Fung, in the matter of Bradford Insulation (S.A.) Pty Limited (in liquidation) [2025] FCA 653 (20 June 2025)

(a - d, together being the Ifield Companies)

(e) Rhodium Resources Australia Pty Ltd (In Liquidation) ACN 160 017 596;

(f) Softwood Holdings Limited (In Liquidation) ACN 007 541 460;

(g) Advance Petroleum Holdings Pty Ltd (In Liquidation) ACN 102 514 652;

(h) Advance Petroleum Pty Ltd (In Liquidation) ACN 007 030 757;

(i) Allgreen Pty Ltd (In Liquidation) ACN 094 312 768;

(j) Clarisse Holdings Pty Ltd (In Liquidation) ACN 082 607 609;

(k) Dermody Petroleum Pty Ltd (In Liquidation) ACN 008 017 329;

(l) Grameen Foundation (Australia) Limited (In Liquidation) ACN 086 046 924;

(m) Meiji Dairy Australasia Pty Ltd (In Liquidation) ACN 064 273 418;

(n) Merck Pty Ltd (In Liquidation) ACN 001 239 818;

(o) MET BF Pty Ltd (In Liquidation) ACN 140 102 656;

(p) Open Energi Australia Pty Ltd (In Liquidation) ACN 632 760 500;

(q) Orbis Gold Pty Ltd (In Liquidation) ACN 120 212 017;

(r) Taradadis Pty Ltd (In Liquidation) ACN 006 675 592;

(s) Uvex Safety Australia Pty Ltd (In Liquidation) ACN 003 513 693;

(t) Ceres Sustainable Citrus Pty Ltd (Receivers and Managers Appointed) (In Liquidation) ACN 653 706 622; and

(u) Ceres Sustainable Avocados Pty Ltd (Receivers and Managers Appointed) (In Liquidation) ACN 654 896 394,

(t-u, together being the Hazell Companies)

(together a-u, being the Companies),

is dispensed with.

1. Pursuant to s 499(3) of the Corporations Act 2001 (Cth) and s 90-15(1) of the Insolvency Practice Schedule (Corporations), the Second and Third Plaintiffs are appointed as the joint and several liquidators to fill the vacancy in the office of liquidator of each of the Ifield Companies and Fung Companies, caused by the resignation of the First Plaintiff from that office.
2. Pursuant to s 499(3) of the Corporations Act and s 90-15(1) of the Insolvency Practice Schedule, the Second Plaintiff is appointed as the joint and several liquidator to fill the vacancy in the office of liquidator of each of the Gill Companies, caused by the resignation of the First Plaintiff from that office.
3. Pursuant to s 499(3) of the Corporations Act and s 90-15(1) of the Insolvency Practice Schedule, the Fourth Plaintiff is appointed as the joint and several liquidator to fill the vacancy in the office of liquidator of each of the Hazell Companies, caused by the resignation of the First Plaintiff from that office.
4. Pursuant to s 90-15(1) of the Insolvency Practice Schedule, the requirements of rr 70‑30, 70-35 and 70-40 of the Insolvency Practice Rules (Corporations) 2016 (Cth) are dispensed with in relation to the:

(a) Second and Third Plaintiffs' appointment as joint and several liquidators of the Ifield Companies and Fung Companies;

(b) Second Plaintiff's appointment as joint and several liquidator of the Gill Companies; and

(c) Fourth Plaintiff's appointment as joint and several liquidator of the Hazell Companies.

1. The creditors of the Companies have leave to apply within 60 days of the making of the orders above.
2. The Fourth Plaintiff notifies the creditors of the Hazell Companies of:

(i) the making of the order referred to at Order 4; and

(ii) the current status of the liquidation by reference to the matters identified in paragraph 18 of the affidavit of Mr Michael Fung, dated 29 May 2025, in relation to the Hazell Companies, within 7 days of these orders being made by notifying the known creditors of the Companies in writing or by email.

1. The Second and Third Plaintiffs notify the members of the Ifield Companies, Fung Companies and Gill Companies of:

(i) the making of the orders referred to at Orders 2 and 3; and

(ii) the current status of the liquidation by reference to the matters identified in paragraph 18 of the affidavit of Mr Michael Fung, dated 29 May 2025, in relation to the companies to which they have been appointed, within 7 days of the orders being made by notifying the known members of the Companies in writing or by email.

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

1. On 29 May 2025, the plaintiffs filed an originating process under s 499(3) of the Corporations Act 2001 (Cth) and s 90-15(3)(c) of the Insolvency Practice Schedule (Corporations) to the Corporations Act (IPS), following the resignation of the first plaintiff (Mr Fung) as liquidator of 21 companies (as defined in Annexure A: broadly - the Ifield, Fung, Gill and Hazell Companies - and collectively, the Companies). The plaintiffs seek the appointment of the second to fourth plaintiffs as liquidators to fill the respective vacancies.
2. The originating process was supported by the affidavit of Mr Michael Fung, sworn 29 May 2025. The plaintiffs also provided written submissions dated 12 June 2025.
3. I make orders to the following effect:

(1) The second and third plaintiffs (Mr Walley and Ms Gill) be appointed as joint and several liquidators of the Ifield Companies and Fung Companies;

(2) Mr Walley be appointed as the joint and several liquidator of the Gill Companies; and

(3) The fourth plaintiff (Mr Owen) be appointed as the joint and several liquidator of the Hazell Companies.

1. I make ancillary orders, including for dispensation of the requirements of rr 70-30, 70-35 and 70-40 of the Insolvency Practice Rules (Corporations) 2016 (Cth) (IPR), and for notification of certain matters to the creditors and members of the Companies.

1. Mr Fung is a registered liquidator and currently:

(1) a joint and several liquidator, by way of members' voluntary liquidation over the Ifield and Gill Companies, and by way of creditors' voluntary liquidation over the Hazell Companies; and

(2) the solely appointed liquidator, by way of members' voluntary liquidation, over the Fung Companies.

1. Mr Fung is a partner of PricewaterhouseCoopers (PwC). He has resigned, effective 20 July 2025. Following his resignation, Mr Fung will no longer have access to PwC's resources used to manage the office of liquidator of the Companies. Day-to-day carriage of the matters will continue to be conducted by PwC staff.
2. Mr Walley, Ms Gill and Mr Owen (the proposed liquidators) are registered liquidators, and partners of PwC.
3. Mr Fung indicates that he has explained to the proposed liquidators what work needs to be done in relation to the liquidations of the Companies, and that (on the basis of information and belief):

(1) The proposed liquidators are familiar with:

(a) the systems and processes used by PwC in relation to the liquidations of the Companies; and

(b) the current status of the liquidations of the Companies.

(2) No remuneration will be sought by the proposed liquidators in relation to any work associated with the handover or transition of the liquidations.

1. The proposed liquidators have consented to act as liquidators subject to the Court making orders, "facilitating [Mr Fung's] resignation from the office of liquidator of the Companies". In that regard, I note that the resignation letters of Mr Fung (each signed and dated 27 May 2025) state that his resignation as liquidator is subject to appointment by this Court of a proposed replacement to fill the vacancy in the office of liquidator of the Companies caused by his resignation. Each consent of the proposed liquidators (signed and dated 20 May 2025) attaches a schedule of rates for work undertaken in insolvency administration, not including disbursements.
2. On 30 May 2025, the plaintiffs sent the Australian Securities and Investments Commission (ASIC) a copy of the originating process and supporting affidavit, as required by r 2.8 of the Federal Court (Corporations) Rules 2000 (Cth) in relation to an application under s 90-20 of the IPS (for an order under s 90-15 of the IPS in relation to the external administration of a company). On 11 June 2025, ASIC confirmed that it did not propose to intervene in the proceeding.
3. The plaintiffs do not seek an order as to costs.

1. Section 499(3)(a) of the Corporations Act provides that if a liquidator, other than a liquidator appointed by the Court resigns, the Court may fill the vacancy.
2. Section 90-15 of the IPS empowers the Court to make orders in relation to the external administration of a company. It relevantly provides:

Court may make orders in relation to external administration

Court may make orders

(1) The Court may make such orders as it thinks fit in relation to the external administration of a company.

...

Examples of orders that may be made

(3) Without limiting subsection (1), those orders include any one or more of the following:

(a) an order determining any question arising in the external administration of the company;

(b) an order that a person cease to be the external administrator of the company;

(c) an order that another registered liquidator be appointed as the external administrator of the company...

1. The plaintiffs seek dispensation from rr 70-30, 70-35 and 70-40 of the IPR, which are made for the purposes of s 70-50 of the IPS, and concern the provision of information, reports and documents to creditors. Subrule (1) of each rule provides conditions of application. It was not clear from the plaintiffs' submissions whether their contention was that the rules did not apply, or that the rules should be dispensed with (which are different propositions).
2. Rule 70-30 of the IPR governs the information to be given to creditors in certain administrations. It provides:

Initial information required to be given to creditors in certain administrations

(1) This section:

(a) is made for the purposes of section 70-50 of the Insolvency Practice Schedule (Corporations); and

(b) applies to companies under administration, windings up by the Court and voluntary windings up; and

(c) does not apply if a provisional liquidation of a company has been appointed.

Information about creditors' rights to be given

(2) The external administrator must give information about the following to as many creditors of the company as reasonably practicable:

(a) the fact that the external administrator has been appointed in relation to the company;

(b) the right of creditors to request information, reports and documents under sections 70-40 and 70-45 of the Insolvency Practice Schedule (Corporations);

(c) other than in the case of a voluntary administration - the right of creditors to direct that a meeting of the creditors be held under section 75-15 of the Insolvency Practice Schedule (Corporations);

(d) the right of creditors to give directions to the external administrator under section 85-5 of the Insolvency Practice Schedule (Corporations);

(e) the right of the creditors to appoint a reviewing liquidator under section 90-24 of the Insolvency Practice Schedule (Corporations);

(f) the right of the creditors to remove and replace the external administrator under section 90-35 of the Insolvency Practice Schedule (Corporations).

Time for giving information etc.

(3) The information must be given:

(a) in writing; and

(b) in the case of a company under administration - at the same time as notice of a meeting of the creditors referred to in section 436E of the Act is given; and

(c) in the case of a winding up by the Court - within 20 business days after the eternal administrator is appointed; and

(d) in the case of a voluntary winding up - within 10 business days after the day of the meeting of the company at which the resolution for voluntary winding up is passed.

1. Rule 70-35 of the IPR applies if an external administrator intends to seek a remuneration determination in relation to the external administration: r 70-35(1)(b). The rule provides:

(2) The external administrator of a company must give to as many of the creditors as reasonably practicable a notice (an initial remuneration notice) specifying the following:

(a) the method by which the external administrator seeks to be remunerated;

(b) the rate of remuneration;

(c) an estimate of the expected amount of the external administrator's remuneration;

(d) the method by which disbursements will be calculated.

(3) The initial remuneration notice must:

(a) include a brief explanation of the types of methods that could be used to calculate remuneration; and

(b) specify the method that the external administrator proposes to use to calculate remuneration; and

(4) If the external administrator proposes to receive remuneration worked out wholly or partly on a time-cost basis, the notice must include details about the respective rates at which the remuneration of the external administrator and the other persons who will be assisting, or will be likely to assist, the administrator in the performance of his or her duties are to be calculated.

(5) The initial remuneration notice:

(a) must be in writing; and

(b) must be given at the same time as the information mentioned in section 70-30 is given to the creditors

1. Rule 70-40 of the IPR governs the report on dividends to be given in certain external administrations. It applies if a liquidator has been appointed in relation to a company: r 70‑40(1)(b). The reporting obligation varies depending on whether or not the company is following the simplified liquidation process. It was not evident - and the plaintiffs' legal representative was unable to say - whether or not the Companies were following that process. Accordingly, it was not evident which obligations were in issue.
2. Rule 70-40 relevantly provides:

(2) If the company is following the simplified liquidation process:

(a) the liquidator must provide to the creditors of the company a report containing information on the following:

(i) anything relating to the winding up of the company that has been done by the liquidator to date;

(ii) the date on which, in the liquidator's opinion, the winding up of the company is likely to end;

(iii) the likelihood of creditors receiving a dividend before the affairs of the company are fully wound up; and

(b) the report must be provided within 3 months after the date of the liquidator's appointment; and

(c) a copy of the report must be lodged with ASIC at the same time as it is provided to the creditors.

(3) If the company is not following the simplified liquidation process, or has ceased to follow the simplified liquidation process:

(a) the liquidator must provide to the creditors of the company a report containing information on the following:

(i) the estimated amounts of assets and liabilities of the company;

(ii) inquiries relating to the winding up of the company that have been undertaken to date;

(iii) further inquiries relating to the winding up of the company that may need to be undertaken;

(iv) what happened to the business of the company;

(v) the likelihood of creditors receiving a dividend before the affairs of the company are fully wound up;

(vi) possible recovery actions; and

(b) the report must be provided before:

(i) the end of the period of 3 months after the date of the liquidator's appointment; or

(ii) the end of the period of 1 month after the date on which the company ceased to follow the simplified liquidation process;

whichever occurs later; and

(c) a copy of the report must be lodged with ASIC in the approved form at the same time as it is provided to the creditors.

1. I consider it appropriate to make orders for the appointment of the Second, Third and Fourth Respondents as liquidators of each of the Companies in light of:

(1) Mr Fung's resignation from PwC (effective 20 July 2025), and resignation as liquidator of the Companies (subject to this Court's appointment of a liquidator to fill the vacancy caused by his resignation);

(2) the continued conduct of the liquidations by PwC, and the benefit to the respective administrations in ensuring continuity within one firm: see Free & Ors [2010] NSWSC 1079 at [6];

(3) the consent of the proposed liquidators (subject to the Court's orders facilitating Mr Fung's resignation as liquidator), who are registered liquidators and partners of PwC, and thereby have access to its resources;

(4) the evidence of familiarity of the proposed liquidators with:

(a) the liquidation systems and processes of PwC; and

(b) the liquidations of each of the Companies, including the outstanding tasks to be performed in respect of each liquidation, as outlined in Mr Fung's affidavit; and

(5) the absence of any opposition from ASIC.

3.2 Ancillary orders dispensing with compliance with rules and providing for notification

1. The plaintiffs contend that the replacement of the liquidator of the Companies does not "crystallise an obligation to report to creditors as required under rules 70-30, 70-35 and 70-40 of the IPR". It is not clear why that is so, unless it is argued that:

(1) the terms of the rules do not give rise to such an obligation; or

(2) the implicit operation of the rules is such that, once the reporting obligation is performed, it need not be repeated.

1. Each of the rules is stated to be made for the purposes of s 70-50 of the IPS. It was not explained, by reference to that provision, which is broad in its application, why the purposes of s 70-50 were not met by application of the IPR to court-appointed liquidators in creditors' and members' voluntary liquidations. Nevertheless, there have been cases where the appointment of a liquidator to fill a vacancy left by a resigning liquidator has been taken to trigger the obligations contained in the rules (see Michael, in the matter of Scenic Hinterland Day Tours Pty Ltd (in liq) [2023] FCA 1277 at [90]).
2. As indicated above, the plaintiffs' submission that the rules do not apply is not consistent with the request to make orders to dispense with those requirements. While the latter request may be fashioned as an alternative, no submission was put that the relevant rules did not apply on their terms.
3. The plaintiffs submitted that, given the orders sought as to notification of creditors and members (where relevant) as to the proposed appointments, as well as details of the remuneration of each of the proposed liquidators (in terms of the provision of rates and the indication that no remuneration would be sought for work associated with the transition of the liquidators), it was appropriate to dispense with the requirements dealing with information to be provided to creditors, remuneration of liquidators, and reporting requirements under rr 70-30, 70-35 and 70-40 of the IPR.
4. The plaintiffs explained that they sought the orders for dispensation in order to mitigate any risk or requirement that such reporting is necessary. That is a submission that the requirements should be dispensed with so that they need not be complied with. It does not reveal the reason for non-compliance.
5. An additional reason was given: namely, that "the information or report has already been provided to relevant creditors of the Companies (as the case requires) by the resigning liquidator", in which case there is no commercial utility in requiring each of the proposed liquidators to incur further costs in providing that material "again" in relation to 21 separate liquidations, relying on Michael at [90].
6. The difficulty with that proposition is that the premise is a matter of submission, and not evidence. While it may be accepted that some of the liquidations were longstanding (by reference to Mr Fung's date of appointment as liquidator in 2020 and 2022), and one might expect that material to have been provided shortly after initial appointment of a liquidator, there is no evidence that such material was provided (cf. Lock, in the matter of Lock [2021] FCA 682 at [10]; Michael at [90]-[92]). The plaintiffs' legal representative made a submission from the Bar table that she had confirmed with the plaintiffs that such notices had been provided. I am unable to accept that as evidence of the asserted fact. Ms Papos rightly accepted that this information was not in evidence. Furthermore, if such notices had been provided shortly after the appointment of a liquidator in those "longstanding" liquidations, the utility of providing updated notices upon appointment of the proposed liquidators (e.g., regarding the projected end of the winding up; and inquiries that have been, and may need to be, undertaken in relation to the winding up, as per r 70-40) is reinforced, not undermined.
7. The plaintiffs provided a further reason, being that: "Mr Fung has been in office long enough to have already complied with those obligations, such that the creditors would have received the information or reports required" under the relevant rules. Once again, the difficulty with that proposition is that there is no evidence of what actually happened, only supposition as to what would have happened based on duration of office, which varied from a few months to a few years. That may be a safe assumption, but it is an assumption nevertheless.
8. The crux of the plaintiffs' submission appears to be that, in the context of 21 separate liquidations, the Court should not impose any reporting requirements on the proposed liquidators that would present an unnecessary burden or otherwise "impede on the estates" of the Companies in liquidation. That is a compelling submission. It was made in the context of evidence of dates of appointment of Mr Fung as liquidator of the Companies ranging from 19 October 2020 to (most recently) 21 January 2025.
9. In light of that submission and evidence, I am satisfied that it is appropriate to dispense with the reporting requirements contained in rr 70-30, 70-35 and 70-40 of the IPR (to the extent that they apply), in light of the orders made for notification to creditors. Even where dispensation is granted, there may be some value in ensuring that creditors are notified of at least some matters: Michael at [91].
10. Rule 70-30 of the IPR applies to voluntary windings up, and is concerned with initial information required to be given to creditors, including the fact of appointment of an external administrator. The orders proposed by the plaintiffs countenance such notification, that is, of the appointment of a proposed liquidator to fill the vacancy caused by Mr Fung's resignation from that office.
11. Rule 70-35 of the IPR applies if an external administrator intends to seek a remuneration determination in relation to the external administration. There is no evidence of such an intention on the part of any of the proposed liquidators. Moreover, the plaintiffs sought dispensation on the basis that the proposed liquidators provided their intended rates of remuneration (exclusive of disbursements). While that does not meet each requirement of r 70‑35, although it would satisfy r 70-35(2)(b), it does give creditors an indication of the scale of costs. There is also evidence (albeit not direct evidence) that the proposed liquidators do not intend to seek remuneration for work in relation to any handover or transition of the liquidations.
12. Rule 70-40 applies if a liquidator has been appointed in relation to a company. There was no evidence as to which liquidation process was in place for the Companies (i.e., simplified or otherwise). In any event, I am satisfied that is it appropriate to dispense with this requirement in light of orders requiring notification to creditors as to the current status of the liquidation of each of the relevant Companies, by reference to the matters outlined in Mr Fung's affidavit. Mr Fung indicates he has apprised the proposed liquidators of these matters. Given that evidence, I do not consider this limited reporting requirement to be burdensome.
13. With that in mind, while the rules in question are concerned only with information to be provided to creditors, I consider it appropriate to make the same order in relation to notification to be provided to members of the Companies (which are the subject of members' voluntary liquidation). That way, both creditors and members are apprised of the appointment of a new liquidator and, coupled with information as to their remuneration, the tasks that remain to be performed by the liquidator.

I certify that the preceding thirty-three (33) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Younan.

(a) Bradford Insulation (S.A.) Pty Limited (In Liquidation) ACN 007 527 406;

(b) James Patrick & Co Pty Ltd (In Liquidation) ACN 000 014 951;

(c) Softwood Plantations Pty Limited (In Liquidation) ACN 007 544 685;

(d) Softwoods Queensland Pty Ltd (In Liquidation) ACN 010 721 212;

(a - d, together being the Ifield Companies)

(e) Rhodium Resources Australia Pty Ltd (In Liquidation) ACN 160 017 596;

(f) Softwood Holdings Limited (In Liquidation) ACN 007 541 460;

(e - f, together being the Fung Companies)

(g) Advance Petroleum Holdings Pty Ltd (In Liquidation) ACN 102 514 652;

(h) Advance Petroleum Pty Ltd (In Liquidation) ACN 007 030 757;

(i) Allgreen Pty Ltd (In Liquidation) ACN 094 312 768;

(j) Clarisse Holdings Pty Ltd (In Liquidation) ACN 082 607 609;

(k) Dermody Petroleum Pty Ltd (In Liquidation) ACN 008 017 329;

(l) Grameen Foundation (Australia) Limited (In Liquidation) ACN 086 046 924;

(m) Meiji Dairy Australasia Pty Ltd (In Liquidation) ACN 064 273 418;

(n) Merck Pty Ltd (In Liquidation) ACN 001 239 818;

(o) MET BF Pty. Ltd. (In Liquidation) ACN 140 102 656;

(p) Open Energi Australia Pty Ltd (In Liquidation) ACN 632 760 500;

(q) Orbis Gold Pty Ltd (In Liquidation) ACN 120 212 017;

(r) Taradadis Pty Ltd (In Liquidation) ACN 006 675 592;

(s) Uvex Safety Australia Pty Ltd (In Liquidation) ACN 003 513 693;

(g-s, together being the Gill Companies)

(t) Ceres Sustainable Citrus Pty Ltd (Receivers and Managers Appointed) (In Liquidation) ACN 653 706 622; and

(u) Ceres Sustainable Avocados Pty Ltd (Receivers and Managers Appointed) (In Liquidation) ACN 654 896 394,

(v) (t-u, together being the Hazell Companies)