Australian Motor Homes Pty Limited v Maria's Farm Veggies Pty Limited

BACKGROUND 2 Tvesa and Mansa Sons are related entities within a corporate group (SK Group) ultimately controlled by Krishnakumar Agrawal and Shashikumari Agrawal who for convenience, and without intending any disrespect, I will refer to in these reasons as Kris and Shashi. 3 Mansa Sons was the treasury company for the SK Group. It raised funds from approximately 150 investors (primarily natural persons and self-managed super funds) to provide seed finance for property development projects carried out by various special purpose vehicles (SPVs) within the group, including Tvesa. 4 The loans between Mansa Sons and the SPVs were unsecured and undocumented with funds being transferred between entities in the SK Group on an informal basis depending upon when money was needed by a particular entity. 5 Due to the casual, frequent and undocumented nature of fund transfers, the plaintiffs have been unable to ascertain the true value of debts owing between entities in the SK Group. Tvesa's balance sheet records a debt from Tvesa to Mansa Sons of $432,781.35 (Mansa Debt). However, the plaintiffs have no confidence in the accuracy of the debts recorded in the books of Tvesa or Mansa Sons such that the true value of the Mansa Debt may be significantly higher.

The appointment of administrators to Mansa Sons 6 On Friday, 30 June 2023 Vincent Pirina, Ian Niccol and Andrew McEvoy of Aston Chace were appointed as administrators of Mansa Sons. On the same day Aston Chace notified Westpac of their appointment (Notification Letter). In the Notification Letter Aston Chace sought information about any accounts held by Mansa Sons and requested that in the event there was a current account, it be immediately frozen as to debits "so that no withdrawals can be made without the express written approval of the Administrators". According to an email dated 17 July 2023 from Nahla Wahib at Westpac to Aaron Kerma at Aston Chace, Westpac received the Notification Letter at 4.58 pm on 30 June 2023.

Transfers between Tvesa and Mansa Sons 7 On Sunday, 2 July 2023 between 9.48 am and 10.16 am four deposits were made into Mansa Son's account held with Westpac (Mansa Account) from entities within the SK Group including a deposit of $983,000 from Tvesa at 10.16 am (Morning Transaction). That evening at 9.55 pm, without the authority of Aston Chace, the four deposits were reversed, including by transferring the sum of $983,000 into Tvesa's account held with Westpac (Tvesa Account) (Evening Transaction). 8 Immediately prior to the Evening Transaction the Tvesa Account had a credit balance of $682.34. On 3 July 2023, $18,194 was transferred from the Tvesa Account to an unknown account, leaving a final balance of $965,488.34 (Remaining Funds). 9 On the morning of 4 July 2023 Westpac acknowledged receipt of the Notification Letter and provided Aston Chace with the information they had requested. It was as a result of this correspondence that Aston Chace first became aware of the Morning Transaction and the Evening Transaction. 10 On 6 July 2023 Madison Marcus, the solicitors for the administrators at the time, demanded that Tvesa return the sum of $983,000 to their clients. Tvesa refused to do so. In response, its solicitors, A.I. Legal, stated that the deposit of $983,000 into the Mansa Account was "made in error" and continued: My client concedes that there is a loan balance between our respective clients in the approximate amount of $147,000 and my client will attend to payment of such amount shortly. In relation to the amount paid in error and returned by way of the alleged unauthorised transaction, such amount was never the property of your client and should rightfully revert to my client.

The appointment of Messrs Billingsley and Mansoor to Mansa Sons and Tvesa 11 On 12 July 2023, at the first meeting of creditors of Mansa Sons, the creditors removed Messrs Pirina, Niccol and McEvoy as administrators (Former Administrators) and appointed Messrs Billingsley and Mansoor in their stead. 12 On 25 July 2023 Tvesa went into voluntary liquidation and Messrs Billingsley and Mansoor were appointed as liquidators. 13 On 4 August 2023, at the second meeting of creditors of Mansa Sons, the creditors voted in favour of Mansa Sons being wound up and Messrs Billingsley and Mansoor were appointed as liquidators.

Initial investigations undertaken by Messrs Billingsley and Mansoor 14 On 20 July 2023 Mr Mansoor attended a meeting with Mr Billingsley, Kris, Shashi, Bharat Agrawal (Kris' brother), and Aydin Acar of A.I. Legal. Mr Mansoor recalls that a number of things were discussed at that meeting including the transfer by Mansa Sons to Tvesa as part of the Evening Transaction. In relation to that topic Mr Mansoor recalls that Kris said: "the funds were transferred to do 'a deal' with [Mansa Sons]", that "[Mansa Sons] is only owed $140k from Tvesa" and "the funds were transferred by mistake". 15 On 21 July 2023 Mr Mansoor sent an email to Kris which included: I refer to our discussion with respect to Tvesa Investments Pty Ltd and the funds that were transferred into and out of the Company's bank account after the former Administrators appointment to the Company. I note that you are a director of Tvesa Investments and were involved in the Company. In this regard to these funds which are currently frozen by the bank, I require an email detailing why these funds were transferred to and out from the Company's bank account. I also require a balance sheet for Tvesa Investments so that I can seek advice from my lawyer on your request to release the balance of monies post repayment of the money owed to the Company. 16 By email also dated 21 July 2023 (21 July Email) Kris responded in the following terms (as written): Please find attached Draft Balance Sheet and Profit & Loss account as on 30 June 2023 (I have not entered sales entry of 10-18 Station Street, Wentworthville that was settled in last week of June 2023). Attached ledger of Tvesa Investments in Mansa Sons books, having balance outstanding of $432,781.35 of which Principle is $146,973 and interest accrued is $285,808.35. Attached bank transaction to confirm $983,000 was transferred from Tvesa (from sales proceeds of 10-18 Station Street, Wentworthville 2145) and was returned on same day realising that it was transferred by mistake as realised that trades owing to SK Homes has be cleared to complete construction of 3 houses (2 of customer and 1 of Dawn Enterprise (10 Akshar Court)). So can you please request the ST. George to unfreeze the account of Tvesa Investments ASAP. 17 Dawn Enterprise referred to in the 21 July Email is Dawn Enterprise Pty Ltd (in liquidation). It is also a company in the control of Kris and Shashi: Kris has been a director since 22 October 2018; and Shashi has been a director since 10 July 2017. 18 Following receipt of the 21 July Email Messrs Billingsley and Mansoor undertook further investigations which revealed that as at 2 July 2023: (1) there was no contractual relationship or loan account between Tvesa and SK Homes Pty Ltd (in liquidation), a company of which Kris is the sole director; (2) SK Homes was a debtor, rather than a creditor, of Dawn Enterprise; and (3) there was no documentation recording any obligation on the part of Tvesa to pay SK Homes on behalf of customers.

Application made to the Supreme Court of New South Wales 19 On 23 August 2023 Messrs Billingsley and Mansoor filed an originating process in the Supreme Court of New South Wales, in which they sought the same relief as was sought in this Court. That application came before the Supreme Court for hearing on 21 September 2023. At that time Williams J declined to make the order sought. As summarised by Mr Mansoor her Honour raised the following issues: (1) further investigation was required to determine whether the sum of $983,000 was the property of Mansa Sons immediately before it was transferred out. Her Honour was concerned that inquiries arising from Kris' email dated 21 July 2023 had not been followed up; and (2) the evidence suggested the payment from Tvesa to Mansa Sons was made by mistake or, at least, her Honour could not be satisfied that it was not made by mistake. 20 In dismissing the application, Williams J indicated that, once further investigations were undertaken, it may be appropriate to bring a new application.

Further investigations undertaken by Messrs Billingsley and Mansoor 21 On 29 September 2023 Mr Mansoor had a telephone conference with Kris. Mr Mansoor's file note of that conversation records: Call between Mirzan Mansoor, and Krishnakumar Sitaram Agrawal ("Kris"). Reason for the call was to: 1. Clarify the transfer of funds between Tvesa & Mansa, and back to Tvesa again. … Clarify the transfer of funds post appointment. Mirzan: "Can you walk with me again the transfer of funds between Tvesa & Mansa, and back to Tvesa again. I may need your assistance with my application to Court regarding the transfers." Kris: "It was a mistake; it was not Mansa's money." Mirzan: "Why did you make the transfer in the first place?" Kris: "I made the transfer to pay off suppliers……" Mirzan: "There are no suppliers in Mansa. I don't understand why the payment was made?" Kris: "I was upset in the morning when I made the payment, and then I realised my mistake, and transferred the money back." Mirzan: "Upset about what?" Kris: no response. Mirzan: "Would you be comfortable providing a written statement if I needed you to do so?" Kris: "Yes" 22 In September 2023 Mr Mansoor spoke with Mr McEvoy, one of the Former Administrators, to inquire whether the Former Administrators had any conversations with Kris or his representatives about "a deal" as asserted by Kris. Mr McEvoy informed Mr Mansoor that there was no deal. 23 On 2 November 2023 Messrs Billingsley and Mansoor together with their solicitor, Mark Petrucco of Hall & Wilcox, had a further telephone conversation with Kris. The file note of this conversation includes: Attendees • Krishnakumar Agrawal • Mirzan Mansoor, Michael Billingsley and David Huang of Olvera Advisors • Mark Petrucco of Hall and Wilcox Mirzan: Why did you make the transfer of funds from Tvesa to Mansa? Kris: I was stressed out and transferred the funds from Tvesa to Mansa. Mirzan: What were you stressed out about? Kris: I was stressed out about the administration and creditors. Mirzan: Were you aware that Mansa was in administration at the time of transfer? Kris: I knew the company [Mansa] was in administration, however, not aware I was not able to transfer the funds to creditors. Mirzan: Why did you make the transfer of funds from 3 other related entities, TKA Investments and SK Homes and SK Homes Aus at the same time as you made the transfer from Tvesa to Mansa? Kris: To bring funds in one place. Mirzan: Why one place? Was it for the purpose of disseminating funds to creditors? Kris: Yes. Mirzan: Why did you transfer the funds back? Kris: I realised I couldn't transfer to creditors / customers because the Mansa was in administration. Mirzan: What customers were you going to pay? Kris: SK Homes creditors / pay trade suppliers. Mirzan: I refer to our discussion at Aydin's office where you commented about doing a deal? Kris: There was no deal at all. Mirzan: I refer to your email to me on 21 July 2023, you said you made a mistake because trades were owing to SK Homes for the construction of 3 houses, one for Dawn Enterprise and 2 of 'customer'. Who were the customers? Kris: 10 Akshar Court Mirzan: Customers were Dawn Enterprises' customers or whose? What houses or properties were you referring to? Kris: 10 Akshar Court & 27-19 Toongabbie Toad of Dawn Enterprises Mirzan: Who were the 2 customers? Kris: SK Homes' customers. I don't remember the address... Marsden Park and Blacktown Mirzan: Does Tvesa have any outstanding trade creditors to be paid? Kris: No. Mirzan: Would Tvesa owe SK Homes? Kris: Tvesa owed something to Dawn Enterprise. Mirzan: Did you transfer the funds to Mansa because it was the treasury company? Kris: Yes. Mirzan: Can you please explain how the group transferred funds internally? Kris: Funds were transferred from one entity to another, depending on whichever entity needed the money at that time. 24 Messrs Mansoor and Billingsley have conducted further investigations in relation to the Morning Transaction and the Evening Transaction, in particular as to the reasons for the payments into and out of the account. In doing so, notwithstanding the lack of formal documentation, they have attempted to conduct a detailed reconciliation of the accounts of Mansa Sons and Tvesa and the amount owing at the time of the Morning Transaction. 25 Based on his review of the records of Mansa Sons and Tvesa Mr Mansoor says that, apart from the general ledger, there is no formal documentation recording the transactions or monies owing from Tvesa to Mansa Sons. 26 Mr Mansoor has conducted an analysis of the monies owing to and from Tvesa and SK Homes. Based on his review of the records of Tvesa: (1) there is no contractual relationship between Tvesa and SK Homes; (2) there were no loan accounts between Tvesa and SK Homes as at 2 July 2023; and (3) there is no documentation recording any obligation on Tvesa to pay SK Homes on behalf of the "customers", as referred to by Kris. 27 Mr Mansoor has also conducted an analysis of the monies owing to and from Dawn Enterprise to SK Homes. Based on his review of the records of Dawn Enterprise and Tvesa: (1) there is no contract recorded between Tvesa and Dawn Enterprise to the effect that Dawn Enterprise directed Tvesa to pay SK Homes in reduction of the debt it owed to SK Homes; (2) as at 2 July 2023 Dawn Enterprise had a loan receivable from SK Homes in the amount of $2,751,367. Mr Mansoor instructed one of his employees, David Huang, to conduct an analysis of the Dawn Enterprise ledger, a copy of which was in evidence before me; and (3) there is no documentation recording any obligation on Tvesa to pay SK Homes on behalf of "customers" as referred to by Kris.

Tvesa's creditors 28 Mr Mansoor has reviewed Tvesa's balance sheet and identified that it has the following unsecured creditors, all of whom Mr Mansoor says are persons related to Kris and Shashi or are related entities in the SK Group, including a number of SPVs: (1) Mansa Sons; (2) Dawn Enterprise; (3) Patidar; (4) United Capital Australia Pty Ltd (in liquidation), a company of which Kris and Shashi are directors. On 8 September 2023 Simon Cathro and Declan Lane of Cathro & Partners were appointed as joint and several liquidators of United Capital; (5) SK Insure Pty Ltd, a company of which Kris is a director; (6) Kris; (7) Bharat Agrawal, Kris's brother; and (8) Amit Shah. 29 Messrs Billingsley and Mansoor were appointed as joint and several liquidators of Dawn Enterprise and Patidar on 25 July 2023. 30 Based on a search of the records of the Personal Property Securities Register, Mr Mansoor has identified that the Commonwealth Bank of Australia holds security over Tvesa.

Mansa Sons' debtors and creditors 31 Mr Mansoor has reviewed Mansa Sons' balance sheet and notes that as at June 2023 it had two debtors: Dawn Enterprise; and Patidar. 32 Mr Mansoor has identified the following unsecured creditors of Mansa Sons, all of whom are related entities: (1) Aadhar Developers Pty Ltd, a company of which Shashi is the director; (2) United Capital; (3) Patidar; (4) Samarpan Investments Pty Ltd (administrators appointed), a company of which Shashi is the director. On 31 July 2023 Messrs Cathro and Lane were appointed as joint and several liquidators; (5) Sachyog Investments Pty Ltd; (6) SK Capital Pty Ltd (administrators appointed), a company of which Kris is the director. On 1 August 2023 Rajiv Ghedia and Shumit Banerjee were appointed as joint and several administrators; (7) SK Insure; (8) SK Realty Pty Ltd, a company of which Sailesh Dalal is the director and in which Shashi is a shareholder; (9) Unique Accounting & Taxation Services Pty Ltd. Anitabahen Agrawal, Kris' sister, is the director of Unique Accounting; and (10) Kris. 33 In addition, Mr Mansoor has identified a large number of unrelated and unsecured creditors of Mansa Sons who advanced funds to it, including pursuant to written loan agreements purportedly for the purposes of property development. 34 On the appointment of the Former Administrators, Mansa Sons had no cash at bank and no real property or realisable assets other than the unsecured loans it made to the SPVs, including Tvesa.

Messrs Billingsley and Mansoor's remuneration 35 Messrs Billingsley and Mansoor's remuneration as administrators of Mansa Sons has been approved but has not been paid. The expenses they have incurred as administrators and liquidators are also unpaid. Messrs Billingsley and Mansoor have not yet sought approval of their remuneration as liquidators of Mansa Sons.

STATUTORY FRAMEWORK AND LEGAL PRINCIPLES 36 The plaintiffs seek an order under s 90-15 of the IPS which permits the Court to make such orders as it thinks fit in relation to the external administration of a company: see s 90-15(1) and s 5-15 of the IPS. 37 Section 90-15(3) of the IPS sets out examples of orders that can be made, including an order determining any question arising in the external administration of the company. A non-exhaustive list of the matters which the Court may take into account in making orders under s 90-15(1) is set out in s 90-15(4) as follows: Without limiting the matters which the Court may take into account when making orders, the Court may take into account: (a) whether the liquidator has faithfully performed, or is faithfully performing, the liquidator's duties; and (b) whether an action or failure to act by the liquidator is in compliance with this Act and the Insolvency Practice Rules; and (c) whether an action or failure to act by the liquidator is in compliance with an order of the Court; and (d) whether the company or any other person has suffered, or is likely to suffer, loss or damage because of an action or failure to act by the liquidator; and (e) the seriousness of the consequences of any action or failure to act by the liquidator, including the effect of that action or failure to act on public confidence in registered liquidators as a group. 38 In Lewis (liquidator), in the matter of Concrete Supply Pty Ltd (in liq) [2020] FCA 841; (2020) 145 ACSR 459 White J set out the principles applicable to the exercise of the power under s 90-15(1) of the IPS, including at [30]-[31]: 30 The principles applied by the courts in the exercise of the power under cl 90-15 are, in effect, the same as those which were applied in the exercise of the power under the former s 479(3) (in the case a court-ordered winding up) or under s 511 (in the case of a voluntary winding up) of the Act: In the matter of HIH Casualty and General Insurance Limited (in liquidation and Subject to Schemes of Arrangement) ACN 008 482 291 [2018] NSWSC 1886 at [4]-[5]; Warner (Liquidator), in the matter of Sakr Bros Pty Ltd (in liq) [2019] FCA 547 at [18]. In In the matter of Hawden Property Group Pty Ltd (in liq) (ACN 003 528 345) [2018] NSWSC 481, Gleeson JA noted at [8], that the power under cl 90-15 to "make such orders as it thinks fit in relation to the external administration of a company" (cl 90-15(1)), including "an order determining any question arising in the external administration of the company" (cl 90-15(3)(a)), is wider than s 479(3) and accommodates the determination of substantive rights. His Honour noted that the Court would not make a determination of substantive rights without affording potentially affected parties an opportunity to be heard: ibid. 31 The established principles indicate: (a) the power to give directions is intended to facilitate the performance of the liquidator's functions and should be interpreted widely to give effect to that intention: Re Octaviar Administration Pty Ltd (in liq) [2017] NSWSC 1556 at [9]; (b) the power is available to give a liquidator advice as to the proper course of action to be taken in the liquidation: Re Bell at [47]; Re MF Global Australia Ltd (in liq) [2012] NSWSC 994 at [7]; (c) the Court may give directions that provide guidance on matters of law and the reasonableness of a contemplated exercise of discretion but will usually not do so when the subject of the directions sought relates to the making and implementation of a business or commercial decision and when there is no particular legal issue raised and no attack on the proprietary or reasonableness of the decision: Re MF Global at [7]; (d) the Court does not interfere with or seek to second guess the liquidator's judgment unless there is evidence of a lack of good faith, an error of law or principle, or real and substantial grounds for doubting the prudence of the liquidator's conduct or when the Court considers that the liquidator's decision is not a proper and reasonable one: Re One.Tel at [36]; Re Bell at [31], [47] and [50]; Re Octaviar at [10]; (e) the effect of a direction is to sanction a course of conduct on the part of the liquidators so that, providing full disclosure has been made to the Court, the liquidator may adopt the course free from the risk of personal liability for breach of duty: Re Bell at [47]; Re One.Tel at [32]; and (f) the directions do not bind third parties, and do not determine substantive matters in dispute between the liquidator and third parties: Re Bell at [47]. …

CONSIDERATION 39 Mansa Sons and Tvesa each have potential claims against one another in respect of the transfers made on 2 July 2023. A legal question arises as to which entity has the better proprietary claim to the Remaining Funds in circumstances where both entities are now in liquidation and Westpac has frozen the Remaining Funds in the Tvesa Account and will not permit any withdrawal unless the liquidators of both Mansa Sons and Tvesa agree. 40 In addition, as Messrs Mansoor and Billingsley are liquidators of both Mansa Sons and Tvesa, in circumstances where Mansa Sons has no funds, and, where in their capacity as liquidators of Mansa Sons, Messrs Mansoor and Billingsley have outstanding remuneration and expenses, they are in a position of conflict. 41 Accordingly, Messrs Mansoor and Billingsley sought: (1) the Court's guidance on a question of law, namely, whether Mansa Sons is entitled to the return of the Remaining Funds; and (2) the Court's direction on a question of propriety, namely, whether they are justified in returning the Remaining Funds to Mansa Sons in circumstances where they are in a position of conflict. 42 Messrs Mansoor and Billingsley submitted that Mansa Sons has the superior claim to the Remaining Funds and on that basis, in their capacity as liquidators of Tvesa, they were justified in returning the Remaining Funds to Mansa Sons. For the following reasons I accepted that submission. 43 First, as explained below, Mansa Sons received legal and beneficial title to the funds transferred in the Morning Transaction. 44 Despite Tvesa's original contention that the transfer from Tvesa to Mansa Sons was made in "error", there was no evidence to support that contention. Rather, the evidence, which I summarise below, pointed to a contrary conclusion, namely that the transfer from Tvesa to Mansa Sons was not a mistake: (1) that the Morning Transaction was made up of four separate transactions undertaken over a short period of time transferring funds into the Mansa Account suggested that the Transfer was voluntary and intentional; (2) the descriptions used for the transfers that made up the Morning Transaction demonstrated that there was no mistake as to the identity of the recipient; (3) there was no suggestion that the amounts transferred were a mistake in that there was an error in transcribing or inputting the digits or any error about the amount owing at the time the Morning Transaction was undertaken; (4) Kris' explanation about "trades owing to SK Homes" was not supported by the investigations undertaken by Messrs Billingsley and Mansoor in relation to the accounts; and (5) Kris otherwise provided no credible explanation about the alleged "error" or "mistake" which led to the making of the Morning Transaction. 45 As the plaintiffs submitted, the explanation Kris provided on 2 November 2023, that he wanted "to bring funds in one place" for the purpose of disseminating funds to creditors, seems to be, given the outcome of the plaintiffs' other investigations, the most credible explanation for the Morning Transaction. 46 That said, even if the Morning Transaction was a mistake at the time it was made, Tvesa could not recover from Mansa Sons any amounts owing to it which, at the time, was said to be $432,781.35 of the total that was transferred (see [5] above). In addition, assuming Tvesa was operating under a mistake at the time of the Morning Transaction, Tvesa would only have a personal claim against Mansa Sons for moneys had and received, provable in Mansa Sons' liquidation. 47 The plaintiffs have not been able to identify any further claim that would entitle Tvesa to a proprietary remedy in relation to the funds transferred in the Morning Transaction. They submitted that, subject to obtaining further evidence, they might be able to argue that the Morning Transaction was undertaken by Kris in breach of his fiduciary duty owed as a director because he was seeking to prefer the interests of other members of the SK Group and himself over the interests of Tvesa. However, as the plaintiffs pointed out, a payment made in breach of fiduciary duty only gives rise to a proprietary remedy against the recipient of the funds, that is, Mansa Sons, where the recipient has knowledge of the breach of duty: see Grimaldi v Chameleon Mining NL (No 2) [2012] 200 FCR 296 at [251]. That was not the case here. 48 At the time of the Morning Transaction, Mansa Sons was controlled by the Former Administrators who constituted its directing mind and will. They did not have knowledge of any breach of duty at the time of the Morning Transaction. In fact, the Former Administrators had no knowledge of the Morning Transaction until they obtained a copy of Mansa Sons' bank statements on 4 July 2023. Accordingly, it is difficult to see how Mansa Sons could be liable as a constructive trustee on the basis of knowing receipt. 49 I was therefore satisfied that Mansa Sons received the funds transferred by the Morning Transaction beneficially (and not as trustee) and those funds therefore became the property of Mansa Sons. 50 Secondly, given the operation of s 437D of the Corporations Act, the Evening Transaction was, in my opinion, void. 51 Section 437D provides: Only administrator can deal with company's property (1) This section applies where: (a) a company under administration purports to enter into; or (b) a person purports to enter into, on behalf of a company under administration; a transaction or dealing affecting property of the company. (2) The transaction or dealing is void unless: (a) the administrator entered into it on the company's behalf; or (b) the administrator consented to it in writing before it was entered into; or (c) it was entered into under an order of the Court. (3) Subsection (2) does not apply to a payment made: (a) by an Australian ADI out of an account kept by the company with the ADI; and (b) in good faith and in the ordinary course of the ADI's banking business; and (c) after the administration began and on or before the day on which: (i) the administrator gives to the ADI (under subsection 450A(3) or otherwise) written notice of the appointment that began the administration; or (ii) the administrator complies with paragraph 450A(1)(b) in relation to that appointment; whichever happens first. (4) Subsection (2) has effect subject to an order that the Court makes after the purported transaction or dealing. (5) If, because of subsection (2), the transaction or dealing is void, or would be void apart from subsection (4), an officer or employee of the company who: (a) purported to enter into the transaction or dealing on the company's behalf; or (b) was in any other way, by act or omission, directly or indirectly, knowingly concerned in, or party to, the transaction or dealing; contravenes this subsection. 52 The question which arose was whether the payments made under the Evening Transaction were void ab initio by reason of s 437D. 53 There is limited case law on the operation of s 437D of the Corporations Act, including on whether a payment or transfer made contrary to it is void ab initio. 54 In Sev.en Gamma a.s v IG Energy Holdings (Australia) Pty Ltd [2023] NSWSC 1032 Ball J considered a defence based on s 437D of the Corporations Act. At [24] his Honour observed that: It is common ground that the GSD, if executed, would be void under s 437D(2) unless it was entered into under an order of the Court made under s 437D(2)(c). There appears to be no authority dealing specifically with the circumstances in which the Court would make such an order. IEAH accepts that the provision confers a wide discretion on the Court. However, it submits, correctly in my view, that the power must be exercised consistently with the purpose of Part 5.3A of the Corporations Act, which is concerned with the administration of a company's affairs pending the possible execution of a deed of company arrangement: see s 435A of the Corporations Act. Commenting on a similar power conferred by s 227 of the Companies Act (NT) (a predecessor to s 468(1) of the Corporations Act) in relation to the disposition of the property of a company after the commencement of its winding up, the Full Court of the Federal Court in Jardio Holdings Pty Ltd v Dorcon Constructions Pty Ltd (1984) 3 FCR 311 at 316-7 said: The object of s. 227 is to hold matters in statu quo during the pendency of the petition, while at the same time permitting those transactions to take place which the court thinks should be sanctioned … A transaction entered into in good faith which offers actual or prospective advantage to the company or its general body of creditors would, ordinarily, be sanctioned by the court even if an incidental advantage were obtained by one creditor or one class of creditors …. Prima facie, an attempt by an unsecured creditor to gain security for a past debt is inimical to the interests of the general body of creditors of the debtor. … 55 For the following reasons I accepted the plaintiff's submission that void in s 437D means void ab initio. 56 First, the text of the section suggests that is so. Section 437D(2) provides that a transaction or dealing affecting property of the company is "void" unless the exceptions set out therein apply. Section 437D(2) uses the present tense, is, and applies where a company is under administration. Further, s 437D(4) provides that subsection (2) has effect "subject to an order that the Court makes after the purported transaction or dealing". That is, it has effect in the absence of a court order. 57 In National Acceptance Corp Pty Ltd v Benson (1988) 12 NSWLR 213 the New South Wales Court of Appeal considered the construction of s 368(1) of the Companies (New South Wales) Code which provided that: Any disposition of property of the company, other than an exempt disposition, and any transfer of shares or alteration in the status of the members of the company made after the commencement of the winding up by the court is, unless the court otherwise orders, void. 58 At 214 Kirby P observed that while the word "void" may, in particular contexts, have a more limited construction, normally "it should receive the meaning which ordinarily attaches to it in everyday speech, viz, having no legal effect for any purpose as against the world so that it is as if the transaction which is 'void' has not occurred, as least so far as the eye of the law is concerned". His Honour also noted that other considerations may require a more limited meaning to be given to the word "void" but that because Parliament from time to time uses "voidable" or expressions such as "void as against the liquidator" in legislation it should be presumed, at least as a preliminary matter, that where legislation refers to "void" it intends "a more radical consequence, both in terms of effect and in respect of the parties affected". 59 At 215 Kirby P said: Moreover, as Priestley JA has pointed out, the very provision for the court otherwise to order that a transaction shall not be avoided assumes that, in default of such an order, that is the consequence of the statute. This is the reverse of what would be the situation if the transaction were voidable and not void. 60 Applying the reasoning of Kirby P in Benson, and by analogy, the word "void" as used in s 437D(2) of the Corporations Act, must, in my view, mean void ab initio. 61 Secondly, as the plaintiff submitted, such a construction is confirmed by the context and purpose of s 437D of the Corporations Act. That Act uses both the language of "void" and "voidable". Consistently with the presumption that different words in the same statute are intended to have different meanings, it can be assumed, as a matter of context, that a distinction between the two terms is intended and that the choice of the word "void" in s 437D was deliberate and intended to carry with it a particular meaning. 62 In addition, s 437D is within Pt 5.3A of Ch 5 of the Corporations Act which concerns company administrations. The object of Pt 5.3A is to provide for the business, property and affairs of an insolvent company to be administered in a way that maximises the chances of the company, or as much of its business as possible, continuing in existence or, if that is not possible, that results in a better return for the company's creditors and members than would result from an immediate winding up: see s 435A of the Corporations Act. In other words, its purpose is to provide for a limited period in which there is a standstill in the affairs of the company so as to maximise its chance of survival. In International Air and Transport Association v Ansett Australia Holdings Limited (2008) 234 CLR 151 at [81] the High Court (Gummow, Hayne, Heydon, Crennan and Kiefel JJ) observed that s 437D of the Corporations Act is one of the provisions found in Pt 5.3A which is intended to protect the company's property during administration. 63 As the plaintiffs submitted, a construction of s 437D(2) that renders a transaction or dealing void ab initio is consistent with the purpose of Pt 5.3A. That is, to provide a company with time to consider its position and maximise return to creditors by freezing the company's title to property. An interpretation of s 437D(2) otherwise would be less likely to fulfill that legislative purpose. 64 It follows that the Evening Transaction, which was made without meeting any of the conditions in s 437D(2) of the Corporations Act, was void ab initio. 65 Thirdly, there is the question of what, if any, remedy is available to Mansa Sons in relation to the breach of s 473D of the Corporations Act. There is no power under the Corporations Act to grant relief against a breach of s 437D. The plaintiffs informed me that they had been unable to identify any case law which considered the remedies available to an administrator in circumstances such as these. That being so, the plaintiffs submitted that Mansa Sons would need to seek relief in equity by way of restitution. 66 In Australian Motor Homes Pty Limited v Maria's Farm Veggies Pty Limited [2018] NSWSC 216 the Supreme Court found that a contract for sale of a motor vehicle was void because of the operation of s 437D of the Corporations Act and that the defendant, Maria's Farm Veggies Pty Limited, was entitled to recover the value of the goods from either or both of the parties to the unauthorised sale, noting that the obligation to make a payment for consideration given or received under an unenforceable contract lays in restitution: at [43]-[44]. The administrators elected to seek recovery of the value of the property disposed of under the unauthorised transaction rather than recovery of the property in specie. Accordingly, the question of the nature of the remedies available in restitution and, in particular, whether an equitable proprietary remedy in aid of the administrators' restitutionary claim was available did not arise. 67 Before me the plaintiffs submitted that Mansa Sons would be entitled to an equitable proprietary remedy in aid of its restitutionary claim for the following reasons: (1) s 473D of the Corporations Act deems the transfer of funds void ab initio, i.e., from the moment of the purported transfer, so that there is no time period during which a transferee may be entitled to deal with the property beneficially; and (2) notwithstanding that the property transferred in contravention of s 437D was fungible and placed into a mixed account, so that it is no longer identifiable, the principles in Brady v Stapleton (1952) 88 CLR 322 apply so that the beneficiary of the funds is entitled to treat the relevant proportion of the account as trust money or is otherwise entitled to a charge over the indistinguishable mass equal to the amount transferred. 68 By way of analogy, in Great Investments Limited v Warner (2016) 243 FCR 516 at [60] a Full Court of this Court (Jagot, Edelman and Moshinsky JJ) considered a scenario where a benefit was transferred to a recipient without the authority of the transferring company and without a contract. At [60] their Honours noted that in such a scenario "the company may be entitled, subject to defences, to a proprietary claim if the recipient still has the specific benefit". 69 Having regard to s 437D(4) of the Corporations Act, the defences which might be available to a proprietary restitutionary claim include where there has been a change in position or bona fide purchaser for value without notice. However, those defences could not apply here. It is apparent: first, that Tvesa took the funds with notice of Mansa Sons' lack of authority; and secondly, that the funds remain in Tvesa's account. 70 Fourthly, and finally, having regard to s 90-15(4) of the IPS, there were in my view no discretionary factors that would operate to prevent a grant of the relief sought: (1) there is no disentitling conduct on the part of Mansa Sons; (2) the proprietary remedy sought would not give Mansa Sons unfair priority over other equally deserving creditors of Tvesa. It is not in an equivalent position to Tvesa's unsecured creditors who, in any event, save for one, are related entities of Tvesa; (3) in any event, Tvesa's creditors had the opportunity to be heard on the application and to make any submissions on prejudice. Despite the application being served upon them and the matter being called three times outside the court room there was no appearance by or any behalf of any interested party including any creditor; and (4) this is not a case where an equitable remedy will be disproportionate or where some lesser remedy is capable of doing "full justice": see Bathurst City Council v PWC Properties Pty Limited (1998) 195 CLR 566 at [42]. The operation of s 437D means that a disposition of property is void. Mansa Sons would be entitled to trace its property at common law. However, because the money has entered a mixed fund, tracing is unavailable. That being so, as the plaintiffs submitted, the common law is "insufficient" and equity is required to intervene. 71 As a final matter I note that the issues raised by Williams J on the application before her Honour have, in my view, been addressed in the evidence before me. Each of the matters raised by her Honour has been appropriately considered, investigated, and addressed.

CONCLUSION 72 For those reasons I made the orders sought by the plaintiffs on their application. I certify that the preceding seventy-two (72) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Markovic.