Lawrence, in the matter of Reveal Group Pty Ltd (In Liquidation) [2024] FCA 523

Federal Court of Australia|2024-05-16|Before: Cheeseman J

Pursuant to s 90-15 of the Insolvency Practice Schedule (IPS), the First Plaintiff cease forthwith to be liquidator of the companies in Appendix A.
Pursuant to s 499(3) of the Corporations Act 2001 (Cth) and section 90-15 of the IPS, the Fourth Plaintiff be appointed liquidator of the company in Appendix B.
Pursuant to s 499(3) of the Act and s 90-15 of the IPS, the Second and Third Plaintiffs be appointed as joint and several liquidators of the companies in Appendix C.
Pursuant to s 499(3) of the Act and s 90-15 of the IPS, the Second Plaintiff be appointed liquidator of the company in Appendix D.
Pursuant to section 90-15(1) of the IPS, the requirements of each of the rules 70-30, 70-35 and 70-40 of the Insolvency Practice Rules (Corporations) 2016 (Cth) be dispensed with in relation to each appointment of the Second, Third and Fourth Plaintiffs referred to in Orders 2, 3 and 4.
Pursuant to section 1322(4)(d) of the Act, the period within which the Second, Third and Fourth Plaintiffs must lodge the annual administration return prescribed by s 70-5 of the IPS after they have commenced to act as liquidator of the companies referred to in Orders 2, 3 and 4 be abridged to align with the incumbent appointment date of the First Plaintiff in each winding up as applicable.
Pursuant to s 90-15 of the IPS, the Second, Third and Fourth Plaintiffs each in respect of each company of which they are appointed liquidator pursuant to Orders 2, 3 and 4, notify creditors of their appointments (including that the cost of this application was borne by Hall Chadwick and not the creditors of the relevant company) and provide an update on the status of the external administration within 28 days of the date of this order.
There be no order as to costs.
Any person seeking to understand the basis on which these orders were made, be granted access to the transcript of the hearing and the evidence relied upon by the plaintiffs, upon the payment of any applicable fees and applying for access in the usual manner.

CHEESEMAN J 1 The statutory framework for this application is provided by s 499(3) of the Corporations Act 2001 (Cth) and s 90-15(1) of the Insolvency Practice Schedule. The substance of this application is to remove the first plaintiff, Mr Richard John Lawrence, from his position as liquidator of seven companies, and in his place appoint one or more of the second to fourth plaintiffs as liquidator to one or more of those seven companies. The impetus for removing the first plaintiff as liquidator is that he has ceased his position as partner of the insolvency practice Hall Chadwick effective from 7 November 2023. 2 The result of making the orders sought by the plaintiff will be that each of the seven companies impacted by the removal of the first plaintiff as liquidator will be transitioned to the control of a replacement liquidator or liquidators, being one or more of the second to fourth plaintiffs, each of whom are partners or employees of Hall Chadwick. The net effect will be that for each of the affected companies there will be at least one replacement liquidator appointed singly, or, in some cases, two replacement liquidators appointed on a joint and several basis. 3 Each of the replacement liquidators, as I have noted, are continuing employees or partners of Hall Chadwick. In support of the application, the plaintiffs have read the affidavits of Mr Lawrence, the first plaintiff, and Mr Albarran, the second plaintiff, and tendered exhibit RA-1 to Mr Albarran's affidavit. Mr Albarran deposes to the considerations that cause him to believe that it is in the best interests of the creditors of each of the companies that one or more of the proposed replacement liquidators be appointed as liquidators of each of the companies in place of the first plaintiff. 4 Having considered the evidence relied upon by the plaintiffs, and noting that each of the proposed replacement liquidators has provided the requisite declaration of independence, relevant relationships and indemnities, I am satisfied that it is in the best interests of the creditors of each of the companies impacted to make the orders. In this regard, I note that the continuation of the involvement of the same firm upon the retirement of a liquidator has long been recognised: see In the matter of Arresso Consulting Pty Limited [2019] NSWSC 997 at [8] (Ward CJ in Eq) and the authorities cited therein. 5 Here, Mr Albarran deposes to the fact that, notwithstanding the proposed replacement liquidators' usual rates of charge are higher than those that creditors have approved in the relevant liquidations, the proposed replacement liquidators have agreed to be bound by the creditor approved hourly rates in each winding up. The plaintiffs do not seek costs of this application. In bringing this application, the plaintiffs have utilised an available mechanism which is likely to be the most cost-effective means of affecting the necessary rearrangement: in this regard, see Free & Ors [2010] NSWSC 1079 at [6] (Barrett J). 6 For these reasons, I am satisfied it is appropriate to make orders substantially in the form of the short minutes provided by the plaintiffs, a copy of which will be placed on the Court file. Any party wishing to understand the basis upon which I have made the orders may access the transcript in the usual way, and also the evidence read and relied on by the plaintiffs in this application. I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Cheeseman.

SCHEDULE OF PARTIES NSD 445 of 2024 Plaintiffs Fourth Plaintiff: KATHLEEN VOURIS

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