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[2026] NSWSC 797
Supreme Court of NSW
2026-07-10
Williams J
Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: In the matter of Manly Warringah Cabs (Trading) Co-operative Society Ltd (administrators appointed pursuant to the Co-operatives National Law (NSW)) [2026] NSWSC 797
Hearing dates: 2 July 2026
Date of orders: 10 July 2026
Original judgment source is linked above.
Decision date: 10 July 2026
Jurisdiction: Equity - Corporations List
Before: Williams J
Decision: See orders at [122].
Catchwords: CORPORATIONS – Insolvency – Co-operative registered in New South Wales under Co-operatives National Law (NSW) – Where administrators were appointed to the co-operative – Application by administrators for winding up in insolvency – Whether insolvency was established in fact –Whether there are viable alternatives to winding up – Relevance of administrators’ conduct in holding a ballot to the residual discretion
CORPORATIONS – Identity of the liquidators to be appointed on the winding up – Where current administrators seek to be appointed as liquidators – Where defendants oppose that appointment – Where administrators are currently largest creditor of the co-operative by reason of their claim for remuneration as administrators
ASSOCIATIONS AND CLUBS – Rules – Proper construction of Co-operatives National Law (NSW) in respect of the voting rights of members of a co-operative – Utility of declaratory and other relief sought by five members of the co-operative
Legislation Cited: Co-operatives (Adoption of National Law) Act 2012 (NSW) ss 3, 5, 24
Co-operatives National Law (NSW) ss 3, 10, 11, 38, 56, 59-61, 63, 134, 144-149, 152, 153, 230, 236, 239, 385-386, 388, 444
Co-operatives National Regulations (NSW) cl 2.5
Corporations Act 2001 (Cth) ss 95A, 437A, 459A, 459P, 461, 467, 477, 532
Insolvency Practice Schedule (Corporations), ss 90-15, 90-20
Point to Point (Taxi and Hire Vehicles) Act 2016 (NSW)
Cases Cited: Ainsworth v Criminal Justice Commission (1992) 175 CLR 564; [1992] HCA 10
Australian Securities and Investments Commissioner v Edge (2007) 211 FLR 137; [2007] VSC 170
Catholic Metropolitan Cemeteries Trust v Attorney General of New South Wales (2024) 116 NSWLR 314; [2024] NSWCA 30
Expile Pty Ltd Jabb’s Excavations Pty Ltd (2003) 46 ACSR 446; [2003] NSWSC 699
In the matters of University Co-Operative Bookshop Ltd (in liq) and Co Info Pty Ltd (in liq) [2024] NSWSC 1034
Lo v Chief Commissioner of State Revenue (2013) 85 NSWLR 86; [2013] NSWCA 180
Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24
Re Azmac Pty Ltd (in liq) (2020) 146 ACSR 113; [2020] NSWSC 204
Sean Investments Pty Ltd v MacKellar (1981) 38 ALR 363
Category: Procedural rulings
Parties: Interlocutory Process for winding up orders filed 15 April 2026
Manly Warringah Cabs (Trading) Co-operative Society Limited (Administrators Appointed Under the Co-Operatives National Law (NSW)) (Applicant)
Trevor Mark Pogroske (In his capacity as joint and several administrator of Manly Warringah Cabs (Trading) Co-operative Society Limited (Administrators Appointed Under the Co-Operatives National Law (NSW)) (Second Applicant)
Anthony Warner (In his capacity as joint and several administrator of Manly Warringah Cabs (Trading) Co-operative Society Limited (Administrators Appointed Under the Co-Operatives National Law (NSW)) (Third Applicant)
Interlocutory Process filed 25 June 2026
Paul Fletcher (First Applicant)
Mohammad Dar (Second Applicant)
Manjo Kumar (Third Applicant)
Makhan Hayer (Fourth Applicant)
Aswin Sharma (Fifth Applicant)
Manly Warringah Cabs (Trading) Co-operative Society Limited (First Respondent)
Trevor Mark Pogroske (Second Respondent)
Anthony Warner (Third Respondent)
Representation: Counsel:
Mr S A Wells (Applicants for winding up / Respondents to 25 June 2026 interlocutory process)
Mr N Hill (Solicitor) (Opponents to winding up / Applicants on 25 June 2026 interlocutory process)
Solicitors:
Assured Legal Solutions (Applicants for winding up / Respondents to 25 June 2026 interlocutory process)
Australegal (Opponents to winding up / Applicants on 25 June 2026 interlocutory process)
File Number(s): 2025/50166
Publication restriction: N/A
These reasons concern an application by the administrators appointed to Manly Warringah Cabs (Trading) Co-operative Society Limited by the Registrar of Co-operatives on 5 December 2025 for orders winding up the Co-operative on the grounds of insolvency or, alternatively, on the just and equitable ground. Five members of the Co-operative who are jointly represented by Mr Nigel Hill, solicitor, oppose the winding up application and seek declaratory relief and orders that relate directly or indirectly to the voting rights of members of the Co-operative. Those members are Mr Paul Fletcher, Mr Mohammad Dar, Mr Manoj Kumar, Mr Makhan Hayer, and Mr Ashwin Sharma. It is convenient to refer to them in these reasons as the Opposing Members.
For the reasons that follow, I have determined that the Co-operative is insolvent and should be wound up and that the claims of the Opposing Members should be dismissed. I have considered all of the parties’ written and oral submissions in coming to those conclusions, although I have not found it necessary to repeat the substance of all of those submissions in order to explain the reasons for my decision.
Manly Warringah Cabs (Trading) Co-operative Society Limited is a body registered under the Co-operatives National Law (NSW) (the CNL) as a co-operative (the Co-operative). For approximately 70 years, the Co-operative operated a taxi service in the Manly, Warringah and surrounding Sydney Northern Beaches areas.
The Co-operative is governed by its rules which have the effect of a contract under seal between the Co-operative and each member, between the Co-operative and each director or other officer, and between the members themselves (the Rules). [1]
The CNL provides that the rules of a co-operative may only be amended under the CNL. [2] Subject to certain exceptions that are not presently relevant, an amendment requires a special resolution, and does not take effect unless and until it is registered by the Registrar of Co-operatives. [3] The Registrar must register an amendment unless it is contrary to the CNL or the Registrar has other reasonable cause to refuse to register the amendment. [4] The Commissioner for Fair Trading is the Registrar of Co-operatives in New South Wales (the Registrar). [5]
As referred to in more detail later in these reasons, the CNL requires the rules of a co-operative to contain active membership provisions which state the primary activities of the co-operative and state the way in which, and the extent to which, a member of the co-operative must use or support an activity of, or maintain a relationship or arrangement with, the co-operative, for carrying on a primary activity of the co-operative, in order to establish active membership of the co-operative. [6] Only active members of a co-operative are entitled to vote. [7] A vote cast by a member not entitled to vote must be disregarded. [8] A resolution that would, if given effect to, make or amend the active membership provisions in the rules of a co-operative (an active membership resolution) [9] must be approved by the Registrar before it is passed by special resolution of the co-operative. [10] Where the proposed special resolution is to make an active membership provision when the rules of the co-operative contain no active membership provision, rather than to amend an existing active membership provision, the only members of the co-operative who are entitled to vote on the resolution are those members who would be active members if the resolution had already taken effect. [11] Where the proposed special resolution is to amend an existing active membership provision, the only members entitled to vote on the resolution are the existing active members. [12]
The objects of the Co-Operative are set out in rule 5 of the Rules. Rule 5A provides:
ACTIVE MEMBERSHIP PROVISIONS
5A In accordance with Part IIIA of the Act:
(a) To provide or arrange a taxi radio network for members is a chief primary object of the society; and
(b) A member shall at all relevant times be a person (either a natural person or persons, or a corporation or corporations) who is;
(i) the registered owner, or
(ii) a lessee who holds an approved lease from a registered owner
of a taxi for which there is a taxi registration licence issued pursuant to the applicable legislation or regulations thereunder as may be in force from time to time and which taxi, in return for the payment of a periodic subscription is permitted to operate on a radio network provided by or arranged by the society in order to establish active membership of the society.
These proceedings originally arose out a dispute between three plaintiffs and eight defendants concerning the validity of resolutions passed or purportedly passed at a special general meeting of the Co-operative requisitioned or purportedly requisitioned by the defendants on 16 January 2025 which removed or purportedly removed the plaintiffs as directors of the Co-operative and appointed or purportedly appointed five of the defendants as directors of the Co-operative. The plaintiffs contended that five of the eight defendants had not been entitled to requisition the meeting or to vote on the resolutions by reason of not being active members of the Co-operative at the time, and that the five defendants purportedly appointed as directors were not qualified to be so appointed under the Rules. The plaintiffs sought declarations concerning the proper construction of the active membership provision in rule 5A, and declarations to the effect that the requisition, notice of meeting and resolutions were ineffective, invalid and of no effect and that the five defendants were not validly appointed directors of the Co-operative.
Seven of the eight defendants filed a cross-claim which raised allegations of oppression in respect of the conduct of the affairs of the Co-operative and sought, inter alia, an order under s 134(b) of the CNL that the Co-operative be wound up.
On 16 October 2025, Black J made an order pursuant to s 134(a) of the CNL that the Registrar appoint an administrator of the Co-operative and dismissed the plaintiffs’ claims and the cross-claim. Those orders were made by consent of all parties to the proceedings. His Honour identified the following matters as establishing that the Court could and should make the order under s 134(a):
disputes between members about the construction of the active membership provision in rule 5A of the Rules;
disputes between members about the recent admission or purported admission to membership of persons who are not active members;
disputes between members about the qualification of directors to hold office in the Co-operative under rule 39 of the Rules;
disputes about the validity of a meeting requisitioned for the purpose of seeking to remove the directors of the Co-operative and appoint new directors, which stemmed from the disputes about the construction of the active membership provision in rule 5A in circumstances where only active members were entitled to vote;
disputes about the validity of the outcome of that meeting convened by requisitioning members and a competing meeting convened by the directors of the Co-operative, which were held at the same place on the same day;
the impact of all of those disputes between members on the continuing governance of the Co-operative; and
the Co-operative’s financial position, including operating losses, which raised “an issue as to the Co-Operative’s solvency” which “would appropriately be addressed by an independent administrator, who has specialised expertise in insolvency law, and may be able to assist in identifying the steps necessary to restructure the operations of the Co-operative, so as to balance its available revenue and expenses, and possibly allow it to continue to operate in a way that does not generate future losses into the ongoing future, and decline into solvency [sic-insolvency]”.
On 5 December 2025, the Registrar appointed Mr Trevor Pogroske and Mr Anthony Warner as joint and several administrators of the Co-operative (the Administrators). [14]
On the appointment of the Administrators, the directors of the Co-operative ceased to hold office and the functions of the board of the Co-operative were conferred on the Administrators. [15]
Mr Pogroske gave evidence that it was clear to the Administrators from the outset that the Co-operative faced significant challenges, including a history of poor management, financial disarray, and ongoing disputes between members, including disputes arising from the construction of the Rules and the concept of active membership under the Rules. I accept that evidence, which was not challenged by the Opposing Members.
The Administrators have taken the following actions during their appointment:
conducted extensive investigations into the Co-operative’s financial and operational position in order to assess the state of the business, identify immediate action items, and inform the conduct of the administration;
engaged with stakeholders and their representatives, including the members who were the moving parties in the oppression suit referred to above, to understand their position and concerns regarding the conduct of the Co-operative’s business;
reviewed the Co-operative’s financial and other business records;
caused audited financial statements for the Co-operative to be prepared for the financial year ended 30 June 2025 and instructed the auditor to prepare special purpose financial statements for the half-year ended 31 December 2025, as referred to in more detail at [57]-[58] below;
identified options for re-capitalising the Co-operative, and sought member approval for that plan, as referred to in more detail at [22]-[39] below;
kept the Department of Fair Trading informed about progress of the administration;
oversaw and provided instructions and guidance on financial and operational matters affecting the Co-operative’s employees, operators, drivers, suppliers, landlords, real estate agents, bankers and professional advisers; and
instructed lawyers to address issues raised by various members of the Co-operative and to assist in making the winding up application.
The Administrators’ investigations revealed that:
the financial records of the Co-operative were spread across multiple different accounting systems with incomplete data and that there was no history of reconciliations having been conducted between those systems;
cash forecasts were not produced;
the Co-operative was receiving demands from its creditors, including taxi drivers seeking payment for completed taxi jobs, and was rationing cash and seeking to prioritise payments to certain taxi operators over others and over third-party creditors;
third-party creditors from which the Co-operative was receiving demands for payment included iCare Workers Insurance, which was owed $19,095 for outstanding workers compensation premiums, and OneTeam IT, which provides services that are essential for maintaining the Co-operative’s accounting and information technology systems;
bank reconciliation reports were not reviewed;
GST balances were not reviewed prior to lodgement of Business Activity Statements;
superannuation payments to employees had not been processed for two quarters; and
the Co-operative was subject to two separate ATO payment plans with the Commissioner of Taxation, one in relation to outstanding superannuation guarantee payments and one in relation to outstanding Business Activity Statement arrears.
As referred to in more detail at [57]-[58] below, the audited financial statements that the Administrators caused to be prepared for the financial year ended 30 June 2025 and the special purpose financial statements for the financial half-year ended 31 December 2025 showed that the Co-operative was trading at a loss and that its current liabilities exceeded its current assets by more than $1,000,000. The total current liabilities as at 31 December 2025 were just under $1,000,000 excluding a $312,567 liability to members in respect of their shares. The Co-operative’s only significant asset is real property at 12 Boola Street, Cromer, New South Wales. The fair value of the Cromer property was estimated in the audited financial statements as $3,800,000. The property is subject to a registered mortgage in favour of Westpac Banking Corporation securing an overdraft facility under which $482,020 was owing as at 31 December 2025 according to the special purpose financial statements prepared by the auditor. As explained at [61] below, the full amount owing under the overdraft facility is presently due and payable. The Co-operative’s net assets as at 31 December 2025 as recorded in the audited financial statements are $2,525,626 after taking into account non-current assets including the Cromer property and the Co-operative’s non-current liability for deferred tax.
The Administrators formed the view that the Co-operative was in a dire financial position. They took the following actions in order to assess the options available to re-capitalise the Co-operative’s operations.
On 12 January 2026, the Administrators wrote to Mr Todd Cathcart (Regional General Manager – Business Banking at Westpac) advising of their appointment and stating that they were reviewing the possibility of restructuring the Co-operative’s operations by selling the Cromer property and utilising the whole or part of the proceeds to invest in the business after discharging the overdraft and any overdue liabilities. The Administrators requested an indication as to whether the bank would consider increasing the overdraft facility by an additional $300,000 pending completion of a potential sale of the Cromer property which would be likely to occur within six to eight months. Mr Cathcart replied on 5 February 2026 advising that the bank had decided not to increase the overdraft facility because it was “not comfortable providing finance to fund continued trading losses – potentially eroding members’ equity within the Co-operative”.
On 13 January 2026, the Administrators wrote to members of the Co-operative advising members of their appointment and stating that, based on the investigations undertaken at that stage, they had determined that the Co-operative was in “a serious financial position”, and that they were “extremely concerned about the solvency of the Co-Op” and that it may need to be wound up. The letter stated that the Administrators were considering various avenues to raise funds, but that it was not known whether those avenues would succeed. The letter requested any member interested in funding the Co-operative to contact the Administrators to explore mutually acceptable terms and conditions for such funding. The letter advised that, in the absence of any funding (from members or other sources), the Administrators intended to apply to the Court for the appointment of a liquidator.
Mr Pogroske gave evidence that, in response to the Administrators’ request for expressions of interest from members to who may be willing to fund the Co-operative, Mr Peter Lubrano wrote to the Administrators on 10 February 2026 indicating that he could provide $1,000,000 and “would be interested in having discussions around a first mortgage security over the 12 Boola Street property and other conditions”. However, shortly before the Administrators received Mr Lubrano’s letter, the Administrators had received a telephone call from him during which they had discussed the Co-operative’s need for loan funding for working capital purposes and Mr Lubrano had indicated that he did not wish to provide funding for that purpose. The Administrators nevertheless caused their solicitor to send an email to Mr Lubrano’s solicitor after they received Mr Lubrano’s letter, inquiring whether Mr Lubrano wished to explore funding the Co-operative despite their earlier discussion. The Administrators’ solicitor received no response to that email. One of the Opposing Members, Mr Ashwin Sharma, gave evidence that Mr Lubrano told him that he was upset that his written expression of interest dated 10 February 2026 had been with complete silence by the Administrators and that the Administrators had not followed up his expression of interest with him or with his solicitor before the closure of the ballot referred to below on 12 March 2026. Although no objection was taken to Mr Sharma’s evidence, it is plainly hearsay and carries little weight. I therefore prefer the evidence of Mr Pogroske to the evidence of Mr Sharma. The Opposing Members did not adduce evidence from Mr Lubrano about his intentions concerning potential funding for the Co-Operative as at 10 February 2026. There is no evidence that Mr Lubrano is presently will and able to fund the Co-operative.
The Administrators also sought finance from 12 third-party lenders through a finance broker. Three lenders provided terms sheets for finance of $1,000,000 at interest rates ranging between 8.49% and 9.25% per annum and secured by mortgage over the Cromer property and a General Security Agreement. The proposed loan amount of $1,000,000 included $485,000 to repay the existing overdraft facility, pre-paid interest and establishment fees in respect of the new facility, and broker and valuation fees. The Administrators considered that the terms offered by Harbour Credit Partners were superior to the terms offered by the other two third-party lenders.
The Administrators sought proposals from three commercial property agents for prospective appointment as agents for sale of the Cromer property. The sale price estimated by those agents for the Cromer property ranged between $3,200,000 and $4,500,000.
After taking the steps described above, the Administrators formulated a proposal which they considered to be the only viable pathway to save the business and to avoid liquidation: raise interim finance to pay the Co-operative’s current liabilities pending a sale of the Cromer property to and provide some working capital to facilitate restructuring and the election of a new board of the Co-operative to take the business forward, and repay the interim finance from the sale proceeds of the Cromer property when completed (the Proposal).
Pursuant to s 359(1)(b) of the CNL, any sale of the Cromer property would require member approval by special resolution by a special postal ballot, meaning that 75% of members would need to vote in favour of the sale in the ballot. This was common ground at the hearing A special postal ballot requires a disclosure statement approved by the Registrar pursuant to s 248 of the CNL.
On 12 February 2026, the Administrator sent to all active and inactive members of the Co-operative a notice of special postal ballot in respect of the proposed sale of the Cromer property and a notice of postal ballot in respect of the proposed interim finance, together with a disclosure statement approved by the Registrar which outlined the Proposal and enclosed the audited financial statements for the year ended 30 June 2025 which were then in draft form. The financial statements for the six-month period ended 31 December 2025 were still being prepared by the auditor. The disclosure statement advised members that the Administrators had formed the view that the Co-operative was in serious financial difficulty and that, as at the date of the disclosure statement, it was unable to discharge its current liabilities as and when fall due. The disclosure statement summarised the steps taken by the Administrators which I have described above, which had culminated in the formulation of the Proposal.
The disclosure statement noted that, in accordance with the Rules and s 230 of the CNL, only active members were eligible to vote in the special postal ballot. The disclosure statement annexed a list of 13 members who were active members according to the register maintained by the Co-operative. The disclosure statement advised that any member who did not appear on that list and who believed that they are an active member should urgently provide details and documentary evidence of the basis of their claim to be an active member.
The disclosure statement advised that ballots must be returned to the Administrators by email by no later than 12 March 2026, being 28 days after the date of notice of the ballot. Ballots received after that deadline would not be accepted or counted.
The resolutions to be voted on were set out in section 7 of the disclosure statement:
**“**7. Resolutions
Special resolution by special postal ballot – Sale of Property (the “Special Resolution”)
‘That the Active Members of the Co-Op resolve to approve the sale of the Co-Op’s property at 12 Boola Place, Cromer NSW 2099 in such manner as the Administrators determine is in the best interests of the Co-Op.’
Ordinary resolution by postal ballot – Funding
‘That, subject to the Special Resolution for the sale of the property being passed, the Active Members of the Co-Op resolve to authorise the Administrators to enter into a funding agreement with a financier, as the Administrators determine is in the best interests of the Co-Op.’”
“8. Effect on Co-Op if resolutions are not passed
Members are advised that if either of the Resolutions described in Section 7 above are not passed, the Co-Op will not be able to pay its debts as and when they fall due, and the Administrators in carrying out their statutory responsibilities, will have no alternative but to immediately cease trading operations and consider putting in effect the process to place the Co-Op into liquidation.”
“Mr Warner and I acknowledge (and previously acknowledged to the Respondents directly) that while member approval was required for the sale of the Property, member approval was not necessary to seek to raise finance. However, the two were nonetheless inherently connected.
The sale of the Property was required to provide the necessary funds to repay the existing debts of the Co-operative (including the debt secured by the mortgage in favour of Westpac Bank and the new proposed finance facility), making the sale a critical component of the overall proposal. As far as I am aware, up to the commencement of the application for a winding up of the Co-Operative, there was no alternative financing proposal from a third party lender other than [the term sheets from the three third-party lenders] (all of which required or were premised upon the sale of the Property). Absent that pathway to repayment, no lender was prepared to make finance available to the Co-Operative. Given this interdependence, and in light of the commercial realities of the Co-Operative’s financial position, we believed it was both appropriate and necessary to progress both matters together.
Seeking consent for the sale of the Property while also addressing the finance ensured transparency and, as far as we were concerned, allowed members to fully understand the broader context and implications of the Proposal. We maintain this approach was the correct one, as it ensured all members were fully informed and could make an appropriate decision about the future of the Co-Operative.”
I accept Mr Pogroske’s evidence.
On 13 February 2026, Mr Hill (the solicitor now acting for the Opposing Members) wrote to the Registrar making various complaints about the contents of the disclosure statement. Mr Hill’s complaints included that the Administrators had treated the Co-operative’s register of members as identifying the active members who are entitled to vote, in circumstances where the interpretation of the active membership provisions of the Rules was “hotly contested”. Mr Hill wrote:
“The administrators appear nonetheless to have ram-raided the China shop and unilaterally decided how the active membership rules should be interpreted, which appears to be the interpretation propounded by the ousted directors (since they have adopted their register of active members). This is most unfortunate as it is highly contentious and sensitive. It is deeply concerning to our clients that the administrators, once more, seem to be siding with the ousted directors.”
Mr Hill’s statement above was materially misleading in two important respects. First, it erroneously suggests that the mere fact that the Administrators have taken a view that aligns with the views of the directors who ceased to hold office by reason of the Administrators’ appointment means that the Administrators are “siding” with those former directors and acting against the members represented by Mr Hill. Second, the Administrators had not purported to make any unilateral determination as to the identity of the active members. As I have explained above, the disclosure statement identified the 13 active members listed in the register as the active members entitled to vote and invited any other members claiming to be active members to identify themselves for the Administrators to consider the voting entitlement of any such member. In any event, the Administrators’ assessment that there were 13 active members based on the register is consistent with Mr Hill’s own assessment at the time, as referred to in his later correspondence with the Registrar. [16]
Mr Hill also wrote:
“It is obvious to everyone that Co-operative is insolvent. We have been putting this to the Registrar for over 2 years. …
…
The administrators have indicated that, in their view, restoring solvency requires the sale of the Cromer property and the provision of bridging finance. We have been saying precisely this for over 6 months. Blind Freddy could see this.”
On 25 February 2026, the Administrators issued a supplementary notice to members enclosing the audited financial statements for the year ended 30 June 2025 and the special purpose financial statements for the six-month period ended 31 December 2025 which had been prepared by the auditor.
On 27 February 2026, the Administrators wrote to all creditors and operators of the Co-operative advising of their appointment and the Proposal that had been put to members for determination by special resolution by special postal ballot. The letter stated:
“The results of Members ballots in relation to sale and funding will be declared on 12 March 2026. If the resolutions are passed by members, the Administrators will pursue the interim funding arrangements on an urgent basis to provide the Co-operative with liquidity whilst the sale of the property is pursued.
The anticipated timeframe for the sale of the property is anticipated to take approximately six (6) months, subject to market conditions and completion of the required approval processes.
In the interim period, the Administrators are focused on maintaining operational continuity, preserving asset value, and ensuring that the interests of creditors and operators are managed in accordance with the requirements of the Co-operatives National Law.
However, creditors and operators should be aware that until the funding is made available the Co-operative’s cash resources are extremely stressed and unfortunately all-payments may be delayed.
In this regard we would appreciate creditors and operators being patient until the funding has been received.”
During the period between 24 February and 9 March 2026, Mr Hill, acting on the instructions of Mr Fletcher, engaged in extensive correspondence with the Registrar and the Administrators complaining about numerous aspects of the disclosure statement that had been circulated to members with the notice of special postal ballot on 12 February 2026. The Registrar informed Mr Hill that they did not consider that there was any basis to withdraw their approval of the disclosure statement or to exercise any other statutory power. In later correspondence with the Registrar, Mr Hill complained that the Registrar had “ignored” his concerns raised prior to the closure of the ballot. In truth, the Registrar had rejected those concerns and declined to take the action urged by Mr Hill.
After the notice of postal ballot and disclosure statement was sent to all members, no member who was not included in the 13 active members listed on the register contacted the Administrators claiming to be an active member. Accordingly, the only members entitled to vote on the resolutions in section 7 of the disclosure statement were the 13 active members identified in the disclosure statement. Of those 13 active members, three voted in favour of the resolutions, eight voted against, and two elected not to vote. Accordingly, the resolutions were not carried.
Following that outcome, and in light of the Co-operative’s operating losses and inability to meet its liabilities as and when they fell due, and the bank’s refusal to extend the overdraft facility, the Administrators determined that the Co-operative must cease operations. The Administrators sent a letter to the Co-operative’s creditors and operators on 13 March 2026 which stated:
“As disclosed in our notice to you dated 27 February 2026, the Administrators issued a notice to the members of MWC on 12 February 2026 seeking approval to sell the Co-Op’s property located in Cromer NSW and to raise finance to provide funding until the settlement of that sale occurred. Approval to sell the Cromer property was therefore critical to facilitate the recapitalisation of the Co-Op. Unfortunately, the ballot was not successful in that a majority of Active Members voted against both resolutions. As a result, the Co-Op cannot be saved. No other viable option is available as the Co-Op is without funds to continue trading and is therefore insolvent.
We will now take the appropriate steps to approach the Supreme Court seeking orders that the Co-Op be wound up and placed into liquidation as soon as possible.
Accordingly, we must close the operations of the Co-Op with immediate effect.
We have notified the Department of Fair Trading of our intentions and actions.
We will write to creditors and operators, as soon as the court makes the relevant orders we will be seeking. We will explain the liquidation process to you at that point in time. In the meantime, we kindly ask that you close any account and send a final invoice in respect of any amounts owing to you by the Co-Op …
Please note we cannot make any further payments at this stage as the Co-Op is without funds. Payment of your outstanding accounts will be dependent upon the appointment of Liquidators and sufficient funds being available following the sale of the Cromer property and realisation of any other assets or claims. This process is likely to take many months and we kindly request that you be patient.”
The closure of the Co-operative’s operations meant that it was no longer able to comply with its obligations as an authorised taxi service provider under the Point to Point (Taxis and Hire Vehicles) Act 2016 (NSW) and associated regulations, including its obligations to pay transport levies. The Administrators were advised by the office of the Point to Point Transport Commissioner that the Co-operative was required to surrender the authorisation, and the Administrators did so.
On 16 March 2026, Mr Hill, acting on the instructions of Mr Fletcher, wrote to the Registrar noting that all members had been rendered inactive by the Administrators’ decision to cease operations, stating that “our clients” were opposed to the Administrators’ proposed winding up of the Co-operative, contending that control should be handed back to the members to secure short-term finance, sell the Cromer property and distribute the sale proceeds to members, and urging the Registrar to revoke the appointment of the Administrators and issue new rules for the Co-operative under s 390 of the CNL so that all members could vote on the election of new directors and the proposed sale of the Cromer property. The Registrar replied on 18 March 2026, responding to the substance of the matters raised in Mr Hill’s letter and reiterating that they did not consider there to be any basis for them to exercise any statutory power at that time.
On 23 March 2026, Mr Hill, acting on the instructions of Mr Fletcher, wrote to the Registrar purportedly on behalf of “members”, seeking the Registrar’s in-principle views on a proposed amendment to rule 5A of the Rules of the Co-operative, prior to the matter being put to members. The letter stated that amendments to active membership provisions of the Rules required prior approval of the Registrar pursuant to regulations made under s 60(2) of the CNL.
The proposed new rule 5A enclosed with Mr Hill’s letter was in the following terms:
“5A.1 Primary activity
For the purposes of Part 2.6 of the CNL, the primary activity of the Co-operative is the operation and delivery of member services for members connected with the taxi industry (including current and former operators and drivers), comprising:
(a) member registry and entitlement administration, including maintaining accurate registers, validating eligibility, and processing member directions, notices and elections;
(b) preservation and restructuring initiatives directed to restoring the Co-operative’s former operating activities or effecting an orderly, member-benefiting transition consistent with the Rules and applicable law;
(c) member support services reasonably incidental to (a)-(b), limited to: (i) responding to member enquiries regarding entitlements and registry status; (ii) preparing and lodging submissions to regulators on specified matters affecting members’ rights or entitlements; and (iii) facilitating member consultations required by the Rules or the CNL; and
(d) administrative, accounting, record-keeping and compliance functions necessary for paragraphs (a)-(c) above, including (where reasonably necessary) the realisation of assets solely to fund or implement (a)-(c), and the collection and application of levies or contributions for the same purpose, in accordance with the Rules.
5A.2 Active membership – use or support of primary activity
A member is an active member if the member uses or supports the primary activity in Rule 5A.1 by satisfying all of the following:
- Service participation: within the preceding 12 months, the member has obtained at least one member service described in Rule 5A.1(a) or (c), evidenced by a processed registry update, a lodged entitlement direction, or a completed documented support request,
- Governance engagement: within the preceding 12 months, the member has participated in at least one formal Co-operative process connected with the primary activity (a general meeting, requisitioned meeting, ballot or formal consultation), and
- Financial contribution (if applicable): the member has paid any subscription, levy or contribution lawfully determined under the Rules and referable to the costs of carrying on the primary activity, where due and payable.
5A.3 Continuity during non-network periods
A member does not cease to be an active member merely because the Co-operative has temporarily ceased or suspended the operation or arrangement of taxi network or dispatch services, provided the member continues to satisfy Rule 5A.2.
5A.4 Interpretation
During any period in which taxi network or dispatch services are not operated or arranged, the activities described in Rule 5A.1 constitute the fundamental purpose for which the Co-operative exists and make a significant contribution to its business.”
On 30 March 2026, Mr Hill, on behalf of “the requisitioning members”, applied to the Registrar under s 60(2) of the CNL for approval of the proposed new rule 5A. Mr Hill made the application while contending that the approval was not necessary. The basis of that contention was that the existing rule 5A had been “invalidated” by the cessation of the Co-operative’s operations, the proposed new rule 5A was therefore not amending an existing active membership provision but inserting an active membership provision in the Rules in circumstances where there was currently no such provision, that s 60(2) of the CNL was not engaged and that the members entitled to vote on the resolution to introduce the proposed new rule 5A were the members who would be active members if the resolution had already taken effect pursuant to s 153 of the CNL. This contention represented a departure from the position stated in Mr Hill’s 23 March 2026 letter.
On 17 April 2026, Mr Hill sent a further letter to the Registrar acknowledging their reply to his letter of 23 March 2026. The Opposing Members did not tender that reply. However, it appears from Mr Hill’s 17 April 2026 letter that the Registrar’s reply stated that s 60(2) of the CNL applied so that the Registrar’s approval of any proposed amendment to the active membership provision in rule 5A of the Rules was required. In his 17 April 2026 letter, Mr Hill propounded the reasons why he contended that s 60(2) of the CNL did not apply, including his contention that the existing rule 5A was “no longer an active membership provision” as a result of the Co-operative having surrendered its taxi service and booking authorisation and ceased carrying on its taxi network and despatch operations on 13 March 2026. Mr Hill stated that he acted for a “substantial group of members”, but named only the eight persons who had been defendants and cross-claimants in these proceedings before the statement of claim and cross-claim were dismissed on 16 October 2025. [17] Mr Hill wrote that, as a consequence of the COVID-19 pandemic and the New South Wales government taxi-licence buy-back scheme, the active members of the Co-operative had been reduced to 12 or 13 members out of a total membership of approximately 90 members.
On 24 April 2026, the Registrar replied to Mr Hill reiterating that s 60(2) of the CNL did apply to the proposed amendment to rule 5A and stating that they considered that it was inappropriate to approve a proposed amendment to the Rules “at this stage” in circumstances where the Administrators had applied to the Court for the Co-operative to be wound up. The Registrar had therefore exercised the power under s 60(6)(c) of the CNL to refuse approval of the proposed amendment.
On 8 May 2026, Mr Fletcher served on the Co-operative a requisition signed by 42 members for a general meeting – described by Mr Fletcher as representing almost 50% of the Co-operative’s membership of approximately 90 members - to consider a resolution approving a new active membership provision of the Rules and a resolution approving a new dispute resolution procedure to deal with any future internal disputes. Pursuant to s 257 of the CNL, the board of a co-operative is only required to call a general meeting on the written requisition of that number of members who together are able to cast at least 20% of the total number of votes able to be cast at a meeting of the co-operative. As I have mentioned earlier in these reasons, votes are only able to be cast by active members. As Mr Fletcher and the other Opposing Members acknowledge, none of the members of the Co-operative were active members within the meaning of the existing rule 5A of the Rules following the cessation of operations on 13 March 2026. Mr Fletcher maintains that the requisition was validly made under rule 29 of the Rules, which requires the board of the Co-operative to convene a general meeting on the requisition of the lesser of the tenth of the members or fifty members being the holder of shares upon which calls or other sums then due have been paid.
On 11 May 2026, Mr Fletcher and two other members of the Co-operative each signed letters of commitment to lend an aggregate sum of $310,000 to the Co-operative for a period of 12 months on terms that the Co-operative must use all reasonable endeavours to complete a sale of the Cromer property as soon as reasonably practicable but by no later the expiry of the 12 months, and that the lenders were to be repaid out of the sale proceeds after payment of the overdraft facility secured by the mortgage and were entitled to lodge a caveat over the Cromer property to protect their interests. Each letter of commitment included the following term:
“This commitment is conditional on the occurrence of the later of the following events (the Trigger Event):
(a) the Supreme Court of New South Wales refusing or adjourning (without making a winding up order) the application by the Administrators for the winding up of the Co-operative in proceedings No. 2025/50166, and
(b) the Registrar of Co-operatives terminating the administration of the Co-operative under the Co-operatives National Law (NSW).
The Lender will advance the Loan Amount to the Co-operative within 5 business days of written request from the Co-operative or its duly appointed management PROVIDED THAT this commitment lapses where a winding-up order is made in respect of the Co-operative before the Trigger Event occurs.”
Of the total proposed loan sum of $310,000, Mr Fletcher committed $200,000, Mr James Dowd committed $100,000 and Ms Patricia Keetels committed $10,000.
On 31 May 2026, Mr Fletcher served on the administrators a notice requesting that three resolutions be included in the notice of the next general meeting of the Co-operative, namely a resolution recording “the wish of the membership to resume democratic member control of the Co-operative’s affairs rather than proceed to winding up”, a resolution recording members’ support for the member finance proposal to lend a total sum of $310,000 to the Co-operative, and a resolution nominating five members for appointment as directors of the Co-operative upon revocation of the appointment of the Administrators by the Registrar. The proposed appointees were Mr Fletcher, three of the other Opposing Members, and Mr Dowd.
The Administrators did not convene a special general meeting of the Co-operative in response to the 8 May 2026 requisition. The requisitioning members convened a meeting themselves, which was held on 26 June 2026, as referred to below.
On 9 June 2026, the Opposing Members commenced proceedings in the New South Wales Civil and Administrative Tribunal seeking a review of the Registrar’s decision made on 24 April 2026 to refuse approval of the proposed amendment to rule 5A. The Tribunal dismissed those proceedings on 16 June 2026 on the basis that the Opposing Members lacked standing to seek the review. Under s 574 of the CNL, it is the Co-operative rather than any individual member that has standing to appeal to the Tribunal against the Registrar’s decision to refuse an amendment of its rules. The Co-operative has a distinct legal personality. [18]
On 24 June 2026, the Administrators received emails from two members of the Co-operative attaching a petition signed by 27 members expressing their opposition to the resolutions to put to the special general meeting requisitioned or purportedly requisitioned by Mr Fletcher and others, to the requisitioning members’ proposal to appoint directors to the Co-operative, and to any interference in the process of the administration.
On 26 June 2026, the Opposing Members met together with 18 other members of Co-operative (being a total of 23 members) and unanimously resolved or purportedly resolved to adopt the proposed new rule 5A.
On 26 June 2026, each of Mr Fletcher, Mr Dowd and Ms Keetels executed a Deed Poll in favour of the Co-operative by which they committed to make the loans totalling $310,000 subject to the same “Trigger Event” and on the same terms as the letters of commitment referred to at [49]-[50] above. Clause 5.1 of each Deed Pool made the lending covenant conditional on the occurrence of the “Trigger Event”.
The audited financial statements that the Administrators caused to be prepared for the Co-operative for the financial year ended 30 June 2025 and the special purpose financial statements prepared by the auditor for the financial half-year ended 31 December 2025 disclosed that:
throughout the 2024 and 2025 financial years, the Co-operative sustained operating losses and experienced negative trading cash flows while incurring increasing liabilities;
the Co-operative sustained a pre-income tax loss of $96,021 for the year ended 30 June 2025 and $54,325 for the half-year ended 31 December 2025;
current liabilities as at 31 December 2025 were approximately $1,389,828, comprising:
(a) borrowings ($511,965, being the bank overdraft of $482,020 and a vehicle finance loan of $29,945); (b) trade and other payables ($430,922); (c) lease liabilities ($11,888); (d) employees’ accrued annual leave ($36,413); (e) members’ shares which are classified as a current liability due to the refundable nature of share capital in a co-operative upon a member’s exist ($312,567); and
non-current liabilities as at 31 December 2025 were deferred tax liabilities ($86,073); and
current liabilities exceeded current assets by over $1,000,000 as at 30 June 2024, 30 June 2025 and 31 December 2025.
The audited financial statements were qualified for uncertainty as to going concern and an inability to obtain sufficient appropriate audit evidence to verify the completeness, existence and accuracy of trade receivables and trade and other payables. The Administrators attribute this to the poor management of the Co-operative and the poor state of the books and records maintained prior to their appointment.
According to Mr Pogroske’s affidavit affirmed on 30 June 2026, even excluding certain liabilities in the financial statements that the Opposing Members dispute, (being members’ share capital, member debentures, and the Administrators’ remuneration and legal costs), the current liabilities of the Co-operative amount to $932,842.30 comprising:
borrowings totalling $497,673.65 (being $464,203.22 owing under the overdraft facility and $33,470.43 owing in respect of the vehicle finance loan);
priority employee claims totalling $101,269.15 (being annual leave, long service leave, redundancy and other entitlements relating to two employees, one of whose entitlements was recognised in the 31 December 2025 financial statements and the other of whom has subsequently submitted a proof of debt); and
unsecured creditors totalling $333,899.50 (including $153,510.33 owed to operators, and monies owing for land tax, PAYG, superannuation, and workers compensation insurance).
Mr Pogroske’s evidence of those current liabilities is based on his review of the Co-operative’s books and records, proofs of debt received from creditors, source documentation provided by creditors supporting their claims, and banking records.
The amount owing under the overdraft facility is secured by the mortgage over the Cromer property. To the extent that the Opposing Members disputed that this is a current liability, they are mistaken. Under clause 17(l) of the terms of the facility, an event of default occurs if a person is appointed to investigate or manage the affairs of the Co-operative. The Administrators were appointed to conduct the affairs of the Co-operative and have the functions of the board. [19] The appointment of the Administrators was therefore an event of default, following which the amount owing became payable on demand and the bank became entitled to sue for that amount and/or to appoint receivers pursuant to clause 18 of the terms of the facility. The bank wrote to the Administrators on 11 June 2026 referring to its right to immediately require payment of all amounts owing and confirming that the amount of $464,203.22 was immediately due and payable. That constitutes a demand for payment, and the amount of $464,203.22 owing under the facility represents a current liability, notwithstanding that the bank has not yet sued for it or appointed receivers. The Opposing Members relied on a subsequent communication between Mr Hill and a representative of the bank in which Mr Hill informed the representative of a member proposal for the orderly sale of the Cromer property as an alternative to liquidation. According to an email sent by Mr Hill to Mr Fletcher on 23 June 2026 giving an account of his conversation with the bank representative, the representative told Mr Hill that the bank was a secured creditor and probably would not take a position either way. I reject the Opposing Members’ submission that this conversation indicates that the bank does not regard the Co-operative as being in default under the overdraft facility and does not consider the whole amount owing to be presently due and payable.
The non-contentious current liabilities of $932,842.30 exceed the cash at bank ($24,196.94 as at 23 June 2026) by more than $900,000 and exceed the total current assets recorded in the 31 December 2025 financial statements ($62,113) by approximately $870,000.
Between 31 December 2025 and June 2026, the Co-operative’s cash at bank has increased (from $12,364 to $24,196.94) and the amount due under the overdraft facility has decreased (from $482,020 to $464,203.22). I infer that this is attributable to the cessation of operations on 13 March 2026 stemming the operating losses and reducing ongoing expenses, and the continued receipt of rent in respect of the Cromer property in the amount of $13,927.05 per month. However, those modest improvements have made no material impact on the significant deficit of current assets compared to current liabilities, even if the contentious current liabilities are excluded from consideration as Mr Pogroske did for the purpose of his analysis set out in his 30 June 2026 affidavit. [20]
By interlocutory process filed on 15 April 2026, the Co-operative and the Administrators seek an order for the winding up of the Co-operative in insolvency or on the just and equitable ground and an order appointing the Administrators as joint and several liquidators of the Co-operative. The application is made pursuant to ss 459A, 459P and 461(1)(k) of the Corporations Act 2001 (Cth), which apply to the Co-operative by reason of s 444 of the CNL.
The Opposing Members oppose the winding up order on the grounds set out in their Notice of Appearance and Grounds of Opposition and propounded at the hearing on 2 July 2026. One of those grounds is intertwined with the Opposing Members’ claims for the following relief in their interlocutory process filed on 25 June 2026:
declarations that:
(a) on the proper construction of s 60 of the CNL, the fact that an application has been made for the winding up of a co-operative is not, of itself, a relevant consideration in determining whether to approve an amendment to an active membership provision of that co-operative under that section; (b) existing rule 5A of the Rules ceased to operate as an active membership provision within the meaning of s 146 of the CNL upon the Administrators closing the Co-operative’s taxi network and dispatch operation and surrendering its taxi service and booking authorisation on 13 March 2026; (c) there is accordingly no active membership provision presently in force in the Rules within the meaning of the CNL; (d) the Registrar’s direction made under s 60(2) of the CNL (the Administrative Order) does not apply to the proposed new rule 5A, because proposed new rule 5A does not amend an existing active membership provision within the meaning of s 146 of the CNL; (e) section 60(3) of the CNL accordingly does not require the Registrar’s prior approval before proposed new rule 5A may be adopted by the Co-operative; and (f) section 153 of the CNL applies to the adoption of proposed new rule 5A, with the result that the members entitled to vote on its adoption are those members who would qualify as active members if the proposed rule 5A were in force; and
an order that, if proposed new rule 5A is adopted at a special general meeting of the Co-operative scheduled for 26 June 2026 by the requisite majority of members entitled to vote, the Administrators take all steps reasonably necessary as soon as practicable to give effect to the adoption and registration of rule 5A, including by authorising each of the Opposing Members to sign and lodge an application to register the new rule with the Registrar under s 63 of the CNL and, in the event that the Registrar refuses to register any such rule change, by authorising each of the Opposing Members to appeal or review the refusal on behalf of the Co-operative.
Proposed declarations 1(b)-(f) above are sought in the alternative to 1(a).
The substance of the Opposing Members’ grounds of opposition to the winding up application may be summarised as follows:
the special ballot conducted by the Administrators in respect of the Proposal was limited to 13 out of 99 members of the Co-operative as a result of the Administrators relying on active membership provisions of the Rules that had been the subject of dispute in these proceedings;
the special ballot was defective in that the disclosure statement was deficient and misleading in several respects and the special resolution concerning the proposed sale of the Cromer property did not comply with s 359 of the CNL;
the Co-operative is not insolvent because it is able to borrow against the security of its equity in the Cromer property in order to discharge its current liabilities pending a sale of the Cromer property to repay that loan or, alternatively, to accept the proposal propounded by Mr Fletcher, Mr Dowd and Ms Keetels to lend a total amount of $310,000 to the Co-operative (the member finance proposal); and
even if the Co-operative is insolvent (which the Opposing Members deny), the Court should exercise its residual discretion not to wind up the Co-operative because each of the two courses referred to immediately above (borrowing from a third-party financier or accepting the member finance proposal) are viable and superior alternatives to winding up. In this context, it was submitted that the special general meeting held on 26 June 2026 produced a binding outcome restoring members’ voting rights so that members can now vote on the member finance proposal. This third ground of opposition depends on acceptance of the propositions in respect of which the Opposing Members seek the declarations in prayers 1(b) to (f) of their interlocutory process filed on 25 June 2026.
In the event that the Court finds that the Co-operative is insolvent and determines that it should be wound up, the Opposing Members submit that the Court should not appoint the Administrators as liquidators because they are the largest creditor of the Co-operative by reason of the fees they have incurred in conducting the administration to date and this would give rise to a conflict between their duties as liquidators and their interests as a creditor. The Opposing Members also submitted that the Administrators are unsuitable for appointment as liquidators by reason of various aspects of their conduct of the administration about which the Opposing Members complain. The Opposing Members propose Mr Michael Jones, official liquidator, as an alternative appointee if a winding up order is made.
It is common ground that the Co-operative’s solvency or insolvency is a question of fact to be determined in accordance with s 95A of the Corporations Act. Section 95A(1), as applied to co-operatives pursuant to s 444 of the CNL, provides that a co-operative is solvent if, and only if, it is able to pay all its debts as and when they become due and payable. Section 95A(2) has the effect that a co-operative that is not solvent, is insolvent. I respectfully adopt Black J’s summary of the principles applicable to this “cash flow test” of insolvency in *In the matters of University Co-Operative Bookshop Ltd (in liq) and Co Info Pty Ltd (in liq) (*University Co-Op). [21] The submissions made on behalf of the Opposing Members emphasise, and I accept, that the factual question of solvency or insolvency is to be determined objectively by considering the Co-operative’s financial position as a whole and having regard to commercial realities, including any financial resources that the Co-operative may be able to realise by borrowing against the security of its assets.
On the basis of the evidence referred to at [56]-[63] above, I find that the Co-operative has current liabilities of at least $932,842.30 that are presently due and payable and a deficiency of at least $870,000 in current assets available to discharge those current liabilities. I further find that the Co-operative has had a net asset deficiency of this magnitude since 30 June 2024.
It was not submitted on behalf of the Opposing Members that the Co-operative should resume operations, or that it would generate sufficient income to discharge its liabilities if it were to resume operations. As I have said at [63] above, the modest rental income that the Co-operative is generating is insufficient to discharge its current liabilities now or in the foreseeable future.
As the Administrators acknowledge, there will be a net surplus of assets to pay creditors in full once the Cromer property is sold. Absent member approval by special resolution by special postal ballot, which requires 75% of members to vote in favour of the sale, any sale of the Cromer property would need to be a mortgagee sale or a sale by a liquidator pursuant s 477(2)(c) of the Corporations Act as applied by s 444 of the CNL if the Co-operative is wound up.
Contrary to the submissions made on behalf of the Opposing Members, there is no evidence that any of the three third-party lenders from whom the Administrators elicited proposals in January and February 2026 remain willing to lend to the Co-operative following the members’ failure to approve the sale of the Cromer property, which was the sole pathway to repayment of the then loan then proposed, on 12 March 2026. There is no evidence of the Opposing Members having made enquiries with those third-party lenders or having sought or obtained funding proposals or offers from other third-party lenders. The Opposing Members’ submission that third-party finance is available to the Co-operative is mere speculation.
I reject the Opposing Members’ submission that the Co-operative is not insolvent by reason of the member finance proposal. As the Administrators submitted, the member finance proposal is insufficient by a significant margin to discharge all of the Co-operative’s current liabilities which amount to at least $932,842.30. To the extent that the Opposing Members maintained the submission that the overdraft facility is not presently due and payable, I reject that submission for the reasons explained at [61] above. In any event, as Mr Pogroske deposed, even excluding the amount owing under the overdraft facility, the member finance proposal loans totalling $310,000 would not be sufficient even to cover the Co-operative’s other current liabilities of least $468,339.08, all of which are presently due and payable. Even the Opposing Members’ submissions described the Co-operative’s “genuinely pressing liabilities” as amounts totalling $455,904.
The member finance proposal suffers from a further fundamental difficulty. It is conditional on the Registrar revoking the appointment of the Administrators. There is no evidence of any realistic prospect of such a revocation, which would be contrary to the order to which the Opposing Members and other parties consented on 16 October 2025 and which would give rise a real risk that the Co-operative would revert to the state of internal disputation that gave rise to these proceedings in the first place. [22] To date, the Registrar has rejected submissions made by Mr Hill on behalf of Mr Fletcher urging the Registrar to revoke the appointment of the Administrators. [23]
All of the cases on which the Opposing Members relied in which the availability of finance was successfully relied on to resist a finding of insolvency turned on their own facts and are distinguishable from the present case.
For all of those reasons, I find that the Co-operative is unable to pay its debts that are presently due and payable, and presently has no realistic prospect of borrowing funds against the security of the Cromer property in order to pay those debts. I further find that the member finance proposal is subject to conditions that are unlikely to be satisfied. Even if those conditions were satisfied, the member finance proposal would not realise sufficient funds for the Co-operative to discharge its debts that are presently due and payable. Accordingly, the Co-operative is insolvent within the meaning of s 95A of the Corporations Act as applied to the Co-operative pursuant to s 444 of the CNL.
As the Opposing Members submitted, the Court has a residual discretion to dismiss the winding up application, or to adjourn the winding up application, notwithstanding the finding of insolvency. [24]
I decline to exercise that discretion in the present case.
The Opposing Members’ complaints about the special postal ballot conducted by the Administrators, including their complaints about the contents of the disclosure statement, have no bearing on the insolvency of the Co-operative, which is the basis for the winding up application. [25] I accept Mr Pogroske’s evidence referred to at [31] above, and reject the Opposing Members’ submission that the Co-operative’s present inability to pay its debts as and when they fall due and payable is due to the Administrators’ decision not to use third-party funding which they had identified and had the power to procure, secured against the Cromer property, without member approval. As Mr Pogroske’s evidence establishes, lenders were not prepared to make funding available to the Co-operative without the repayment pathway of a sale of the Cromer property which required member approval that was not forthcoming.
For all of the reasons explained above, I reject the Opposing Members’ submission that third-party finance or the member finance proposal are viable alternatives to winding up. [26] As Mr Pogroske deposed, a dismissal or adjournment of the winding up application would prolong the administration. That would serve no purpose given the events which have already happened, and would merely increase the costs of the administration.
There will therefore be an order for the winding up of the Co-operative in insolvency. It is not necessary to consider the Administrators’ alternative application for winding up on the just and equitable ground.
The Opposing Members’ claims fall to be considered in the following statutory context.
The objects of the CNL are set out s 3, which provides:
“The objects of this Law are—
(a) to enable the formation, registration and operation of co-operatives; and
(b) to promote co-operative philosophy, principles, practices and objectives; and
(c) to protect the interests of co-operatives, their members and the public in the operations and activities of co-operatives; and
(d) to ensure directors of co-operatives are accountable for their actions and decisions to the members of co-operatives; and
(e) to encourage and facilitate self-management by co-operatives at all levels; and
(f) to encourage the development, integration and strengthening of co-operatives at local, regional, national and international levels by supporting and fostering State, Territory and national peak organisations and co-operative instrumentalities.”
“The co-operative principles are the following principles—
1 Voluntary and open membership
Co-operatives are voluntary organisations, open to all persons able to use their services and willing to accept the responsibilities of membership, without gender, social, racial, political or religious discrimination.
2 Democratic member control
Co-operatives are democratic organisations controlled by their members, who actively participate in setting their policies and making decisions. Men and women serving as elected representatives are accountable to the membership. In primary co-operatives members have equal voting rights (1 member, 1 vote) and co-operatives at other levels are organised in a democratic way.
3 Member economic participation
Members contribute equitably to, and democratically control, the capital of their co-operative. At least part of the capital is usually the common property of the co-operative. They usually receive limited compensation (if any) on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes—
(a) developing the co-operative, possibly by setting up reserves, part of which at least would be indivisible;
(b) benefiting members in proportion to their transactions with the co-operative;
(c) supporting other activities approved by the membership.
4 Autonomy and independence
Co-operatives are autonomous, self-help organisations controlled by their members. If they enter into agreements with other organisations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their co-operative autonomy.
5 Education, training and information
Co-operatives provide education and training for their members, elected representatives, managers and employees so they can contribute effectively to the development of their co-operatives. They inform the general public, particularly young people and opinion leaders, about the nature and benefits of co-operation.
6 Co-operation among co-operatives
Co-operatives serve their members most effectively and strengthen the co-operative movement by working together through local, national, regional and international structures.
7 Concern for the community
While focusing on member needs, co-operatives work for the sustainable development of their communities through policies accepted by their members.”
“In the interpretation of a provision of this Law, a construction that would promote the co-operative principles is to be preferred to a construction that would not promote the co-operative principles.”
The remaining provisions of the CNL provide substance to many of the co-operative principles.
For example, it is plain from Part 3.2 Division 1 of the CNL that the members who exercise democratic member control of a co-operative, by actively participating in decision-making through the exercise of voting rights, are limited to the active members of the co-operative. Section 230 of the CNL provides that a member cannot vote on any resolution if the member is not an active member of the co-operative. Section 236 provides that a vote cast by a member when not entitled to vote under Part 3.2 Division 1 (or any other provision of the CNL) must be disregarded.
The effect of Part 2.1 Divisions 1, 2 and 3 and Part 2.3 Division 1 of the CNL is that, from the time of formation, a co-operative is required to have rules that include active membership provisions. These rules (including active membership provisions) can only be amended by special resolution (s 61), which requires a two-thirds majority at either a general meeting of the co-operative or in a postal ballot (not being a special postal ballot) of members (s 239).
Part 2.6 Division 1 of the CNL defines “active member”, “active membership provisions”, and “active membership resolutions” by reference to the definition of “primary activity”. It is convenient to set out those definitions in full:
“144 Meaning of “primary activity”
A primary activity of a co-operative is an activity specified in the rules of the co-operative as a primary activity of the co-operative.
145 Meaning of “active member”
A member of a co-operative is an active member of the co-operative if the member—
(a) uses or supports an activity of, or maintains a relationship or an arrangement with, the co-operative, for carrying on a primary activity of the co-operative, in the way and to the extent the rules of the co-operative provide; or
(b) maintains any other relationship or arrangement with the co-operative for carrying on a primary activity of the co-operative that the National Regulations provide.
146 Meaning of “active membership provisions and resolutions”
(1) Active membership provisions in the rules of a co-operative are provisions in the rules that state—
(a) which of the activities of the co-operative are the primary activities of the co-operative; and
(b) the way in which, and the extent to which, a member of the co-operative must use or support an activity of, or maintain a relationship or arrangement with, the co-operative, for carrying on a primary activity of the co-operative, to establish active membership of the co-operative.
(2) An active membership resolution is a resolution that would, if given effect to, make or amend active membership provisions in the rules of a co-operative.”
“Division 2 Active membership provisions
147 Number of primary activities required
A co-operative must have at least one primary activity.
148 Rules to contain active membership provisions
The board of a co-operative must ensure the rules of the co-operative contain active membership provisions under this Part.
149 Factors and considerations for deciding primary activities and other matters
(1) The board of a co-operative must ensure the relevant factors and considerations are taken into account in deciding—
(a) which of the activities of a co-operative are its primary activities; and
(b) the way and extent to which a member is required to use or support an activity of, or maintain a relationship or arrangement with, a co-operative, for carrying on a primary activity of the co-operative, to establish active membership of the co-operative.
(2) The relevant factors and considerations are—
(a) the primary activity or (if more than one) the primary activities taken together must form the basic purpose for which the co-operative exists and a significant contribution to the business of the co-operative; and
(b) the way and extent of required utilisation, support, relationship or arrangement should be reasonable when considered in relation to the activities of the co-operative as a whole; and
(c) any other factors and considerations prescribed by the National Regulations.
(3) The National Regulations may—
(a) provide for the things to be taken into account in deciding whether an activity makes a significant contribution to the business of the co-operative; and
(b) state minimum percentages of turnover, minimum amounts of income or minimum amounts of business necessary to constitute that significant contribution.
(4) Factors and considerations may be prescribed by the National Regulations so as to apply to co-operatives generally or to a specified class of co-operatives.
(5) Nothing in this section limits the right of active members other than the board of the co-operative to propose an active membership resolution.”
“… a relevant factor and consideration is that the co-operative actually carries on its primary activities or is likely to do so within 2 years of its formation.”
“… an activity makes a significant contribution to the business of a co-operative:
(a) if, in the course of a financial year, it contributes at least:
(i) 10% of the co-operative’s turnover; or
(ii) 10% of the co-operative’s income; or
(iii) 10% of the co-operative’s expenses; or
(iv) 10% of the co-operative’s surplus; or
(b) if, in the Registrar’s opinion, failure by the co-operative to conduct the activity would reduce the business conducted by the co-operative by more than 10%.”
“The only members of a co-operative who are eligible to vote on an active membership resolution when the rules of the co-operative do not contain active membership provisions are the members who would be active members if the resolution had already taken effect.”
Further, it is plain from the CNL as a whole that the co-operative principle of democratic membership control may be affected by administration under Part 4.1 Division 2 or Division 3 of the CNL, or by the winding up of the co-operative under Part 4.5 of the CNL. That is consistent with the object in s 3(c) of the CNL which extends to the protection of the interests of a co-operative and its members, and also the interests of the public in relation to the operations and activities of co-operatives.
Pursuant to s 437A of the Corporations Act (as applied by s 382 of the CNL), an administrator appointed under Part 4.1 Division 2 of the CNL on the grounds of the Registrar’s opinion that the co-operative is insolvent or likely to become insolvent has control of the co-operative’s business, property and affairs, has power to carry on that business and manage that property and those affairs, has power to terminate or dispose of all or part of that business and to dispose of any of that property, and may perform any function and exercise any power that the co-operative or any of its officers could perform or exercise if the co-operative were not under administration. Pursuant to ss 385 and 386 of the CNL, an administrator appointed under Part 4.1 Division 3 of the CNL is appointed to conduct the affairs of the co-operative and has the functions of the board of the co-operative. A liquidator appointed to a co-operative that is wound up in insolvency pursuant to Part 5.4 of the Corporations Act (as applied by s 444 of the CNL) has the essential functions of identifying, taking possession of and realising the co-operative’s assets, investigating and determining claims against the co-operative, and applying assets to the satisfaction of those claims in accordance with the statutory scheme of priority, [27] and has all the powers set out in s 477 of the Corporations Act as applied by s 444 of the CNL.
The Opposing Members seek the declaration in prayer 1(a) of their interlocutory process on the assumption, contrary to their primary submission, that s 60(2) of the CNL was engaged in the circumstances of this case and required the Registrar’s approval of proposed amended rule 5A. What follows below adopts that assumption, without deciding whether s 60(2) was engaged.
As the Opposing Members submitted, s 60(2) of the CNL does not enumerate the considerations that must or may be taken into account by the Registrar in deciding whether to approve a proposed amendment to active membership provisions of the rules of a co-operative. It follows that the Registrar must act on the basis of the substance of the proposed amendment in all the circumstances applicable to the co-operative in respect of which the application is made for approval to amend the active membership provisions of the rules. The particular matters to be taken into account, and the respective weight to be given to them, are largely a matter for the Registrar. [29]
The text of the proposed amended rule 5A that was the subject of the application to the Registrar under s 60(2) of the CNL is set out in full at [44] above. I observe that the proposed amended rule is premised on:
the Co-operative engaging in the “primary activity” of delivering to members the services described in proposed rules 5A.1(a)-(d), including services directed to restoring the Co-operative’s former operating activities or “effecting an orderly, member-benefitting transition” (proposed rule 5A.1(b));
the services described in proposed rule 5A.1 forming “the basic purpose for which the co-operative exists” (proposed rule 5A.4 and CNL s 149(2)(a) set out at [91] above); and
the provision of the services described in proposed rule 5A.1 making a “significant contribution” to the business of the Co-operative (proposed rule 5A.4, CNL s 149(2)(a) set out at [91] above, and CNR cl 2.5(2) set out at [93] above).
The pending winding up application in respect of the Co-operative rendered each of those premises doubtful. A winding up of the Co-operative would result in the Co-operative ceasing to deliver any of the services described in proposed rule 5A.1, albeit that some of the functions of a liquidator are similar to some of the services described in proposed rule 5A.1. Contrary to the submissions made on behalf of the Opposing Members, I do not consider that it is to be implied from the subject matter, scope or objects of the CNL as described at [84]-[95] above that the winding up application was an irrelevant consideration or an extraneous matter (in the sense of being an impliedly prohibited consideration) [30] to the exercise of the Registrar’s power under s 60(2) to approve or refuse approval for proposed rule 5A by way of amendment to the active membership provisions of the Rules of the Co-operative in all the circumstances of this case, assuming that s 60(2) was engaged. The Opposing Members’ claim for a declaration in terms of prayer 1(a) of their interlocutory process will therefore be dismissed.
Even if I had come to the opposite conclusion, I would have declined to exercise the discretion to make a declaration in terms of prayer 1(a) on the ground that the declaration lacked utility because it would produce no foreseeable consequences for the parties. [31] It would not be binding on the Registrar (who the Opposing Members chose not to join as a respondent to their interlocutory process, and who was not otherwise a party to the proceedings) and it would not disturb the Registrar’s decision made on 24 April 2026 to refuse approval for the proposed amended rule 5A.
The Opposing Members’ contention that the Rules of the Co-operative had no active membership provisions within the meaning of the CNL following the cessation of its operations on 13 March 2026, and that s 153 of the CNL then applied to any vote on an active membership resolution, is reasonably arguable, albeit for reasons that were not articulated in the Opposing Members’ submissions.
Section 153 of the CNL contemplates that it may come to pass that the rules of a co-operative do not contain active membership provisions. [34] Given that the rules of a co-operative must include active membership provisions from the time of the formation of the co-operative, [35] it is reasonably arguable that the only scenarios in which the rules of a co-operative might not contain active membership provisions are where the co-operative ceases the primary activity or primary activities by which its active membership provisions have been formulated, or where that activity or those activities cease to form the basic purpose for which the co-operative exists and/or cease to make a significant contribution to the business of the co-operative. [36] It is reasonably arguable that the definitions of “primary activity” and “active membership provisions” in ss 144 and 146 of the CNL should not be read literally, and that a co-operative ceases to have “active membership provisions” in those scenarios notwithstanding that its rules contain a provision which satisfies the literal meaning of the definition of “active membership provisions” in s 146. It is reasonably arguable that s 153 of the CNL would otherwise have no work to do.
The contrary argument in favour of a literal construction of the definitions of “primary activity” and “active membership provisions” is that the construction above would be contrary to the objects of the CNL because it would create fertile ground for disputes between co-operative members about the purpose for which the co-operative exists and the “primary” or other character of its activities. If the legislature had intended Pt 2.6 of the CNL to operate in the manner outlined above, it would be expected that “primary activity” would have been defined in s 144 as “an activity carried on by the co-operative and specified in the rules of the co-operative as a primary activity of the co-operative”. Section 153 applies where the rules of a co-operative have omitted provisions satisfying the literal meaning of the “active membership provisions” definition, in contravention of the provisions of the CNL requiring such provisions to be included.
It is not necessary to decide between those competing constructions, and it would be undesirable to do so in the absence of submissions from both parties. It is not necessary because the declarations sought in prayers 1(b) to (f) of the Opposing Members’ interlocutory process would produce no foreseeable consequences for the parties and the order sought in prayer 2 lacks utility in circumstances where the Co-operative is to be wound up in insolvency, undermining the premises of proposed rule 5A, [37] and there will be no occasion for members to exercise voting rights in general or special meeting or by ballot during the winding up. The members’ entitlement to share in the likely surplus on winding up is not tied to voting rights. [38] The sole basis on which the Opposing Members submitted that prayers 1(b)-(f) and prayer 2 had utility was that declarations and an order in those terms would facilitate members voting on the member finance proposal, and that the availability of that proposal was relevant to the question of solvency and/or was a viable alternative to winding up if the co-operative was insolvent. For the reasons I have already explained, the Co-operative is insolvent and the member finance proposal is not a viable alternative to winding up. I would therefore have declined to make declarations and an order in terms of prayers 1(b) to (f) and prayer 2 of the Opposing Members’ interlocutory process even if I had determined that the CNL should be construed in the manner outlined at [103] above.
Subject to the Court granting leave under s 532(2) of the Corporations Act as applied to the Co-operative by s 444 of the CNL, the Administrators seek appointment as liquidators of the Co-operative and have given their consent to that appointment should the Court see fit to appoint them.
Leave is required under s 532(2) because the Administrators are creditors of the Co-operative for their remuneration and for the reimbursement of their expenses incurred in the administration. The estimated total amount of remuneration is $475,731.07 up to 24 June 2026, and the estimated expenses are legal costs of $250,000 up to 30 June 2026. The Administrators tendered a draft remuneration report describing the work to which the remuneration relates. The remuneration has been calculated on a time basis at the hourly rates approved by the Registrar when appointing the Administrators. Pursuant to s 388 of the CNL, the Administrators’ remuneration at those rates and their expenses are payable from the Co-operative’s funds and have the same priority on the winding up of the Co-operative as the liquidators’ remuneration and expenses. If the Administrators are appointed as the liquidators, they will adjudicate their own claim for their remuneration. However, any member, as a person with a financial interest in the winding up of the Co-operative, will be entitled to appeal that adjudication under ss 90-15 and 90-20 of the Insolvency Practice Schedule. [39]
The Opposing Members oppose the appointment of the Administrators as liquidators on the following grounds:
there will be a conflict between the Administrators’ interests as a creditor of the Co-operative in respect of their claimed remuneration and expenses on the one hand and their duties as liquidator on the other hand;
the following aspects of the Administrators’ conduct of the administration were improper and demonstrate their unsuitability for appointment as liquidators:
(a) the inclusion in the audited financial statements for the year ended 30 June 2025 and in the special purpose financial statements for the six-month period ended 31 December 2025 of legal expenses of these proceedings, which the Opposing Members contend are payable by the former directors of the Co-operative personally and not by the Co-operative; (b) the Administrators charged in excess of $50,000 for the first month of the administration during which their activities were limited to reviewing payments, arranging insurance, and interviewing parties; (c) the Administrators linked the availability of short-term finance to member approval of the sale of the Cromer property, “thereby creating the liquidity crisis that the**y now rely on to justify winding up and their own continued involvement”; and (d) the Administrators conducted a materially deficient ballot process, failed to engage with member finance options, retained “conflicted management” contrary to the interests of members, and “failed to resolve the active membership dispute that was the primary reason for their appointment”.
As to (1) above, the claim in respect of the Administrators’ remuneration will be the same whether the Administrators are appointed as liquidators or another person is appointed as liquidator. The conflict is managed by the ability of any member to appeal the determination of the Administrators’ claim in the winding up, as referred to above. I accept the Administrators’ submission that their status as creditors of the Co-operative for their claimed remuneration does not impair their suitability for appointment as liquidators. I note that their remuneration as liquidators may be reviewed by the Court under s 449 of the CNL, even if approved by creditors under s 60-10 of the Insolvency Practice Schedule.
As to 2(a) above, the fact that there is a dispute about the proper characterisation of legal fees that were included as liabilities of the Co-operative included in the audited financial statements for the year ended 30 June 2025 signed by the directors who held office as at the accounting date, and in the special purpose financial statements prepared by the auditors for the six-month period ended 31 December 2025, does not reflect adversely on the propriety of the Administrators’ conduct of the administration. That is a matter that will need to be resolved following further investigation in the course of the winding up. The Opposing Members have a strong view that those legal fees are personal liabilities of the former directors and not liabilities of the Co-operative. The former directors apparently have a different view. It does not follow from the strength of the Opposing Members’ conviction that the Administrators have acted improperly by failing to ensure that the Opposing Members’ view prevailed in the preparation of the financial statements.
I reject the submission in 2(b) above. The Opposing Members did not identify any evidence supporting the submission. The Administrators have given a detailed account of all of their activities during the administration, to which the Opposing Members make no reference. The evidence of Mr Pogroske referred to at [14]-[16] and [18] above strongly suggests that a great deal more work was done during the first month of the administration, including reviewing the financial books and records of the Co-operative, ascertaining that its financial records were spread across multiple systems with no reconciliations having been produced between those systems, and understanding such records as were available to a sufficient degree to the form the view that the Administrators had formed and communicated to members by 13 January 2026 that the Co-operative was in a dire financial position.
I reject the submission in 2(c) above for the reasons identified in Mr Pogroske’s evidence, which I have accepted at [31]-[32] above.
I reject the submission in 2(d) above.
I understand that the Opposing Members’ complaint about the ballot process relates to their allegation that the proposed resolution for the sale of the Cromer Property failed to comply with s 353 of the CNL because it gave the Administrators complete discretion with respect to the sale and did not include any details of the proposed sale price. That allegation is without substance. It was not supported by any submissions drawing on the principles of statutory construction. As I have referred to earlier in these reasons, the contents of the disclosure statement setting out the Proposal and the terms of the proposed resolution were approved by the Registrar before distribution to members.
To the extent that the Administrators’ alleged failure to engage with member finance options relates to Mr Lubrano, I reject that allegation on the basis of Mr Pogroske’s evidence which I have accepted at [21] above. To the extent that the allegation relates to the member finance proposal, the Administrators did not act improperly in failing to engage with a proposal that would not raise sufficient funds to address the Co-operative’s insolvency.
I understand that the Administrators’ alleged retention of “conflicted management” contrary to the interests of members relates to the Administrators engagement with Mr Dharam Paul and Mr Dalbinder Singh in managing the operations of the Co-operative in the period between the Administrators’ appointment and the cessation of operations on 13 March 2026. The Opposing Members complain that this was inappropriate in circumstances where Mr Paul and Mr Singh had been found to have engaged in oppressive conduct against members of the Co-operative. The premise of the complaint is false. The Court made no findings against Mr Paul, Mr Singh, or any other person, before making the order for the Registrar to appoint an administrator to the Co-operative by consent of all parties and on the basis of the matters referred to at [11] above. [40] The Opposing Members’ dispute with Mr Paul and Mr Singh does not, without more, make Mr Paul and Mr Singh “conflicted”. Nor does it follow from the dispute that the Administrators’ engagement with Mr Paul and Mr Singh was contrary to the interests of members.
The Opposing Members’ submission that the active membership dispute was the primary reason for the Administrators’ appointment is misconceived. All of the matters identified by Black J and summarised at [11] contributed to his Honour’s determination to make the order under s 134(a) of the CNL by consent. Questions concerning the solvency of the Co-operative assumed particular importance when the Administrators’ investigations revealed that it was in a dire financial position.
I accept the Administrators’ submission that their appointment as liquidators would ensure a smooth and efficient liquidation process given the knowledge they have developed of the Co-operative and its operations during the administration, the work that they have already undertaken with a view to the sale of the Cromer property (including evaluating sale proposals and agent credentials), and their ability to commence work immediately. The Opposing Members’ propose the appointment of Mr Michael Jones, official liquidator, who would not start with those same advantages. There is no evidence of Mr Jones’ rates or any other method by which he will charge for his services. There is therefore no reason to believe that a winding up under Mr Jones would be more cost effective than if the Administrators are appointed as liquidators. Mr Jones was a candidate for appointment as administrator of the Co-operative, but the Registrar determined to appoint Messrs Pogroske and Warner for reasons that are not disclosed by the evidence.
For all of those reasons, I consider that it is in the best interests of the members as a whole for the Administrators to be appointed as liquidators of the Co-operative.
For all of the foregoing reasons, the orders of the Court are as follows:
In relation to the interlocutory process filed on 15 April 2026 by Manly Warringah Cabs (Trading) Co-operative Society Limited (Administrators Appointed under the Co-operatives National Law (NSW)) and Trevor Mark Pogroske and Anthony Warner in their capacities as joint and several administrators of the Co-operative (the Applicants) in respect of which a Notice of Appearance and Grounds of Opposition was filed on behalf of Paul Fletcher, Mohammad Dar, Manoj Kumar, Makhan Hayer, and Ashwin Sharma (the Opposing Members):
(a) Order pursuant to ss 459A and 459P of the Corporations Act 2001 (Cth), as applied by s 444 of the Co-operatives National Law (NSW), that Manly Warringah Cabs (Trading) Co-operative Society Limited (Administrators Appointed under the Co-operatives National Law (NSW)) (the Co-operative) be wound up. (b) Order pursuant to s 532(2) of the Corporations Act 2001 (Cth), as applied by s 444 of the Co-operatives National Law (NSW), that leave be granted to Trevor Mark Pogroske and Anthony Warner to seek appointment as, and to act as, joint and several liquidators of the Co-operative. (c) Order that Trevor Mark Pogroske and Anthony Warner be appointed as joint and several liquidators of the Co-operative. (d) Order that the Applicants’ costs of the interlocutory process be paid by the Opposing Members, jointly and severally, on the ordinary basis as agreed or assessed. (e) Order that, to the extent that the Applicants do not recover the costs in order 1(d) above from the Opposing Members, the Applicants’ costs of the interlocutory process are costs in the winding up of the Co-operative.
(a) Order that the interlocutory process is dismissed. (b) Order that the Opposing Members are to pay the costs of the respondents to the interlocutory process on the ordinary basis as agreed or assessed.
**********
CNL, s 55(1).
CNL, s 59.
CNL, ss 61, 63(1).
CNL, s 63(3).
Co-operatives (Adoption of National Law) Act 2012 (NSW), ss 3, 5, 24.
CNL, s 56(1) and Schedule 1 item 1(b); CNL ss 144-148.
CNL, s 230.
CNL, s 236.
CNL, s 146(2).
CNL, s 60.
CNL, s 153.
CNL, ss 230, 236.
CNL, s 56(1) and Schedule 1 item 1(b). CNL ss144-148.
CNL, s 385.
CNL, s 386.
See [46] below.
See [9]-[11] above.
CNL, s 38.
CNL, ss 385,386.
See [59] above.
[2024] NSWSC 1034 at [5]-[10].
See [9] above.
See [42] above.
Corporations Act, s 467; Expile Pty Ltd Jabb’s Excavations Pty Ltd (2003) 46 ACSR 446; [2003] NSWSC 699 at [57] (Campbell J, as his Honour then was).
See [26]-[39] and [67(1)] and [67(2)] above.
See [67(4)] and [69]-[77] above.
Australian Securities and Investments Commissioner v Edge (2007) 211 FLR 137; [2007] VSC 170 at [40]-[42] (Dodds-Streeton J).
See [65(1)(a)] above.
Sean Investments Pty Ltd v MacKellar (1981) 38 ALR 363 at 373-374 (Deane J); Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24, 39-41 (Mason J, as his Honour then was).
Lo v Chief Commissioner of State Revenue (2013) 85 NSWLR 86; [2013] NSWCA 180 at [9] (Basten JA, Beazley P agreeing).
Catholic Metropolitan Cemeteries Trust v Attorney General of New South Wales (2024) 116 NSWLR 314; [2024] NSWCA 30 at [27] (Leeming JA, Bell CJ and Ward P agreeing) and the authorities there cited, including Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 582; [1992] HCA 10 at 175 CLR 581-582 (Mason CJ, Dawson, Toohey and Gaudron JJ).
See [65(1)(b)]-[65(1)(f)] above.
See [65(2)] above.
Section 153 is reproduced at [94] above.
See [89] above.
Section 149(2)(a) reproduced at [91] above.
See [98]-[99] above.
CNL, s 235.
See Re Azmac Pty Ltd (in liq) (2020) 146 ACSR 113; [2020] NSWSC 204 at [41]-[44] (Rees J) and the authorities there referred to.
See CNL s 135(a)(ii).
(1992) 175 CLR 564
(2007) 211 FLR 137
(2024) 116 NSWLR 314
(2013) 85 NSWLR 86
(1986) 162 CLR 24
(1981) 38 ALR 363