for 7.00 hours of work associated with his application for an injunction to restrain Mr Minus and Ms Minasian and their companies from lodging further caveats on the title, and resisting ABCD's proceedings in the Court of Appeal, including an all-day attendance on 19 May 2017 to instruct lawyers, and reviewing documents relied on by ABCD in the Court of Appeal on 22 May. The application for an injunction was reasonably made in the circumstances, as is confirmed by its success, and this work was reasonably and efficiently done and is allowed in full at $3,747.50.

97(g): completion of the contract for sale

1. The Receiver claims remuneration of $8,425.00 for 21.00 hours of work associated with the completion of the contract for sale. This must be viewed in the context of the total amount claimed for the sale. As has been mentioned, putting aside the costs associated with the complexities created by Mr Minus, the total amount claimed for the routine aspects of the sale (items 97(b), (c), (g) and (h)) is $26,745.70 for 67.6 hours of work. Mr Sampson gave this evidence: HIS HONOUR Q. If you go to 97(c), that's page 189, 190, I'll just use the term in your affidavit of 23 August which describes that as "work concerning communications with prospective purchasers and offers from prospective purchasers" and that totals about 20 hours on those two pages. Please just check that if you are happy with that? A. Yes, your Honour. Q. And then 97(b) the previous two pages is described as "preparing for sale, work associated with preparing the properties for sale, communications". Let's leave that out because that's pre-sale. So 20 hours of 97(c). Then 97(d) is tasks required for the - that's largely the litigation so we'll pass over (d) and (f). But then you go to (g) which is described as "work connected with the completion of the contract, 21 hours". Then (i) is "communications with the purchasers". Let me go back to (g). So in (g), we've got 21 hours completion of the contract. Under (d) we've got - (d) is not the right one. (c) you've got 20 hours effectively negotiating with purchasers and then (g) 20 hours completing the contract. That's 40 hours to sell a barrister's chambers effectively? A. Yes, your Honour. Q. Just at first sight that's a lot of time, and I've tried to leave out of that all of the complications of proceedings in the Court and so on, that's a lot of time to sell a room and a couple of cupboards? A. Yes, your Honour.
2. In my judgment the time incurred in connection with "the completion of the contract for sale", especially in the context of the other amounts claimed in connection with the sale, is excessive; again, it can hardly be conceived that a prudent business person selling such a property, with a solicitor acting on the conveyance, would spend 21 hours on tasks associated with completion of the sale. Again, some of the items claimed are attendances of 3 units which should have required only one or two.
3. Some - although not a great deal - of this work was occasioned by the novation of the contract, in respect of which Mr Sampson gave this evidence: HIS HONOUR Q. At whose request was the rescission undertaken, Mr Sampson? A. I'm not sure whether it was my lawyers who said in this situation a rescission deed needs to be attended to, but it wasn't my instigation. I am in my lawyers' hands as to the mechanics of substituting the purchaser. Q. But, as you understand it, it was for the purchaser's benefit and convenience? A. Correct, and I understood that Mr James said if there were extra costs associated with this document, he would pay for the legals of it. He was apologetic. Q. So why are you claiming remuneration for it then against the company and not getting it from Mr James? A. I don't know that I incurred costs for it. MINUS Q. Mr Sampson, the very fact that you have to have a meeting with Mr James to discuss the issue which is then subsequently referred to your lawyers for which you charge is a cost that is being incurred by the company which it should not incur, isn't it? A. Well, sitting here right now I don't know who was the author or who drafted the deed of rescission. It was- HIS HONOUR Q. It would normally have the drafter on it? A. Yeah, I - yes. MINUS Q. But, Mr Sampson, I am asking you something different. I am saying to you that you chose a course, you have told us that you were convinced that Mr James through your oral balance sheet convinced you that he was a person who could undertake the purchase without any difficulties within a certain timeframe and now he has come back to you after various negotiations and changes to the contract and said to you, "I want to rescind the contract"? A. Well, he said to me, "I want to change the purchaser. We have made an error in the purchaser of it."
4. The purchaser agreed to cover any legal costs of the novation. The Receiver ought to have insisted that he also be responsible for remuneration for any work by the Receiver occasioned by it.
5. I allow $6,000 for approximately 15 hours of work.

97(h): communications with the Strata Plan owners

1. The Receiver claims remuneration of $2,387.00 for 5.70 hours of work associated with communications with the Strata Plan owners and their managing agent and lawyers "as to various matters including payment of funding for my legal costs of my appointment as receiver, the adjustment to be made on completion of the sale … for strata levies, and contact with [the purchaser] concerning that adjustment". This work appears mainly to have been associated with ascertaining the requirements of the strata owners in connection with the sale, and determining what adjustments were required on settlement, and is allowed in full at $2,387.00.

97(i): communications with the purchaser about the litigation

1. The Receiver claims remuneration of $1,036.00 for 2.70 hours of work associated with communications with the purchaser about the litigation. I accept that some communication to keep the purchaser informed about the status of the litigation instituted by ABCD and DRA and its potential impact on the progress of the sale was entirely reasonable. However, the attendances claimed (ranging between 2 units and 5 units) were excessive. I allow $800 for about 2 hours of work.

97(j): statutory and administrative tasks

1. The Receiver claims remuneration of $4,417.50 for 11.80 hours of work associated with statutory and administrative tasks, including changing the locks at Suite 602, obtaining insurance, considering invoices for legal fees and disbursements, professional indemnity insurance, new job set up and preparation of his Declaration of Independence and Relevant Relationships. Of this, a total of 10.30 hours was attributable to reviewing invoices for legal fees. As I have observed, a receiver is expected to undertake such a review and closely scrutinise disbursements. However, here that review resulted in not a single query; it resulted in not a single cent of the legal costs (which were in the order of $250,000) being questioned. The Receiver gave this evidence: Q. And you spent time reviewing the legal costs? A. Yes. Q. Why was that necessary? HIS HONOUR: Because it was repeatedly held that an insolvency practitioner is bound closely to scrutinise the disbursements charged. MINUS: Thank you, your Honour for that assistance. Q. As a result of that analysis you've identified that you challenged some of the costs that were associated or included with the strata the Owner's Corporation proof of debt. Did you identify any costs that you queried with your solicitor as a result of undertaking that work? A. No, I didn't find anything that needed further query. HIS HONOUR Q. You spent 12 hours analysing bills amounting to over $250,000 and didn't find a single thing to query? A. I had discussion with my other colleagues in the office, a senior consultant, and I asked him I sought his advice and counsel as well. No, I didn't find anything else your Honour.
2. In that context, a claim for ten hours in an entirely unproductive exercise is disproportionate.
3. I allow $2,400 for a total of approximately 6 hours of work.

97(k): discussions and correspondence with Mr Minus and his consultant

1. The Receiver claims remuneration of $2,879.50 for 6.90 hours of work being discussions and correspondence with Mr Minus and a consultant engaged by him, Mr Peile. This work was occasioned by Mr Minus, and is allowed in full at $2,879.50.

97(l): work performed during the operation of the stay

1. The Receiver claims remuneration of $15,350.00 for 32.20 hours of work performed during the operation of the stay between 25 October 2016 and 6 December 2016 when his appointment took effect, including analysis of the potential to terminate the winding up of ABC as opposed to proceeding to a receiver's sale, meeting with Mr Minus, liaising with the petitioning creditor's lawyers, and various meetings with Mr Minus. When this work was performed, Mr Sampson was not acting as receiver; his appointment as such had not taken effect, and he could only have been acting as liquidator. I do not see how work done in that capacity can properly be the subject of a claim for remuneration as receiver, and though he may well be entitled to claim remuneration in respect of it as liquidator, that is not the claim now before the Court. This head must therefore be wholly disallowed. I am conscious that the order of 25 October 2016 included provision that, to the extent that the applicant's costs of the application were not recoverable from the respondent, they be costs in the receivership; but that related to the costs of the application, not the liquidator's remuneration.

97(m): preparing evidence for the remuneration application

1. The Receiver claims remuneration of $4,268.00 for 9.70 hours of work performed in preparing evidence for the remuneration application.
2. In addition, pursuant to the amended interlocutory process, Mr Sampson also claims remuneration of $12,936.00 plus GST for work performed between 28 July 2017 and 23 January 2018, and $5,510.00 plus GST for attendance at a pre-hearing conference and at Court on 2 and 7 February 2018, for a total of 9.5 hours at his hourly rate of $580 per hour. [24] Mr Sampson's affidavit of 2 February 2018 quantifies and particularises the claim in respect of the period between 28 July 2017 and 23 January 2018, which substantially (as to $11,375.00) relates to the preparation and review of evidence for the present application, and also includes a small amount of ongoing administrative work.
3. Including the initial claim of 9.70 hours, a total of $15,643.00 (or some 32 hours) was spent essentially on preparation and reviewing evidence for the remuneration application. The substance of what was involved was the production of reports from the receiver's computerised time recording system, and the giving of instructions for five affidavits, the substance of which (excluding annexures and exhibits) comprised 131, 3, 21, 34 and 7 paragraphs respectively. In my view, given that lawyers (senior and junior counsel, and solicitors) were engaged to act on the application, 32 hours for this exercise is excessive, and either inefficient or indulgent. With some misgivings, I allow $9,600 for 24 hours work.
4. As to attendance at the hearing, Mr Sampson was required to attend for cross‑examination on both days of the hearing, and it was plainly reasonable for him to have a pre-hearing conference with counsel, and I allow this at his (as distinct from the average) hourly rate, at $5,510.00 as claimed.
5. Including provision for administrative work, at an amount of $1,561.00, I allow this item in total at $16,671.00.

97(n): bank account administration

1. The Receiver claims remuneration of $668.00 for 2.00 hours of work performed in bank account administration. I allow this in full at $668.00.

Summary

1. The above is summarised in tabular form as follows: Para Description Claimed Allowed 97(a) Obtaining possession of Suite 602 9015.50 5000.00 97(b) Preparing Suite 602 for sale 7981.50 6000.00 97(c) Communications with prospective purchasers and obtaining legal advice 7952.50 4000.00 97(d) Tasks required for the completion of the sale; application for production of CTs 4886.00 4400.00 97(e) Defending claims against receiver 34571.50 30000.00 97(f) Application for injunction 3747.50 3747.50 97(g) Completion of the contract for sale 8425.00 6000.00 97(h) Communications with SP owners and purchaser re adjustments 2387.00 2387.00 97(i) Communications with the purchaser about the litigation 1036.00 800.00 97(j) Statutory and administrative tasks 4417.50 2400.00 97(k) Communications with Mr Minus and Mr Peile 2879.50 2879.50 97(l) Work performed during the stay 15350.00 0.00 97(m) Preparing evidence for the remuneration application [25] 22714.00 16671.00 97(n) Bank account administration 668.00 668.00 TOTAL 126031.50 84953.00

Conclusion

1. For the foregoing reasons, I have concluded that: [26] 1. The $15,350.00 claimed in respect of work performed during the operation of the stay [27] should be disallowed in whole, as it is referable to the liquidation and not the receivership. 2. Of the $35,761.50 claimed in respect of obtaining possession of and selling Suite 602, [28] $23,387.00 should be allowed. This represents a significant reduction (about 35%), commensurate with my view that time was incurred in connection with the taking possession of and sale of Suite 602 substantially in excess of that which a reasonably prudent businessperson acting in his or her own interests would have incurred in undertaking those tasks efficiently. 3. Of the $47,120.50 claimed in respect of responding to impediments to the sale created by, litigation commenced by, and issues raised by, Mr Minus and ABCD, [29] $41,827.00 should be allowed. This represents a very high level of recovery for work reasonably required as a result of the actions of Mr Minus, involving only a modest moderation (about 11%) of the claim in this respect. 4. Of the $5,085.50 claimed in respect of administrative tasks of the receivership, [30] $3,068.00 should be allowed, reflecting my view that the claim for work done in reviewing legal costs is disproportionate to the result achieved, which was nugatory. 5. Of the $22,714.00 claimed in respect of preparing and conducting the remuneration application, including in the amended application, [31] $16,671.00 should be allowed, reflecting my view that excessive time was spent in preparing and reviewing affidavits having regard to what was involved and that lawyers were engaged.
2. Thus, of the remuneration claimed by Mr Sampson as receiver, including the additional claim in his amended interlocutory process, a total of $84,953.00 is justified. Consistent with what appears for the period from 28 July 2017 to 23 January 2018, there would have been some minor ongoing administrative tasks in the meantime, and there will be some further tasks associated with finalisation of the receivership, including the passing of accounts, the obtaining of directions for distribution of the remaining funds, and the payment of the approved remuneration and transfer of funds, for which I allow a further five hours ($2,640.00). Reasonable remuneration for the totality of the receivership, including work up to the date of the hearing, attendance at the hearing, and any further work required to complete the receivership, is therefore $87,593.00, which (recognising that this is not a precise calculation) I round up to $90,000.00. Mr Sampson would be justified in paying that remuneration out of the proceeds of sale of Suite 602.
3. Mr Sampson also seeks an order that his costs and expenses of this application also be an expense in the receivership. A receiver is entitled to be reimbursed out of the property for costs and expenses properly and reasonably incurred. No order to that effect is necessary, and none is desirable lest it suggest that the Court has approved the costs and expenses.
4. The Court therefore orders that: 1. Pursuant to (NSW) Uniform Civil Procedure Rules 2005, r 26.4, the remuneration of the applicant David Henry Sampson, as the Receiver of Lots 21, 31 and 34 in Strata Plan 21574, situate at and known as Suite 602, Level 6, Culwulla Chambers, 67 Castlereagh Street, Sydney ("the property") pursuant to the order of the Court made on 25 October 2016, be fixed in the amount of $90,000.00. 2. The applicant as such receiver would be justified in paying his remuneration so fixed from the proceeds of the sale of the property.
5. It is probably appropriate that the balance of the interlocutory process, wherein the applicant seeks inter alia an order passing his accounts as receiver, and directions as liquidator, be referred to the Corporations List judge, but I will afford the parties an opportunity to be heard on that question.

Endnotes

1. See clause 8(2) and (3) of the Custodian Deed. It is not entirely clear that its function as custodian for ABCD was ABC's sole capacity, and the right of indemnity, whether under clause 8 of the Deed or at general law, would not extend to liabilities incurred in any other capacity.
2. See Selth v Australasian Barrister Chambers (No 3) (2017) 256 FCR 367; [2017] FCA 649.
3. In the matter of Australasian Barrister Chambers Pty Ltd [2016] NSWSC 1767.
4. In the matter of Australasian Barrister Chambers Pty Ltd [2016] NSWSC 1939.
5. In the matter of Australasian Barrister Chambers Pty Ltd (in liq) [2017] NSWSC 245.
6. In the matter of Australasian Barrister Chambers Pty Ltd (in liq) [2017] NSWSC 597.
7. In the matter of Australasian Barrister Chambers Pty Ltd (in liq) [2017] NSWSC 627.
8. ABCD Corporation Pty Ltd v Sampson [2017] NSWCA 117.
9. In the matter of Say Enterprises Pty Ltd [2018] NSWSC 396 at [6].
10. In the matter of Gondon Five Pty Ltd and Cui Family Asset Management Pty Ltd [2019] NSWSC 469 at [34]-[37].
11. Re Universal Distributing Co Ltd (in liq) (1933) 48 CLR 171; [1933] HCA 2; In the matter of AAA Financial Intelligence Ltd (In liq) [2014] NSWSC 1004 at [18].
12. (2004) 184 FLR 44; (2004) 50 ACSR 324; [2004] NSWSC 751.
13. Wenkart v Pantzer (2005) 223 ALR 385; [2005] FCA 1572 (Branson J); Mohamed v Hurstville Tower Medical Clinic Pty Ltd (in liq) [2006] NSWSC 4 at [9] (Barrett J); Re Anderson Group (2002) 20 ACLC 1607; [2002] NSWSC 764 at [12] (Barrett J); Sanderson, as liquidator of Sakr Nominees Pty Ltd (in liq) v Sakr (2017) 93 NSWLR 459; (2017) 118 ACSR 333; [2017] NSWCA 38 (Bathurst CJ, Beazley P, Gleeson JA, Barrett AJA, Beach AJA); In the matter of Banksia Securities Ltd (in liq) (receivers and managers appointed) [2017] NSWSC 540 at [37]-[46] (Gleeson JA).
14. Templeton v Australian Securities and Investments Commission (2015) 108 ACSR 545; [2015] FCAFC 137 (Besanko, Middleton and Beach JJ); In the matter of Wine National Pty Ltd [2016] NSWSC 4 at [15] (Black J); In the matter of Banksia Securities Ltd (in liq) (receivers and managers appointed) [2017] NSWSC 540 at [42] (Gleeson JA).
15. Templeton v Australian Securities and Investments Commission (2015) 108 ACSR 545; [2015] FCAFC 137 at [31] (Besanko, Middleton and Beach JJ); Sanderson, as liquidator of Sakr Nominees Pty Ltd (in liq) v Sakr (2017) 93 NSWLR 459; (2017) 118 ACSR 333; [2017] NSWCA 38 at [55] (Bathurst CJ).
16. Venetian Nominees Pty Ltd v Conlan (1998) 20 WAR 96 at 100-101 (Kennedy and Ipp JJ); Re Timeshare Resort Club Ltd (in liq) (2010) 187 FCR 13; (2010) 78 ACSR 705; [2010] FCA 673 at [36]‑[37] (Barker J); In the matter of Wine National Pty Ltd [2016] NSWSC 4 at [12] (Black J).
17. Deputy Commissioner of Taxation v Starpicket Pty Ltd (No 2) [2013] FCA 699 at [21] (Gordon J).
18. In the matter of Sakr Nominees Pty Ltd [2016] NSWSC 709 at [8]; although that was a case about a liquidator, there is no reason why the same principles should not apply.
19. See In the matter of Sakr Nominees Pty Ltd [2017] NSWSC 668 at [8].
20. The amounts referred to are exclusive of GST.
21. As to which see now Carter Holt Harvey Woodproducts Australia Pty Ltd v Commonwealth [2019] HCA 20.
22. In the matter of Australasian Barrister Chambers Pty Ltd [2016] NSWSC 1767.
23. Pursuant to the amended interlocutory process, Mr Sampson claims additional remuneration of $12,936 plus GST for work performed between 28 July 2017 and 23 January 2018, which almost exclusively relates to the remuneration application, and $5,510 plus GST for attendance at a pre-hearing conference and at Court on 2 and 7 February 2018, for a total of 9.5 hours at his hourly rate of $580 per hour.
24. As ultimately quantified in the Receiver's Further Closing Submissions of 28 February 2018.
25. Including the additional claim in the amended interlocutory process.
26. Analysed according to the main tasks in the receivership as categorised in [39] above.
27. Item 97(l).
28. Items 97(a), 97(b), 97(c), 97(g) and 97(h).
29. Items 97(d), 97(e), 97(f), 97(i) and 97(k).
30. Items 97(j) and 97(n).
31. Item 97(m) and the additional claim. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 28 June 2019