Hayes, in the matter of Pumpkin Patch Originals Limited (Administrators Appointed) (in Receivership) v Pumpkin Patch Originals Limited

JAGOT J: 1 This is an application for recognition of a foreign main proceeding and ancillary relief under article 15 of the Model Law on Cross-Border Insolvency of the United Nations Commission on International Trade Law (the Model Law), which is contained in schedule 1 of the Cross-Border Insolvency Act 2008 (Cth) (the Act) and has the force of law in Australia by reason of s 6 of that Act. 2 Interlocutory orders were made in this matter on 26 October 2016, including orders for service on the defendant of the relevant material, notification of the originating process to each person in Australia claiming to be a creditor of the defendant known to the plaintiffs, as well as publication on or before 2 November 2016 of the filing of the originating process in The Australian newspaper in accordance with r 15A.6 of the Federal Court (Corporations) Rules 2000 (Cth). 3 The orders made on 26 October 2016 also provided in Order 7 that the matter be listed for hearing today at 9.15 am. When the matter came before me this morning, there was no appearance by any person claiming to be a creditor of the defendant and, accordingly, the matter has proceeded on the basis of the evidence adduced by the plaintiffs to support the making of final orders generally in accordance with the originating process. 4 In addition to the evidence documenting the relevant service and notification of the application, the primary affidavit in support of the application is that of Joseph Hayes, sworn on 26 October 2016, an official liquidator and chartered accountant, who deposes to the fact that he and two colleagues were appointed as joint and several administrators of the company Pumpkin Patch Originals Limited (the company), the defendant to these proceedings, pursuant to s 39I of the Companies Act 1993 (NZ) (the New Zealand law). 5 Mr Hayes made his affidavit with the authority and on behalf of the company and the other administrators. The affidavit sets out the relevant factual circumstances in support of the application for recognition of the appointment in New Zealand as a foreign main proceeding for the purposes of the Act and the Model Law. 6 The application as a whole depends on the definition of "foreign proceeding" in article 2(a) of the Model Law, which is defined to mean not only a collective judicial proceeding in a foreign state, but also a collective administrative proceeding in a foreign state pursuant to a law relating to insolvency in which proceeding the assets and affairs of the debtor are subject to control or supervision by a foreign Court for the purpose of reorganisation or liquidation. 7 The application for the New Zealand proceeding to be recognised as a "foreign main proceeding" depends on the definition of that term in article 2(b), which is defined to mean "a foreign proceeding taking place in the state where the debtor has the centre of its main interests". 8 Otherwise, insofar as relevant, "foreign representative" is defined in article 2(d) to mean "a person or body, including one appointed on an interim basis, authorised in a foreign proceeding to administer the reorganisation or the liquidation of the debtor's assets or affairs, or to act as a representative of the foreign proceeding". By article 15.1 of the Model Law, a foreign representative may apply to the Court for recognition of the foreign proceeding in which the foreign representative has been appointed. That application is to be accompanied by certain material set out in articles 15.2 and 15.3. 9 In article 16.3, there is a presumption which is relied upon in the present case to the effect that, in the absence of proof to the contrary, the debtor's registered office is presumed to be the centre of the debtor's main interests. 10 Pursuant to article 17.1, a foreign proceeding shall be recognised if the requirements of that section are met, and, under article 17.2(a), the proceeding shall be recognised as a foreign main proceeding if it is taking place in the state where the debtor has the centre of its main interest. 11 The submissions in support of the application identify the basis upon which it is said, and on which I accept, that the requirements of the Act and the Model Law are satisfied in this case, with the consequence that the orders as sought should be made. 12 The defendant company is registered in New Zealand and, as Mr Hayes' primary affidavit sets out, although there are operations and assets in Australia, the registered office of the company is in Auckland, New Zealand. The fact that there are operations and assets in Australia as identified does not rebut the presumption that its centre of main interests are in New Zealand. 13 Also as set out in the written submissions, under the relevant provisions of the New Zealand law, the administrators of the debtor company have functions equivalent to those under Pt 5.3A of the Corporations Act 2001 (Cth), including to control its business, property and affairs and to act as its agent. 14 I am satisfied accordingly that the administrators satisfy the definition of "foreign representative" as set out above. 15 It is also the case that the appointment of the administrators is within the definition of "foreign proceeding". I accept the submission that, although the administrators were appointed by the directors and not pursuant to an order of the Court, the provisions of the relevant New Zealand law give rise to a collective administrative proceeding whereby the administrators' actions are subject to a statutory regime which includes Court supervision sufficient for the purposes of the definition. Article 15.2 supports this conclusion, as it provides that an application for recognition shall be accompanied by a copy of the decision commencing the foreign proceeding and appointing the foreign representative, a certificate from the foreign Court affirming the existence of the foreign proceeding and of the appointment of the foreign representative or, in the absence of such evidence, which is this case, "any other evidence acceptable to the Court of the existence of the foreign proceeding and of the appointment of the foreign representative". 16 This is consistent with other decisions referred to in the written submissions on behalf of the plaintiff, which I adopt as set out below: 14. In this respect, a creditors' voluntary liquidation in England has been held to meet the definition of a "foreign proceeding" not least because the functions and duties of the liquidator were regulated by the Insolvency Act UK and were ultimately subject to the supervision of the High Court: see Raithatha v Ariel Industries plc [[2012] FCA 1526]; (2012) 212 FCR 139 per Yates J at [28] ff. 15. Support for the fact that the administration of PPOL meets the definition of "foreign proceeding" is also found in the extrinsic material to the Act and Model Law which is extracted in Raithatha at [34] ff. In particular, CLERP paper No 8 referred to at paragraph [38] in Raithatha makes plain that in the Australian Corporations context the scope of the Model Law extends to part 5.3A voluntary administrations. 16. In other jurisdictions, namely, the United States, Australian creditors' voluntary liquidations (which do not involve court appointment or proceedings) have been recognised as "foreign proceedings": see In re Betcorp Limited (in liq) 400 B.R 266; see also re ABC Learning Centres Limited 445 B.R. 318 and, according to orders which have been made, an Australian voluntary administration has been recognised as a foreign proceeding: see Re Newstat Limited (the reasons for judgment are not able to be located). 17 Otherwise, I also accept that all procedural requirements have been satisfied and that, accordingly, it is appropriate that orders be made. I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jagot.