Australian Securities and Investments Commission v Letten

REASONS FOR JUDGMENT 1 The facts giving rise to this application are relevantly summarised in Australian Securities and Investments Commission v Letten (No 16) [2011] FCA 1308. I adopt the same defined terms in these reasons for decision. 2 These reasons for decision concern paragraph 1(c) of the Amended Interlocutory Process filed by the Receivers on 13 December 2011 which concerns the sale of the Management Lot (the property located at Heritage Avenue, Chirnside Park Victoria, being Lot 34 on Plan of Subdivision 415064K and consisting of the common areas of the Sebel Heritage Yarra Valley). 3 Under paragraph 1(c) of the Amended Interlocutory Process, if the Boerkamp Contract was terminated, the Receivers sought an order pursuant to paragraph 10 of the 4 June Orders for: 1. approval of the contract of sale for the Management Lot entered into by the Receivers with the 57th defendant, GHG, on 18 February 2011 (the Contingency Contract) in the event that AFML did not exercise its right of first refusal under cl 22.6 of the HMA; and 2. in the event that AFML did exercise its right of first refusal under cl 22.6 of the HMA, approval of the sale of the Management Lot to AFML on the terms set out in a form of contract provided to AFML on 7 October 2011. 4 On 20 December 2010, the Receivers filed an affidavit. The purpose of that affidavit was to provide an update "in respect of Glenbelle's application to AFML for approval of the sale of the Management Lot to GHG pursuant to cl 22.4(b)(ii) of the HMA". On 22 December 2010, the Receivers filed a further affidavit which addressed the fact that the members of the Hotel Scheme had resolved not to exercise the right of first refusal as well as the current attitude of GHG to this application. 5 Before turning to the merits of the application, a number of matters should be noted. First, the Boerkamp Contract was terminated: see Letten (No 16) at [48]. Secondly, AFML has not exercised its right of first refusal under cl 22.6 of the HMA. Thirdly, GHG neither consents to nor opposes this approval application. AFML's current attitude is not presently known. However, given AFML's contractual rights under the HMA, I do not consider it to be prejudiced by the Court determining this application. Fourthly, the Contingency Contract is subject to a number of conditions subsequent. For present purposes, the relevant condition is that contained in cl 22.3 - Court approval of the sale prior to the Sunset Date (as that term is defined in the Contingency Contract). 6 The applicable principles were relevantly summarised in Australian Securities and Investments Commission v Letten (No 11) [2011] FCA 449 at [12]-[18]. The sale process undertaken by the Receivers in relation to the Management Lot was explained in Letten (No 16) at [18]ff. 7 I am satisfied that taking into account all the relevant variables and circumstances of this particular application, the Receivers have taken reasonable care to achieve, and have achieved, an acceptable sale of the Management Lot. Accordingly, pursuant to paragraph 10 of the Orders made on 4 June 2010, the Court approves the contract of sale for the Management Lot of the Sebel Lodge Yarra Valley entered into by the Receivers on behalf of Glenbelle with GHG on 18 February 2011. I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gordon.