Australian Securities and Investments Commission v Green Pacific Energy Ltd

Supreme Court of NSW|2024-04-15|Before: McGrath J, Greenwood J

INTRODUCTION

This is a paradigm case of the irretrievable breakdown in sibling relations, having their consequences in corporation dissolutions. Thankfully, at least the siblings in these proceedings have been able to agree on that.
The plaintiffs are Brenton Bullen and Sonja Trask. As there are multiple parties involved who have the same surname, I will refer to each person by their first name to avoid confusion but without intending any disrespect or over-familiarity.
The other two siblings are Earl Mark Wesley Bullen and Craig Bullen.
Brenton, Sonja, Mark and Craig are the children of Stafford Bullen and Ida Cleo Bullen.
The Bullen family were involved in the business of wildlife safari parks from the 1960s onwards. They had a degree of notoriety.
The operations and landholdings of the Bullen family ultimately resided in three corporate entities which are the subject of the present proceedings, being Earl Courtenay Pty Ltd (first defendant), Droffats Pty Ltd (third defendant) and Fenema Pty Ltd (fourth defendant). The second defendant is Mark.
Brenton, Sonja, Mark and Craig have now all agreed that each of Earl Courtenay, Droffats and Fenema should be the subject of a winding up order on the just and equitable ground pursuant to s 461(1)(k) of the Corporations Act 2001 (Cth).
I will evaluate the factual matrix to form my own views as to whether there is a sufficient reason for making the order to wind up each of Earl Courtenay, Droffats and Fenema: Australian Securities and Investments Commission v Green Pacific Energy Ltd (2006) 59 ACSR 142; [2006] FCA 1254, Greenwood J at [139] (although I note that the Australian Securities and Investments Commission is not the moving party in the present application so there is no requirement that I do so in the public interest).

RELEVANT FACTS

There were originally two principal Bullen family companies, being African Lion Safari Pty Ltd (ALS) and Bullen's African Lion Safari (Adelaide) Pty Ltd (BALS). ALS was incorporated on or about 22 March 1968. Its principal asset was real property at Warragamba where a lion park safari business was conducted. That property was sold for about $25 million several years ago.
BALS was a shareholder in ALS and Brenton and Mark were directors of ALS until 25 June 2022. By unanimous members' resolution on 20 February 2018, ALS was wound up and eventually deregistered on 25 June 2022.
Earl Courtenay held shares in BALS, along with Neil Williamson as trustee for Stafford's estate. By unanimous members' resolution on 20 February 2018, BALS was wound up and eventually deregistered on 25 June 2022.
On the winding up of BALS, Earl Courtenay received distributions totalling $6,493,690.63.
Earl Courtenay was incorporated on about 8 November 1967. The current and sole director of Earl Courtenay is Mark. The shares in Earl Courtenay are held by Droffats, Mark (individually), Mark, Brenton, Sonja and Craig (together) and Fenema.
Droffats was incorporated on 2 June 1961. Mark is the current and sole director of Droffats. The shares in Droffats are held by Fenema, Mark, Brenton, Sonja and Craig (all individually).
Fenema was incorporated on 29 March 1977. The current and sole director of Fenema is Mark (and although Cleo is recorded as a director, she ceased to hold that office on her death). The shares in Fenema are currently recorded as being held by Stafford, Cleo, Mark, Brenton, Sonja and Craig (all individually).
Stafford died on 12 November 2001. On 2 April 2004, probate was granted on his will dated 14 July 2000 to Neil Williamson, solicitor.
Cleo died on 8 December 2007. Mark is the executor under Cleo's will dated 30 May 2006 and has not, until now, sought probate under her will despite her owning real property in Wallacia, which has been bequeathed equally to Mark, Brenton and Craig.

ALLEGATIONS

The allegations giving rise to these proceedings are contained in an amended originating process filed 13 December 2023 and a statement of claim filed 21 December 2023. The defence of Earl Courtenay, Mark, Droffats and Fenema was filed on 21 February 2024.
The proceedings involve various allegations regarding the conduct of Mark in relation to each of Earl Courtenay, Droffats and Fenema. The claims that have been made by Brenton and Sonja include breaches of fiduciary duties, improper exclusion from the participation and the management of the companies, and denial of access to information to them by Mark, including by seeking to avoid their right to call and attend members' meetings.
On 26 March 2024, each of Brenton, Sonja, Mark and Craig reached agreement to settle these proceedings, including by the agreement for the winding up of each of Earl Courtenay, Droffats and Fenema pursuant to s 461(1)(k) of the Corporations Act.

CONSIDERATION

It is abundantly clear to me that there has been a complete and irretrievable breakdown in the relationships between each of Brenton, Sonja, Mark and Craig, sufficient to justify a winding up of each of Earl Courtenay, Droffats and Fenema on the just and equitable ground: Fexuto Pty Ltd v Bosnjak Holdings Pty Ltd (2001) 37 ACSR 672; [2001] NSWCA 97, Young J at [89]; Nassar v Innovative Precasters Group Pty Ltd (2009) 71 ACSR 343; [2009] NSWSC 342, Barrett J at [132]. It is obviously in the interests of all three companies, their creditors and their members that an independent person assume control of their affairs.
I note that the parties are of the same mind, having agreed that their relationships as the members of each of Earl Courtenay, Droffats and Fenema, have irretrievably broken down and that their winding up is the subject of their unanimous consent.
I have evidence of the consent of Barry Anthony Taylor and Matthew Levesque‑Hocking of HLB Mann Judd to be appointed as liquidators of each of Earl Courtenay, Droffats and Fenema.
There is no evidence of the advertising of the application to wind up each of Earl Courtenay, Droffats and Fenema, as required by s 465A(c) of the Corporations Act, or that notice of the application has been lodged with ASIC, as required by s 465A of the Corporations Act. Brenton and Sonja seek an order pursuant to s 467(3)(b) of the Corporations Act dispensing with any notices being given or steps being taken as required by the Corporations Act or by the rules.
I am satisfied that this is an appropriate case to dispense with those requirements. All of the members of the relevant companies are parties to the proceedings other than Craig, but Craig is on notice of the applications to wind up the companies because he was a party to the heads of agreement made on 26 March 2024, pursuant to which all of the siblings agreed to seek the making of winding up orders by the court. I am also satisfied that there is no realistic prospect of any creditor of the companies opposing the application, and in any event those companies have assets, so such a creditor could prove in their respective winding up. I also do not consider that any substantive purpose could be achieved by compliance with the requirements: Carter v New Tel Limited (2003) 44 ACSR 661; [2003] NSWSC 128, Austin J at [23]; In the matters of Seedz Investments Pty Ltd, Snap Fitness Double Bay Pty Ltd, Yelneh Industries Pty Ltd and Fitness Management Pty Ltd [2017] NSWSC 650, Gleeson JA at [17]-[19]; In the matter of A Twins Spare Parts Pty Ltd [2020] NSWSC 156, Gleeson JA at [11].

ORDERS

Accordingly, I make the following orders by consent: 1. Declare that the relationship between the members of the first defendant, Earl Courtenay Pty Ltd (ACN 009 764 729) (Earl Courtenay Pty Ltd), has irretrievably broken down. 2. Order pursuant to s 461(1)(k) of the Corporations Act 2001 (NSW) that Earl Courtenay be wound up. 3. Note the consent of Barry Anthony Taylor and Matthew Levesque‑Hocking of HLB Mann Judd to be appointed as liquidators of Earl Courtenay Pty Ltd filed 21 March 2024. 4. Order that Barry Anthony Taylor and Matthew Levesque‑Hocking of HLB Mann Judd be appointed as liquidators of Earl Courtenay Pty Ltd. 5. Order that the plaintiffs' costs are to be paid pursuant to s 466(2) of the Corporations Act 2001 (Cth). 6. Order that the second defendant's costs of the proceedings are to be paid by Earl Courtenay Pty Ltd on the ordinary basis as agreed or assessed by the liquidators from the funds of Earl Courtenay Pty Ltd on the winding up. 7. Declare that the relationship between the members of the third defendant, Droffats Pty Ltd (ACN 009 709 442) (Droffats Pty Ltd), has irretrievably broken down. 8. Order pursuant to s 461(1)(k) of the Corporations Act 2001 (Cth) that Droffats Pty Ltd be wound up. 9. Notes the consent of Barry Anthony Taylor and Matthew Levesque‑Hocking of HLB Mann Judd to be appointed as liquidators of Droffats Pty Ltd filed 21 March 2024. 10. Order that Barry Anthony Taylor and Matthew Levesque‑Hocking of HLB Mann Judd be appointed as liquidators of Droffats Pty Ltd. 11. Order the plaintiffs' costs are to be paid pursuant to s 466(2) of the Corporations Act 2001 (Cth). 12. Order that the second defendant's costs of the proceedings are to be paid by Droffats Pty Ltd on the ordinary basis as agreed or assessed by the liquidators from the funds of Droffats Pty Ltd on the winding up. 13. Declare that the relationship between the members of the fourth defendant, Fenema Pty Ltd (ACN 009 993 346) (Fenema Pty Ltd), has irretrievably broken down. 14. Order pursuant to s 461(1)(k) of the Corporations Act 2001 (Cth) that Fenema Pty Ltd be wound up. 15. Note the consent of Barry Anthony Taylor and Matthew Levesque‑Hocking of HLB Mann Judd to be appointed as liquidators of Fenema Pty Ltd filed 21 March 2024. 16. Order that Barry Anthony Taylor and Matthew Levesque‑Hocking of HLB Mann Judd be appointed as liquidators of Fenema Pty Ltd. 17. Order that the plaintiffs' costs are to be paid pursuant to s 466(2) of the Corporations Act 2001 (Cth). 18. Order that the second defendant's costs of the proceedings are to be paid by Fenema Pty Ltd on the ordinary basis as agreed or assessed by the liquidators from the funds of Fenema Pty Ltd on the winding up. 19. Order that the proceedings be otherwise dismissed. 20. Order, pursuant to s 467(3)(b) of the Corporations Act 2001 (Cth), that the requirements contained in ss 465A(1)(a), (b) and (c) of the Corporations Act 2001 (Cth) relating to the lodgement, service and publication of notice of a winding up application in respect of each of Earl Courtenay Pty Ltd, Droffats Pty Ltd and Fenema Pty Ltd be dispensed with. 21. Direct that the exhibits may be returned to the parties forthwith.

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: 19 April 2024

Corporations Act 2001(NSW)

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