In the matter of BRS Quarries Australia Pty Ltd and Pleasure Point Mine Pty Ltd [2025] NSWSC 307 | Case summary | Zoe

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In the matter of BRS Quarries Australia Pty Ltd and Pleasure Point Mine Pty Ltd [2025] NSWSC 307 | Case summary | Zoe

On 7 March 2025, the Administrator was appointed to each of the Companies, pursuant to resolutions of their respective directors.
The first meeting of creditors for each of the Companies was held on 19 March 2025.
By operation of s 439A of the Act, the Administrator must convene the second meeting of creditors by 4 April 2025, unless the time is extended under s 439A(6) of the Act.
Pleasure Point Mine owns freehold land in Helidon, Queensland (the Land), and BRS holds a mining lease and an EPA permit in relation to the Land.
Pleasure Point Mine purchased the Land and the shares in BRS for $5.2m in August 2021.
The Land is a greenfield site, where mining operations have not yet commenced. The Land, the mining lease and the EPA permit (which are collectively referred to by the Administrator as the Mine) represent the only substantial assets of the Companies.
The Companies have never traded or had employees. According to the Administrator’s investigations, the only activities of the Companies appear to have been to engage experts for the purpose of exploration and reporting on the Mine.
Based on an exploration drilling program, the Mine has a measured resource of 40.9m tonnes of sandstone, including an estimated 16m tonnes of silica. However, the Administrator deposes, based on his investigations to date, that the current permit and licence for the Mine are not sufficient to allow the extraction of sufficient quantities of construction sand and aggregate or refined silica.
The presently known secured creditors of Pleasure Point Mine have lodged proofs of debt for claims in the amount of $31,159,914 and the presently known unsecured creditors of Pleasure Point Mine have lodged proofs of debt for claims in the amount of $2,987,429.
The presently known unsecured creditors of BRS have lodged proofs of debt for claims in the amount of $2,027,147.
The Administrator has not yet adjudicated on any claims.
The Administrator has considered the potential for a Deed of Company Arrangement (DOCA) for each of the Companies and has met with two interested parties. He deposes that he is unable to progress any such negotiations until the value of the Companies’ assets is determined.
Since 12 March 2025, the Administrator’s staff have taken steps to obtain a valuation of the Mine. It is unnecessary to set out here the detail of the steps taken. I am satisfied that the Administrator has proceeded with appropriate diligence in seeking to retain a valuer, but has encountered problems in finding a valuer with both capacity and availability. The Administrator has now received a proposal from one valuer, and another valuer has indicated that a proposal will shortly be provided. Based on his discussions with potential valuers, the Administrator has ascertained that it will take until at least the end of April 2025 for the valuation to be prepared.
The Administrator has also been undertaking investigations in relation to around 180 related party transactions. In addition, the Administrator has been investigating related party creditors. The Administrator estimates, based on the complexity of those investigations and the poor state of the relevant documentation, that it will take another four to six weeks to complete those investigations.
Having regard to those matters, the Administrator seeks that the convening period for the second meeting of creditors be extended by just over twelve weeks, to 30 June 2025. The extension is sought by the Administrator to allow sufficient time to:
obtain a valuation of the Mine;
complete the Administrator’s investigations into the related party transactions and related party creditors;
provide a meaningful report to creditors; and
have further discussions with interested parties as to a possible DOCA proposal.

Section 439A(6) of the Act gives the Court power to extend the convening period on an application made within the period specified in s 439A(5). The present application is brought within time.
Section 439A(7) provides that, on such an application, the Court may only extend the convening period if the Court is satisfied that it would be in the best interests of the creditors if the convening period were extended in accordance with the application.
The principles governing such an application are well known.
In Australian World-Wide Pty Ltd v Palmer [2014] NSWSC 141 at [7], Brereton J observed that the Court no longer, if it ever did, approaches such an application with a presumption against extending the convening period. The Court’s task on an application under s 439A(6) is to balance the need for the administration of a company to be carried out as efficiently and expeditiously as practicable so as to minimise the effect on those persons who are subject to the moratorium imposed by Pt 5.3A of the Act, against the need to give the administrators time to present meaningful choices to the creditors at their meeting: ibid at [8], referring to Carter v Global Food Equipment Pty Ltd [2007] NSWSC 901 at [11] (White J).
On the one hand, the legislation establishes an expectation that administrations will be carried out relatively swiftly so that creditors can make their own decision at a relatively early point in time; and on the other, the objects of Pt 5.3A may in some cases be better served by allowing an administrator time to see if the business of the company can be continued or a better return secured for creditors than upon an immediate winding up: ibid at [10]; and see also Re Riviera Group Pty Ltd (admins apptd*)(recrs & mgrs apptd)* [2009] NSWSC 585 at [15]-[16] (Austin J).
In Mighty River International Ltd v Hughes and Bredenkamp (2018) 265 CLR 480; [2018] HCA 38 at [72]-[73], Nettle and Gordon JJ (in dissent, but not relevantly in this respect) observed that:
the period fixed by s 439A(5) of the Act for convening creditors’ meetings is “designedly brief”, reflecting that the emphasis of Pt 5.3A is “on informality… and speed of action”;
it is, however, recognised that it is not always practicable for an administrator to gather sufficient information within the convening period to form the requisite opinions and communicate them to creditors in accordance with s 438A and s 439A, and accordingly, courts are given a power under s 439A(6) to extend the convening period;
consistent with the legislative intention of Pt 5.3A that the administration of a company be brought to an end within a short period of time, there is a presumptive expectation that extensions will be brief**,** but the courts have recognised that significant extra time may be required, and should be allowed, in complex cases; and
provided that the evidentiary case for extension has been properly prepared, there has been no evidence of material prejudice to those affected by the moratorium imposed by the administration, and the administrator's estimate of time has had a reasonable basis, the courts have tended to grant extensions for the periods sought by administrators.
Their Honours quoted with approval Barrett J’s observations in Re Diamond Press Australia Pty Ltd [2001] NSWSC 313 at [10] that:

Having regard to the facts and principles outlined above, I am satisfied that an order should be made extending the convening period for the second meeting of creditors, for three main reasons.
First, the basis for the requested extension has been explained in the evidence. In particular, additional time is sought to obtain a valuation of the Companies’ only substantial assets, being the Mine assets, which is necessary for the Administrator to negotiate any proposed DOCA with interested parties and to assess any such proposal. The Administrator has formed the view that the assets of Pleasure Point Mine and BRS are likely to obtain a greater value when sold together, because the mining and environmental permits held by BRS are linked to the Land held by Pleasure Point Mine, and the value of the Land is improved by the existence of the licences and permits, due to the economic activity which they enable.
Further, additional time is sought to complete the investigations into related party transactions and related party creditors, in circumstances where those investigations are attended by complexity and poor documentation.
The Administrator has explained that he needs to complete those tasks before he can provide a meaningful report to creditors.
Secondly, the Administrator has deposed that he is not aware of any prejudice that would be suffered by any creditor as a result of the extension. Neither of the Companies had employees and therefore the extension would not delay any employee claims. The Administrator gave notice of his intention to make this Application to creditors on 28 March 2025. No creditor has appeared to oppose the Application. Further, the Plaintiffs have proposed, and I will make, an order granting leave to any person who can demonstrate sufficient interest, including any creditor, to apply to vary or discharge the extension order on three days’ written notice. Such an order is appropriate, lest a creditor who has not been heard on this ex parte application be adversely affected: Australian World-Wide at [25]-[26], referring to Global Food Equipment at [25].
Thirdly, the Administrator's estimate of time has a reasonable basis, having regard to the evidence in respect of the time needed to obtain a valuation of the Mine and to complete the investigations into related party transactions.
In circumstances where the Mine assets are the Companies’ only substantial assets, where the Administrator has formed the view that those assets are likely to obtain a greater value if sold together, and where further time is required for the Administrator to obtain and consider a valuation of those assets before negotiating any DOCA proposal and reporting to creditors, I am satisfied that the Court should exercise its discretion to grant the relief sought. The proposed extension will allow the Administrator to pursue sensible and constructive actions directed towards maximising the return to creditors and any return for shareholders.
The Administrator also seeks a Daisytek order pursuant to s 447A of the Act, that is, an order allowing the Administrator to hold the second meeting of creditors prior to the expiry of the extended convening period if desirable, so as to avoid unnecessary delay until the end of that period: see In the matter of Daisytek Australia Pty Ltd (2003) 45 ACSR 446; [2003] FCA 575 at [14]-[17] per Lindgren J. I am satisfied that this order should also be made, which is now more or less the ordinary practice on a s 439A(6) application: Australian World*-*Wide at [28]. Again, there will be leave for any interested person, including any creditor, to apply to set aside this order on three days’ notice.
In addition, the Administrator seeks, and I will make, orders facilitating the giving of notice of the second meeting of creditors, and the giving of notice of these orders to creditors and to the Australian Securities and Investments Commission (ASIC).
Finally, the Administrator seeks an order that the costs of and incidental to this Application be costs in the administration of each of the Companies. Given that I have concluded that the extension sought by the Application is in the best interests of the creditors of the Companies, it is appropriate that this form of costs order be made.