RE NORTHERN TERRITORIES RESOURCES PTY LTD (ADMINISTRATORS APPOINTED)... [2026] WASC 46 | Case summary

Supreme Court of WA|2026-02-24|Before: Hill J

(This judgment was delivered extemporaneously and has been edited from the transcript to include references, headings and to correct matters of grammar and expression.)

On 4 December 2025, I made orders extending the convening period of the second creditors' meeting of Northern Territories Resources Pty Ltd (Company) to 8 June 2026. At the hearing on that date, counsel for the plaintiffs indicated they would be seeking a hearing at a later time to address the remainder of the orders sought in the plaintiffs' originating process concerning the administrators' personal liability in respect of an amended loan agreement.
On 5 February 2026, the plaintiffs filed a minute of proposed orders, as well as a certificate of urgency, certifying that the orders sought were of such an urgent nature that the originating process was required to be relisted and heard by 20 February 2026. For this reason, the originating process was relisted before me today on an urgent basis.
In support of the application, the plaintiffs read three additional affidavits, being:

I have also had the benefit of a written outline of submissions, as well as brief oral submissions from counsel who appeared before me this morning.
I am satisfied from the contents of Ms Hamid's first affidavit that the application has been served on the Australian Securities Investments Commission (ASIC).[1] I also note that at this stage, formal notice of the application has not been given to all of the Company's creditors.[2] However, the orders sought by the plaintiffs provide for notice to be given promptly to creditors with an ability to apply to vary or discharge the orders.

Some of the factual background to this application has been summarised in my previous decision.[3] I do not intend to repeat that summary, and in the course of these reasons, intend to adopt the same terms that I used in those reasons. The following matters that I refer to are those that are relevant to the application currently before me, which were not set out in my earlier reasons.
On 3 December 2025, the Administrators, the Company and Gold Valley entered into a deed of amendment in respect of a loan agreement between the Company and Gold Valley (First Amendment Deed). On 29 January 2026, the Administrators, the Company and Gold Valley entered into a further deed of amendment in respect of the Loan Agreement (Second Amendment Deed) (together, Amended Loan Agreement).[4]
In accordance with cl 2 of the First Amendment Deed, Gold Valley and the Company's receivers executed a deed of retirement on 3 December 2025. The effect of this was that the receivers immediately retired from the Company on that date.[5]
Since 3 December 2025, the Administrators have drawn down on the facility made available under the terms of the Amended Loan Agreement on three occasions. Mr Palandri's evidence is that these funds were used for the payment of key expenses of the Company between November 2025 and January 2026, including the costs associated with the care and maintenance of the Mine, employee wages, expenses arising as a consequence of Cyclone Fina, insurance, tenement costs, legal costs, as well as advertising and marketing costs associated with the sales campaign being conducted.[6]
Mr Palandri considers the terms of the Amended Loan Agreement to be commercial and reasonable in the circumstances, given the Company's financial position, the appointment of administrators, and the urgent need for funding in order to preserve value for creditors.[7]

Should orders be made to relieve the plaintiffs from personal liability?

Pursuant to s 443A of the Corporations Act 2001 (Cth) (Act), an administrator is personally liable for any debts they incur in the performance or exercise, or purported performance or exercise of their functions and powers as administrators.
Pursuant to s 443D of the Act, an administrator is entitled to be indemnified out of the Company's property for the debts for which they are liable under s 443A.
Where an administrator enters into a loan agreement, the loan and the interest payable on it are not considered to be a debt falling within the terms of s 443A of the Act, and the indemnity that is the subject of s 443D. For this reason, unless an order is made by the court modifying the operation of pt 5.3A of the Act, the administrators will be personally liable for the loan and any interest payable on it.
It is well accepted that s 447A of the Act empowers the court to make orders limiting the personal liability of an administrator where it is satisfied the loan agreement is made for the purpose of allowing the company in administration to trade, or to continue operating for the benefit of creditors.[8]
Counsel during the course of submissions this morning drew my attention to two decisions of the New South Wales Supreme Court, namely, Re Camel Pty Ltd and Re Renex Holdings (Dandenong) Pty Ltd, where Black and Nixon JJ separately have held that these orders can be made in respect of a loan agreement that has already been entered into.[9] For the reasons given by Black and Nixon JJ, I accept that to be the case.
Where these circumstances arise, courts have generally expressed the view that administrators should not be expected to expose themselves to substantial personal liabilities. Where orders are made relieving administrators from personal liabilities in respect of borrowings, the orders permit the administrators to make commercial decisions about the ongoing operations of the company under administration by focusing on what is in the best interests of creditors, without any influence of the concern as to their personal liability.
The factors the court takes into account on an application such as the one before me were summarised by Gilmour J in Mentha, Re Griffin Coal Mining Company Proprietary Limited (administrators appointed).[10]
In this case, the key terms of the amended loan agreement can be summarised as follows:

(a) the plaintiffs have entered into the Amended Loan Agreement in their capacity as the joint and several administrators of the Company;

(b) the limit of the loan provided for in the original loan agreement has been extended from $2,000,000 to $4,000,000 (Loan);

(c) the limit of the advances made in respect of the Loan has been extended from $300,000 to $450,000;

(d) the Loan can be used for funding the external administration of the Company; and

(e) there are terms specifying how the Loan can be accessed, what the funds can be used for, and includes provision for its repayment.

On the basis of the evidence before me, I am satisfied it is appropriate to make the orders sought under s 447A of the Act for two primary reasons.
First, I accept that the purpose of the funding provided under the Amended Loan Agreement is to provide working capital for the administration, and to fund the continuing operation of the Company during the period of the administration. Mr Palandri's evidence, which I accept, is that without the funding the Company will lack the resources to undertake the necessary care and maintenance of the Mine and the associated processing plant. If this were to cease, it is likely that there will be a significant deterioration in the value of the Company's assets, potential contamination of the Mine and surrounding third-party tenements, as well as an increase in claims against the Company.[11]
Second, without this funding, I accept the Administrators would lack the financial resources to conduct a sales campaign which is likely to deliver a better outcome to creditors than liquidation.
Given these matters, I consider that the proposed orders are consistent with the interests of creditors and the objects of part 5.3A of the Act.

Should directions be given for approval to enter in the Amended Loan Agreement?

The plaintiffs also seek orders pursuant to s 90-15 of the Insolvency Practice Schedule (Corporations) (sch 2 of the Act) (IPS) that they were justified in causing the Company to enter into the Amended Loan Agreement.
Pursuant to s 90-15(1) of the IPS, the court may make 'such orders as it thinks fit in relation to the external administration of the company.' It is accepted by the courts that this power is broad, and is at least as extensive as the powers formally available to the court under s 479(3), and s 511 of the Act.
The principles which govern the exercise of the power can be briefly summarised as follows.

(a) the power to give advice is intended to facilitate external administrators' performance of their functions and should be interpreted widely to give effect to that purpose;

(b) the court may give a direction where it is just and beneficial to do so;

(c) the function of the power is to give an external administrator advice as to the proper course of action to take in the external administration;

(d) the court will not give a direction as to a matter of commercial or business judgment. There must be a legal issue of substance or procedure, including an issue of power, propriety or reasonableness; and

(e) the power will generally not be used to determine substantive rights or make binding orders, although it is possible to do so where the necessary parties are before the court.

Mr Palandri's evidence is that without entry into the amended loan agreement, the Administrators would not be able to fund the Administration of the Company, undertake the necessary care and maintenance, or continue their sales campaign.
I accept that in the circumstances of this case, the direction sought by the plaintiff goes to the reasonableness or propriety of the Administrators entering into the Amended Loan Agreement, and that it is appropriate to make the direction sought.

For these reasons, I am satisfied it is appropriate to make orders in terms of the plaintiff's minute of proposed orders that was filed on 5 February 2026.
The plaintiffs seek orders for the costs of the application to be costs in the administration of the Company. This is the usual and appropriate costs order on applications of this nature, and I will make that order.
As noted earlier, on the evidence before me, creditors have only been given short notice of this application. In these circumstances, I accept it is appropriate that they be given notice of the court's orders, and an allowance be made for any aggrieved party to apply to the court to vacate or vary these orders. In my view, this order protects creditors of the Company from any potential prejudice that might arise as a consequence of the orders that are being made.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

[1] Affidavit of Monica Hamid filed 5 February 2026, 'MH1', 'MH2'.

[2] Affidavit of Jared Troy Palandri filed 5 February 2026 [24].

[3] Re Northern Territories Resources Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) [2025] WASC 540.

[4] Affidavit of Jared Troy Palandri filed 5 February 2026 [8] - [9], 'JTP13', 'JTP14'.

[5] Affidavit of Jared Troy Palandri filed 5 February 2026 [12], 'JTP15', 'JTP16'.

[6] Affidavit of Jared Troy Palandri filed 5 February 2026 [19].

[7] Affidavit of Jared Troy Palandri filed 5 February 2026 [11].

[8] Secatore, Re Fletcher Jones and Staff Pty Ltd (Administrators Appointed) [2011] FCA 1493.

[9] Re Green Camel Pty Ltd [2024] NSWSC 1199; Re Renex Holdings (Dandenong) 1 Pty Ltd (Administrators Appointed) [2015] NSWSC 2003.

[10] Mentha, Re Griffin Coal Mining Company Pty Ltd (Administrators Appointed) [2010] FCA 1469; (2010) 82 ACSR 142 [30].

[11] Affidavit of Jared Troy Palandri filed 5 February 2026 [23].

RE NORTHERN TERRITORIES RESOURCES PTY LTD (ADMINISTRATORS APPOINTED) (RECEIVERS AND MANAGERS APPOINTED) [No 2] [2026] WASC 46 (24 February 2026)

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