Jahani, in the matter of Ralan Group Pty Ltd (in liquidation) [2022] FCA 107

APPLICATION 20 By an interlocutory process dated 5 November 2020, the liquidators applied under s 90-20 of the Insolvency Practice Schedule (Corporations) being Sch 2 to the Corporations Act 2001 (Cth) (IPS (Corporations)) for orders under s 90-15(1) of the IPS (Corporations) and s 96 of the Trusts Act 1973 (Qld). The application related to the dispersal of moneys held to the credit of the NAB Trust Account and the payment of the liquidators' remuneration and expenses. A copy of the application and Mr Jahani's affidavit affirmed on 4 November 2020 and exhibit SJ-3 were served on the Australian Securities and Investments Commission (ASIC) on 13 November 2020. ASIC indicated that it did not intend to appear at the hearing of the application.

Liquidators' position as at 21 December 2020 21 The liquidators initially sought a direction that they would be justified in adopting a process for assessing and verifying claims to amounts standing to the credit of the NAB Trust Account. The proposed process, as outlined in the September Circular, was as follows. No return would be made to 939 depositors with a balance of less than $500 because it would cost more than $500 per depositor to establish each claim to the funds. After payment of the liquidators' remuneration and legal costs, approximately 85 cents in the dollar would be paid to 139 depositors with over $500, provided they were able to provide a payment receipt or original bank statement showing the original payment to the Company. 22 The liquidators sought that direction because it was Mr Jahani's opinion that the NAB Trust Account was the only source from which the liquidators' remuneration (which includes remuneration for the period that they were administrators) and expenses could be paid. The evidence given in his affidavits affirmed on 4 November 2020 and 1 June 2021 is to the effect that: (a) The Company's books and records indicate that it is a creditor of seven related entities in an aggregate amount of $29,406,902 but the liquidators do not currently propose any actions for recovery of that amount. The liquidators are also liquidators of the related entity debtors and they do not expect those entities to pay any dividend to unsecured creditors; (b) While there are three term deposit bank accounts, those funds are held on separate and distinct trusts for specific purchasers under specific land sale contracts. Mr Jahani does not believe that there is any basis for the liquidators' remuneration and expenses to be recovered from those funds; and (c) The Company's books record an asset of $413,887.13 as "GST on acquisitions". However, based on the liquidators' investigations, that "purported asset" has no realisable value. That is because it appears to be a book entry for capitalisation of GST from time to time, rather than the net balance of GST input tax credits (or any other amount) which the Company might be able to claim from the Commissioner of Taxation, who is owed in excess of $892,000 in respect of the Company's GST obligations. 23 In written submissions filed on 2 December 2020, the liquidators relied on Mr Jahani's affidavit affirmed on 4 November 2020. The submissions: (a) Noted that notice of the liquidators' intention to file the interlocutory application was provided to each person who appeared to have an entitlement to moneys in the NAB Trust Account and the chief executive of the OFT; (b) Relied on authorities relevant to s 90-15 of the IPS (Corporations): In the matter of Go Energy Group Ltd [2019] NSWSC 558 at [16] (Black J); In the matter of Courtenay House Capital Trading Group Pty Ltd (in liq) [2019] NSWSC 495 at [2] (Black J); In the matter of Hawden Property Group Pty Ltd (in liq) (ACN 003 528 345) [2018] NSWSC 481; (2018) 125 ACSR 355 at [6]-[8] (Gleeson JA); Walley, in the matter of Poles & Underground Pty Ltd (Administrators Appointed) [2017] FCA 486 (Gleeson J) and In the matter of RCR Tomlinson Ltd (administrators appointed) and Ors [2020] NSWSC 735 (Black J); (c) Submitted that it would be sensible, practical and expedient in the circumstances that claims of less than $500 be treated as having no entitlement, relying on Georges v Seaborn International (Trustee), in the matter of Sonray Capital Markets Pty Ltd (in liq) [2012] FCA 75; (2012) ACSR 442 (Sonray) at [129]-[136] (Gordon J); and (d) In relation to approval of the liquidators' remuneration where a statutory trust is involved, relied on In the matter of AAA Financial Intelligence Ltd (in liquidation) ACN 093 616 445 [2014] NSWSC 1004 at [13] (Brereton J) (AAA Financial Intelligence Ltd (in liquidation)) and In re MF Global Australia Ltd (in liq) [2012] NSWSC 994 (Black J). They also relied on Kelly, in the matter of Halifax Investment Services Pty Ltd (in liquidation) (No 6) [2019] FCA 2111 (Gleeson J) and In the matter of Independent Contractor Services (Aust) Pty Limited ACN 119 186 971 (in liquidation) (No 2) [2016] NSWSC 106 (Brereton J). The evidence in support of the claimed remuneration was the Remuneration Report.

Opposition of interested persons as at 21 December 2020 24 Both the approval of the remuneration and expenses out of the NAB Trust Account and the direction were resisted by a number of persons who filed correspondence, notices of appearance, grounds of opposition, affidavits and submissions concerning the application. I note that some of the material filed in affidavit form can properly be accepted only as submissions. They were depositors to the NAB Trust Account or claimed to represent people who entered into contracts for the purchase of apartments "off the plan" from companies in the Ralan Group. They were given leave to be heard on the application without ultimate objection by the liquidators. A basis of objection to leave being given to some was noted in the liquidators' written and oral submissions. I will refer to these people as "interested persons". Given that much of the material was repetitive, I will refer to only some of the materials. Submissions from the interested persons are generally considered chronologically in these reasons. 25 Suichin (Erin) Lin's affidavit made on 18 November 2020 contained correspondence with the liquidators that she made on behalf of herself and the "Ralan Claims Support Committee". 26 The correspondence raised points made in a number of the submissions, notices of appearance and affidavits. It was to the effect that: Depositors were concerned about the provision of the wrong email address for response to the September Circular. They were also concerned that it was not sent to some "creditors" at all. Many of the depositors have suffered tremendous financial losses, are elderly, cannot speak English or do not understand legal terms. They feel cheated and distrust Grant Thornton whom they would like to see removed. They feel that Grant Thornton failed to protect unsecured creditors' interests. The depositors objected to depositors with balances less than $500 receiving nothing and to payment of the liquidators' remuneration and expenses from the NAB Trust Account at all. The depositors wished to review invoices, not just the general information in the Remuneration Report and they said they would arrange for volunteers to attend to distribution so that costs would be minimised. 27 In a response provided to Ms Lin on 12 November 2020, Grant Thornton: (a) Explained the error in the email address for receipt of responses to the September Circular and the steps taken to address it. The explanation was in terms similar to Mr Jahani's evidence to this Court; (b) Said that the September Circular was emailed to all creditors on the list of creditors relating to the Company. Creditors of other Ralan Group entities would not have received the email and Grant Thornton received only one email advising that a depositor did not receive an email, which they later found in their spam filter. On the day Grant Thornton issued the September Circular, they also published a copy on their website; (c) Said that a full accounting of all remuneration claimed by Grant Thornton was in the Remuneration Report and that it complies with insolvency practice regulations. Legal invoices could not be provided to the depositors because of legal privilege. The liquidators advised ASIC that the resolutions to approve payment of the liquidators' remuneration proposed in the September Circular were not passed. Court approval would now be sought and depositors would be advised of the terms of the proposed application; (d) Said that only the liquidators could attend to distribution of the funds in the NAB Trust Account because the use of volunteers would involve too great a risk of defalcation; and (e) Said that the September Circular was not an update in relation to the liquidation of all companies in the Ralan Group or recovery actions to be taken in relation to those other companies. The liquidations of Ralan Group companies were not pooled. Litigation funders were bringing actions on behalf of creditors of the Ralan Group companies. The liquidators were not in a position to bring action against other Ralan Group companies in relation to funds released under side letters: the Company suffered no loss, the depositors did. 28 By an email dated 13 November 2020, Ms Lin requested the liquidators to transfer the NAB Trust Account to a fund directed by the chief executive under the Administration Act or otherwise to ASIC. In submissions filed on behalf of the liquidators on 2 December 2020, the liquidators referred to the request conveyed by Ms Lin. They said that they understood it to be a request to adopt the mechanism for the appointment of receivers of the NAB Trust Account under Div 3 of Part 4 of the Administration Act. That was because the powers under ss 62 and 63 of that Act are predicated on the chief executive having appointed a receiver under s 47 of the Administration Act. The liquidators' position at that stage was that there did not appear to be any direct mechanism by which the funds in the NAB Trust Account could be paid to the chief executive. 29 Ms Lin annexed a range of documents to her affidavit dated 18 December 2020 which was relied on in many of her submissions which she filed subsequently and her statement of 21 December 2020. I note the following matters raised by Ms Lin. 30 Ms Lin says that her group have questions about the legality, independence and justice of Grant Thornton's role as administrators and liquidators. Ms Lin states that her group have come to believe that Grant Thornton assisted with "serious misconducts" to allow crime to be gotten away with and continued damage to the interests of unsecured creditors. In support of this, Ms Lin submitted as follows: 31 First, Deloitte referred Grant Thornton to the Ralan Group and the Deloitte receivers were appointed to "Gold Coast entities" of Ralan Group by Wingate. Ms Lin also refers to a similar appointment in relation to the Arncliffe project. 32 Annexure SL-4 is Grant Thornton's declaration of independence, relevant relationships and indemnities (DIRRI) which Ms Lin says was part of the notification to creditors of the administrators' appointment of the Ralan Group companies on 31 July 2019. I note that, in the DIRRI, Grant Thornton said: This appointment was referred to us by Deloitte Touche Tohmatsu Limited ("Deloitte") ("the Referrer"). The [Ralan] Group are a tax client of Deloitte and sought initial advice from Deloitte prior to our involvement. We believe that this referral does not result in a conflict of interest or duty because: • There is no commercial relationship, arrangement or connection with the Referrer that would challenge our objectivity; • The Referrer has the discretion to refer potential insolvency appointments to any insolvency practitioner(s) of its choosing. There is no expectation, agreement or understanding that the Referrer will refer any potential insolvency appointments to GTAL going forward. The Referral of potential insolvency appointments going forward are not contingent on the outcome of this appointment; • Our relationship with the Referrer will not influence our ability to comply with our statutory and fiduciary obligations associated with this appointment; • No fee has or will be paid for this referral; • Requests for consent to act as an external administrator from advisors are common practice and do not impact on our independence ln carrying out our duties as Administrators; and • Any work previously carried out in respect of other matters referred by the Referrer does not have any bearing on this Administration and will not impact on compliance with our statutory and fiduciary duties. Prior to our appointment, we had the following meetings and telephone discussion with the Group's advisor and its director: • On 26 July 2019, Said Jahani received a telephone call from the Referrer to discuss a potential insolvency appointment; • On 27 July 2019, Said Jahani and his staff attended a meeting with the Referrer to discuss the background and financial position of the Group; and • On 29 July 2019, Said Jahani and his staff attended a meeting with the Referrer and a director of the Group, William O'Dwyer, to further discuss the background and financial position of the Group and the implications of the formal insolvency process. We received no remuneration for this advice. In our opinion, the aforementioned meetings and telephone conversation do not result in a conflict of interest or duty, or affect our independence for the following reasons: • ARITA's Code of Professional Practice specifically recognise the need for practitioners to provide advice on the insolvency process and the options available and do not consider such advice results in a conflict or is an impediment to accepting the appointment; • Advice was only provided to the Group in respect of the formal insolvency process. No personal advice was provided to the board, the directors or other stakeholders; and • The pre-appointment advice will not influence our ability to be able to fully comply with statutory and fiduciary obligations associated with the Administration or the Group in an objective and impartial manner. We have provided no other information or advice to the Group, the directors and its advisors prior to our appointment beyond that outlined in this DIRRI. 33 Second, Ms Lin submitted that Grant Thornton refused to give lawyer Mathew Bransgrove (who Ms Lin says had nearly 500 retainers from unsecured creditors) access to "Ralan's record[s]" to search for evidence for a proposed class action against some secured creditors, including Wingate and Westpac, and against Deloitte. 34 Ms Lin relies on annexure SL-10 which contains email correspondence between Mr Bransgrove and Ms Lin and between Mr Bransgrove and Ashurst (the solicitors for the administrators) concerning Ashurst's letter of 5 December 2019. In Ashurst's letter, Grant Thornton agreed to provide Mr Bransgrove with access to some of the Ralan Group's books and records "identified by [the administrators] as part of their investigations focusing on the information made available to advisors and lenders in relation to the release of deposits". Mr Bransgrove complained that: Grant Thornton was not prepared to grant access to all of the Ralan Group's books and records; Grant Thornton would not make the records easily searchable (for example on a document management database); Mr Bransgrove would only be given two days to consider the material and he would not be allowed to copy documents; and The liquidators claimed a fee of $15,000 to cover their expenses. These matters were also the subject of submissions filed by Jingjing Fu on 18 December 2020, submissions made by Xiao Qing Wu that were accepted for filing on 11 December 2020 and an affidavit made on 18 December 2020 containing submissions by Stanley Xie. 35 Ms Lin noted the advice received from Piper Alderman on 9 December 2020 that the Supreme Court of New South Wales had approved an application on behalf of a number of unsecured creditors of the Ralan Group for examinations into the involvement of Deloitte and BDO Australia in the affairs of the Ralan Group. 36 Third, Ms Lin submitted that Grant Thornton poorly managed voting on a deed of company arrangement proposed to creditors of the Ralan Group at the second creditors' meeting. I take this to be a reference to the deeds of company arrangement considered at the creditors' meeting held on 9 December 2019. Annexure SL-9 is a copy of an email chain in January 2020 between Ms Lin and employees of Grant Thornton in relation to voting at the meeting (which I take to be the second creditors' meeting on 9 December 2019). Ms Lin claims that the votes of some creditors were not counted in relation to the deed of company arrangement proposals relating to Ruby 3 and Ruby 4 Towers. 37 Fourth, Ms Lin complains that Grant Thornton has stopped investigation of unfair preferences and voidable transactions despite what was said on page 13 of the Administrators' Report as follows: We estimate that there may be up to $11 million in unfair preferences and voidable transaction recoveries open to a Liquidator to pursue should the Group be placed into Liquidation at the second meeting of creditors. The actual claims may be significantly greater than $11 million, however, at this stage $11 million represents our best estimate of what may be recovered. 38 Fifth, Ms Lin relies on the fact that, at page 14 of the Administrators' Report, the administrators recommended against voting in favour of the deeds of company arrangement proposed by Mr O'Dwyer as follows: It is the Administrators' recommendation, for the reasons outlined on page 103, that the Group, including the DOCA Entities and Ralan Arncliffe Pty Ltd, be wound up. The Administrators' reasons include, but are not limited to: 1. The Group is clearly insolvent and requires a mechanism to deal with creditors' claims 2. There are a number of potential actions that could be commenced by a Liquidator, subject to sufficient funding, which would not be possible under the terms of the proposed DOCAs; and 3. It is the Administrators' opinion that the proposed DOCAs are highly contingent and likely to fail. but the chair of the second creditors' meeting exercised a casting vote in favour of one deed of company arrangement. Annexure SL-8 is said to be a partial extract of the minutes of the second creditors' meeting and it provides as follows: The Chairperson stated that for Ralan Arncliffe Pty Ltd, creditors voted for liquidation and against the DOCA and as result Ralan Arncliffe Pty Ltd would enter into liquidation. The Chairperson stated that for the DOCA Entities, creditors have voted for the DOCA and against liquidation. The breakdown of the poll results was tabled for creditors present at the meeting and is attached as Appendix E. The Chairperson advised that with the exception of Ralan Paradise No.2 Pty Ltd ("RP2"), all other entities voted in favour of the DOCA by majority in value and a majority in number. In RP2, there was a majority in number, but not a majority in value which means there is a split vote. The Chairperson explained that where there is a split vote, the law dictates that the Chairperson may exercise a casting vote. Taking into account the ARITA Professional Code of Practice and case law authority, pursuant to IPR 75-115, the Chairman noted that he would exercise a casting vote in favour of the DOCA proposal for RP2. The Chairperson gave the following reasons as to why he voted in favour of the DOCA proposal: • In relation to RP2, we have a majority in number (112 v 103) supporting a DOCA but not in value, with $87,720 v $60,307 voting against. • Taking into account the ARITA Professional Code of Practice and case law authority, pursuant to IPR 75-115, as chairman of the meeting, I am exercising a casting vote for RP2 in favour of the DOCA for the following reasons: 1. The estimated return to creditors of RP2 alone purely from liquidator actions in a liquidation scenario is currently nil. Creditors of RP2 will therefore not receive a presently identifiable benefit if RP2 goes immediately into liquidation as opposed to entering into a DOCA. 2. All creditors of RP2 have been admitted to vote for the value of their deposit that was not released to Ralan Capital Investments Pty Ltd and is held by Ralan Property Services QLD Pty Ltd, which is currently treated as being held on trust. I note that there is currently $382,356 being held in the trust account of Ralan Property Services QLD Pty Ltd in relation to RP2 creditors. The claim of creditors of RP2 is for the return of their unreleased or reduced "deposit" for each claimant. The return available in respect of that claim, will not change whether RP2 goes into liquidation or enters into a DOCA. Our expectation is that the creditors of RP2 will … 39 Sixth, Ms Lin claimed that the liquidators were trying to mislead the depositors and the Court into believing that the funds in the NAB Trust Account were assets of the Company and states that the release of those funds should not be treated as a dividend to creditors. She relied on annexures SL-1 and SL-12 which are copies of a solicitor's covering letter to Ms Lin dated 22 and 23 March 2016 confirming exchange of contracts for the purchase of residential units from Ralan Paradise No. 3 Pty Ltd and Ralan Paradise No. 2 Pty Ltd, and cl 8.11(d) and (e) to cl 8.14(b)(i) of the respective contracts. Ms Lin notes that cl 8.14 states that if the contract is terminated without default by the buyer, the deposit must be given back to the buyer. 40 Seventh, Ms Lin opposed the liquidators' proposal as too costly and submitted that if the Court approves the liquidators' application then the unsecured creditors will "suffer another hard hit mentally". She submitted that, having regard to the Administration Act, the liquidators could not charge their "service fees" to the NAB Trust Account. Ms Lin requested the Court's assistance in setting up a "self-managed" trust fund to help the depositors get their trust moneys. 41 In submissions dated 20 January 2021, Ms Lin made a further proposal for distribution of the NAB Trust Account to depositors relying on a former Ralan Group employee's knowledge of Ralan Group's systems and identification of depositors in information contained in annexure E to the COI Report which was annexed to Ms Lin's affidavit dated 21 December 2020. I note that the COI Report related to Ralan Capital Investment Pty Ltd, Ralan Arncliffe Pty Ltd and Ruby Apartments Pty Ltd and that the Administrators' Report at page 6 indicates that those were the only Ralan Group entities in respect of which the Committee of Inspection was appointed. 42 Mr Xie raised the following issues in addition to those noted by Ms Lin. I note that Mr Xie is not a lawyer, although he purports to act under powers of attorney given by Wenhao Tony Ye, Guoying Li, Lin Chen, and Jin Ju Yan. The liquidators note that Mr Xie claims to be a creditor of the Company but he does not appear to be a depositor and Mr Yan also appears not to be a depositor. In summary, Mr Xie: (a) Claimed that Grant Thornton had a conflict of interest in the Ralan Group; (b) Said that there were procedural irregularities in the first creditors' meeting of the Ralan Group, that Grant Thornton "monopolised procedure[s]" and did not give an opportunity for the appointment of a new voluntary administrator, an assertion he made at the first creditors' meeting to a Grant Thornton staff member who denied that to be true; (c) Said that, even though he had been appointed to the Committee of Inspection at the first creditors' meeting he had not been asked to do anything in overseeing the administration and he had been asked to attend only one meeting of the Committee of Inspection which was held on 20 November 2019; (d) Made a number of assertions that appear to relate to a deed of company arrangement proposed by Mr O'Dwyer and the appointment of the Deloitte receivers to a number of Ralan projects; and (e) Asserted that Grant Thornton refused to give "key evidence" to Mr Bransgrove and makes a number of complaints of the kind outlined at [34] above in relation to that matter. 43 Other matters raised in notices of appearances and submissions filed by depositors before the interlocutory hearing on 21 December 2020 submitted that: (a) Grant Thornton should work in the creditors' interests because the conduct of the Ralan Group and Mr O'Dwyer was criminal and Ralan Group traded while insolvent since 2014. The liquidators should investigate to find "hidden money", not seek "easy money" for their own remuneration from the NAB Trust Account. After they have been defrauded of so much, the depositors' money in the NAB Trust Account is their "last piece of hope" and they would suffer further mentally if the liquidators were paid from the NAB Trust Account; (b) Grant Thornton was referred to Mr O'Dwyer by Deloitte. Deloitte had knowledge of the Ralan Group's practices from at least February 2015. Deloitte were appointed as receivers of a number of Ralan Group companies and depositors believe those arrangements were made to exploit loopholes in the law to get away with crime; (c) Grant Thornton is doubling up on its claims to remuneration or making excessive claims to remuneration having already received $1.4 million. I note that the remuneration claimed in the COI Report was in relation to the voluntary administration of Ralan Capital Investment Pty Ltd, Ralan Arncliffe Pty Ltd and Ruby Apartments Pty Ltd (but not the Company) of $1,149,557 (for the period from 30 July 2019 to 10 November 2019) and $304,000 (for the period from 11 November 2019 to 9 December 2019); (d) During the voluntary administration period, creditors' emails and calls were not returned or answered and requests from the Committee of Inspection were rejected. Grant Thornton did not arrange a translator at the first creditors' meeting; (e) Three law firms were actively preparing class actions for unsecured creditors but ultimately ceased. Grant Thornton should co-operate with those law firms but instead they asked an unreasonably high fee for access to documents so that crimes have not been exposed; and (f) The moneys in the NAB Trust Account are not assets of the Company; they should be protected under s 15 of the Administration Act which is said to state that withdrawals cannot be made to cover expenses without the consent of both parties to the transaction.

Sections 20-22 of the Administration Act 44 Having regard to the terms of ss 20-22 of the Administration Act (including the imposition of criminal liability for breach of ss 21 and 22), I considered it appropriate to hear from the chief executive who was not represented when the hearing on 21 December 2020 commenced. Sections 20-22 of the Administration Act provide as follows: 20 Trust money not available to agent's creditors An amount paid, or required to be paid, to a trust account under this division can not be - (a) used for payment of the debt of a creditor of an agent; or (b) attached or taken in execution under a court order or process by a creditor. Division 3 Payments from trust accounts 21 When payments may be made from trust accounts (1) An amount paid to a trust account must be kept in the account until it is paid out under this Act. Maximum penalty - 200 penalty units or 2 years imprisonment. (2) An amount may be paid from a trust account only in a way permitted under this Act. Maximum penalty - 200 penalty units or 2 years imprisonment. 22 Permitted drawings from trust accounts (1) An agent may draw an amount from the agent's trust account to pay the agent's transaction fee or transaction expenses for a transaction only if - (a) the amount is drawn against the transaction fund for the transaction; and (b) the agent is authorised to draw the amount under this section. Maximum penalty - 200 penalty units or 2 years imprisonment. (2) The agent is authorised to draw an amount from the transaction fund to pay a transaction expense when the expense becomes payable. (3) After the transaction is finalised, the agent is authorised - (a) to draw an amount from the transaction fund to pay the person entitled to the amount, or someone else in accordance with the person's written direction, that is equal to the difference between - (i) the balance of the transaction fund; and (ii) the total of the agent's transaction fee and any outstanding transaction expense; and (b) after the amount, if any, mentioned in paragraph (a) has been paid - to draw the agent's transaction fee from the transaction fund. Example of when a transaction is finalised - the settlement of a contract for the sale of property or the termination of the contract (4) For subsection (3)(a) or (b), if a dispute about the transaction fund arises, the transaction is not taken to be finalised until the agent is authorised to pay out the transaction fund under division 5. (5) The agent must pay an amount mentioned in subsection (3)(a) to the person entitled to it, or someone else in accordance with the person's written direction - (a) if the person asks, in writing, for the balance - within 14 days after receiving the request; or (b) if the person has not asked, in writing, for the balance - within 42 days after the transaction is finalised. Maximum penalty - 200 penalty units or 2 years imprisonment. (6) In this section - transaction expense means an expense an agent is authorised to incur in connection with the performance of the agent's activities for a transaction. transaction fee means fees, charges and commission payable for the performance of an agent's activities for a transaction. transaction fund means an amount held in an agent's trust account for a transaction.

Chief executive's appearance on 21 December 2020 45 After a brief adjournment of the hearing on 21 December 2020, Peter O'Connor, a Senior Principal Lawyer for the Crown Solicitor of Queensland, appeared and submitted that the chief executive had not received a letter giving notice of the interlocutory application from the liquidators' solicitors. Following the hearing, Mr Jahani had a telephone conversation with Mr Browne of the OFT and he was informed, for the first time, that the OFT was considering the potential for the appointment of a receiver to the NAB Trust Account pursuant to the Administration Act.

Sections 47, 48, 78 and 79 of the Administration Act and appointment of receiver of NAB Trust Account 46 Sections 47 and 48 of the Administration Act provide as follows (note to s 47(1) excluded): 47 When receiver may be appointed (1) If the chief executive believes, on reasonable grounds, defalcation has, or may have, been committed in relation to an agent's trust account, the chief executive may appoint a receiver if - (a) the agent consents to the appointment; or (b) the chief executive - (i) gives the agent written notice - (A) stating the chief executive proposes to appoint a receiver on the ground that defalcation has, or may have, been committed in relation to the agent's trust account; and (B) outlining the facts and circumstances forming the basis for the ground; and (C) inviting the agent to show, in writing, within a stated time of at least 21 days, why the appointment should not be made; and (ii) after considering any written representations given within the stated time, still considers the ground exists. (2) The chief executive may immediately appoint a receiver if the chief executive believes, on reasonable grounds, a person can not obtain payment or delivery of trust property held for the person by an agent because of - (a) the agent's mental or physical infirmity; or (b) the agent's death; or (c) the abandonment of the agent's business; or (d) if the agent is a licensee - (i) the agent's disqualification from holding a licence; or (ii) the cancellation or suspension of the agent's licence; or (iii) a refusal to renew the agent's licence; or (iv) the expiry of the agent's licence. 48 Trust property over which receiver may be appointed A receiver may be appointed over trust property - (a) held by an agent; or (b) held by another person for an agent; or (c) recoverable by an agent; or (d) if an agent is dead, that may be recoverable by the agent's personal representative. 47 On 22 December 2020, the OFT discovered that the liquidators' solicitors' letter dated 13 October 2020 advising of the liquidators' intention to make the interlocutory application had been received by the OFT but, due to administrative oversight, it was forwarded to the incorrect business unit for consideration. The Court was advised promptly of that fact. The chief executive appeared as amicus curiae on all occasions subsequent to 21 December 2020. 48 By written submissions filed on 20 January 2021, the chief executive advised that: The prima facie evidence supported an allegation that deposit funds had not been "reinvested" in accordance with the terms of contracts signed by investors for the purchase of properties "off the plan". On that basis, there may have been a "defalcation". That enlivened the chief executive's discretion to appoint a receiver under s 47 of the Administration Act. The process had begun to make an appointment. Pursuant to s 79(2)(a)(i) of the Administration Act, the receiver would be remunerated through the claim fund established under s 78 of the Administration Act and in accordance with a costs agreement settled at the time of appointment. However, work undertaken by the liquidators prior to their appointment as receivers would be viewed separately from "future work" and it would not be recoverable against the claim fund. 49 Section 78 of the Administration Act relates to the establishment of the claim fund, its funding by the Treasurer of Queensland and how moneys in it are to be held by the relevant department. Section 79 provides as follows: 79 How fund may be applied (1) The fund must be used to pay the amount of all claims allowed against the fund. (2) The fund may also be used to pay - (a) the remuneration and costs of the following - (i) a receiver appointed under section 47; (ii) a special investigator appointed under section 70; or Note - The remuneration and costs of a receiver are recoverable under section 64 (Recovery of remuneration and costs). The remuneration and costs of a special investigator are recoverable under section 75 (Recovery of remuneration and costs). Amounts recovered under these sections by the chief executive are paid to the fund under section 120 (Recovery of payments - general). (b) a special payment by the chief executive under part 8, division 2. (3) The Treasurer may transfer an amount from the fund to the consolidated fund. 50 On 10 February 2021, the chief executive appointed Messrs Jahani and Killer as receivers of the NAB Trust Account pursuant to s 47(1)(a) of the Administration Act. That appointment eliminated the need for a direction concerning the adoption of a process for assessing and verifying claims to amounts standing to the credit of the NAB Trust Account and meant that the receivers' remuneration for assessing claims on that Account would be paid out of the claim fund under s 79.

Case management hearing on 24 February 2021 and orders then sought by liquidators 51 A case management hearing was held on 24 February 2021 and following it orders were made for the filing of further evidence and submissions. The application was set down for hearing on 1 June 2021 having regard to the availability of counsel. The liquidators filed submissions on 17 and 26 March 2021 and the chief executive filed submissions on 7 April 2021. The liquidators filed a further affidavit affirmed by Mr Jahani on 17 March 2021. 52 The orders which the liquidators then sought were as follows: (a) The Court approve the liquidators' remuneration incurred in connection with investigating and administering the funds in the NAB Trust Account and this remuneration be fixed in the amount of $177,416.41 plus GST of $17,741.64 for the period from 30 July 2019 to 1 March 2021; (b) Their remuneration be paid out of the NAB Trust Account; and (c) Their costs and expenses incurred in connection with investigating and administering the funds in the NAB Trust Account and this application be paid out of the NAB Trust Account on an indemnity basis, subject to their undertaking to the Court that they will limit their claims to be paid any of those amounts out of the NAB Trust Account to an aggregate amount not exceeding $215,481 plus GST of $21,548.10 (upon the liquidators claiming, receiving and re-contributing to the NAB Trust Account GST input tax credits received on that GST component of $21,548.10). Mr Jahani deposed that the cap represented a 23% discount to remuneration and expenses actually incurred. The Court notes that it was Mr Jahani's evidence as at 17 March 2021 that the legal costs that the liquidators seek to recover are $101,617.14 plus GST of $10,033.71. 53 It was (and is) the position of both the chief executive and the liquidators that if the liquidators' remuneration and expenses incurred prior to their appointment as receivers and the costs of this application are paid out of moneys contributed to the NAB Trust Account then there will be a shortfall in moneys available to pay depositors in full. They also agreed that if the liquidators' remuneration and expenses are not paid out of the NAB Trust Account, there will be no shortfall. The liquidators submitted that, having regard to the cap on the remuneration and expenses they claim, depositors would be paid at least 90 cents in the dollar if they were paid out of the NAB Trust Account.

Liquidators' submissions 54 In their submissions filed in March 2021 and in oral submissions made at the hearing on 1 June 2021 the liquidators submitted in summary as follows. 55 First, there is no direct authority as to whether liquidators' remuneration may be paid from a trust account established under the Administration Act notwithstanding the terms of s 21 of the Administration Act. 56 Second, they relied on the "salvage principle" in In re Universal Distributing Company Ltd (in liquidation) [1933] HCA 2; (1933) 48 CLR 171 at 174-175 (Dixon J, as his Honour then was). They submitted that it is settled law that the remuneration, costs and expenses incurred by a person such as a liquidator in preserving, recovering and realising a fund on behalf of others should be borne by the fund and that entitlement is secured by an equitable lien over the fund. They relied on Coad v Wellness Pursuit Pty Ltd (in liq) [2009] WASCA 68; (2009) 40 WAR 53 (Wheeler, Pullin and Buss JJA) and In the matter of Stephen Parbery, Nicholas Martin and Mark Robinson as liquidators of Trio Capital Limited (in liquidation) [2012] NSWSC 597; (2012) 88 ACSR 700 (Trio Capital Limited (in liquidation)) at [18] (Black J). Where the company in liquidation is not a trading trust, a claimant to a fund must meet the reasonable administration costs of administering the claim: see Re Greater West Insurance Brokers Pty Limited [2001] NSWSC 825; (2001) 39 ACSR 301 (Re Greater West Insurance Brokers) at [19] (Young CJ in Eq), relying on Re G B Nathan and Co Pty Ltd (in liq) (1991) 24 NSWLR 674 (Re G B Nathan) (McLelland J). 57 Third, the liquidators submitted that: A liquidator is entitled to be indemnified out of the trust assets for reasonable remuneration, costs and expenses, relying on 13 Coromandel Place Pty Ltd v C L Custodians Pty Ltd (in liq) [1999] FCA 144; (1999) 30 ACSR 377 at [34] (Finkelstein J). While s 22 of the Administration Act constrains payments out of a trust fund by an agent, it does not prevent the use of those funds to indemnify a liquidator for reasonable remuneration, costs and expenses. There would be inherent unfairness in depriving liquidators of reasonable remuneration and expenses where they have administered trust funds for a long period for the benefit of contributors to the fund. The liquidators did not indicate how such a payment would be authorised under the Administration Act. 58 They said that there would be particular unfairness where, as here, neither the contributors to the fund nor the chief executive has taken steps to have a receiver appointed and allowed the liquidators to undertake work for the benefit of those contributors. Such an outcome would result in insolvency practitioners being unwilling to undertake the role of liquidator: see Re Greater West Insurance Brokers at [22]. 59 Fourth, the liquidators said that this approach is consistent with cases which found that an external administrator's reasonable remuneration and expenses should be paid in priority to persons with equitable claims upon funds held upon statutory trusts. They relied on Re Greater West Insurance Brokers, which concerned s 28(4) of the Insurance (Agents and Brokers) Act 1984 (Cth) (repealed) (Brokers Act). They also relied on In the matter of All Class Insurance Brokers Pty Ltd (in liq); Vardy v Westpac Banking Corporation [2014] NSWSC 475 (White J) (All Class Insurance Brokers) and Warner, in the matter of GTL Tradeup Pty Ltd (in liq) [2015] FCA 323; (2015) 104 ACSR 633 (Farrell J) (Re GTL Tradeup), which concerned reg 7.8.03 of the Corporations Regulations 2001 (Cth). See also Sonray at [291]ff and In re MF Global Australia Ltd (in liq) (No. 2) [2012] NSWSC 1426 at [50], [54] and [61] (Black J). That is because, while none of those cases dealt with an express provision such as s 21(2) of the Administration Act, there was in each case a de facto requirement to only use funds as specified in the legislation. For instance, in Re Greater West Insurance Brokers, payment of remuneration usurped the statutory priorities under the Brokers Act, with the effect that there was less money to be paid to other claimants on the fund. 60 Fifth, the liquidators submitted that even if the Court were to find that ss 21 and 22 of the Administration Act prohibited the payment of moneys from the NAB Trust Account to the liquidators, nothing in the Administration Act operates to subvert the existence of an equitable lien on those funds. In this regard, the liquidators relied on s 53 of the Administration Act which relevantly provides as follows: 53 Possession of receivership property (1) A receiver may take or enter into possession of receivership property. … (5) The receiver may take or enter into possession of receivership property under subsection (1) despite a lien or other security over it claimed by another person. (6) However, the taking or entry into possession does not affect the person's claim to the lien or other security against a person other than the receiver. 61 The liquidators submitted that, in light of the foregoing: … any funds paid to beneficiaries are impressed with an equitable charge such that part of those funds ought to be distributed to the Liquidators (potentially, having regard to the operation of ss 21 and 22 of the [Administration] Act, by the Receivers once those funds are in the possession of the Receivers and form part of the receivership property under s 53 of the [Administration] Act) in satisfaction of their reasonable remuneration and expenses.

Chief executive's submissions 62 In written submissions filed on behalf of the chief executive on 7 April 2021 and at the hearing on 1 June 2021, Mr O'Connor submitted that: (a) The chief executive does not cavil with the "uncontroversial notion" that liquidators are entitled to be indemnified out of trust assets for their costs and expenses associated with a liquidation; (b) However, the cases relied on by the liquidators are decided under different legislative regimes from this case and the implication by law of a right to claim an equitable lien for remuneration is subject to the wording of the legislative context in which the claim arises; and (c) Section 21 of the Administration Act is drafted in unequivocal terms and does not permit such an implication: moneys may only be distributed from a trust account as permitted under the Administration Act and there is no manner prescribed in that Act for the distribution of funds to an external administrator upon a licensee becoming insolvent. The chief executive acknowledged that that view would have the result that the industries which must maintain trust accounts governed by the Administration Act would be the only industries where a liquidator could be denied reasonable remuneration for their work connected with the liquidation. 63 The chief executive noted the decision in Wicks v Michael Giles Real Estate Pty Ltd (In Liquidation) [2004] QSC 438. In that case, the only licensed director died so that there was no one authorised under the Property Agents and Motor Dealers Act 2000 (Qld) (PAMD Act) to operate a trust account. The trust account was subject to ss 383 and 384 of the PAMD Act which are in relevantly the same terms as ss 20 and 21 of the Administration Act. As a result, landlords were unable to be paid rent which had been paid into the trust account by tenants so that they were taking their business elsewhere, thus deflating the value of the rent roll that was the respondent company's main asset for which there was a willing purchaser. No one was willing to be appointed as a director of the respondent company because there were substantial group tax and other liabilities for which a new director might become liable under the Income Tax Assessment Act 1997 (Cth). It was common ground that, as there was no default or defalcation, there was no basis for the chief executive to appoint a receiver to the trust account under the PAMD Act. Accordingly, the Court appointed a receiver. The liquidator of the respondent company, who had also been appointed as receiver to the trust account and provisional liquidator, sought directions concerning payments to be made out of the trust account to property owners and for remuneration and expenses incurred as receiver. 64 Justice Moynihan of the Supreme Court of Queensland found that the combined effect of ss 383 and 384 of the PAMD Act was that moneys in the trust account could only be paid to the property owners on whose behalf moneys were held on trust: Wicks at [19]. His Honour found that the PAMD Act did not authorise payment of the receiver's remuneration and expenses out of the trust account and he rejected an argument that the receiver was not a "creditor" of the respondent company in relation to remuneration and expenses: see Wicks at [19]-[21] and [29]. His Honour then said at [23]-[25]: 23 The applicant, citing Re Oygevault International BV (In Liquidation) 14 ACSR 245 considered making a submission that the receiver's remuneration be treated as an expense in the winding up rather than a deferred expense. There was, however, no evidence as to the effect of such an order on what was otherwise available for unsecured creditors. 24 It is, however, unnecessary to consider that aspect of the matter because after taking instructions counsel for the applicant informed me that he did not pursue the point since there were sufficient funds available in any event. 25 Those being the consideration, I direct: - 1. Property owners who had appointed the company as agent to manage the letting of properties are entitled to be paid rental deposits paid after 16 July 2004 to the company by the tenants of those properties. 2. The property being the trust accounts conducted under the Property Agents and Motor Dealers Act 2000 (Qld) are Michael Giles Real Estate Pty Ltd as provided by the order of 30 July 2004: (a) The outlays and expenses of the receiver in getting in, preserving and administering the property be treated as an expense under s 556(1)(a) of the Corporations Act in the winding up of Michael Giles Real Estate Pty Ltd. (b) Otherwise, the receivers remuneration in respect of the appointment made on 30 July 2004 be treated as a deferred expense in terms of the winding up of the company as provided for by s 566 of the Corporations Act; 3. I direct the liquidator to act in accordance with directions 1 and 2. 65 The chief executive submitted that: (a) The decision in Wicks is distinguishable from the present case because Moynihan J was not called upon to analyse the PAMD Act in any depth. That was because the amount of the trust fund was sufficient to pay all property owners with claims on the trust account and the receiver's remuneration and expenses, and that was the determinative factor in the orders made. The liquidators agree with that position. (b) The Administration Act repealed the PAMD Act with the intention of simplifying and improving regulation in those industries governed by the PAMD Act. The intention of the legislature was to tighten protection for consumers, that is, purchasers and sellers. The Explanatory Notes to the Agents Financial Administration Bill 2013 (Qld) make it clear the "trust account" and "claim fund" provisions were intended to be for the benefit and protection of persons who might otherwise suffer financial loss as a result of their dealings with agents. They do not expressly refer to the potential for loss arising from liquidation, but rather protection from defalcation or other unscrupulous practices. It might be observed that liquidation may often be the result of such practices. (c) Section 21 of the Administration Act requires that an amount paid to a trust account must be kept in that account until it is paid out under the Administration Act. The unambiguous text of the legislation reveals an intention to protect the depositors from loss and its provisions should not be read narrowly as being designed only to protect against a defalcation by an agent but rather as a global protection from loss of consumers' funds. (d) Amounts held in a trust account established under the Administration Act are not "assets" in the property pool of the company in liquidation. If they were, the broader protective intent of the Administration Act becomes illusory. (e) If the chief executive's construction is not accepted and the liquidators' application is granted, then there will inevitably be a shortfall in the funds to be paid to the claimants in the amount of the liquidators' remuneration and expenses. In those circumstances, it is to be expected that any amounts remaining in the trust account would be transferred to the consolidated fund for disbursement by the chief executive so that, ultimately, the investors would not suffer a pecuniary loss. This submission relied on s 62 of the Administration Act.

Interested persons' submissions 66 A number of submissions filed by interested persons prior to the hearing on 1 June 2021 reiterated points previously made and further submissions which may relevantly be summarised as follows: (a) Section 22 of the Administration Act prohibits payment of the liquidators' remuneration and expenses; (b) Reliance is placed on statements by the Office of Fair Trading of New South Wales concerning the protection of deposits in "off the plan" purchases; (c) Reliance is placed on references to the value of bitcoin and a house situated in Bellevue Hill in New South Wales which the administrators identified as having been owned by Mr O'Dwyer in the COI Report. It is suggested that the liquidators' remuneration should be recovered from those assets; (d) Support is expressed for the proposal put forward by Ms Lin in her affidavit dated 21 December 2020 and for the chief executive's submissions; (e) The precedents relied on by the liquidators relate to industries other than real estate; real estate is subject to the Administration Act and the case is therefore distinguishable; (f) As professional insolvency practitioners, Grant Thornton should have prepared a business plan before accepting appointment. If there is not enough money to pay their fees out of the Company's assets or to pursue voidable transactions, those are matters that they should have taken into account before accepting appointment rather than having remuneration taken out of the NAB Trust Account; and (g) The liquidators applied to the Court on their own accord and therefore they should bear the legal costs incurred. The chief executive's appointment of Grant Thornton as receivers of the NAB Trust Account indicates that Grant Thornton is the "losing party" which is another factor in support of why the depositors should not pay legal fees.

Submissions filed after hearing on 1 June 2021 and ss 62 and 63 of the Administration Act 67 At the hearing on 1 June 2021, in light of the submission made orally set out at [63(e)] above, I invited the chief executive to file submissions on the operation of s 62 of the Administration Act in practice and how the Universal Distributing principle might apply in the current circumstances. 68 Sections 62 and 63 of the Administration Act provide as follows: 62 Payment of claims (1) This section applies if the receiver has - (a) given notice under section 59(1); and (b) complied with section 61. (2) The receiver may pay a claim allowed by the receiver only if the receivership property is enough to pay all claims allowed by the receiver. (3) If the receivership property is not enough to pay all of the allowed claims, the receiver - (a) may pay any part of the property that consists of money to the chief executive; and (b) must give a copy of the final claims report prepared under section 61(7) to the chief executive. (4) Money paid to the chief executive under subsection (3) must be - (a) paid to the consolidated fund; and (b) paid from the claim fund under section 63(3)(b). (5) In this section - claim does not include a claim by the agent. 63 Money not dealt with by receiver (1) This section applies to receivership property consisting of money in the receiver's possession. (2) The receiver must give the money to the chief executive if - (a) the receiver has not dealt with it under this division; and (b) the chief executive, by written notice, asks for it. (3) Money given to the chief executive under subsection (2) must be paid to the consolidated fund and be paid from the claim fund in the following order - (a) to reimburse claims paid from the claim fund in relation to the agent; (b) to pay unsatisfied claims against the claim fund in relation to the agent; (c) to pay the remuneration and costs of a receiver appointed under section 47; (d) to pay the remuneration and costs of a special investigator appointed under section 70; (e) to pay claims by the agent against the money.

Chief executive's submissions 69 The chief executive's submissions were filed on 3 June 2021. The chief executive submitted that: Having regard to s 62(3)-(4) of the Administration Act, in practice, if a receiver appointed under the Administration Act has complied with the relevant provisions of that Act in the conduct of the claims process and there are sufficient funds to pay all of the claims, then the receiver will pay the claims. However, if there are insufficient funds, then the balance will be transferred to the consolidated fund and the chief executive will ensure that the funds are paid to the depositors in accordance with s 63(3)(b) of the Administration Act. The chief executive will supplement any deficiency out of the claim fund established under s 78 of the Administration Act to ensure there is no loss to the claimants. 70 The chief executive then submitted as follows (citations inserted): 9. In the present matter, if the Chief Executive's interpretation of s 21 is accepted then the liquidator may not receive their remuneration from the funds held in the trust account and there will be sufficient funds in that account to pay the claims. However, if the application is granted then there will be a shortfall in the trust account and those funds would be transferred to the Chief Executive to manage the release of funds to the allowed claims. Universal Distributing 10. The principle from Universal Distributing was restated by the High Court in Stewart v Atco [Pty Ltd (in liq) (2014) 252 CLR 307 at [22]-[23]]: The principle in Universal Distributing is stated at some length, no doubt because Dixon J was concerned to identify its sources. It may be more shortly stated as: a secured creditor may not have the benefit of a fund created by a liquidator's efforts in the winding up without the liquidator's costs and expenses, including remuneration, of creating that fund being first met. To that end, equity will create a charge over the fund in priority to that of the secured creditor. The circumstances in which the principle will apply are where: there is an insolvent company in liquidation; the liquidator has incurred expenses and rendered services in the realisation of an asset; the resulting fund is insufficient to meet both the liquidator's costs and expenses of realisation and the debt due to a secured creditor; and the creditor claims the fund. In these circumstances, it is just that the liquidator be recompensed. To use the language of Deane J in Hewett v Court [(1983) 149 CLR 639 at 668-669], it might be said that a secured creditor would be acting unconscientiously in taking the benefit of the liquidator's work without the liquidator's expenses being met. However, such a conclusion is avoided by the application of the principle stated in Universal Distributing. 11. Universal Distributing and Stewart v Atco were followed by the Victorian Court of Appeal in Primary Securities Ltd v Willmott Forests Ltd [[2016] VSCA 309 at [16]], where Maxwell P stated; … what needs to be shown in order to establish the liquidator's lien is that: (a) the costs and expenses incurred by the liquidator were incurred exclusively in caring for, preserving and/or realising property; (b) the activity of care, preservation and/or realisation enured for the benefit of the creditors of the company (including the secured creditor); and (c) there is property which can properly be subjected to the liquidator's charge for remuneration, costs and expenses. 12. The Chief Executive reiterates previous submissions which were to the effect; 12.1. In the context of the regime under [the Administration Act], an amount paid to a trust account must be kept in the account until it is paid out under the Act, per s 21; 12.2. The unambiguous text of the legislation reveals an intention to protect the depositors from loss, the provision should not be read narrowly to act as a protection against a defalcation from the agent only but a global protection from loss of those funds; 12.3. Amounts held in the trust account established under [the Administration Act] are not 'assets' in the property pool of the company in liquidation, if that were the case then the broader protective intent of [the Administration Act] becomes illusory. 13. If the Chief Executive's construction of s 21 is accepted and the above passage from the judgement of Maxwell P is accepted, then in the present case, there is no "property which can properly be subjected to the liquidator's charge for remuneration". 14. If the Chief Executive's construction is not accepted and the application is granted, then there will inevitably be a shortfall in the funds to be paid to the claimants in the amount of the applicants' remuneration. In those circumstances, it is to be expected that any remaining balance of the trust account would be transferred to consolidated revenue for disbursement by the Chief Executive. Ultimately the creditors would not suffer a pecuniary loss.

Liquidators' submissions 71 In brief submissions filed on 7 June 2021 in reply to the chief executive's submissions of 3 June 2021, the liquidators submitted that there is nothing in Primary Securities Ltd v Willmott Forests Limited (recvs and mngrs apptd) (in liq) [2016] VSCA 309; (2016) 50 VR 752 (Primary Securities Ltd v Willmott Forests Limited) that requires the claimant liquidator to create or realise a fund in order for the Universal Distributing principle to apply, relying on the joint judgment of Whelan and Santamaria JJA at [124]-[128] which states as follows (citations omitted): 124 In our view the authorities also make it clear that the [Universal Distributing] principle may apply where the claimant has cared for or preserved an asset, and not simply where the claimant has realised it and created a fund. One circumstance where the principle may apply is where the claimant has acted as a kind of 'stand in', undertaking activities which the holder of the proprietary interest would have had to undertake itself had the claimant not done so. In essence, that is what happened in Pattison v Lockwood. On the other hand, if the claimant's activities are properly characterised as unrelated to the interests or objectives of the holder of the proprietary interest then the claimant may have no entitlement to priority over that proprietary interest holder. It seems to us that that was the position in Dean-Willcocks. 125 In our view, when Dixon J referred to 'care, preservation and realisation' of an asset, the activities to which he referred are to be read disjunctively. Spigelman CJ in Dean-Willcocks was clearly of that view and, it seems to us, Beazley JA implicitly accepted it also. It was expressly accepted by the trial judges in both Thackray and Re S & D and implicitly accepted in 13 Coromandel Place. This conclusion is itself inconsistent with the applicant's contention that the principle can only apply where the claimant has realised a fund. It can also apply where the claimant has cared for or preserved an asset without realising it. 126 In our view Finn J was correct in Pattison v Lockwood when he rejected the submission that the existence of a fund was a pre-requisite for the principle in Universal Distributing to apply. The liquidators also relied on the judgment of Maxwell P at [14]-[16] which states as follows: 14 With respect, these contentions do not explain why the existence of a fund should be viewed, as counsel submitted it should be, as the 'touchstone' for the application of this principle. As I have said, the notion of justice on which the principle rests applies with equal force when no fund is created. And the task of identifying the recoverable costs is made no more difficult by the absence of a fund. In every case, the question to be determined is one of fact, namely, whether the costs were incurred exclusively for the purpose of care, preservation and/or realisation of the assets. 15 For these reasons, the principle in Universal Distributing does not depend for its application on the existence of a fund as the product of the liquidator's efforts. As the joint reasons make clear, this conclusion accords with that reached by Finn J in Pattison v Lockwood, and there is no authority to the contrary. 16 In a case where no fund has been created, what needs to be shown in order to establish the liquidator's lien is that: (a) the costs and expenses incurred by the liquidator were incurred exclusively in caring for, preserving and/or realising property; (b) the activity of care, preservation and/or realisation enured for the benefit of the creditors of the company (including the secured creditor); and (c) there is property which can properly be subjected to the liquidator's charge for remuneration, costs and expenses. 72 The liquidators noted that they did not understand the chief executive to be necessarily submitting to the contrary, but that the submission was made for completeness.

Submissions filed after 30 June 2021 email 73 On 30 June 2021, I caused an email to be sent to the solicitors for the liquidators and the chief executive seeking responses to a number of questions. A single written response (lodged for filing on 23 July 2021) summarised the respective positions of the liquidators and the chief executive. That response was circulated to the interested persons ahead of a hearing on 30 July 2021. Relevantly, the response addressed the following matters. 74 First, the Court asked the liquidators what relief they now sought in light of the fact that receivers had been appointed over the NAB Trust Account so that the liquidators no longer control it. The liquidators accepted that a declaration would be the appropriate form of relief if the Court determined that the Universal Distributing principle applied in relation to their stewardship of the NAB Trust Account. However, the liquidators submitted that, given the novelty of the circumstances, they also sought an order under s 90-15 of the IPS (Corporations) "determining their remuneration and the payment of their remuneration and costs out of the [NAB] Trust Account". The chief executive reiterated his submission that the funds held in the NAB Trust Account are not "trust assets" capable of distribution as part of the "property pool" as in the ordinary course of winding-up of a business. 75 At a hearing on 30 July 2021, counsel for the liquidators accepted that, as the NAB Trust Account is now receivership property, the relief the liquidators require is a declaration concerning whether the NAB Trust Account was subject to a lien in the liquidators' favour and the amount of remuneration and expenses that the lien secured. The liquidators would then rely on s 53(5) and (6) of the Administration Act (see [60] above). 76 Second, the Court asked whether the fact that administrators and liquidators are not exempt from compliance with Subdiv 2 of Div 1 of Part 3 of the Occupations Act "Recovery of reward or expense by property agent and resident letting agent" had any implications for the application of the Universal Distributing principle. That was in the context that s 6 of the Occupations Act exempts administrators, liquidators and receivers appointed under s 47 of the Administration Act (but not Court appointed receivers) from the application of certain provisions of that Act concerning activities in relation to a business that is or was authorised to be carried on under a licence that is or was in force. 77 In that regard, I accept the joint submission made by the liquidators and the chief executive that: (a) The liquidators' claims for remuneration and expenses in this case are not made in relation to performing activities of a property agent licensee, thus Subdiv 2 of Div 1 of Part 3 has no application to the administrators' and liquidators' activities relating to the administration and winding up process; and (b) As liquidators of a property agent licensee which is a corporation, the liquidators were in control of the NAB Trust Account and sought to apply that fund to the persons properly entitled to it at a time when the Company (being a licensee corporation) ceased performing activities of a property agent. Accordingly, Subdiv 2 of Div 1 of Part 3 of the Occupations Act has no application in the current circumstances. 78 Third, the liquidators accepted that the Universal Distributing principle operates on the conscience of a beneficiary of a fund where an administrator or liquidator (as opposed to the licensee) does work for the benefit of the beneficiary. Accordingly, the beneficiary may not take the benefit of the work undertaken to protect or maintain the fund and to identify beneficiaries without paying the administrators or liquidators for that work. They said that the equitable obligation so arising is acknowledged by the inclusion of s 53(5) and (6) of the Administration Act. 79 The chief executive submitted that in his experience, a receiver had relied on the power under s 53 to take possession of trust property chattels that have been subject to a general law lien (such as a warehouseman's lien or a repairer's lien). He said that s 53 therefore empowers the receiver to take physical possession notwithstanding that lien, without affecting the lienholder's claims against third parties. The liquidators accepted that submission. The liquidators went on to submit that it did not preclude or detract from s 53(5) and (6) being construed as consistent with a legislative intention to recognise an external administrator's lien arising on the Universal Distributing basis in respect of trust property regulated under the Occupations Act which continues despite the loss of possession of the property. 80 Fourth, the Court asked (effectively): If the Universal Distributing principle does apply in this case what, if any, implications for the reasonableness of any remuneration which the liquidators claim against the NAB Trust Account arise out of the circumstances in which the chief executive may appoint a receiver under s 47 of the Administration Act? For ease of reference, s 47 is set out at [46] above. The relevance of that question is that, upon appointment of a receiver under s 47, the chief executive could draw upon the claim fund to pay the receiver's remuneration, rather than it being deducted from the NAB Trust Account pursuant to the liquidators' lien for remuneration for doing that work. 81 In relation to the appointment of the receiver under s 47(1): the question asked was whether there was anything learned after 3 September 2019 (when Mr Jahani sent to Mr Browne of the OFT the documents referred to at [12] above) which enabled the chief executive to reach the suspicion which he found adequate to make an appointment under s 47(1) on 10 February 2021? 82 The chief executive submitted that: The defalcation that may have arguably occurred in this case that justified the appointment of the receiver is that the deposit moneys under side agreements with purchasers of units were not transferred into an interest earning account. That is, the deposit moneys were neither reinvested in accordance with the terms of the sale contract nor were they paid out into a special trust account or in any other way in accordance with the provisions of Administration Act. The chief executive's knowledge of any potential defalcation did not crystallise by mere knowledge of the side agreements with purchasers of units procured by the Ralan Group as a result of which moneys were disbursed from the NAB Trust Account to companies in the Ralan Group. The chief executive says that it was only upon notice of these proceedings being heard (in December 2020) that any consideration of appointing a receiver to the NAB Trust Account could have commenced. The liquidators accept that there was nothing before the Court to suggest that the chief executive was or should have been aware, prior to 3 September 2019, of matters which would have enabled the chief executive to appoint a receiver under s 47(1). 83 The liquidators emphasised that the amount claimed as remuneration to 1 March 2021 is capped at $215,481 plus GST, representing a 23% discount on remuneration, and it did not take into account the further time, costs and remuneration associated with pursuing this application since then. 84 In relation to the power of the chief executive to appoint a receiver under s 47(2): (a) The liquidators submitted that the Company's business was abandoned (relevant to s 47(2)(c)) upon their appointment as administrators because the Company did not carry on business after that time (for instance, it took no further deposits). The chief executive did not concede that the Company's business was abandoned at any time by the liquidators. (b) Relevantly to s 47(2)(d) of the Administration Act: (i) Section 77(1)(c) of the Occupations Act provides for automatic cancellation of the licence of a corporate licensee where "the licensee has been wound up or deregistered under the Corporations Act". It is notable that there is no trigger dependent upon the appointment of an administrator (which occurred on 30 July 2019) and the liquidators were appointed on 17 December 2019; and (ii) There is a trigger for suspension of a licence under s 76(1)(c) of the Occupations Act, where the chief executive is satisfied that a licensee has failed to file an audit report as required under s 34 of the Administration Act. Under s 76(4) of the Occupations Act, the licence will remain suspended until the audit report is filed or an application to QCAT for cancellation is heard and decided. It is Mr Jahani's evidence that the last audit report was prepared by Assura Group Pty Ltd for the period from 1 November 2017 to 31 October 2018 and the next audit report was due in late 2019 but the liquidators (and before that, the administrators) did not have funds out of which to pay for such a report. The NAB Trust Account was not available for that purpose. The submissions did not address the fact that no further audit report had been filed nor would one be filed because, on Mr Jahani's evidence, the liquidators lacked funds. (iii) The chief executive submitted that the pre-condition to the chief executive appointing a receiver under s 47(2) was the chief executive's satisfaction that a person could not obtain payment or delivery of trust property held for the person by an agent. Whether the chief executive was aware that the Company's licence was cancelled or suspended is a secondary question. 85 In summary, the force of the submissions of both the liquidators and the chief executive was that it was not up to either of them to raise the issue of whether a receiver should have been appointed under s 47 of the Administration Act in order to relieve the NAB Trust Account of the costs of determining entitlements to the moneys standing to its credit and arranging for payment to those persons. 86 Fifth, the Court asked: If the Court declared that the liquidators had a lien over the NAB Trust Account for reasonable remuneration and expenses under the Universal Distributing principle and that lien endured under s 53(5) and (6) of the Administration Act, how might that amount be recovered having regard to ss 62 and 63 of the Administration Act (see [66] above)? 87 The position adopted by the liquidators and the chief executive was that if the Court were to declare that the liquidators had an equitable lien over funds in the NAB Trust Account for expenses and remuneration before the appointment of the receivers: (a) There would be insufficient funds in the NAB Trust Account to meet both the claim of the liquidators for their remuneration and expenses (as determined by the Court) and the whole of each depositor's claimed entitlement to funds in the NAB Trust Account; (b) In those circumstances, under ss 62(3) and 63 of the Administration Act, the funds in the NAB Trust Account would be transferred by the receivers to the chief executive to manage the release of funds both: (i) in recognition of the liquidators' claim to them (in the amount determined by the Court); and (ii) to each identified depositor; (c) Any shortfall would be met out of the claim fund established under the Administration Act. In practical terms, it may be that the receivers assist the chief executive with the process of that distribution, although the Court need not be troubled with those administrative matters; and (d) The consequence of the above is that each identified depositor will receive the whole of his or her identified deposit currently in the NAB Trust Account. 88 At the end of the hearing on 30 July 2021, Mr O'Connor was given time to confirm his instructions and the liquidators were given leave to file further evidence concerning their claimed remuneration.

Interested persons' submissions 89 On 2 August 2021, Ms Lin filed submissions on her own behalf and on behalf of Xu Zhi Hu, Xiao Qing Wu, Jingjing Fu, Ling Zou and Shuyan Dong to the following effect: (a) They believe that at the time of their appointment the administrators had no intention to have recourse to the NAB Trust Account for their remuneration and expenses on the basis of statements made by Mr Jahani at the first creditors' meeting. If Mr Jahani had indicated that remuneration might be paid from the NAB Trust Account, they would have opposed the appointment of the administrators as administrators; (b) They reiterated submissions concerning the belief that Grant Thornton must have had a "project financial performance plan" which would have accommodated their remuneration before accepting appointment and the current application can only be made for their own "commercial reasons". If the absence of funds available to pay their remuneration is because of "irresistible factors" beyond their control, Grant Thornton should accept the reality of the bankruptcy of this project. If they are driven by "commercial reasons" they should be condemned; (c) In reliance on ASIC Information Sheet 45, liquidators may apply to ASIC for funding to carry out investigations in relation to the possible commission of offences where the liquidator suspects that such offences may have occurred. Grant Thornton should have applied to ASIC for funding to carry out further investigations in relation to the NAB Trust Account as early as possible; and (d) They are concerned that if the Court allows the liquidators' application to approve remuneration, it will create an undesirable precedent and would lead to external administrators claiming inflated costs and expenses in company collapses. Trust accounts under the Administration Act would cease to be meaningful, which would have a negative impact on the real estate industry.

Chief executive's submissions 90 In submissions filed by the chief executive on 13 August 2021, the chief executive referred to cases dealing with equitable claims made by external administrators to be paid remuneration and expenses out of statutory trust accounts. The cases were Re Greater West Insurance Brokers at [16], [18] and [19] and All Class Insurance Brokers at [29]. In All Class Insurance Brokers, White J cited and endorsed the Universal Distributing principle. Justice White found that a liquidator is entitled to be paid from the trust account in priority to other claimants his reasonable remuneration and reimbursement or exoneration for reasonable expenses incurred in administering the trust property, including handling and determining claims of creditors necessary to determine who is entitled to the moneys in the account. The chief executive contrasted such a case with the "proprietary interest" claims of external administrators of trustees of trading trusts discussed in Carter Holt Harvey Woodproducts Australia Pty Ltd v Commonwealth [2019] HCA 20; (2019) 268 CLR 524 at [80]. The submissions then proceeded as follows: 10. Assuming that the Universal Distributing principle does apply, this would mean that there is an equitable charge over the trust account, now receivership property, in favour of the liquidators for their professional costs. It follows that the liquidator had that charge at the time the trust account passed to the receiver. … 11. The receivership property here, being the balance in the trust account, is insufficient to fully satisfy the liquidators' equitable lien and the claims of the interested persons. That being the case, the balance of the trust account can be transferred to consolidated revenue and administered by the Chief Executive, per s 62(3) and (4). … 12. Practically speaking, the difficulty that has been experienced thus far in the resolution of this matter is the conflict between s 21 [Administration Act] and the liquidators claim for remuneration out of those funds. The operation of s 21 does not defeat a claim in equity per se, rather, it serves to prohibit a direct transfer from the trust account to the liquidator for such remuneration as there is no mechanism to make such a payment under the Act. By operation of ss 53 and 62, upon the declaration being made, s 21 is not offended if the balance of the trust account is transferred to be administered by the Chief Executive. 13. With respect to the mechanism for payment of claims, s 62(4)(b) states that the money paid to the Chief Executive is to be paid from the claim fund under s 63(3)(b), namely; to pay unsatisfied claims against the claim fund in relation to the agent. Assuming the above to be true and the declaration being made, the 'unsatisfied claims' would include the amount in respect of the liquidators' equitable charge as declared by this Court and those of the interested persons. 14. Section 63 affords a separate mechanism to pay claims than that contained in s 82. For this reason, it is unnecessary to consider whether the preconditions of s 82 are met. That provision is concerned with recuperation of loss occasioned upon some defalcation, failure or breach by an agent independently of a receiver's appointment or company liquidation. Quantum 15. The applicants seek remuneration in the amount of $215,481 plus GST for their own professional and legal costs associated with the liquidation and this application. This amount is said to represent a 23% discount on the applicants' actual costs incurred in the period prior to their appointment as receivers and approximately 10% of the balance in the trust account. 16. In speaking to the reasonableness of the amount sought by the applicants in this application, the Chief Executive notes that the rates normally payable to panel firms appointed under the legislation are substantially less than the commercial rates that are charged in the ordinary course. Amounts paid to meet the shortfall comes from the claim fund, a fund established by [the Administration Act] to compensate persons in particular circumstances for financial loss arising from dealings with agents. In other words; the public revenue. It therefore ought to be drawn upon conservatively. 17. It is not the case that the applicants' work is going un-rewarded as they are being paid $300,000 from the claim fund for their professional services in conducting the receivership. The Chief Executive considers this amount to be fair and reasonable in these circumstances. 18. On the assumption that this Court determines the liquidators have an equitable lien over the trust account for remuneration of their work undertaken prior to their appointment as receiver, the Chief Executive does not intend to make specific submissions as to the remuneration which might be considered reasonable. Conclusion 19. Section 21 [of the Administration Act] prohibits payment out of the trust account other than authorized under the Act. Upon this Court's determination that that liquidator has an equitable lien over the funds in the trust account the available funds will be insufficient to meet all legal claims against the fund. By operation of ss 53 and 62, the balance of the trust account would be transferred to consolidated revenue and administered by the Chief Executive. The shortfall will be met by consolidated revenue (claim fund) which will ensure the claimants, including the liquidators, receive the entirety of the funds they are owed.

Submissions and evidence filed on 1 September 2021 91 Those submissions and evidence primarily related to the amount claimed by the liquidators for remuneration and expenses which is addressed further below. Despite being given the opportunity to file responding submissions to the liquidators' and chief executive's submissions filed on or after 13 August 2021, the interested persons did not file any submissions by the due date of 21 January 2022.

DO THE LIQUIDATORS HAVE AN EQUITABLE LIEN OVER THE NAB TRUST ACCOUNT? 92 I have determined that I will make a declaration with respect to the liquidators' entitlement to an equitable lien over the NAB Trust Account for reasonable remuneration and expenses incurred as administrators and liquidators in relation to "identifying, recovering, realising, protecting or distributing trust assets" or attempting to undertake those steps in respect of the NAB Trust Account. That will be done in reliance on the Universal Distributing principle. In forming that view, I have had regard to the following matters. 93 The liquidators relied on a well-established line of authority (see [55] and [58] above) in which courts authorised the payment of an external administrator's reasonable remuneration and expenses in priority to persons with equitable claims over funds held upon statutory trusts notwithstanding that (as here) the provisions dealing with distribution of the funds held on statutory trust did not provide for the payment of the external administrator's reasonable remuneration and expenses: see s 28(4) of the Brokers Act which is set out in Re Greater West Insurance Brokers at [4] and reg 7.8.03 of the Corporations Regulations which is set out in Re GTL Tradeup at [43]. 94 I accept White J's statement of relevant principles in All Class Insurance Brokers at [29]-[31] as follows: Liquidator's remuneration and expenses in administering the trust 29 The liquidator is entitled to be paid from the trust account in priority to other claimants his reasonable remuneration and reimbursement or exoneration for reasonable expenses incurred in administering the trust property, including handling and determining claims of creditors necessary to determine who is entitled to the moneys in the account (Re Universal Distributing Co Pty Ltd (in liq) (1933) 48 CLR 171 at 174-175; Re Berkeley Applegate (Investment Consultants) Ltd (in liq) [1989] Ch 32 at 50-51; Re GB Nathan & Co Pty Ltd (in liq) at 689; Grime Carter & Co Pty Ltd v Whytes Furniture (Dubbo) Pty Ltd [1983] 1 NSWLR 158; 13 Coromandel Place Pty Ltd v CL Custodians Pty Ltd (in liq) (1999) 30 ACSR 377 at 385; 17 ACLC 500 at 509; Re Sutherland; French Caledonia Travel Service Pty Ltd (in liq) (2003) 59 NSWLR 361 at [213], [217]; In Re MF Global Australia Ltd (in liq) (No. 2) [2012] NSWSC 1426 at [50], [54], [61]). In this case the only asset available to the liquidator is the trust account. There is no property beneficially owned by the company available to meet the liquidator's remuneration and expenses (compare Re GB Nathan & Co Pty Ltd (in liq) at 689). 30 Regulation 7.8.03(6) stipulates how money in an account maintained for the purposes of s981B is to be paid. Regulation 7.8.03(6) does not provide for payment out of the trust account of any expenses of a liquidator or administrator incurred in recovering moneys that should have been held in the trust account, nor in administering the trust account, nor in determining the entitlement of persons to moneys in the trust account, nor in distributing such moneys. The predecessor provision to that regulation was s 28(4) of the Insurance (Agents and Brokers) Act 1984 (Cth) which was in materially the same terms. In Re Greater West Insurance Brokers Pty Ltd [2001] NSWSC 825; (2001) 39 ACSR 301 Young CJ in Eq (as his Honour then was) held that the terms of that provision were not "strong enough to make me hold that the Act intended some different result" (at [22]). His Honour held that the liquidator's costs were recoverable from the trust money notwithstanding that s 28(4) made no provision for payment out of the trust account of moneys for the liquidator's remuneration and expenses. 31 It may be taken that the regulation was passed with the knowledge of the interpretation given to s 28(4) of the Insurance (Agents and Brokers) Act and that no different result was intended by the regulation. It would be highly inconvenient if a different result were intended. If there were no right to remuneration and recovery of expenses no liquidator or administrator could be expected to carry out the work that would be needed to recover moneys that should have been in the trust account, or handle claims to moneys in the trust account, or to distribute money from the trust account. Such an inconvenient construction should not be adopted if an alternative construction is reasonably open. Such a right of remuneration and reimbursement as exoneration is implied by law. I therefore conclude that I should follow Re Greater West Insurance Brokers Pty Ltd. 95 For reasons explained by the liquidators, I do not accept that Maxwell P's reasoning in Primary Securities Limited v Willmott Forests Ltd at [16] precludes reliance on White J's reasoning. 96 The chief executive says that the cases on which the liquidators rely are distinguishable from this case because the terms of s 28(4) of the Brokers Act and reg 7.8.03(6) of the Corporations Regulations did not preclude the implication of an equitable lien in favour of an external administrator over the statutory fund (see [61(b)] above). He says, and the interested persons support the view, that the unequivocal terms of s 21 of the Administration Act preclude such an implication arising. That is because it allows payments out of a trust account established under the Administration Act only in ways prescribed by that Act and there is no method prescribed for payment of remuneration and expenses of external administrators. He says that the unambiguous language of the Administration Act reveals a statutory intention to protect depositors from loss, and those provisions should not be read narrowly (to protect only against defalcation by an agent) but rather, they should be read as a global protection from loss of funds paid to the trust account. I am not persuaded to that view. 97 First, I find that the implied obligation to pay the reasonable remuneration and expenses of the liquidators (or administrators) derives from their work done for the benefit of the depositors to the NAB Trust Account, not as an agent of the Company. 98 Section 20(b) of the Administration Act prohibits funds in a trust account being "attached or taken in execution under a court order or process by a creditor". That is in contrast to the express terms of s 20(a) which prohibits funds in a trust account being "used for payment of the debt of a creditor of an agent". Accordingly, there may be some ambiguity as to the meaning of "creditor" in s 20(b). However, in my view "creditor" in s 20(b) should be taken to mean "creditor of the agent" consistent with its use in s 20(a). 99 This view is supported by the terms of the Explanatory Notes to the Property Agents and Motor Dealers Bill 2000 (Qld) which, at p 115, states that the prohibition in s 383 (the statutory predecessor of s 20 which is relevantly in the same terms) (emphasis added): protects trust account money by providing that an amount paid, or required to be paid, to a trust account cannot be used by the licensee to pay a debt to a licensee's creditor, and cannot be attached or taken in execution under a court order or process by a licensee's creditor. To the same effect, the Explanatory Notes to the Agents Financial Administration Bill 2013 (Qld) provides, at p 16, that: Clause 20 protects trust account money by providing that an amount paid, or required to be paid, to a trust account cannot be used by the agent to pay a debt to the agent's creditor, and cannot be attached or taken in execution under a court order or process by an agent's creditor. 100 I note that in interpreting s 383 of the PAMD Act, Moynihan J found that the court appointed receiver was a creditor of the licensee: see Wicks at [20]. I accept the liquidators' submission that Wicks at [20] can be distinguished from this case. That is because in Wicks at [17], Moynihan J recognised that the relevant work performed by the Court appointed receiver was for the benefit of the licensee so that the receiver might be characterised as a creditor of the licensee for the purposes of s 383 of the PAMD Act. In this case, the liquidators' claim arises because the NAB Trust Account passed through their hands (contrary to the chief executive's submissions) and they did work communicating with depositors and seeking to identify correctly the persons to whom the funds in the NAB Trust Account should be paid. That work was for the benefit of depositors so that it is appropriate to apply the Universal Distributing principle. 101 Second, on 19 November 2021, the liquidators and the chief executive drew to my attention a decision of Downes J delivered on 27 October 2021: Heenan, in the matter of Ruby Apartments Pty Ltd (in liq) v Ralan Paradise No. 1 Pty Ltd (in liq) (No 2) [2021] FCA 1314 (Heenan). As noted at [5(b)] above, Messrs Heenan, Tracy and Algeri were appointed by Win Mezz No. 196 Pty Ltd as receivers of Ruby Apartments Pty Ltd and of Ralan Paradise No. 1 Pty Ltd. 102 In Heenan at [61]-[66], Downes J considered a submission that payment of the Deloitte receivers' remuneration from a trust account created under the Administration Act was not authorised under that Act, including ss 20-22. Justice Downes found that: (a) A receiver is ordinarily entitled to look to a trust account for their indemnity for remuneration and expenses, relying on Australian Securities and Investments Commission, in the matter of GDK Financial Solutions Pty Ltd (in liq) v GDK Financial Solutions Pty Ltd (in liq) (No 3) [2008] FCA 448; (2008) 246 ALR 580 at [10] (Finkelstein J) and Re Arcabi Pty Ltd (Receivers & Managers Appointed) (in liq); Ex parte Theobald & Herbert in their capacities as Receivers & Managers of Arcabi Pty Ltd (Receivers & Managers Appointed) (in liq) [2014] WASC 310; (2014) 288 FLR 236 at [66] (Master Sanderson); and (b) By reason of s 149 of the Administration Act, the receivers' right to an indemnity for costs and expenses secured by an equitable lien over the trust account was not affected or limited by that Act. Section 149 of the Administration Act provides as follows: 149 Civil remedies not affected Nothing in this Act affects or limits a civil remedy that a person may have against an agent or another person for a matter. 103 The existence of s 149 of the Administration Act was not drawn to my attention in any of the submissions made by the liquidators, the chief executive or the depositors. 104 I note that ss 20-22 of the Administration Act are relevantly in the same terms as their statutory predecessors, ss 383-385 of the PAMD Act. Section 149 of the Administration Act is in essentially the same terms as s 595 of the PAMD Act which provides as follows: 595 Civil remedies not affected Nothing in this Act affects or limits any civil remedy that a person may have against a licensee or another person in relation to any matter. 105 In light of the existence of ss 149 and 53(5) and (6) in the statutory scheme of the Administration Act, I am not satisfied that the terms of s 28(4) of the Brokers Act and reg 7.8.03 of the Corporations Regulations are relevantly distinguishable from ss 20-22 of the Administration Act. 106 Since the reasons in Heenan contain no reference to Moynihan J's reasons in Wicks, I infer that they were not drawn to Downes J's attention, notwithstanding that they relate to ss 383-385 of the PAMD Act which are the statutory predecessors of, and relevantly in the same terms as, ss 20-21 of the Administration Act. It is also notable that s 595 of the PAMD Act does not appear to have been drawn to the attention of Moynihan J since it is not referred to in his Honour's reasons in Wicks. 107 In my view, I should follow Heenan because: (a) Moynihan J's dicta in Wicks are obiter dicta since there was more money in the trust account than was required to pay both the court appointed receiver's remuneration and expenses and all moneys due to the landlords on whose behalf money was held; (b) Downes J's decision in Heenan is consistent with the decision of Douglas J in Chief Executive of the Department of Justice and Attorney-General v Hambleton [2013] QSC 356 (Hambleton). In Hambleton, a liquidator of a real estate agent disallowed proofs of debt by the chief executive who claimed subrogation for payments the chief executive made out of the claim fund established under the PAMD Act. One argument considered by Douglas J related to the significance of the omission of a statutory right of subrogation of a kind that had existed under s 124 of the Auctioneers and Agents Act 1971 (Qld) (repealed). In Hambleton at [27]-[28], Douglas J found that the absence of an equivalent to s 124 of the Auctioneers and Agents Act in the PAMD Act did not evince a statutory intention to preclude the application of the equitable doctrine of subrogation. After noting a submission relying on s 595 of the PAMD Act, Douglas J found that, in the circumstances, the proper conclusion was the legislature did not intend to omit that remedy and it was likely that it proceeded on the assumption that the general law already made provision for such an entitlement; and (c) While it appears that the decision in Wicks was also not drawn to Douglas J's attention, I nonetheless prefer the reasoning of Downes and Douglas JJ. 108 The proposition put forward by the chief executive and supported by the liquidators is that the chief executive may pay from the claim fund amounts which would satisfy both the liquidators' claim to reasonable remuneration and expenses as declared by the Court and the depositors in full (see [85] above). No interested person challenged that proposition. 109 However, in my view the correct analysis is that: (a) Having regard to ss 53(6) and 149 of the Administration Act and notwithstanding the terms of s 62 of the Administration Act, in application of the Universal Distributing principle as discussed in All Class Insurance Brokers at [29]-[31] and notwithstanding ss 20-22 of the Administration Act, the liquidators should be paid their reasonable remuneration and expenses (as declared by the Court) out of the NAB Trust Account currently held as receivership property; and (b) The balance of the NAB Trust Account should be paid to the chief executive under s 62. That is on the basis that the depositors have contractual claims against the Company (that is, the agent) within s 63(3)(b) to be repaid all of the amounts which were paid to the NAB Trust Account and not released to Ralan Capital Investment Pty Ltd under side letters. Accordingly, the balance of the NAB Trust Account, being receivership property, is inadequate to meet those claims. 110 I acknowledge that interested persons have resisted allowing any payment of the liquidators' remuneration and expenses out of the NAB Trust Account, although none opposed the approach agreed by the chief executive and the liquidators when they were given an opportunity to file submissions in response to them by 21 January 2022. 111 I do not accept that the interested persons' distrust of all of the external administrators involved in addressing the collapse of the Ralan Group or any alleged breach of the Corporations Act by directors of the Ralan Group is a reason to refuse to make a declaration in relation to the liquidators' reasonable remuneration and expenses. In my view, the evidence before me does not support the suspicion or belief held by some of the interested persons that Grant Thornton engaged in "serious misconducts" which allowed crime to go unpunished and created damage to the interests of unsecured creditors. 112 First, insofar as the interested persons opposed the interlocutory application on the basis of ss 15-17 of the Administration Act, those provisions are not relevant to the resolution of the application as they relate to the agent's obligation to pay money into a general trust account or special trust account. 113 Second, insofar as the interested persons relied on s 22 of the Administration Act to say that the liquidators' "service fees" could not be paid from the NAB Trust Account, that provision sets out the way an agent (licensee) may pay money out of the NAB Trust Account. For the reasons set out above, I do not accept that s 22 operates to defeat the liquidators' equitable lien. 114 Third, insofar as the interested persons' submissions rely on statements made by the Office of Fair Trading of New South Wales, such statements are based on the law as it applies to off-the-plan developments in New South Wales. They are therefore not relevant to the NAB Trust Account which is a trust account established under the Administration Act, which is a law of Queensland. 115 Fourth, insofar as the interested persons opposed the proposal that depositors with less than $500 in the NAB Trust Account would receive no return put forward in the Notices of Proposal to Creditors, that proposal is no longer operative. I will consider whether the costs of seeking approval of that proposal may properly be claimed further below. 116 Fifth, I am not satisfied that the matters disclosed in the DIRRI provided to creditors of the Ralan Group in July 2019 (see [32] above) disclose a conflict of interest or a basis for a reasonable belief that the liquidators would not be sufficiently independent to perform their statutory and fiduciary roles as administrators and liquidators. 117 Further, contrary to some of the interested persons' submissions, the administrators/liquidators did not appoint receivers and managers to any of the Ralan Group entities. The secured creditors appointed the receivers and managers. While it appears that the administrators did consent to the appointment of receivers and managers by the secured creditors under s 440B of the Corporations Act, as noted in the Administrators' Report: (a) The receivers and managers were responsible for realising the assets over which security was held in line with their obligations under s 420A of the Corporations Act, which requires that they obtain market price or the best price reasonably obtainable in the circumstances; (b) It was the administrators' opinion that: (i) The Ralan Group had been insolvent since 2014; (ii) Even if the Ralan Group secured funding for Ruby Towers 2, 3, 4 and Sapphire, it would have incurred an overall loss of over $140 million on these developments and would not have been in a position to pay all creditors in full; (iii) "At this stage, it is unlikely there will be any surplus funds remaining after the Group assets have been sold and the secured creditors (NAB, Westpac, Wingate and Balmain) are paid in priority to all other creditors". 118 There is nothing in evidence that supports a contention that the exercise of the administrators' discretion under s 440B of the Corporations Act was conflicted, inappropriate or not in the best interests of the depositors or creditors of the relevant companies in the Ralan Group as a whole. That is so even though the depositors are understandably disappointed at the foreshadowed outcome that there would be no surplus available to distribute to them after secured lenders had been satisfied. 119 Sixth, the belief held by some of the interested persons that the Grant Thornton must have had a business plan for the insolvent administration of the Ralan Group before accepting their appointment and that they should bear the consequences of there being inadequate funds to pursue claims on behalf of creditors so that claiming remuneration is unethical is misplaced. 120 The Corporations Act does not require an administrator or liquidator to perform his or her role without the prospect of remuneration or indemnity: see ss 545 (which applies where assets are insufficient to meet expenses of winding up) and 568 (disclaimer of onerous property). That is because professional liquidators make a living in undertaking insolvent administrations and the source of their remuneration is the assets of the insolvent group and recoveries made in pursuing litigation for unfair preferences, voidable transactions or other issues. It is unrealistic to expect administrators/liquidators to work on behalf of creditors of an insolvent company without recompense or to take the risk of litigation for which they will be personally liable where the prospect of recovery may be diminished, for instance, because the assets of a corporate officer are subject to security held by a lender. 121 It is useful to set out s 545 of the Corporations Act, which provides as follows: 545 Expenses of winding up where property insufficient (1) Subject to this section, a liquidator is not liable to incur any expense in relation to the winding up of a company unless there is sufficient available property. (2) The Court or ASIC may, on the application of a creditor or a contributory, direct a liquidator to incur a particular expense on condition that the creditor or contributory indemnifies the liquidator in respect of the recovery of the amount expended and, if the Court or ASIC so directs, gives such security to secure the amount of the indemnity as the Court or ASIC thinks reasonable. (3) Nothing in this section is taken to relieve a liquidator of any obligation to lodge a document (including a report) with ASIC under any provision of this Act by reason only that he or she would be required to incur expense in order to perform that obligation. 122 The effect of s 545 is that, apart from lodging certain documents, a liquidator is not required to do anything if s/he cannot recover expenses. It means the liquidator commits no wrong in failing to carry out any duties in those circumstances: see Jenkins v Jonkay Pty Ltd [2007] FCA 858 at [10] (Finkelstein J) cited with approval in Australian Sawmilling Company Pty Ltd (in liq) v Environment Protection Authority [2021] VSCA 294 at [172] (Ferguson CJ, Sifris and Kennedy JJA). 123 While it may be distasteful to creditors that they get little return where orders are made for payment of an external administrator's remuneration and expenses from a fund, there is nonetheless a benefit to creditors and beneficiaries in having their position resolved and to the community in not permitting assets to remain unproductively in the hands of a defunct company: see Re GTL Tradeup at [70] and also All Class Insurance Brokers at [31]. 124 Seventh, Ms Lin complained that the liquidators have not pursued the unfair preference claims identified in the Administrators' Report at p 13 (see [36] above) and her evidence included published data concerning the value of bitcoin. I understand the evidence concerning the value of bitcoin to relate to comments made in the Administrators' Report relating to voidable transactions as follows: Our investigations have identified a number of other voidable transactions which require further review, including the purchase of Group properties by Mr O'Dwyer and his family trust, the purchase of Bitcoin in Mr O'Dwyer's name using Group funds (recorded in his shareholder loan account) and the granting of new security by the Group to Wingate in the month prior to our appointment (June 2019). Our investigations into these and other transactions will continue if the Group is placed into Liquidation. 125 The application before the Court relates only to remuneration and expenses incurred as administrators or liquidators of the Company in connection with the NAB Trust Account. Neither Ms Lin nor any other interested person has demonstrated that any unfair preference claim or voidable transaction claim against Mr O'Dwyer or anyone else was available to the liquidators as liquidators of the Company and it was Mr Jahani's evidence that there were no such recoveries available to the Company. 126 Eighth, as to Ms Lin's complaint set out at [36] above, that complaint does not relate to the liquidators' conduct as liquidators of the Company and it is not clear that any failure to take into account the votes to which Ms Lin refers made any difference to the outcome of the second creditors' meeting. This is not a reason to deny the liquidators' reasonable remuneration and costs. 127 Ninth, Mr Xie's claim that Grant Thornton "monopolised procedures" at the first creditors' meeting and did not give an opportunity for the appointment of another administrator is no more than a bare assertion. His own evidence suggests that staff of Grant Thornton rejected this claim at the first creditors' meeting. Further, the minutes of the first creditors' meeting are not in evidence and there is no evidence that any other potential administrator was nominated for consideration at the first creditors' meeting. Counsel for the liquidators submitted that there was no other nomination. The legitimacy of the administrators' appointment is not in doubt on the basis of the evidence before the Court. 128 Mr Xie similarly complained that Grant Thornton "monopolised" the vote on the proposed deeds of company arrangement at the second creditors' meeting. The complete minutes of that meeting are also not in evidence. There is in evidence exhibit LZ-1. It appears to be a report broadcast on "A Current Affair". It features brief footage of what is said to be part of the second creditors' meeting at which Mr O'Dwyer attempted to speak in support of the proposed deeds of company arrangement, during which time the chairman did not intervene. It is clear that this was a rowdy meeting, at least at this stage, attended by a large number of people. Where there are large numbers of people at a meeting and feelings are high, as appears to have been the case at that meeting, it is necessary for the chairman to ensure that the business of the meeting is conducted in an orderly fashion. There is no evidence that any creditor of the Ralan Group who wished to speak at the meeting did not have an opportunity to do so. 129 I am not satisfied that the evidence before the Court supports Mr Xie's claims. In any event, the central issue is whether the claimed remuneration and expenses are reasonable in relation to necessary work undertaken in relation to the identification, protection and realisation of the NAB Trust Account (including the identification of claimants on that fund). 130 Tenth, Ms Lin and a number of investors noted that, in the Administrators' Report, the administrators recommended that creditors vote against the two deeds of company arrangement proposed by Mr O'Dwyer, but the chairman of the second creditors' meeting nonetheless exercised a casting vote in favour of one of the deeds of company arrangement. That proposed deed of company arrangement related to seven entities involved in the development of the Gold Coast properties, not including the Company. The stated rationale for the chairman's decision is set out in annexure SL-8 (see [37] above). I note that creditors of all of the seven entities other than Ralan Paradise No. 2 Pty Ltd (RP2) had voted in favour of the deed of company arrangement by a majority in number and value (contrary to the administrators' recommendation), while a majority in number but not in value of the creditors of RP2 had voted in favour. An important element of the chairman's decision to exercise his casting vote in favour of the deed of company arrangement was that the depositors in respect of whom the Company held funds were unaffected whether RP2 went into liquidation or adopted the proposed deed of company arrangement. In those circumstances, there is no apparent lack of logic or reason in that decision and it does not support the suspicion of assisting "serious misconduct" asserted by a number of the interested persons. 131 Eleventh, Mr Xie raised complaints concerning the conduct of the Committee of Inspection, however, the Committee of Inspection did not relate to the Company. The remuneration and expenses referred to in the COI Report related to work undertaken by the administrators of Ralan Capital Investment Pty Ltd, Ralan Arncliffe Pty Ltd and Ruby Apartments Pty Ltd. That claim to remuneration is not before this Court and I am not satisfied that any "double counting" has been demonstrated. 132 Twelfth, insofar as there was an error in the email address for receipt of responses to the Notices of Proposal to Creditors seeking approval of the liquidators' claimed remuneration and expenses, I am satisfied that the liquidators adequately explained the error and took prompt action to remedy it. In any event, as the resolutions were not passed, the interlocutory application is proposed for the determination of the liquidators' remuneration and expenses. 133 Further, insofar as it is claimed that the September Circular was not sent to all Ralan Group creditors, I accept the liquidators' explanation that the September Circular was only sent to creditors of the Company and that was appropriate as the liquidations of the Ralan Group companies were not pooled. There was no basis for the September Circular to be sent to all creditors of all Ralan Group companies as the claimed remuneration and expenses related only to work done as administrators and liquidators of the Company in relation to the NAB Trust Account. I accept the explanations given by the liquidators to Ms Lin set out at [27] above. 134 Thirteenth, in relation to the claim that Grant Thornton failed to give "key evidence" to Mr Bransgrove and other lawyers contemplating a class action on behalf of Ralan Group creditors, I note that Grant Thornton agreed to provide access to documents it considered relevant if its costs, estimated to be approximately $45,000, were paid. Grant Thornton would accept payment of $15,000 from each of the three law firms that made such requests. It is not clear that any of the claimed documents related to the Company. Further, the depositors' request for access to what is likely to be a vast number of documents with search capacity free of charge may not be reasonable if there is not sufficient property available for the liquidators to comply with that request. That is particularly so in relation to a group of the size of the Ralan Group and having regard to the nature of its business. There is no evidence that the amount for which the liquidators sought to be reimbursed was excessive for the task that was being asked of them. Further, the fact that the Supreme Court of New South Wales may have granted an application from Ralan Group creditors to examine Deloitte and BDO Australia concerning their roles in the affairs of the Ralan Group says nothing about Grant Thornton's independence or the manner in which it has conducted the external administration of the Company. 135 Fourteenth, to the extent that they have not already been addressed, I am not satisfied that any of the following are reasons to refuse to make a declaration in relation to the liquidators' reasonable remuneration and expenses: (a) Mr Jahani's failure to foreshadow an application for remuneration to be paid from the NAB Trust Account specifically at either the first or second creditors' meetings of companies in the Ralan Group; (b) Any failure to seek funding from ASIC to carry out investigations in relation to the Ralan Group; (c) Any precedential value of this decision; (d) The failure to have a Mandarin translator at the first creditors' meeting. I note that that meeting was convened shortly after the administrators' appointment and before any significant investigation into the Ralan Group's affairs had been conducted; (e) The claim made by one interested person that the liquidators did not return calls and emails from Ralan Group creditors. While it might be true that there were instances where that occurred, it is plain from Mr Jahani's evidence that a significant amount of the claimed remuneration relates to responding to depositors' enquiries and that Mandarin speaking staff were engaged in that process; and (f) The concern that depositors may have been misled into investing into projects of an insolvent group or other possible activity in breach of law and the difficulty that they faced because of age or inability to speak English or understand legal documents. While I acknowledge the hurt felt by depositors at the losses they have incurred, particularly having regard to the circumstances identified in the Administrators' Report (see [15] above), that hurt is not a reason to refuse professional insolvency practitioners reasonable remuneration and expenses. To do so would mean that no professionals would be willing to undertake insolvent administrations and that would not be in the interests of either individual creditors or the community at large.

Declaration now sought by liquidators 136 The liquidators and the chief executive responded to further questions which I put to them on 18 August 2021 by submissions filed on 1 September 2021. The liquidators also filed an affidavit signed by Mr Jahani on 1 September 2021. This material addressed remuneration. 137 The liquidators also provided to chambers a form of short minute of order which they now seek as follows: 1. The First Applicants have an equitable lien over the funds in the NAB Trust Account as security for their remuneration and expenses on the basis of the principle in Re Universal Distributing Co Ltd (In Liq) (1933) 48 CLR 171 in the amount of $215,481 (excluding GST). In these orders, "NAB Trust Account" means the bank account defined in paragraph 10 of the affidavit of Said Jahani affirmed on 4 November 2020 and filed on 12 November 2020.

Liquidators' evidence and submissions concerning remuneration 138 First, Mr Jahani's 1 September 2021 affidavit addressed the adequacy of the evidence supporting the liquidators' claimed remuneration having regard to the fact that he had previously relied on the Remuneration Report to support the claimed remuneration. 139 Mr Jahani's evidence addressed three periods: (a) The "VA period" from 30 July 2019 to 17 December 2019; (b) The "first liquidation period" from 18 December 2019 to 27 August 2020; and (c) The "second liquidation period" from 28 August 2020 to 15 March 2021. I note that the receivers were appointed on 10 February 2021. 140 Mr Jahani noted that he had previously provided a "cumulative" figure of $177,416.41 plus GST as at 15 March 2021 in relation to the liquidators' remuneration. He deposed that: (a) In preparing this affidavit he reviewed the Remuneration Report and underlying timesheets in relation to the VA period and the timesheets of the liquidators and staff for the first and second liquidation periods; and (b) He continues to hold views previously expressed regarding the reasonableness of time recorded and work performed and the appropriateness of hourly rates charged in the administration of the Company generally. However, he has identified a portion of work performed which may not fall within the characterisation of "identifying, recovering, realising, protecting or distributing trust assets" or attempting to undertake those steps in respect of the NAB Trust Account. He described that as "Other Work". The remuneration claimed for Other Work was $20,751.50 (excluding GST). Although he considers that the Other Work was necessary to enable the liquidators to hold their office and continue in their role so that they could continue to deal with the NAB Trust Account, the liquidators wish to reduce the amount of their claimed remuneration to exclude the amounts relating to the Other Work. 141 He summarised the adjustments for Other Work as follows: Period Amount previously claimed (ex GST) Less "Other Work" (ex GST) Amount now claimed (ex GST) VA period $70,152.00 $7,408.50 $62,743.50 First liquidation period $27,451.00 $7,048.50 $20,402.50 Second liquidation period $79,813.41 $6,294.50 $73,518.91 Total $177,416.41 $20,751.50 $156,664.91

VA period from 30 July 2019 to 17 December 2019 142 Annexure SJ-12 contains a breakdown of the liquidators and staff engaged in the matter for the VA period, their seniority, bill out rate and hours worked. That information is provided in relation to categories of "Creditors" (creditor inquiries and proofs of debt), "Assets/Investigations" (trust funds), "Legal", "Administration" (bank account admin) and "Other Work" (creditor reports, creditors' meeting, investigation, file review, ATO and other statutory reporting, ASIC Form 524 and other forms, and planning/review). Annexure SJ-13 provides a table of major tasks for remuneration with headings that correspond to annexure SJ-12 categories. 143 In relation to the tasks which do not comprise Other Work, the table in annexure SJ-13 is as follows in relation to the VA period: Task area General Description Includes Assets/Investigations 14.9 hours $6,154.00 Trust Account 14.9 hours $6,154.00 Securing trust funds Reviewing the requirement to have a trustee in place Placing funds on trust with the Administrators Discussions with the former trustee Review trust records Creditors Creditor Enquiries, Requests & Directions Receive and respond to creditor enquiries Maintaining creditor request log Review and prepare initial correspondence to creditors and their representatives Considering reasonableness of creditor requests Obtaining legal advice on requests Documenting reasons for complying or not complying with requests or directions Compiling information requested by creditors 118.9 hours 116.6 hours NOTE: At the commencement of the Voluntary Administration we received c.5-10 calls/emails per day from creditors requesting information and confirmation of what trust funds were being held on their behalf. $47,266.50 $46,337.50 Dealing with proofs of debt 2.3 hours $889.00 Receipting and filing POD when not related to a dividend Administration 4.1 hours $1,960.00 Bank account administration 4.1 hours $1,960.00 Preparing correspondence opening and closing accounts Requesting bank statements Bank account reconciliations Correspondence with bank regarding specific transfers Legal 13.1 hours $7,363.00 Legal Advice Initial discussions with Ashurst regarding trust funds Meetings to discuss creditors rights to the trust funds Review of the [Administration Act] regarding the trust funds Review legal advice

First liquidation period from 18 December 2019 to 27 August 2020 144 Annexure SJ-14 contains a breakdown of the liquidators and staff engaged in the matter for the first liquidation period, their seniority, bill out rate and hours worked. That information is provided in the same format as annexure SJ-12, save that "administration" (namely bank account admin) is included in Other Work. Annexure SJ-15 provides a table of major tasks for remuneration with headings that correspond to annexure SJ-14 categories. Other Work comprises ASIC investigation reporting and liaison, statutory reporting to creditors, document maintenance/file review/checklist, planning/review, requesting bank account statements and reconciliations and preparing and lodging ASIC forms. 145 In relation to the tasks which do not comprise Other Work, the table in annexure SJ-15 relating to the first liquidation period is as follows: Task area General Description Includes Assets 11.7 hours Trust Funds 11.7 hours $4,872.50 Discussions with former trustee of trust account $4,872.50 Review trust audit accounts Perform audit of Company's trust ledger Creditors Creditor Enquiries, Requests & Directions Receive and respond to creditor enquiries 20.8 hours 15.7 hours Maintaining creditor request log $8,179.00 $5,496.50 Considering reasonableness of creditor requests Obtaining legal advice on requests Documenting reasons for complying or not complying with requests or directions Compiling information requested by creditors Dealing with proofs of debt 5.1 hours Receipting and filing POD when not related to a $2,682.50 dividend Legal 12.5 hours Legal advice Further discussions regarding dividend and Court process $7,351.00 Providing information to solicitors for Court application Reviewing legal advice from Counsel in respect of distributing trust funds Initial review of Court application and affidavit

Second liquidation period from 28 August 2020 to 15 March 2021 146 Annexure SJ-16 contains a breakdown of the liquidators and staff engaged in the second liquidation period, their seniority, bill out rate and hours worked. That information is provided in the same format as annexure SJ-12, save that "Legal" is included under "Assets/Investigations". Annexure SJ-17 provides a table of major tasks for remuneration with headings that correspond to annexure SJ-16 categories. 147 In relation to the tasks which do not comprise Other Work, the table in annexure SJ-17 relating to the second liquidation period is as follows: Task area General Description Includes Creditors Creditor Enquiries, Requests & Directions Receiving and attending to large volumes of creditor enquiries received by email and telephone 88.9 hours 57.0 hours Attending to follow up calls, voicemail messages and emails received subsequent to initial calls and correspondence $43,442.41 $26,778.91 Internal discussions regarding procedure to approach volume of creditor calls Requesting translation support to respond to creditor queries where required and liaising with Mandarin speaking colleagues to assist with telephone calls and email correspondence Review and preparation of correspondence to creditors and their representatives in English and Mandarin as required Discussions with creditors regarding access to creditors portal and documentation required Considering reasonableness of creditor requests Obtaining legal advice on creditor requests where required Documenting reasons for complying or not complying with requests or directions Compiling information requested by creditors Providing status updates to individual creditors based on their individual circumstances as required Dealing with Proofs of Debt 21.9 hours Receipting and filing POD when not related to a dividend $10,995.50 Verifying claimed amounts against POD and Company records as required ahead of court appearance for specified creditors Proposals to Creditors Drafting and reviewing correspondence to provide creditors with an update in relation to distribution of trust funds 10.0 hours Preparing proposal notices and voting forms $5,668.00 Forwarding notice of proposal to all known creditors Discussions with creditors in relation to proposal and voting options Reviewing votes and determining outcome of proposal Preparation and lodgement of individual proposal outcomes with ASIC Assets/Investigations 44.4 hours Trust Funds 6.5 hours Review of trust account and correspondence with relevant bank to obtain specific information $25,789.50 $3,893.50 Preparation of bank account reconciliations in internal software Review of trust ledgers and reconciliations for specific purchaser deposit balances as required Conducting Investigation Reviewing company's books and records in order to confirm the beneficiaries of trust account 10.2 hours Detailed review of group creditor listings based on data extracted from management and Company records $5,577.50 Collating a listing of the Company's creditors (c. 1,000), noting that the majority of creditors were unaware of which entity their claim relates to Collating supporting documentation in relation to potential claimants of trust funds held in the trust account Legal Liaising with solicitor(s) regarding court applications and documentation included in application 27.7 Hours Collating relevant documentation for inclusion in court applications and affidavit $16,318.50 Review of affidavit prior to submission Collating and reviewing creditor listings and claims in preparation of court appearance Discussions with Department of Justice QLD regarding distribution of funds and responding to various requests for information which involved conducting searches into Company records Liaising with solicitor(s) regarding information requests from the Department of Justice QLD as required Administration 8.3 hours Document Maintenance/File Filing of documents relevant to management of trust assets $4,287.00 Review/Checklist 6.2 hours $2,994.50 File reviews relevant to the management of trust assets Updating checklists as it relates to management of trust assets Ongoing internal discussions and update reports regarding status of management of trust assets Insurance 2.1 hours $1,292.50 Correspondence with insurer regarding potential insurance requirements to operate trust account, if required Liaising with various parties to understand licensing and insurance requirements in order to access and take control statutory trust account, if required Review of company books and records regarding previous policy held by licensee to operate trust account

Supplemental information 148 By way of additional context to the categories set out in annexures SJ-13, SJ-15 and SJ-17, Mr Jahani deposed to supplemental information as follows: (a) In relation to creditors: The process of dealing with purchaser creditor queries and correspondence in relation to the moneys in the NAB Trust Account involved in excess of 3,000 email exchanges, telephone calls and other communications with creditors during the period. The work done included confirming creditors' current bank account details for the return of their deposit funds (prior to the receivers' appointment) and providing an update on the liquidators' application to Court with respect to the NAB Trust Account. Given that a significant number of creditors have limited English speaking skills, translation assistance was sought from Mandarin speaking individuals within Grant Thornton in order to attend to a majority of the calls received from creditors as well as numerous follow up calls. In this regard, Mr Jahani noted that: [He used] the term "creditor" in [his] affidavit and its annexures to refer to the persons with deposits in the NAB Trust Account the subject of this Interlocutory Application, although their proprietary interest in the funds extent [sic] beyond that of an unsecured creditor. Similarly, in the annexures to [his] affidavit [he] also refer[s] to "POD" or proof of debt documentation, although [he] treated that documentation in the course of [the Company's] external administration more broadly as claim documentation, given the proprietary nature of those depositor/creditor claims extending beyond an unsecured pari passu claim (b) In relation to assets/investigations, work included: (i) Identifying and reconciling balances of the individual purchase deposits held in the NAB Trust Account and confirming them against the Company's REST ledgers; (ii) Preparing listing of creditors (with individual creditor personal information) specific to the NAB Trust Account using data extracted from management and the Company's books and records and reconciling the listing of creditors against the trust account reconciliation per purchaser; and (iii) Preparing for the interlocutory application including liaising with the liquidators' lawyers, preparing and reviewing Mr Jahani's affidavit in support of the interlocutory application affirmed on 4 November 2020 (including over 1,000 pages of exhibits) and his affidavit affirmed on 17 March 2021, circulating the September Circular (including the fee proposal and notice of the court filing) to the creditor body and responding to the follow up enquiries and queries from creditors; (c) Mr Jahani deposed that none of the work identified related to work done as receivers and the work referred to above has resulted in the receivers not being required to do that same work, which they would have been required to undertake in their capacity as receivers following their appointment. He says that some of that work is being utilised in the preparation of the report that the receivers are required to provide to the chief executive under s 61 of the Administration Act insofar as it comprised: (i) Identifying and reconciling balances of the deposits held in the NAB Trust Account; (ii) Determining the extent to which amounts paid by depositors remained trust property (as opposed to portions which had been released as an unsecured loan by a depositor to a Ralan company, as described at [12] above); (iii) Preparing listing of creditors (with individual creditor personal information) specific to the NAB Trust Account using data extracted from management and the books and records of the Company; and (iv) Communicating with creditors, including considering claim documentation received from creditors, requesting current bank account details, addressing queries relating to the trust funds held and the liquidators' intention with respect to the query and providing updates on the status of the liquidators' interlocutory application as required.

Estimate of liquidators' remuneration in the first and second liquidation periods by reference to the receivers' remuneration agreed with the chief executive 149 Second, Mr Jahani addressed what the liquidators' entitlement to remuneration would be for the period after 17 December 2019, not including any work done as receiver, if the rate agreed between Grant Thornton and the chief executive (as calculated by him) was applied. 150 In his 1 September 2021 affidavit at [39], Mr Jahani deposed as follows: Although there is an umbrella set of terms which might be applied to receivership engagements undertaken by Grant Thornton (the First Applicants' firm) for the Office of Fair Trading, those rates were not the subject of, and were not applied to the agreed fees in relation to the Receivers' appointment (which I address in the sub-paragraphs below). That umbrella agreement is considered confidential and contains commercially sensitive information. For the purpose of the following analysis, I have not applied the rates in that document as rates were not agreed as applying to the Receivers' appointment, however, in the circumstances I explain in the following subparagraphs, it is possible to extrapolate a discount on the Liquidators' fees by reference to the Receivers' remuneration negotiated with the Office of Fair Trading. On 21 December 2021 [scil 2020], I provided the Office of Fair Trading with a fixed fee quote which totalled $355,740 (including any disbursements but ex GST) for the conduct of the proposed receivership. I provided that quote on a fixed fee basis (rather than on a time cost or hourly rates basis) because I wanted to provide certainty regarding the cost of the receivership, having regard to the following complexities: (i) the quantum of creditors/depositors; (ii) the lack of understanding of the impact of the insolvency appointment given the retail nature of the creditor/depositor body; (iii) limited English speaking skills; and (iv) the issues surrounding the release of a significant proportion of their deposits to related Ralan entities As such, I took an alternative view in preparing my fee estimate whereby I adopted a fixed fee quote which was prepared using a methodology of a cost per creditor. That fixed fee quote of $355,740 was prepared on the basis of $300 per creditor x 1,078 creditors. The $300 cost per creditor reflected the scope of works required which included the finalisation of any reconciliation work for the Trust Account, contacting the creditor[s] and requesting they provide their banking details, including provision of any assistance they would require, making payment of their entitlement from the trust account and completing any statutory reporting obligations to the Chief Executive as required. On 4 February 2021, the Office of Fair Trading informed me that it was in the process of seeking quotes for the proposed receivership from several of their panel service providers, however, our fixed fee quote previously provided was considered excessive and we were invited to resubmit a new and lower quote. That same day, I provided a revised fixed fee quote for the receivership of $300,000 (including any disbursements but excluding GST) for the same scope of work. This involved an internal decision by Grant Thornton to offer a 15.6% discount on the initial fixed fee quote provided on 21 December 2021 [scil 2020] in light of the feedback from the Office of Fair Trading. Accordingly, the Receivers and the Office of Fair Trading did not agree any hourly rates in respect of the Receivers' remuneration for our receivership appointment given the fixed fee basis of the agreed receivership remuneration. However, I consider that fixed fee agreement to be reflective of an effective 15.6% discount on the Receivers remuneration in view of the matters set out above. For completeness, the Receivers have not incurred any disbursements in the receivership to date and I do not expect to do so through to completion of the receivership. 151 Mr Jahani deposed that the effect of applying the 15.6% discount would be as follows: Item Amount (ex GST) GST Total Liquidators' remuneration claim for the period 18 December 2019 to 15 March 2021 $93,921.41 $9,392.14 $103,313.55 Less: 15.6% discount $15,426.05 $1,542.60 $16,968.65 Total $79,269.67 $7,926.97 $87,196.64

Expense claim: legal fees 152 Third, Mr Jahani deposed as follows with respect to legal fees and disbursements incurred by the liquidators: (a) Of the $101,617.14 plus GST of $10,033.71 incurred as at 15 March 2021, $90,772.14 plus GST of $8,949.21 was incurred between 18 December 2019 and 15 March 2021. The remaining $10,845 plus GST of the same amount [scil $1,084.50] was incurred prior to that period; and (b) From 16 March 2021 to 1 September 2021, the liquidators have incurred legal costs of $18,152.39 plus GST of $1,815.24. 153 Mr Jahani has not put on any evidence as to the matters covered by the claimed legal fees. However, Ashurst advised by email dated 3 February 2022 that: (a) Legal fees incurred during the first liquidation period were $35,021 (excluding GST); (b) Legal fees incurred during the second liquidation period were $58,546.50 (excluding GST); (c) Those legal fees were incurred in relation to advising the liquidators on the distribution of the NAB Trust Account funds and the interlocutory application to achieve the distribution. Fees for work on the actual drafting of court documents were incurred from 3 August 2020; and (d) Disbursements incurred, being search fees, court fees and document production, during the first and second liquidation periods were $2,476.14 (excluding GST).

Summary 154 I note that the amount of remuneration that the Company's creditors were asked to approve was an aggregate amount of $247,603, comprising $70,152 in relation to the VA period, $27,451 for the first liquidation period and an estimate of $150,000 for the period from 28 August 2021. The effect of Mr Jahani's evidence given in support of the interlocutory application is: (a) The amount the liquidators originally said they might properly claim exclusive of GST for remuneration ($177,416.41) plus legal costs (exclusive of GST) ($101,617.14) was $279,033.55; (b) With the discount for Other Work, but without the 15.6% discount in relation to the first and second liquidation periods, the amount that the liquidators say they might properly claim for remuneration ($156,664.91) plus legal costs to 15 March 2021 ($101,617.14) is $258,282.05 (exclusive of GST); (c) With both the discount for Other Work and the further discount of 15.6% in relation to the first and second liquidation periods, the amount that the liquidators say they might properly claim for remuneration ($142,013.17) plus legal costs to 15 March 2021 ($101,617.14) is $243,630.31 (exclusive of GST); and (d) The liquidators are prepared to cap their claim to remuneration and expenses at $215,481 (excluding GST).

Chief executive's position on liquidators' remuneration 155 I note that it is the chief executive's position that: (a) No rate is determinable for the receivers' remuneration because the fee for all work done by the receivers from the time of their appointment was fixed at $300,000, regardless of the hours required to undertake it or the seniority of the personnel employed in the tasks; (b) In the assessment of the liquidators' remuneration, there is a question of how work carried out as liquidator can be distinguished adequately and remunerated separately from work carried out after the liquidators were appointed as receivers; (c) No funds "passed through the hands" of the liquidators and none were "distributed" before their appointment as receivers. While the liquidators may be entitled to indemnity for their costs in identifying, protecting or distributing assets, in the context of this matter, there has been no distribution to date and the only "asset" is the NAB Trust Account, which was easily identifiable. It was also unnecessary for the liquidators to take any action to protect the funds. They were not required to "recover" assets or reconstruct the accounts of the Company; and (d) The liquidators submit that the work undertaken as liquidator in identifying the individual deposit holders and the amount held for each, taking into account the side-contracts to re-invest significant amounts of their deposits, was reasonably necessary. While the chief executive did not intend to make specific submissions as to an appropriate level of remuneration, he does draw attention to the scope of the work undertaken in the relevant period. He says that, arguably, the records were voluminous purely by virtue of the number of deposit holders and the side-contracts. However, the identification of deposit holders cannot be described as technical or complex in the sense that it necessarily requires the expertise of a senior practitioner.

Principles 156 The interlocutory application sought directions under s 90-15 of the IPS (Corporations) and such further or other orders as the Court considers appropriate. As is evident from the above, the nature of the relief sought by the liquidators has evolved during the course of the proceeding. 157 Section 90-15 of the IPS (Corporations) provides as follows: 90-15 Court may make orders in relation to external administration Court may make orders (1) The Court may make such orders as it thinks fit in relation to the external administration of a company. Orders on own initiative or on application (2) The Court may exercise the power under subsection (1): (a) on its own initiative, during proceedings before the Court; or (b) on application under section 90-20. Examples of orders that may be made (3) Without limiting subsection (1), those orders may include any one or more of the following: (a) an order determining any question arising in the external administration of the company; (b) an order that a person cease to be the external administrator of the company; (c) an order that another registered liquidator be appointed as the external administrator of the company; (d) an order in relation to the costs of an action (including court action) taken by the external administrator of the company or another person in relation to the external administration of the company; (e) an order in relation to any loss that the company has sustained because of a breach of duty by the external administrator; (f) an order in relation to remuneration, including an order requiring a person to repay to a company, or the creditors of a company, remuneration paid to the person as external administrator of the company. Matters that may be taken into account (4) Without limiting the matters which the Court may take into account when making orders, the Court may take into account: (a) whether the liquidator has faithfully performed, or is faithfully performing, the liquidator's duties; and (b) whether an action or failure to act by the liquidator is in compliance with this Act and the Insolvency Practice Rules; and (c) whether an action or failure to act by the liquidator is in compliance with an order of the Court; and (d) whether the company or any other person has suffered, or is likely to suffer, loss or damage because of an action or failure to act by the liquidator; and (e) the seriousness of the consequences of any action or failure to act by the liquidator, including the effect of that action or failure to act on public confidence in registered liquidators as a group. Costs orders (5) Without limiting subsection (1), an order mentioned in paragraph (3)(d) in relation to the costs of an action may include an order that: (a) the external administrator or another person is personally liable for some or all of those costs; and (b) the external administrator or another person is not entitled to be reimbursed by the company or its creditors in relation to some or all of those costs. Orders to make good loss sustained because of a breach of duty (6) Without limiting subsection (1), an order mentioned in paragraph (3)(e) in relation to a loss may include an order that: (a) the external administrator is personally liable to make good some or all of the loss; and (b) the external administrator is not entitled to be reimbursed by the company or creditors in relation to the amount made good. Section does not limit Court's powers (7) This section does not limit the Court's powers under any other provision of this Act, or under any other law. 158 I note that s 90-15(3)(a) of the IPS (Corporations) confers a broad power on the Court to make "an order determining any question arising in the external administration of the company". Section 90-15(3)(a) accommodates the determination of substantive rights as long as appropriate notice has been afforded to potentially affected persons: see In the matter of Hawden Property Group Pty Ltd (in liq) (ACN 003 528 345) [2018] NSWSC 481; (2018) 125 ACSR 355 at [8] (Gleeson JA). Addressing the issues arising concerning the dispersal of moneys in the NAB Trust Account to depositors entitled to those moneys and the liquidators' entitlement to reasonable remuneration and expenses for administering the NAB Trust Account is a matter arising in the course of liquidation of the Company. 159 Further, s 29 of the Federal Court of Australia Act 1976 (Cth) confers power on the Court to make declarations of right as follows: 21 Declarations of right (1) The Court may, in civil proceedings in relation to a matter in which it has original jurisdiction, make binding declarations of right, whether or not any consequential relief is or could be claimed. (2) A suit is not open to objection on the ground that a declaratory order only is sought. 160 The declaration sought relies on the Court's equitable jurisdiction since there is no dispute that the funds in the NAB Trust Account are subject to a statutory trust. I have found that the Administration Act does not prevent the implication of an equitable lien over the NAB Trust Account for the liquidators' reasonable remuneration and expenses. 161 In AAA Financial Intelligence Ltd (in liquidation), Brereton J set out relevant principles as follows and the highlighted matters are particularly relevant to this case: 13 As to the first, the applicable principles may be stated as follows: (a) Where the company is trustee of a trading trust and has no other activities, the liquidators are entitled to be paid their costs and expenses, whether for administering the trust assets or for "general liquidation work", out of the trust assets [Re Suco Gold Pty Limited (1993) 33 SASR 99; 7 ACLR 873; Grime Carter & Co Pty Limited v Whytes Furniture (Dubbo) Pty Limited [1983] 1 NSWLR 158; Re Sutherland; Re French Caledonia Travel Service Pty Ltd (in liq) [2003] NSWSC 1008; (2003) 59 NSWLR 361; 48 ACSR 97, [201]; Bastion v Gideon Investments Pty Ltd (in liq) (2000) 35 ACSR 466, 480 [70]; In the matter of North Food Catering Pty Ltd [2014] NSWSC 77]. (b) Where the company does not act solely as trustee, costs and expenses referable to work done in relation to trust assets which may nonetheless be considered as having been done for the purpose of winding up the company ought ordinarily be borne primarily by the (non-trust) property of the company, to the extent that the assets permit [Re GB Nathan & Co Pty Ltd (in liq) (1991) 24 NSWLR 674, 685-689; Re Greater West Insurance Brokers Pty Ltd [2001] NSWSC 825; (2001) 39 ACSR 301; French Caledonia, [209]]. (c) At least where the non-trust assets do not permit that course, and perhaps even when they do, a liquidator is entitled to be indemnified out of trust assets for his costs and expenses, but only to the extent that they are referable to administering the trust assets [13 Coromandel Place Pty Ltd v CL Custodians Pty Ltd (in liq) (1999) 30 ACSR 377, 385; French Caledonia, [211], [213]. This is pursuant to the court's equitable jurisdiction to allow a trustee remuneration costs and expenses out of trust assets, which extends to a person such as a liquidator who is, for practical purposes, controlling a trustee [Berkeley Applegate (Investment Consultants) Ltd; Harris v Conway [1989] Ch 32, 50-51; Re Application of Sutherland [2004] NSWSC 798; (2004) 50 ACSR 297; Trio Capital Ltd (Admin App) v ACT Superannuation Management Pty Ltd [2010] NSWSC 941; (2010) 79 ACSR 425; In re MF Global Australia Ltd (in liq) (No 2) [2012] NSWSC 1426, [55]; Alphena Pty Ltd (in liq) v PS Securities Pty Ltd atf Joseph Family Trust [2013] NSWSC 447; (2013) 94 ACSR 160]. (d) In principle, where the liquidator does work which would entitle him both to remuneration as liquidator by the company, and recovery from the trust assets, there are two funds liable and there should be contribution between them. However, where there are no assets of the company available, it is unnecessary to consider the question of contribution. If a liquidator has done work which is attributable equally to the winding up of the company and the administration of trust assets, and there are no assets of the company at all to meet his expenses in doing so, the expenses are payable solely from the trust assets [French Caledonia, [212]]. (e) Where the liquidator is administering, through the company of which he/she is liquidator, more than one trust, the liquidator is not entitled to charge the beneficiaries of one trust with the costs and expenses incurred in relation to the other, although where allocation is not possible a pari passu allocation may be permitted [Re Suco Gold, ACLR 882-3; 13 Coromandel, 386]. 14 In this case, the company did not act solely as a trustee. Prima facie, costs and expenses of the winding up should be borne by its non-trust assets. However, it appears that it has none (although this remains to be proven). Subject to that, the liquidators are entitled to their reasonable and proper costs and expenses from the trust assets, but only in respect of such work as is referable to administration of the trust assets. … 162 It is well settled that the onus is on the liquidator or other external administrator to establish that the remuneration claimed is reasonable and that it is the function of the Court to determine the remuneration by considering the material provided and bringing an independent mind to bear on the relevant issues. See cases involving liquidators: Venetian Nominees Pty Ltd v Conlan (1998) 20 WAR 96 at 102 (Kennedy, Ipp and Wallwork JJ); Conlan v Adams [2008] WASCA 61; (2008) 65 ACSR 521 at [28]-[29] (McLure and Buss JJA and Newnes AJA) and Sanderson as Liquidator of Sakr Nominees Pty Ltd (in liq) v Sakr [2017] NSWCA 38; (2017) 93 NSWLR 459 (Sakr Nominees) at [54] (Bathurst CJ) and [69]-[72] (Beazley P, Gleeson and Barrett JJA and Beach AJA). See case involving receivers: Hutchins, in the matter of Ardenberg Pty Ltd (in liq) (Administrators Appointed) (No 2) [2020] FCA 1424 (Hutchins) at [17] relying on In the matter of Say Enterprises Pty Ltd [2018] NSWSC 396 at [6] (In the matter of Say Enterprises Pty Ltd). 163 The liquidators should supply material in support of their application by reference to the matters which are now referred to in s 60-12 of the IPS (Corporations). That is so, notwithstanding that the claim is now to an equitable lien for remuneration and expenses over trust assets rather than for remuneration to be paid out of an insolvent company's assets. 164 Section 60-12 of the IPS (Corporations) provides as follows: 60-12 Matters to which the Court must have regard In making a remuneration determination under paragraph 60-10(1)(c) or (2)(b), or reviewing a remuneration determination under section 60-11, the Court must have regard to whether the remuneration is reasonable, taking into account any or all of the following matters: (a) the extent to which the work by the external administrator was necessary and properly performed; (b) the extent to which the work likely to be performed by the external administrator is likely to be necessary and properly performed; (c) the period during which the work was, or is likely to be, performed by the external administrator; (d) the quality of the work performed, or likely to be performed, by the external administrator; (e) the complexity (or otherwise) of the work performed, or likely to be performed, by the external administrator; (f) the extent (if any) to which the external administrator was, or is likely to be, required to deal with extraordinary issues; (g) the extent (if any) to which the external administrator was, or is likely to be, required to accept a higher level of risk or responsibility than is usually the case; (h) the value and nature of any property dealt with, or likely to be dealt with, by the external administrator; (i) the number, attributes and conduct, or the likely number, attributes and conduct, of the creditors; (j) if the remuneration is worked out wholly or partly on a time-cost basis - the time properly taken, or likely to be properly taken, by the external administrator in performing the work; (k) whether the external administrator was, or is likely to be, required to deal with one or more controllers, or one or more managing controllers; (l) … (m) any other relevant matters. 165 The Court's consideration of the work done by the liquidator must include whether it was reasonable for the liquidator to carry it out and the appropriateness of the amount charged for it. Such an evaluative process, whilst difficult in some circumstances, is not beyond the competence of the Court: see Sakr Nominees at [59] and [69]-[72]. 166 When considering the reasonableness of claimed remuneration, the question of proportionality is important, as explained by Yates J in Hutchins at [18] and [20]: 18 … In Templeton v Australian Securities and Investments Commission [2015] FCAFC 137; 108 ACSR 545 (Templeton), the Full Court said: [32] The question of proportionality in terms of the work done as compared with the size of the property or activity the subject of the insolvency administration or the benefit or gain to be obtained from the work is an important consideration in determining overall reasonableness: see Re AAA Financial Intelligence Ltd (in liq) [2014] NSWSC 1004 at [18] and [19] per Brereton J, Re AAA Financial Intelligence Ltd (in liq) (No 2) [2014] NSWSC 1270 at [35], [36], [43] and [45] per Brereton J, Mirror Group Newspapers plc v Maxwell [1998] 1 BCLC 638 at 645, 651 and 652 per Ferris J (also reported at [1998] BCC 324), Re On Q Group Ltd (in liq) [2014] NSWSC 1428 at [20] per Brereton J, Bank of Nova Scotia v Diemer [2014] ONCA 851 at [33], [45], [55] and [56] per Pepall JA, Re Roslea Path Ltd (in liq) [2013] 1 NZLR 207 at [108], [115] and [121] per Heath and Venning JJ, Brook v Reed [2012] 1 WLR 419 at [51], [86] and [87] per Richards J, referring to the relevant 2004 UK Practice Statement [2004] BCC 912, Re Korda; Re Stockford Ltd (2004) 140 FCR 424 at [47] per Finkelstein J, although we do not endorse his Honour's obiter observations on the "lodestar" methodology as being the required approach as distinct from merely one practical way to proceed in a particular case. [33] Generally, in looking at proportionality, the value of the services rendered must be considered. We would endorse the observations of McLure JA in Conlan as liquidator of Rowena Nominees Pty Ltd (in liquidation) v Adams (2008) 65 ACSR 521 at [47] where her Honour observed: As to the performance of a task reasonably embarked upon, the work done must be proportionate to the difficulty or importance of the task in the context in which it needs to be performed. This is what is encompassed in assessing the value of the services rendered. Using an example from the law, the time spent by an appropriately qualified and experienced practitioner in drafting a statement of claim should be proportionate to the amount in issue. [34] Finally, even if one was not to address proportionality as an express factor, nevertheless its absence may have forensic significance in determining reasonableness. Another way to look at proportionality can be to conclude from a lack of proportionality between the cost of the work done relative to the value of the services provided that there has been overcharging or excessive remuneration claimed (see Thackray v Gunns Plantations Ltd (2011) 85 ACSR 144 at [64] per Davies J). (Emphasis in original.) … 20 Reference should also be made to the discussion of principles by Bathurst CJ in Sanderson as Liquidator of Sakr Nominees Pty Ltd (in liquidation) v Sakr [2017] NSWCA 38; 93 NSWLR 459 at [48] - [60]. I note in particular Bathurst CJ's observation at [57] that the mere fact that the work performed does not lead to an augmentation of the funds available for distribution does not mean that there is no entitlement to remuneration for the work performed.

Consideration 167 I accept that the identification of the NAB Trust Account was not complex and no payments have yet been made out of it since the administrators were appointed. 168 However: (a) There were many depositors and related contracts (including side agreements); (b) Many of the depositors are aged, do not speak English and do not understand legal terminology, complicating communications with them; and (c) Execution of those tasks may have been complicated in some cases arising from variations of Chinese names used in that documentation and records. Accordingly, the task of communicating with depositors to determine their entitlements was time-consuming and has more than normal complexity attached to it. Such work relates to distribution of the NAB Trust Account and properly falls within the Universal Distributing principle: see Trio Capital Limited (in liquidation) at [18] (Black J). 169 I also accept that work falling within the Universal Distributing principle includes: (a) Work done in obtaining bank account statements for the NAB Trust Account and reconciling them with the Company's records; (b) Seeking legal advice as to matters associated with identifying depositors' entitlements to funds in the NAB Trust Account for the purpose of distributing moneys in that Account; and (c) Work done, and obtaining related legal advice in relation to, seeking creditor or Court approval to remuneration for that work. 170 All such claims can only be made for work which was necessary and reasonably incurred. 171 I am satisfied that the amount of $62,743.50 (excluding GST) plus legal expenses of $10,845 (excluding GST) can properly be claimed in relation to the VA period. Having reviewed annexures SJ-12 and SJ-13, I am satisfied that work was done at appropriate levels of seniority and the hours claimed do not appear to be excessive for the work done. 172 I have considered whether it might have been possible for either the administrators or the chief executive to pursue appointment of a receiver under s 47 of the Administration Act before the liquidators were appointed on 17 December 2019. I am satisfied that the failure to seek such appointment during the voluntary administration period was not a factor which I should take into account in determining the declaration which I should make concerning the reasonable remuneration and expenses of the administrators in that period.

First and second liquidation periods 173 In determining the liquidators' entitlement to remuneration for the first and second liquidation periods, the question of whether the remuneration was reasonably incurred in light of the possibility of securing the appointment of a receiver under s 47 of the Administration Act assumes greater significance. 174 It is true that the approach adopted by the liquidators (seeking approval from creditors and the Court of the proposal set out in the Notices of Proposal to Creditors and the interlocutory application) has been adopted in other cases. For example, in Sonray, Gordon J (then a Judge of this Court) ordered that entitlements of less than $50 were to be disregarded. However, the scheme proposed by the liquidators of the Company in this case failed to take account of the possibility of the chief executive appointing a receiver under s 47 of the Administration Act. There is no evidence that recourse to such a scheme was available in cases such as Sonray. 175 Under the proposal set out in the interlocutory application, the NAB Trust Account would bear the whole burden of the liquidators' remuneration and costs and 939 of the 1,078 depositors would receive no return. However, if a receiver were appointed, the costs of identifying depositors and the amount due to them and of distributing moneys held in the NAB Trust Account would be borne by the claim fund established under the Administration Act. 176 I note that the administrators took advice concerning the Administration Act during the VA period (see the table in [143] above under the heading "Legal"). However, the possibility of approaching the chief executive to appoint a receiver under either of s 47(1) or (2) does not appear to have been taken into account before 21 December 2021, even after Ms Lin had raised the issue in her submissions filed on 13 November 2020. 177 As the NAB Trust Account was regulated under the Administration Act, the failure to take account of the regime under that Act and initiate conversations with the chief executive concerning the appointment of a receiver by 27 August 2020 has a bearing on the declaration I should make as to the reasonableness of the liquidators' claimed remuneration and expenses. The interested persons' submission that it was necessary for the liquidators to take account of the regime governing the NAB Trust Account rather than rely on precedents from a different statutory regime was properly made. 178 In saying that, I acknowledge that: (a) The suite of legislation comprising the Administration Act and the Occupations Act is not straightforward and it deals with insolvent administrations (to the extent it does) in an odd way. It is not well suited to dealing with collapses of real estate schemes of the size and complexity of the Ralan Group; and (b) Sections 21-22 and 149 of the Administration Act appear not to have received judicial consideration at the time the interlocutory application was made. However, their statutory predecessors in the PAMD Act had received consideration: see Wicks and Hambleton. 179 I also acknowledge that it is true that the regime for the appointment of a receiver under s 47 of the Administration Act is reliant on the chief executive having a belief, on reasonable grounds, either that: (a) There has or may have been a defalcation in relation to an agent's trust account (s 47(1)); or (b) That a person cannot obtain payment or delivery of trust property held by the agent (s 47(2)). 180 However, it is my view that it was open to the liquidators, with a proper understanding of ss 47, 48, 78 and 79 of the Administration Act and ss 76 and 77 of the Occupations Act, to have initiated discussions with the chief executive after 17 December 2019 and at least by 27 August 2020. The early appointment of a receiver was in the best interests of the depositors. That is because, from the time of appointment, it avoided imposition on the NAB Trust Account of the liquidators' remuneration and expenses. 181 Relevantly to s 47(1): (a) On 3 September 2019, Mr Jahani sent Mr Browne the letter set out at [12] above advising of the payments out of the NAB Trust Account to Ralan Capital Investment Pty Ltd in accordance with the side letters and therefore not reinvested in accordance with the terms of the sale contracts or any other way in accordance with the provisions of the Administration Act; and (b) On 28 November 2019, in the Administrators' Report, the administrators advised creditors that the Ralan Group had been insolvent since 2014, it had an unsustainable business model that replicated a partial Ponzi scheme, and the administrators thought that Mr O'Dwyer had breached ss 180, 181, 184, 588G and Chapters 5C and 7 of the Corporations Act in his role as a director of companies in the Ralan Group. Accordingly, the basis for the appointment of a receiver existed by 28 November 2019 and certainly by August 2020. 182 Further, relevantly to s 47(2)(d)(ii), by 17 December 2019: (a) The liquidators had been appointed by resolution of the Company's creditors. Under s 77 of the Occupations Act, a corporate licensee's licence is automatically cancelled when the licensee is wound up; and (b) On Mr Jahani's evidence Assura Group Pty Ltd prepared the last audit report for the NAB Trust Account. It covered the period from 1 November 2017 to 31 October 2018. The next audit report was due in late 2019 but the administrators did not have funds (other than the NAB Trust Account) out of which to pay for such a report and that Account was not available for that purpose. Accordingly, there were grounds for cancelling the Company's licence because, under s 76(1)(c) of the Occupations Act, a licensee's licence may be cancelled when the chief executive is satisfied that a licensee has failed to file an audit report under s 34 of the Administration Act. Under s 76(4) of the Administration Act, the licence will remain suspended until the audit report is provided. 183 The scale of the Ralan Group collapse, the vulnerability of many non-English speaking and aged purchasers, the publicity surrounding the second creditors' meeting and the information in the letter given to Mr Browne on 3 September 2019 were all likely to have an impact on consumer confidence in the apartment construction industry in Queensland. That would be contrary to the legislative objectives of the Administration Act as stated in the Explanatory Notes to the Agents Financial Administration Bill (2013) (Qld) as follows: The Government has committed to growing a four pillar economy in Queensland focused on tourism, agriculture, resources and construction. As part of this commitment, the Government has adopted a specific property and construction strategy in recognition of the importance of the property and construction sector to the State's economy and the fundamental role it plays in creating the built environment, and providing jobs, affordable housing, and investment and growth opportunities for Queensland. The repeal and split of the PAMD Act aligns with the Government's priorities and its Property and Construction Strategy by demonstrating the Government's commitment to Queensland businesses to have legislation that is appropriately responsive to the needs of each respective industry and strips away unnecessary red tape. This Bill is a component of the Government's achievement of this commitment. Industry groups will benefit from having legislation and obligations that are specific to their line of business. In addition, industry-specific Acts will mean future legislative reforms will be more responsive to marketplace changes in each industry. This is anticipated to lead to increased industry standards, simplified compliance and increased consumer confidence in the regulated industries without having to increase the regulatory burden on licensees … 184 It would therefore have been reasonable for the chief executive of the OFT to consider whether a receiver should be appointed to the NAB Trust Account earlier than 10 February 2021. However, it is unnecessary for me to make a finding concerning the timeliness of the chief executive's decision-making. It is necessary for me to consider the reasonableness of the liquidators' claim to remuneration and expenses for the first and second liquidation periods. 185 I accept that much was going on with the Ralan Group in November-December 2019 so that distribution of the NAB Trust Account might not have been a primary focus of the liquidators at that time or in early 2020. However, Mr Jahani's evidence is that, by the end of the first liquidation period (27 August 2020), preparation of his affidavit in support of the interlocutory application had commenced and advice had been received from counsel in respect of distribution of the "trust funds" (see the table at [145] above under the heading "Legal"). I infer that at least by that time, the liquidators and their lawyers will have contemplated the proposal that some depositors would not receive any return of moneys still held in the NAB Trust Account. Such a course should only be taken when no other is reasonably open. The inflammatory nature of such a proposal to depositors who had lost significant sums, who were aged and often did not speak English or understand legal matters is evidenced by over 3,000 email and telephone communications which followed the depositors' receipt of the September Circular. 186 I have taken into account the dangers of applying hindsight to the reasonableness of decisions taken by external administrators. Having said that, in my view, circumstances existed by the end of the first liquidation period which would, had the liquidators approached the chief executive at that time, have justified the chief executive in being satisfied that either s 47(1) or (2) was available to found the appointment of a receiver. The liquidators then knew that the only source of their reasonable remuneration and expenses would be the NAB Trust Account. If the chief executive was satisfied that a receiver should be appointed, it would have been unnecessary to propose that 939 of 1,078 depositors receive nothing from the NAB Trust Account. That was likely to be less inflammatory than the proposal set out in the September Circular. 187 Further, if the chief executive was not satisfied that the preconditions to the appointment of a receiver existed under either of s 47(1) or (2) notwithstanding the liquidators' proposal that by far the majority of depositors with less than $500 in the NAB Trust Account would receive nothing, it was open to the liquidators to seek a direction under s 90-15 of the IPS (Corporations) that they would be justified in refusing to make payments from the NAB Trust Account. If such a direction were given, s 47(2) of the Administration Act would then certainly have been satisfied. 188 I have taken those matters and the following matters into account in determining the liquidators' reasonable remuneration for the first and second liquidation periods: (a) The balance of the NAB Trust Account is and has been since July 2019, $2,154,809.69; (b) If the liquidators are allowed all of their claimed capped remuneration and expenses of $215,481 (GST exclusive), then their remuneration and expenses, together with the $300,000 fee to be paid to the receivers, will amount to $515,481 (GST exclusive); (c) The amount of remuneration for which the liquidators sought approval from creditors was $247,603 (GST exclusive) inclusive of an estimate of $150,000 in relation to work to be done after 27 August 2020. With the claimed legal expenses this would have been an aggregate amount of $349,220.14 (GST exclusive); (d) I infer that, in estimating $150,000 for the work to be done after 27 August 2020 as stated in the Notices of Proposal to Creditors, the liquidators took into consideration that they would only need to confirm the identity of, and the amount to be paid to 139 depositors who had $500 or more in aggregate deposits in respect of 202 contracts. There would be substantially more work to be done by the receivers in relation to the 1,078 depositors in respect of 1,647 contracts. The receivers also have reporting obligations under Part 4, Div 3 of the Administration Act for which they will be entitled to claim remuneration. It is not clear to me why the estimate for processing each of the depositors' claims of $300 (as set out in Mr Jahani's 1 September 2021 affidavit) was less than the $500 estimated in the application to the Court; (e) There is considerable force to the chief executive's argument that there is no rate for work done by the receivers discernible from the arrangement for a fixed amount of $300,000 without regard to the seniority of the persons undertaking the work or the time taken. However, the liquidators did undertake work in the first and second liquidation periods for the purpose of identifying depositors and the amounts to which they were entitled in the NAB Trust Account. I accept that the work done will relieve the receivers of the need to undertake that work. It is unknowable whether the receivers would have proposed or accepted a $300,000 (GST exclusive) fee had that work not already been undertaken as liquidators; (f) Had the chief executive been approached before the September Circular was sent to the Company's creditors or had the letter sent on 13 October 2020 to the chief executive been followed up, substantial costs for work undertaken by the liquidators and legal fees might have been avoided. Having said that: (i) It is highly likely that some application to the Court would have been required to fix the liquidators' remuneration and expenses or to obtain a direction of the kind contemplated at [187] above; (ii) That is because the chief executive was not willing to pay the liquidators' remuneration and expenses for a period prior to the receivers' appointment. It is notable that the appointment of an administrator is not a "trigger" to the chief executive's powers under s 47(2) of the Administration Act. That is because (in contrast to a licensee failing to file a required audit report or being wound up or the winding up of a licensee) it is not a trigger for the suspension or cancellation of a licence under ss 76 or 77 of the Occupations Act; (iii) The administrators are entitled to remuneration for their work on the basis of the Universal Distributing principle notwithstanding the fact that the Administration Act makes no express provision for it; and (iv) Some remuneration and legal costs are likely to have been incurred by the liquidators in negotiating the appointment of a receiver had the issue not arisen during the proceedings which are now before the Court and I consider that that remuneration is sufficiently related to the repayment of trust moneys to fall within the Universal Distributing principle. 189 Taking into account those matters, I am prepared to accept that the amount of remuneration claimed (at the discounted rate of 15.6%) for work done in the first liquidation period which is not Other Work is reasonable and accordingly I will allow an amount of $17,219.71 (being $20,402.50 less the 15.6% discount). I am prepared to allow the amount claimed at the discounted rate in relation to "Legal" (see [145] above). The liquidators were entitled to take legal advice as to their next steps and it is likely that some application to this Court would have been necessary to obtain approval of their remuneration and expenses even if the chief executive had agreed to appoint a receiver under s 47 during the first liquidation period. 190 In relation to the second liquidation period, I do not consider remuneration associated with the decision to proceed with the proposal set out in the September Circular was reasonably incurred. Upon proper review of the Administration Act and the Occupations Act, another course was open to be pursued which, if successful, would have resulted in a better return to depositors. The appointment of a receiver would most likely have avoided the avalanche of communications which the liquidators received from creditors of the Company for which they claim $36,665.39 (being $43,442.41 set out in the table at [146] less 15.6%) for dealing with depositors' queries and drafting the September Circular. 191 Accordingly, I will not allow the claimed remuneration in relation to the second liquidation period attributed to "creditors". I will allow remuneration in relation to the other categories of claimed remuneration for the second liquidation period, save for some adjustment in relation to the amount claimed for "legal" work in relation to "Assets/Investigations" ($16,318.50) set out in the table at [146] above. While much of the work related to the interlocutory application as originally framed, I accept that it would have been necessary to obtain legal advice in relation to the appointment of a receiver, in negotiating with the chief executive and in pursuing some form of creditor or Court approval or declaration concerning an entitlement to remuneration for the period prior to their appointment as receivers. Accordingly, I am prepared to allow $4,079.62 discounted by 15.6% for this work of the liquidators related to legal matters. 192 Accordingly, for the second liquidation period I would allow $15,054.95 (being $17,837.62 discounted by 15.6%). 193 In aggregate, the amount that I would allow for the liquidators' remuneration is $95,018.16 (GST exclusive) being the sum of the amounts arrived at [171], [189] and [192] above.

Expense claim: legal fees 194 I note that the liquidators made a submission that the Court should not review claimed expenses and an order for expenses will normally be made. In In the matter of Say Enterprises Pty Ltd at [6], Brereton J said (citations omitted): In respect of disbursements, no Court approval or specific order is necessary in the absence of a challenge, although receivers should scrutinise them to ensure that they are reasonable and properly payable, and the Court has an inherent jurisdiction to review receivers' disbursements as they are officers of the Court. However, a receiver may seek a direction that he would be justified in paying certain disbursements in order to obtain prior protection in respect of such a disbursement. 195 In this case, Mr Jahani seeks a declaration concerning his entitlement to a capped amount of remuneration and expenses. However, no invoices for legal expenses have been put into evidence and Mr Jahani has given no evidence that he has scrutinised the invoiced costs to ensure that they are reasonable and properly payable. In those circumstances, I consider that it is necessary for me to consider whether the amount claimed is reasonable, and if not, what should be allowed. 196 I am satisfied that Ashurst has acted for the administrators and liquidators throughout their external administration of the Ralan Group and the Company in particular. Ashurst have been the solicitors on the record for the administrators (in relation to their application for an extension of the convening period) and on the interlocutory application. Further, Mr Jahani's evidence for the VA period and the first and second liquidation periods indicate that the liquidators took advice concerning the matters discussed at [143], [145] and [147] above. In response to a question, Ashurst provided the information discussed at [153] above. 197 In relation to claimed legal expenses of the first and second liquidation periods of an aggregate amount of $90,772.14 (GST exclusive), I am prepared to allow an amount of $60,000 (GST exclusive). The failure to recognise the course open to the liquidators in seeking appointment of a receiver thus alleviating cost to the NAB Trust Account for liquidators' remuneration and avoiding differential treatment of depositors resulted in the liquidators incurring unnecessary legal costs. The lack of detail in the evidence before me means that I should err on the conservative side of what my experience of amounts claimed in litigation of this kind would lead me to understand is consonant with matters of this kind. I have also taken into account the liquidators' evidence that a further amount of approximately $18,000 has been incurred in legal costs since March 2021, which is not being claimed.

Conclusion 198 Taking into account the balance of the NAB Trust Account is $2,154,809.69 and the need for proportion having regard to necessary tasks undertaken by the liquidators, I consider that the reasonable amount of remuneration and expenses is $165,863.16 (GST exclusive). I understand the liquidators intend that they be entitled to recover any GST. I will make a declaration accordingly.

COSTS 199 Ms Lin has indicated that the interested persons wish to be heard on costs. Accordingly, I will reserve the issue of costs. I certify that the preceding one hundred and ninety-nine (199) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Farrell.

Associate: Dated: 16 February 2022 Schedule First Interested Person XU ZHI HU Second Interested Person SUICHUN LIN Third Interested Person LING ZOU Fourth Interested Person JINGJING FU Fifth Interested Person STANLEY XIE Sixth Interested Person SHUYAN DONG Seventh Interested Person XIAO QING WU Eighth Interested Person NA MIN ZHAO Ninth Interested Person GUOYING LI Tenth Interested Person WENHAO TONY YE Eleventh Interested Person THE CHIEF EXECUTIVE, OFFICE OF FAIR TRADING (QLD) Twelfth Interested Person BO HUANG Thirteenth Interested Person TING TING MIAO Fourteenth Interested Person JYH SHING LI Fifteenth Interested Person DALI ZHOU Sixteenth Interested Person HUI TING CHEN Seventeenth Interested Person KELLY RONG XUE Eighteenth Interested Person YU ZHEN WU Nineteenth Interested Person FANG ZHAO Twentieth Interested Person JIAN LI Twenty First Interested Person LEI LIU Twenty Second Interested Person BING ZHONG WU Twenty Third Interested Person ANN YUAN QIENG ZHANG Twenty Fourth Interested Person EMMY CHOU Twenty Fifth Interested Person YAN MING SONG Twenty Sixth Interested Person CHUANMEI XIANG Twenty Seventh Interested Person FULU HUN Twenty Eighth Interested Person MIN ZHENG Twenty Ninth Interested Person MEI LI Thirtieth Interested Person GUANGCHAO GUAN Thirty First Interested Person YUQIONG ZHOU Thirty Second Interested Person HUAJING HUANG Thirty Third Interested Person HAIYAN CAO Thirty Fourth Interested Person XIANGWEN ZHONG Thirty Fifth Interested Person JIA LUO HUANG Thirty Sixth Interested Person XIE PINGFANG Thirty Seventh Interested Person AISHU NALAHARA Thirty Eighth Interested Person LEE SEE WAH Thirty Ninth Interested Person YE MINGQING Fortieth Interested Person LUAN XIANG WANG Forty First Interested Person LONG CHEN Forty Second Interested Person HAN JINGYUN Forty Third Interested Person ZHONG YU Forty Fourth Interested Person XIAO YANG WENG Forty Fifth Interested Person YICHUAN LI