Re Cameron Lane Pty Ltd (in liq) [2024] VSC 202 (26 April 2024)

CORPORATIONS - Application by liquidator under s 480(d) of the Corporations Act 2001 (Cth) to be released as liquidator of the company in liquidation and order that the company be deregistered by ASIC - Whether the requirements of s 480(d) of the Corporations Act 2001 (Cth) and rule 7.5 of the Supreme Court (Corporations) Rules 2023 (Vic) have been met - Held: application successful.

1 By interlocutory application filed 14 March 2024, Mr Peter Vince ('Liquidator'), the Liquidator of Cameron Lane Pty Ltd (in liquidation) ('Company') seeks orders to facilitate the conclusion of the winding up of the Company ('Application'). Orders are sought under ss 480(d) and 488(2) of the Corporations Act 2001 (Cth) ('Act') as to the final distribution of surplus trust assets held in the liquidation, as to his release as Liquidator and the deregistration of the Company, and ancillary orders.

2 Today I gave ex tempore reasons for making the orders sought by the Liquidator in the proceeding. A revised version of those reasons is set out below.

3 The Company had been part of the Planet Platinum Group of companies which owned property and operated businesses. The Planet Platinum Group of companies included amongst others:

(a) Planet Platinum Limited (in liquidation) ('PPL');

(b) Metropolis City Promotions Pty Ltd (in liquidation) ('MCP'); and

(c) Daily Planet Australia Pty Ltd (in liquidation) ('DPA').

4 The Planet Platinum Group's structure involved two trusts:

(a) the Company was trustee of the Cameron Lane Unit Trust ('CLUT'), in which sole capacity it held assets including a property in Elsternwick, and almost 80 percent of the shares in PPL. The CLUT had only one unit holder, MCP; and

(b) MCP was the corporate trustee of a second trust, the John Trimble Family Trust ('JTFT'). MCP held its units in the CLUT in its trustee capacity. Accordingly, any income or capital distributable in the CLUT, cascaded down to the JTFT.

5 On 12 June 2015, Mr John Lindholm was appointed provisional liquidator of PPL and, on 1 December 2015, as liquidator of PPL.

6 On 20 April 2016, the applicant was appointed voluntary administrator of the Company and voluntary administrator of DPA and MCP.

7 On 29 April 2016, the administration of DPA and MCP were terminated and Mr Glenn Crisp ('Mr Crisp') was appointed liquidator of both entities.

8 On 13 May 2016, the administration of the Company was terminated and the Liquidator was appointed as liquidator of the Company by order of Randall AsJ.

9 On 16 May 2016, the Company was removed as trustee of the CLUT. Since then, it has held assets of the CLUT as a bare trustee, subject to the directions of the new trustee Cameron Lane Holdings Pty Ltd ('CLH'), and subject to orders of this Court.

10 Following the collapse of the Planet Platinum Group, in August 2016 steps were taken to take control of the two trusts and their assets by Mr John Trimble ('Mr Trimble') (now deceased).

11 The liquidator of MCP, Mr Crisp, commenced proceeding S ECI 2016 01264 in this Court seeking orders as to the trusteeship of both trusts and their assets ('Trust Proceeding'). When the Trust Proceeding was commenced it was between MCP and its liquidator Mr Crisp ('MCP Plaintiffs'), and Mr Trimble, John Trimble Holdings Pty Ltd ('JTH') and CLH ('Trimble Defendants').

12 For a period the Trust Proceeding was in a hiatus, underpinned by undertakings, an irrevocable direction, and Court orders, as to the handling of trust assets of both the CLUT and the JTFT.

13 In March 2018, the Company and its Liquidator were joined to the Trust Proceeding and an amended originating process filed revising the orders sought against the Trimble Defendants, and adding orders sought as to the assets of the CLUT.

14 The Trust Proceeding was ultimately resolved with a confidential deed of settlement entered into between the parties to the Trust Proceeding in December 2022.

15 Since then, final steps directed at concluding the liquidation of the Company have been undertaken, including obtaining a clearance from the Australian Taxation Office, and the consent of the liquidator of PPL to the transfer of the PPL shares pursuant to s 468A(1)(a) of the Act.

16 The Liquidator contends that there is no longer any impediment to completing the liquidation of the Company. The evidence before me was that all creditors of the Company have been paid. Further, the remaining trust assets are to be transferred as directed and authorised by the current trustee of the CLUT, less payment of final remuneration and expenses as authorised by the trustee, with remuneration having been approved by creditors. This application was brought by the Liquidator seeking orders:

(a) that he have special leave pursuant to s 488(2) of the Act to make a final distribution of surplus trust assets held in the liquidation of the Company as proposed in the affidavit of Peter Robert Vince sworn on 7 March 2024 ('Vince Affidavit'), including the making of in specie distributions as described, within 45 days of the date of any order;

(b) to the extent necessary, an order granting the applicant special leave pursuant to s 488(2) of the Act nunc pro tunc to make interim distributions of surplus trust funds held in the liquidation of the Company as described in the Vince Affidavit;

(c) dispensing with the requirement under reg A5.6.71(1) of the Corporations Regulations 2001 (Cth) ('Regulations') that Corporations Form 551 be annexed to the orders authorising distribution of surplus made by this Court;

(d) dispensing with the requirement under r 7.9(2) of the Supreme Court (Corporations) Rules 2023 (Vic) ('Rules') that the applicant publish a notice of the s 488(2) application in accordance with Form 15;

(e) pursuant to s 480(d) of the Act that the Liquidator be released as liquidator of the Company 60 days after the making of any order;

(f) pursuant to s 480(d) of the Act that the Australian Securities and Investments Commission ('ASIC') deregister the Company 60 days after the making of any order;

(g) dispensing with the requirement under r 7.5(6) of the Rules that the applicant serve updated accounts on creditors of the Company;

(h) that the highlighted passages of the Vince Affidavit and confidential exhibit PRV-2 to that affidavit remain confidential and no person may inspect or obtain a copy of them without further order of the Court; and

(i) that the costs of and incidental to this application are costs in the liquidation of the Company.

17 The following parties were served with the Application and the Vince Affidavit: the creditors who proved a debt in the winding up of the Company (Thirteenth Kaysan Pty Ltd, Cann-Ret Pty Ltd, Bryantcraft Pty Ltd, ASIC, Cloverdale Pty Ltd, Daily Planet Property Pty Ltd, John Ribbands, Lennon Mazzeo Lawyers, State Revenue Office of Victoria, Playaround Pty Ltd, PPL, and the sole unit holder of the CLUT, MCP); ASIC (in its capacity as regulator); the MCP Plaintiffs; and the Trimble Defendants.

18 The Liquidator relied on the following affidavits:

(a) the Vince Affidavit;

(b) the affidavits of service of Nicole Dawn Kendall affirmed on 11 April 2024, Eva Seci sworn on 24 April 2024 and Brooke Quibell sworn on 24 April 2024;

(c) the two affidavits of Cara Thompson both affirmed on 24 April 2024; and

(d) a further affidavit of Cara Thompson affirmed on 26 April 2024.

19 Section 485(2) of the Act is concerned with the distribution of surplus assets in a Court-ordered winding up. It provides that the Court must adjust the rights of the contributories among themselves and distribute any surplus among the persons entitled to it. Section 488(1) of the Act then permits the relevant rules or regulations to provide for the liquidator to perform specified powers and duties of the Court in respect of, amongst other things, the distribution of any surplus among the persons entitled to it, subject to the supervision of the Court. Section 488(2) of the Act operates to limit the scope of the delegation under s 488(1) of the Act.

the Court must adjust the rights of the contributories amongst themselves and distribute any surplus among the persons entitled to it. (emphasis added)

21 Section 488(1) of the Act and r 7.10 of the Rules provide for a general delegation to liquidators of certain powers of the Court in a Court-ordered winding up, including at s 488(1)(c) of the Act:

the adjusting of the rights of contributories among themselves and the distribution of any surplus among the persons entitled to it. (emphasis added)

22 Section 488(2) of the Act then operates to limit the scope of the delegation in the case of a surplus. It provides that:

Despite anything in rules of court or regulations made for the purposes of subsection (1), a liquidator may distribute a surplus only with the Court's special leave.

23 The Court may dispense with the requirements in r 7.10 of the Rules.

24 Regulation 5.6.71 of the Regulations provides that:

(1) an order in a winding up by the Court authorising the liquidator to distribute any surplus to a person entitled to it must, unless the Court otherwise directs, have annexed to it a schedule in accordance with Form 551;

(2) the liquidator must send to each person to whom any surplus is distributed a notice in accordance with Form 552.

25 The Court may dispense with the requirements in reg 5.6.71 of the Regulations and make any order it considers just, particularly in a simple case where there is no need for adjustments of rights between contributories.

26 Counsel for the applicant submitted, and I accept, that the principles applicable to an application under s 488(2) of the Act can be summarised as follows:

(a) a liquidator in a Court-ordered winding up has delegated power to distribute any surplus to the persons entitled to it but may only do so with the Court's special leave;[1]

(b) "special leave" requires that an application be made to the Court, rather than the matter being dealt with as part of some other administrative process;[2]

(c) the requirement for special leave to be obtained serves two purposes. It is designed to ensure that there is in fact a surplus, that all creditor claims have been identified and paid in full. And (where relevant) it ensures that the correct relativities amongst the contributories have been taken into account;[3]

(d) the Court may be satisfied that it is appropriate to make an order under s 488(2) of the Act on evidence that appropriate steps have been taken to identify the Company's creditors; that their claims have been met; that the assets now available, after setting aside amounts to meet final remuneration and costs of the liquidator, can properly be treated as a surplus available for distribution; and that the contributories (or beneficiaries) consent to the order;[4]

(e) the Court may grant special leave under s 488(2) of the Act nunc pro tunc as to a distribution already made, with caution, where there is no prejudice to any third party such as a creditor or contributory;[5]

(f) an important consideration may be that a previous distribution of surplus was interim, capable of being adjusted if necessary in the final distribution;[6]

(g) the Court commonly dispenses with the requirements in r 7.9(2) of the Rules pursuant to r 1.3(1) of the Rules in simple cases where there is no need for adjustment between contributories, the debts of unsecured creditors have been discharged, and notice has been given to ASIC (and, in the case of distributions to contributories, to contributories);[7]

(h) the Court also commonly dispenses with the requirement in reg 5.6.71(1) of the Regulations that Form 551 be annexed to s 488(2) orders. That requirement has been said to be directed to cases where there are numerous contributories and there may be matters for adjustment between them, or where their identity is unclear;[8] and

(i) applications under ss 480(d) and 488 of the Act can be made together[9] and the Court may consider it appropriate to make orders under ss 480(d) and 488(2) of the Act together.[10]

27 Special leave under s 488(2) of the Act may not strictly be necessary for a liquidator of a trustee company to distribute a surplus of trust assets given that, except to the extent of a proprietary interest generated in the trust assets by a right of exoneration,[11] they are not assets of the company.[12] However, in at least two recent cases, special leave to distribute has been granted in the liquidations of corporate trustees.[13]

28 It is appropriate in the circumstances of this matter for the Court to give leave under s 488(2) of the Act and to make the orders sought dispensing with the requirements under reg 5.6.71(1) of the Regulations and r 7.9(2) of the Rules. I accept that it is appropriate for the surplus to be distributed in the manner proposed by the Liquidator for the following reasons.

29 First, the Vince Affidavit makes clear that the Liquidator has taken appropriate steps to identify the assets of the trust and the creditors of the Company. The trust assets have been brought in and realised, save for the two assets held in specie (the PPL shares and the proof of debt), and the creditors have all been paid in full, plus statutory interest.

30 Second, and as to the previous distributions of surplus, these were of trust funds not Company funds. This Court had by order directed that the payments be made. They were interim, and further funds would be coming into the liquidation. The Liquidator believed he was both empowered and compelled to make them. I accept the Liquidator's evidence.

31 Third, the assets now available, after setting aside amounts to meet final remuneration and costs of the liquidation, can properly be treated as surplus available for distribution.

32 Fourth, the surplus is of trust assets. There is no need to adjust the rights of contributories (who have no entitlement to trust assets) or of any party. This is not a complex case. The trust has only one unitholder MCP. The trustee CLH, with MCP's agreement, has authorised and directed the Liquidator to distribute the surplus as specified, being:

(a) to transfer the PPL shares to the current trustee, CLH;

(b) to transfer cash held, and a proof of debt lodged in Mr Trimble's bankrupt deceased estate to the sole unitholder of the CLUT, MCP; and

(c) to pay any remaining fees and disbursements in the liquidation.

33 Fifth, notice of this Application has been given to ASIC, the parties to the Trust Proceeding (including the trustee of Mr Trimble's bankrupt estate), and the creditors. None have objected or sought to be heard. None appeared when the matter was called outside the Court. The Liquidator of the sole unitholder of the CLUT has consented to the orders sought as has Mr Crisp in his capacity as liquidator of MCP and two of the Trimble Defendants namely CLH and JTH. ASIC indicated that they did not wish to be heard on the Application.

34 Section 480 of the Act relevantly provides that:

(a) has realised all of the property of the company or so much of that property as can in his or her opinion be realised without needlessly protracting the winding up, and has distributed a final dividend (if any) to the creditors and adjusted the rights of the contributories among themselves and made a final return (if any) to the contributories; or

(b) has resigned or has been removed from office;

he or she may apply to the Court:...

(d) for an order that he or she be released and that ASIC deregister the company.

35 The effect of an order for release of a liquidator under s 480 of the Act is stated in s 481(3)-(4) of the Act:

(3) An order of the Court releasing the liquidator discharges him or her from all liability in respect of any act done or default made by him or her in the administration of the affairs of the company or otherwise in relation to his or her conduct as liquidator, but any such order may be revoked on proof that it was obtained by fraud or by suppression or concealment of any material fact.

(4) Where the liquidator has not previously resigned or been removed, his or her release operates as a removal from office.

36 Rule 7.5 of the Rules provides that on an application by the liquidator of a company for an order for her/his release:

(a) the interlocutory process must include a prescribed notice as to how any objection must be taken, and that it must be done within 21 days after service of the interlocutory process (r 7.5(2)(a)) and a statement setting out the terms of s 481(3) of the Act (r 7.5(2)(b)),

(b) the supporting affidavit must include details of the matters set out in paragraphs (a) to (m) of r 7.5(3),

(c) the supporting affidavit must include certain statements set out in r 7.5(4),

(d) the liquidator must file with the supporting affidavit a statement of the company's financial position as at the date of filing and a summary of the liquidator's receipts and payments in the winding up (r 7.5(5)), and

(e) unless the Court otherwise orders, the liquidator must also serve on each creditor who has proved a debt a copy of the interlocutory process with a copy of the financial statement and summary of receipts and payments (r 7.5(6)).

37 Rule 2.8 of the Rules also requires notice of an application under s 480 of the Act to be served upon ASIC a reasonable time before the hearing of the application.

38 Counsel for the applicant submitted, and I accept, that the principles applicable to an application under s 480 of the Act can be summarised as follows:

(a) the effect of an order for release has been described as to 'wipe the slate clean', subject to the limited exceptions set out in s 481(3);[14]

(b) the notification provisions allow the application to be the forum at which any claim that the liquidator has been deficient in performing their role to be advanced;[15]

(c) the Court would ordinarily make an order releasing the liquidator unless any reason emerges why it should not do so, if the Court is satisfied the relevant notifications have been given, no creditors have objected to the release of the liquidator or raised any concern as to the performance of their duties and the other evidence contemplated by the appropriate rules is placed before the Court;[16]

(d) the Court may order a release even where steps remain to be taken in the liquidation, where the remaining steps are of a mechanical character. In such a case the Court commonly orders the release to take effect from a specified date;[17]

(e) an order for ASIC to deregister the company should normally be sought as part of an application for the release of the liquidator, to avoid the problem of the winding up continuing after the release of the liquidator, without any liquidator in place; [18] and

(f) the Court also commonly dispenses with the requirement in r 7.5(6) of the Rules that the liquidator serve updated accounts on creditors of the company, and has done so in simple case where are few creditors and they have been paid in full.[19]

39 It is appropriate in the circumstances for the Court to make orders under s 480 of the Act for the following reasons.

40 First, the Application was foreshadowed to creditors by circular on 28 September 2023, prior to the meeting of creditors on 16 October 2023 at which no issue was raised and the final remuneration approval was resolved.

41 Second, the 21 day period for any objection has passed in all cases, on 8 April, 9 April, 10 April, 17 April and 23 April 2024, variously. No objection has been received. No one appeared to oppose the Application when the matter was called in Court.

42 Third, the requirements of r 7.5 of the Rules have been satisfied, save for r 7.5(6) of the Rules as to service of the updated accounts on creditors. As to the latter, the creditors are not large in number, and have been paid out in full, plus statutory interest.

43 Fourth, the creditors have in any event received a copy of the Application and redacted Vince Affidavit.

44 Fifth, the trustee and sole unitholder of the CLUT are agreed that the Application pursuant to s 480 of the Act should be made by the Liquidator and the Company deregistered.

45 Sixth, the Company has been in liquidation for eight years. Now that the Trust Proceeding has settled, the final steps to be taken are known and mechanical and raise no reason to prolong the liquidation and the attendant costs.

46 For the reasons expressed above, I make the following orders:

1. The applicant has special leave pursuant to s 488(2) of the Act to make a final distribution of surplus trust assets held in the liquidation of the Company as proposed in the Vince Affidavit, including the making of in specie distributions as described, within 45 days of the date of this Order.

2. The applicant has special leave pursuant to s 488(2) of the Act nunc pro tunc to make interim distributions of surplus trust funds held in the liquidation of the Company as described in the Vince Affidavit.

3. The requirement under reg 5.6.71(1) of the Regulations that Corporations Form 551 be annexed to the orders authorising distribution of surplus be dispensed with.

4. The requirement under r 7.9(2) of the Rules that the applicant publish a notice of the s 488(2) application in accordance with Form 15 be dispensed with.

5. Pursuant to s 480(d) of the Act, the applicant be released as liquidator of the Company 60 days after the making of this Order.

6. Pursuant to s 480(d) of the Act, ASIC is to deregister the Company 60 days after the making of this Order

7. The requirement under r 7.5(6) of the Rules that the applicant serve updated accounts on creditors of the Company be dispensed with.

8. Pursuant to rr 28.05 and 28A.06 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic), the highlighted passages of the Vince Affidavit, the highlighted pages of exhibit PRV-1 and the confidential exhibit PRV-2 to the Vince Affidavit are to remain confidential and no person may inspect or obtain a copy of them without further order of the Court.

9. Costs of and incidental to this Application are costs in the liquidation of the Company.

10. The solicitors for the applicant serve a copy of this Order as authenticated on ASIC as soon as practicable.

[1] Maertin v Klaus Maertin Pty Ltd (in liq) [2009] NSWSC 618; (2009) 232 FLR 239, 247 [40] (Austin J) ('Klaus Maertin').

[3] Spooner, re Wengen Pty Ltd (in liq) [2022] FCA 863 ('Wengen'), [20] (McEvoy J).

[4] For example, see Re Hawden Property Group Pty Ltd (in liq) [2018] NSWSC 481; [2018] 125 ACSR 355 (Gleeson JA) ('Re Hawden Property Group'); Warner, re Sakr Bros Pty Ltd (in liq) [2019] FCA 547 (Griffiths J) ('Sakr Bros'); Re Global Alliance Corporation Pty Ltd [2020] NSWSC 119 (Emmett AJA) ('Global Alliance'); Knight, re Second ICO Pty Ltd (in liq) [2020] FCA 608; (2020) 144 ACSR 329 (Anderson J) ('Second ICO'); Re Karim Pty Ltd (in liq) [2021] NSWSC 141 (Williams J) ('Re Karim'); Walley, re Icicek Holdings Ltd (in liq) [2020] FCA 701 (Gleeson J) ('Icicek Holdings'); Barnden, re Saeco South Australia Pty Ltd (in liq) [2021] FCA 1204 (Cheeseman J) ('Saeco SA'); Re Glengrant Civil Pty Ltd (in liq) [2017] NSWSC 843 (Robb J) ('Glengrant Civil').

[5] Klaus Maertin (n 1), 250 [48]-[50].

[7] For example, see Re Hawden Property Group (n 4), [60]; Sakr Bros (n 4), [25]; Global Alliance (n 4), [14]; Second ICO (n 4), [27]; Re Karim (n 4), [30]; Icicek Holdings (n 4), [35]; Saeco SA (n 4), [21].

[8] For example, see Klaus Maertin (n 1), 250 [51]; Re Hawden Property Group (n 4), [63]; Sakr Bros (n 4), [26]; Global Alliance (n 4), [13]; Second ICO (n 4), [28]; Wengen (n 3), [34]; Re Karim (n 4), [27]; Icicek Holdings (n 4), [38]; Saeco SA (n 4), [24].

[9] Klaus Maertin (n 1), 253 [66] (Austin J).

[10] See Global Alliance (n 4); Icicek Holdings (n 4); Saeco SA (n 4); Glengrant Civil (n 4).

[11] Carter Holt Harvey Woodproducts Australia Pty Ltd v Commonwealth [2019] HCA 20; (2019) 268 CLR 524, 578-582 [133]-[140] (Gordon J), 564 [90] (Bell, Gageler and Nettle JJ) ('Carter Holt').

[12] Cremin, re Brimson Pty Ltd (in liq) [2019] FCA 1023; (2019) 136 ACSR 649, [49], [51]; Carter Holt (n 11), 588-589 [169]-[171] (Gordon J); Re Pako Supermarkets Pty Ltd (in liq) [2020] VSC 487, [57]-[58] (Connock J).

[13] Second ICO (n 4) in 2020 and Wengen (n 3) in 2022.

[14] RR Impex Pty Ltd (in liq) [2013] NSWSC 1667, [3] and the authorities cited (Black J) ('RR Impex').

[16] Ibid; Re Sakr Nominees Pty Ltd [2017] NSWSC 668, [34] (Black J); Re Hawden Constructions Pty Ltd (in liq) [2018] NSWSC 1472, [8] (Black J) ('Hawden Constructions').

[17] Re Samgris Resources Pty Ltd (in liq) [2022] QSC 126, [70] (Kelly J) ('Samgris Resources'); Re Better Drums Pty Ltd [2019] NSWSC 1262, [7] (Black J).

[18] RR Impex (n 14), [3] and [11]; Samgris Resources (n 17), [73].

[19] Icicek Holdings (n 4), [44]; RR Impex (n 14), [12]; Hawden Constructions (n 16), [6].