RE POST-ARCHITECTURE PTY LTD (RESTRUCTURING PRACTITIONERS APPOINTED); EX PARTE PROUT [2025] WASC 564 (6 February 2026)

1. The Company was incorporated on 2 September 2015 and provides architecture services primarily in Perth, Margaret River, Melbourne and Bali. Mr Nicolas Brunsdon is its sole director, secretary and shareholder.[1]
2. On 6 June 2025, Mr Brunsdon resolved to appoint the plaintiffs as restructuring practitioners of the Company, pursuant to pt 5.3B of the Act.[2]
3. From the investigations carried out by the plaintiffs, as at the date of their appointment, the Company had assets of $256,443 and liabilities of $415,920. The Company's liabilities for the purpose of the restructuring plan totalled $388,846.58, of which $224,504.12 was owed to the Australian Taxation Office (ATO).[3]
4. Mr Brunsdon proposed a restructuring plan which, after consideration, the plaintiffs recommended the creditors accept.[4] Relevantly, the Restructuring Plan provided that:[5]

(a) the company would continue trading;

(b) the restructuring plan would commence on 8 August 2025;

(c) a contribution of $100,000 would be paid by Mr Brunsdon sourced from property sale proceeds on or before 31 October 2025;

(d) the restructuring practitioners' remuneration would be five and a half thousand dollars including GST, or 6 per cent of - a fixed percentage of total payments made to creditors;

(e) approximately $94,500 would be available for distribution to creditors;

(f) interest accrued during the restructuring plan period would be added to the funds to be distributed to creditors;

(g) creditors were estimated to receive a return of 24 cents in the dollar; and eighth, the estimated timing of the return to creditors was on or before 7 November 2025.

1. Only one creditor, the ATO, provided a response to the proposal. The ATO, who was the Company's major creditor, provided a written statement to the plaintiffs accepting the Restructuring Plan. As a consequence, pursuant to reg 5.3B.25(1), the Restructuring Plan came into effect on that date.[6]
2. On 31 October 2025, the Company contravened the Restructuring Plan by failing to pay the contribution by that date. Pursuant to reg 5.3B.31(1)(d), the Company had 30 business days to rectify this contravention, failing which the Restructuring Plan would terminate.[7]
3. On 3 November 2025, the plaintiffs lodged a notice of contravention with the Australian Securities and Investments Commission (ASIC) and circulated this notice to creditors.[8]
4. The plaintiffs have been informed by Mr Brunsdon that settlement of the property was delayed because of approvals that were required which have now been obtained. The original evidence before me was that settlement of the property would occur by the end of April 2026 and that payment to creditors would occur shortly afterwards.[9]
5. The plaintiffs emailed and telephoned the ATO in an attempt to obtain their views on the proposed application, but, at the time of filing Mr Prout's affidavit, had not received any response. A notice to creditors was issued on 3 December 2025 informing creditors of the intention to make this application to vary the plan to delay payment of funds until after settlement had occurred.[10]
6. This morning the plaintiffs received a response from the ATO. In summary, the ATO expressed concern as to the lack of any explanation for the proposed six-month extension of time for payment to creditors, as well as raising concerns about the Company's ability to meet its ongoing obligations. In its response, the ATO stated:

Our support for the proposed variation may not be provided without better disclosure of the circumstances surrounding the delay and the approvals required, and assurances that the company will bring its post-plan approval tax obligations up to date.

1. Having received this response, the plaintiffs filed an amended minute of proposed orders and responded to the ATO, providing further information. This information included that settlement of the relevant property is due to occur on 16 January 2026. The orders now sought by the plaintiff are to:

(a) amend paragraph 3 of the Restructuring Plan to reflect the expected date of receipt as being 28 February 2026;

(b) to amend paragraph 8 of the restructuring plan to provide that the estimated return to creditors will be paid on or before 7 March 2026; and

(c) provide for notification to be given to creditors of the orders made by the court, and for the matter to be relisted on the application of any party who is prejudiced by the making of these orders.

Should the requested amendment to the Restructuring Plan be granted?

1. The ability of a company to enter into a restructuring plan is contained in pt 5.3B of the Act, which was enacted on 1 January 2021. The background to its inclusion in the Act was summarised by SC Derrington J in Re Pope Joan Hospitality Pty Ltd.[11] As her Honour noted at [19], the aim sought to be achieved by the inclusion of this part in the Act is reflected in s 452A of the Act. This section provides that:

The object of this Part, and Schedule 2 to the extent that it relates to this Part, is to provide for a restructuring process for eligible companies that allows the companies:

(a) to retain control of the business, property and affairs while developing a plan to restructure with the assistance of a small business restructuring practitioner; and

(b) to enter into a restructuring plan with creditors.

1. Her Honour summarised at [21] - [28] of her judgment the relevant Regulations and process that govern restructuring plans. I respectfully and gratefully adopt this summary as part of these reasons.
2. Section 458B of the Act provides that the Regulations may confer powers on the Court, including the power to vary a restructuring plan. Reg 5.3B.61 of the Regulations gives the Court power to vary a restructuring plan on the application of, among others, the restructuring practitioner.
3. As SC Derrington J stated in Pope Joan:

Regulation 5.3B.61 grants the Court an apparently unfettered discretion whether and when to grant an order varying a restructuring plan. This wide discretion can be contrasted with the power vested in the Court to adjourn a winding up application in section 453Q(1) of the Corporations Act, by which the Court is obliged to adjourn the winding up proceedings if it is satisfied that it is in the interest of the company's creditors for the company to continue under restructuring rather than be

The question of how the discretion conferred by regulation 5.3B.61 should be exercised is one of statutory construction. The principles applicable to statutory construction which require consideration of the text, context and purpose are well established.

Relevantly, the object of part 5.3B speaks to the part providing for a restructuring process that allows the company to retain control of the business while developing a plan and to enter into that plan with creditors. As the EM elaborates at page 13, paragraph 1.2 it is to establish a formal debt restructuring process for eligible companies. The EM explains at page 13, paragraph 1.4 that the restructuring process may also be referred to as the period where the company is under restructuring or during restructuring. The restructuring process ends once the plan is in place.

1. In exercising the discretion granted to me under the Act and the Regulations, I have had particular regard to the following matters.
2. First, I accept that the proposed variation is consistent with the objects of pt 5.3B, as set out in s 452A of the Act. The evidence before the court is that the proposed restructuring plan can be met.
3. Second, while the ATO raised concerns in relation to the original proposed amendment, it has not informed the plaintiffs that it formally opposes the application. In its communication with the plaintiffs' solicitors, the ATO requested that further information be provided prior to providing its support for the proposed extension. In any event, it is my view that the ATO's position can be adequately protected by the ability to relist the matter within 14 days of being provided with the orders.
4. Third, on the evidence before me, I am satisfied that it is in the interests of creditors for the Company to continue to be subject to the Restructuring Plan. This is because there are additional liabilities that will arise in the event of a winding up of the Company (including to the Company's employees who would have their employment terminated on that event). This naturally will have an impact on any payment to unsecured creditors.
5. Taking into account these matters, and all of the matters set out in the evidence before the court, it is my view that orders should be made to vary the Company's Restructuring Plan, subject to creditors having the right to apply to vary or vacate these orders.

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

[1] Affidavit of Gregory Matthew Prout filed 11 December 2025 [9.1] - [9.2], [9.4], [10].

[2] Affidavit of Gregory Matthew Prout filed 11 December 2025 [5].

[3] Affidavit of Gregory Matthew Prout filed 11 December 2025 [19], [21].

[4] Affidavit of Gregory Matthew Prout filed 11 December 2025 [30].

[5] Affidavit of Gregory Matthew Prout filed 11 December 2025 [28].

[6] Affidavit of Gregory Matthew Prout filed 11 December 2025 [32] - [34].

[7] Affidavit of Gregory Matthew Prout filed 11 December 2025 [37] - [39].

[8] Affidavit of Gregory Matthew Prout filed 11 December 2025 [40], GMP-7.

[9] Affidavit of Gregory Matthew Prout filed 11 December 2025 [41], [47.2].

[10] Affidavit of Gregory Matthew Prout filed 11 December 2025 [44] - [47].

[11] Re Pope Joan Hospitality Pty Ltd [2023] FCA 872 [16] - [18] ('Pope Joan').