Livingstone as liquidator of Labouring Solutions Australia Pty Ltd (in liq) v Labor Solutions (NSW) Pty Ltd

Representation: Solicitors:
Turks Legal (First and Second Plaintiff)

File Number(s): 2025/00138484

Publication restriction: Nil.

JUDGMENT – EX TEMPORE

1. Before the Court for its consideration and determination is an assessment hearing in relation to claims brought by the liquidator of a company and the company itself, concerning two motor vehicles which were transferred from the second plaintiff, which is in liquidation, to the defendant.

2. The proceedings were commenced by the plaintiffs by Statement of Claim filed on 10 April 2025. In summary, it is pleaded that the second plaintiff was, prior to transfer, the registered owner of a Mercedes-Benz motor vehicle and a BMW motor vehicle, and that such vehicles were transferred by the second plaintiff to the defendant for sums of money which, on the first plaintiff’s view of the records of the company in liquidation, were never received. It is pleaded that the declared value on the transfer and the buyer’s declared value are inconsistent and raise concerns about the proper receipt of moneys for the transfer.

3. A number of different provisions of the Corporations Act 2001 (Cth) are relied on in the Statement of Claim. It is pleaded that under s 588FE of the Corporations Act, a transaction may be voidable if the transaction is an uncommercial transaction, an unreasonable director-related transaction or a creditor defeating transaction. No Defence was filed by the defendant in relation to the Statement of Claim.

4. An application by way of Notice of Motion filed on 28 November 2025 was made by the plaintiffs for default judgment for unliquidated damages. In support of the application, the plaintiffs relied on the affidavit of Glenn Ian Livingstone, registered liquidator, dated 14 November 2025. Mr Livingstone is the first plaintiff in the proceedings. Following the filing of the Notice of Motion, the Judicial Registrar entered on 23 December 2025 default judgment in favour of the plaintiffs for damages and costs with damages to be assessed against the defendant.

5. The matter has come on for an assessment hearing today. I am concerned in relation to the knowledge of the defendant of the assessment hearing, as generally speaking, evidence should be served in case there is a dispute as to quantum. I will allow for that in the orders to be made by the Court if I am otherwise satisfied of the quantum alleged.

6. Having reviewed the affidavit of Mr Livingstone, the following matters appear to be established by the evidence:

7. At all relevant times prior to 8 September 2020, the second plaintiff was the registered owner of a 2014 Mercedez-Benz 117 CLA45 AMG motor vehicle;

8. At all relevant times prior to 25 May 2021, the second plaintiff was the registered owner of a 2016 BMW M4 motor vehicle;

9. On 8 September 2020, the second plaintiff transferred the Mercedes Benz to the defendant for the price or declared value of $30,000. In fact, on the evidence, nothing was paid by the defendant for the Mercedes-Benz vehicle in consideration of the transfer to the defendant of it by the second plaintiff;

10. On 25 May 2021, the second plaintiff transferred the BMW motor vehicle to the defendant for the price or declared value of $50,000. In fact, on the evidence, nothing was paid in consideration by the defendant for the BMW motor vehicle to the second plaintiff;

11. The buyer’s declared value was $86,000 for the Mercedes-Benz vehicle. The buyer’s declared value was $151,298 for the BMW motor vehicle;

12. The first plaintiff was appointed liquidator to the second plaintiff by order of the Supreme Court of New South Wales made on 18 May 2022;

13. Demands were made for the payment of the value of the vehicles to the defendant by the first plaintiff on 6 September 2022 and by solicitors on his behalf on 31 October 2022;

14. Mr Marcelle Hannouche was a director of the second plaintiff between 9 May 2015 to 1 February 2021;

15. A Mr Marcelle Isaac was appointed a director of the defendant on 8 April 2015. He has the same date and place of birth as Marcelle Hannouche. In correspondence, the solicitors for the first plaintiff asserted Mr Hannouche and Mr Isaac were the same person, and this was not disputed by the defendant in any correspondence in evidence;

16. A valuation from valuation experts was obtained, valuing the two motor vehicles on the basis of their fair market value as at 8 September 2020 and as at 25 May 2021, respectively;

17. The valuations were desktop valuations, but it is the only valuation evidence before the Court as to the fair market value at the time of transfer of the two motor vehicles;

18. The expert valuations were;

(a) 40,000 to 50,000 dollars for the Mercedes-Benz motor vehicle; and (b) 65,000 to 75,000 dollars for the BMW motor vehicle;

13. Adopting the midpoint of the valuations in circumstances where they were desktop valuations only and there was no inspection of the vehicles, I find the fair market value of the motor vehicles as at the date of transfer to be $45,000 for the Mercedes-Benz motor vehicle and $70,000 for the BMW motor vehicle;

14. Interest is claimed. Interest is to be calculated in accordance with the Civil Procedure Act 2005 (NSW) from the dates of transfer.

15. Turning to the legislation relied on, s 588FE of the Corporations Act relevantly provides as follows:

(1) If a company is being wound up:

(a) a transaction of the company may be voidable because of any one or more of subsections (2) to (6) if the transaction was entered into on or after 23 June 1993; and

(b) a transaction of the company may be voidable because of subsection (6A) if the transaction was entered into on or after the commencement of the Corporations Amendment (Repayment of Directors’ Bonuses) Act 2003; and

(c) a transaction of the company may be voidable because of subsection (6B) if the transaction was entered into on or after the commencement of that subsection.

…

(3) The transaction is voidable if:

(a) it is an insolvent transaction, and also an uncommercial transaction, of the company; and

(b) it was entered into, or an act was done for the purpose of giving effect to it, during the 2 years ending on the relation‑back day.

…

(5) The transaction is voidable if:

(a) it is an insolvent transaction of the company; and

(b) the company became a party to the transaction for the purpose, or for purposes including the purpose, of defeating, delaying, or interfering with, the rights of any or all of its creditors on a winding up of the company; and

(c) the transaction was entered into, or an act done was for the purpose of giving effect to the transaction, during the 10 years ending on the relation‑back day.

…

(6A) The transaction is voidable if:

(a) it is an unreasonable director‑related transaction of the company; and

(b) it was entered into, or an act was done for the purposes of giving effect to it:

(i) during the 4 years ending on the relation‑back day; or

(ii) after that day but on or before the day when the winding up began.

8. Mr Merlino, who appeared for the plaintiffs, submitted that the Court would be satisfied, having regard to the pleading in the Statement of Claim and the default judgment entered, that the transactions in question were voidable transactions within s 588FE of the Corporations Act, giving rise to the power of the Court pursuant to s 588FF(1)(c) of the Corporations Act, to make an order requiring a person (here the defendant) to pay to the company, being the company in liquidation, an amount that, in the Court’s opinion, fairly represents some or all of the benefits that the person has received because of the transaction.

9. As I have indicated, I have found that no consideration was provided by the defendant for the transfer of the two motor vehicles to it on the evidence before me. In those circumstances, in accordance with my factual findings, the Mercedes Benz and BMW motor vehicles were transferred from the second plaintiff to the defendant without proper or any consideration being received for them. In those circumstances, the Court, having adopted the midpoint valuation and there being no suggestion of consideration being provided for the transfers, is entitled to order that $45,000 be paid for the Mercedes-Benz and $70,000 for the BMW.

10. It may be, that having regard to the fact that the vehicles were transferred within related entities, that the vehicles have been particularly well looked after and that the higher valuation is appropriate, but there is simply no evidence of that. In my view, it is unsafe to make that inference on the evidence. However, the midpoint valuation is, in my view, a reasonable valuation to adopt in the absence of other evidence.

[There was then a short adjournment for interest to be calculated.]

11. The Court proceeds to determine the amount to be paid under s 588FF(1)(c) of the Corporations Act 2001. These are the orders I make:

12. Judgment for the plaintiffs against the defendant in the sum of $154,359.61, consisting of $115,000 in the amount ordered to be paid under s 588FF(1)(c) of the Corporations Act 2001 (Cth), together with $39,359.61 in pre- and post-judgment interest;

13. The solicitors for the plaintiffs are to serve these orders on the defendant by 27 March 2026.

14. The defendant is to file any application to set aside or vary order 1 within 14 days after service pursuant to order 2.

15. The defendant is to pay the plaintiffs’ costs of the proceedings as agreed or assessed.

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