In the matter of Aboriginal Connections Aboriginal Corporation (In Liquidation) and Guri Wa Ngundagar Aboriginal Corporation (In Liquidation) [2012] NSWSC 491

Judgment 1This matter first came before me in the Corporations List on 4 October 2011. Mr Baird of counsel appeared and made an application ex parte on behalf of Mr Purchas, the liquidator of the two relevant entities: Aboriginal Connection Pty Ltd ("AC") and Guri Wa Ngundagar Aboriginal Corporation ("GWN"). Each was subject to creditors voluntary winding up. 2AC was, at that time, a "company" as defined by s 9 of the Corporations Act 2001 (Cth). It was registered under s 118 of that Act on 16 September 2002 as a proprietary company limited by shares. GWN, on the other hand, was incorporated on 22 May 1998 under the Aboriginal Councils and Associations Act 1976 (Cth) and was taken, by force of paragraph 3(1) of Division 1 of Part 2 of Schedule 3 to the Corporations (Aboriginal and Torres Strait Islander) Consequential, Transitional and Other Measures Act 2006 (Cth), to be registered as an Aboriginal and Torres Strait Islander corporation under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth): see Cant v Kirby [2011] NSWSC 1193 at [4]. 3The existence of GWN as a juristic person therefore derived from s 42.1 of the last-mentioned Act, which caused it to be a body corporate with perpetual succession. 4By his originating process filed on 14 September 2011, Mr Purchas sought an order under s 579E(1) of the Corporations Act determining that AC and GWN are a "pooled group" for the purposes of s 579E. 5Section 579E(1) is in the following terms: "If it appears to the Court that the following conditions are satisfied in relation to a group of 2 or more companies: (a) each company in the group is being wound up; (b) any of the following subparagraphs applies: (i) each company in the group is a related body corporate of each other company in the group; (ii) apart from this section, the companies in the group are jointly liable for one or more debts or claims; (iii) the companies in the group jointly own or operate particular property that is or was used, or for use, in connection with a business, a scheme, or an undertaking, carried on jointly by the companies in the group; (iv) one or more companies in the group own particular property that is or was used, or for use, by any or all of the companies in the group in connection with a business, a scheme, or an undertaking, carried on jointly by the companies in the group; the Court may, if the Court is satisfied that it is just and equitable to do so, by order, determine that the group is a pooled group for the purposes of this section." 6An order by which the court so determines is, in terms of a definition in s 9, a "pooling order". Because of s 579E(2), the effect of a "pooling order" is, in substance, to cause the companies concerned to be treated as a single entity and for their windings up to proceed accordingly, with claims that one has against any of the others extinguished, debts payable by one to any of the others also extinguished and with each company taken to be jointly and severally liable for the debts of the others. 7An essential first step in applying s 579E(1) is to identify "a group of 2 or more companies". In this particular context, "group" means nothing more than a collection or plurality and the reference to a "group" does not, of itself, make it necessary to find any relationship or shared characteristic: Allen v Feather Products Pty Ltd [2008] NSWSC 259; (2008) 72 NSWLR 597; Re Australian Hotel Acquisition Ltd [2011] NSWSC 1374; Re Kirby Street (Holding) Pty Ltd [2011] NSWSC 1536; (2011) 87 ACSR 84. 8In this case, the identified "group" in respect of which the application was made consisted of GWN and AC. A finding that that group was "a group of 2 or more companies" therefore depended on it being established that each of GWN and AC was a "company" within the s 9 definition of that term. 9When the matter first came before me, AC was such a "company" but GWN was not. 10Mr Baird submitted, however, that, for the purpose of construing and applying s 579E(1) of the Corporations Act, GWN should be treated as a "company" and that this treatment was justified by s 526.35(1) of the Corporations (Aboriginal and Torres Strait Islander) Act which provides, in part, as follows: "The Corporations Act winding up provisions apply to the winding up of an Aboriginal and Torres Strait Islander corporation as if the following substitutions were made . . ." 11There follows in s 526.35(1) a table of substitutions containing two columns, one headed "For a reference to . . ." and the other headed "substitute a reference to . . .". Against "a company" in the first column appears "an Aboriginal and Torres Strait Islander corporation" in the second. There is thus a direction to substitute a reference to "an Aboriginal and Torres Strait Islander corporation" for each reference to "a company" in the "Corporations Act winding up provisions" or, more accurately, a direction to read the provisions "as if" that substitution were made. 12Section 526.35(3) defines "Corporations Act winding up provisions" as follows: "'Corporations Act winding up provisions' means: (a) Parts 5.4, 5.4B, 5.5, 5.6, 5.7B, 5.8, 5.8A and 5.9 of the Corporations Act; and (b) the other provisions of that Act (including Parts 1.2 and 9.4 and Schedule 3 but not including Parts 1.1, 1.1A and 9.4A) to the extent to which they relate to the operation of the Parts referred to in paragraph (a); and (c) the regulations made under that Act for the purposes of the Parts of that Act referred to in paragraph (a) and the provisions referred to in paragraph (b); but does not include the excluded winding up provisions of that Act." 13The definition of "excluded winding up provisions" may, for present purposes, be ignored. 14Section 579E and its related provisions appear in Subdivision B of Division 8 of Part 5.6 of the Corporations Act. They are accordingly within paragraph (a) of the definition of "Corporations Act winding up provisions" in s 526.35(3) of the Corporations (Aboriginal and Torres Strait Islander) Act. By force of s 526.35(1), therefore, s 579E and its related provisions "apply to the winding up of" GWN "as if" each reference in those provisions to a "company" were instead a reference to an "Aboriginal and Torres Strait Islander corporation". 15The question that then arose is whether the reference in s 579E(1) to "a group of 2 or more companies" may be read as a reference to a group consisting of one or more companies and one or more Aboriginal and Torres Strait Islander corporations. Only if that was a permitted reading did GWN and AC make up a relevant "group". 16Having had an opportunity, after the hearing on 4 October 2011, to consider the submissions of counsel and the terms of the legislation, I formed a tentative view that the court had no authority to make a "pooling" order in relation to a "group" consisting of a company registered as such under the Corporations Act and an Aboriginal and Torres Strait Islander corporation. I therefore invited Mr Baird, through my Associate, to review and make further submissions on the following analysis: