82 Reference has already been made to the fact that, in the pre-meeting discussion on 1 April 2008, Mr Morgan referred to the fact that billable time in the administration to that point was $630,000 and that he was writing off $90,000 by agreeing to the figure of $540,000 which was put to the meeting and approved. This matter was also referred to by Mr Morgan when he addressed the meeting of creditors. A transcript of the meeting records him as saying:
"We have had a discussion with the director and his advisors in relation to our fees this morning and we reached a resolution that we will discount our fees by $90,000 off the first amount of $630,000 so what we're looking to do is get a resolution that our fees be approved at $540,000 exclusive of GST."
83 He then went on and recited the form of resolution proposed, making it clear that the fixed sum of $540,000 exclusive of GST related to the period 28 January 2008 to the date of the meeting itself.
84 I see no need for a review of this element. All relevant work had been completed. Mr Morgan informed creditors that the time-based amount of $630,000 was not sought - making it clear that he could have sought it but was content to seek only $540,000. The situation was one in which the administrator, obviously aware of the extent of the work actually done, asked for remuneration of $540,000 and the creditors acceded to that request. He made and communicated a decision to seek less than he might otherwise have sought for completed work. The situation was not one in which the creditors, by their vote, forced upon the administrator a reward for that completed work smaller than that he sought from them.
85 I am not satisfied that, in those circumstances, the court should embark on a review. The circumstances themselves leave no room for a possibility that the remuneration determined by resolution of creditors for past services was not a fair and reasonable remuneration. There was informed and free consent on both sides to the particular quantum.
86 The same cannot be said of the several elements determined prospectively on 1 April 2008. I refer, of course, to the determinations in respect of the period of the voluntary administration after 1 April 2008 and the whole of the period as deed administrator. In relation to each of those elements both Mr Morgan and the creditors asked to determine remuneration were, in a real sense, dealing with the unknown. The "cap" was, in each case, applied in the sense to which reference has already been made, that is, to mark a limit beyond which there could be no remuneration without either a further determination of creditors or an order of the court. The existence of the "cap" did not imply that remuneration could never exceed the stated amount.
87 It is no doubt relevant that both the committee of inspection and a meeting of creditors were later asked to determine additional remuneration and that each did not do so. The proposal was, in each case, raised at the relevant meeting but not approved. But the relevance of that matter is not such as to indicate that the court should not embark upon a review - merely that there is a need for it to be particularly astute and vigilant. If the committee and the meeting of creditors were unwilling to vote additional remuneration, there is a need to be sure that anything more is indeed reasonable.
88 This leads to another point. The court, upon a s 449E(2) review, is not confined to adopting the position for which the administrator contends or that for which an objector contends. As the section makes plain, the court may "confirm, increase or reduce" the remuneration determined by creditors. Once the matter is before it, the court must simply decide, in accordance with s 449E(4), the appropriate quantum.
The form of review
89 Mr Morgan's application for review has been made in the manner required by rule 9.2A of the Supreme Court (Corporations) Rules 1999. This is established by his affidavit of 10 July 2009. In particular, he gave notice in accordance with Form 16A as required by rule 9.2A(3). This was done on or about 8 April 2009. Mr Morgan deposes that no one to whom notice was given served on him a notice under rule 9.2A(4).
90 It was recognised in both Re Korda; Stockford Ltd (above) and Re Carlovers Carwash Ltd [2005] NSWSC 879; (2005) 54 ACSR 696, the view was taken that a registrar of the court is best equipped to perform the court's function of determining remuneration. The same assessment holds good in relation to a s 449E(2) review.
Disposition
91 I have not so far mentioned the claim of Pauls and Mr for an order that Mr Morgan "do all acts necessary to complete" the deed of company arrangement. Since remuneration has not been finally quantified and full effectuation of the deed is not possible in the absence of that quantification, no such order will be made.
92 In relation to Mr Morgan's interlocutory process (see paragraph [26] above), there will be no order in terms of paragraph 1.
93 As to the balance of the matters before the court, there will be orders as follows:
1. Order that the remuneration determined by the Second Resolution set out at paragraph [5] of reasons for judgment published in these proceedings on 13 November 2009 be reviewed pursuant to s 449E(2) of the Corporations Act 2001.
2. Order that the remuneration determined by the Third Resolution set out at paragraph [5] of reasons for judgment published in these proceedings on 13 November 2009 be reviewed pursuant to s 449E(2) of the Corporations Act 2001.
3. Pursuant to Item 7 of the delegation under s 13 of the Civil Procedure Act 2005 made on 9 April 2009, order that there be and is hereby referred to a registrar the matter of conducting and determining each of the reviews so ordered.
4. Direct that evidence admitted upon the hearing of these proceedings on 16 and 22 October 2009 be evidence upon the review, subject to any determination as to relevance of any part of it to the review.
94 As to costs, my inclination is to think that there should be an order that Pauls and Mr Dwyer pay Mr Morgan's costs of the proceedings to date. If Pauls and Mr Dwyer consider that there should be some other order, they must so inform Mr Morgan and my Associate within seven days. In that event, I shall make directions for submissions on costs.
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