RE THERAPY FOCUS LTD (ADMINISTRATORS APPOINTED); EX PARTE ROBERT MICHAEL KIRMAN & ROBERT CONRY BRAUER IN THEIR CAPACITY AS JOINT AND SEVERAL VOLUNTARY ADMINISTRATORS OF THERAPY FOCUS LTD (ADMINISTRATORS APPOINTED) [2025] WASC 503 (1 December 2025)

1. The Company is a public company which is limited by guarantee. It is a not-for-profit organisation and a registered charity, as well as a registered provider under the National Disability Insurance Scheme (NDIS). The Company provides professional therapy services to approximately 3,300 customers in Western Australia and has over 260 employees.[3]
2. On 9 October 2025, the first-named plaintiffs were appointed as the joint and several voluntary administrators of the Company (Administrators) by resolution of the Company's board of directors.[4] Since their appointment, the Administrators have continued to operate the Company's business.[5]
3. On 21 October 2025, the first creditors' meeting of the Company was held. During this meeting, the Administrators advised creditors and other attendees that this application had been filed.[6] No objection was raised by the creditors to this application.
4. To date, the Administrators have identified the Company has the following assets:[7]

(a) cash at bank of $4.8 million;

(b) trade receivables of $1.4 million, comprised of amounts due from the NDIS, government bodies, and customers of the Company;

(c) a fleet of about 40 motor vehicles with an estimated net book value of $1.8 million;

(d) leasehold improvements and leases with a net book value of $1.9 million; and

(e) other assets with a net book value of approximately $400,000.

1. Based on their investigations to date, the Administrators believe the Company has debts of approximately $7.3 million, comprising:[8]

(a) approximately $2.7 million owed to employees and former employees;

(b) approximately $4.3 million owed to government departments and philanthropic bodies for unearned and deferred revenue under contracts with the Company; and

(c) $300,000 to trade and other creditors.

1. The Administrators have commenced a sale and recapitalisation process, including by publishing advertisements seeking expressions of interest. This process has not yet been completed.[9]
2. Mr Kirman believes it is possible there may be delays in the sales process because of a number of factors, including:

(a) the complexity and sensitivity of the services provided by the Company;[10]

(b) the number of parties who have expressed an interest in the process, who are likely to require significant due diligence;[11] and

(c) the Company's not-for-profit status and various accreditations as an allied service provider, which are likely to require additional assessment and consideration by any purchaser.[12]

1. Mr Kirman believes that the Company continuing to trade prior to any finalisation of the sales process is likely to result in a better return to creditors than if the Company was to cease trading or to enter liquidation before the sale was completed.[13]
2. The Administrators seek an extension of the convening period for three months until 6 February 2025. This period is sought to enable the Administrators to conduct a thorough sales and recapitalisation process, to assess the potential return to creditors, and to provide a proper report to creditors ahead of the second creditors' meeting.

Should an extension of time to convene the second creditors' meeting be granted?

1. The legal principles that govern an application for an extension under s 439A(6) of the Act are well known.
2. In considering whether to grant the extension, the court is required to consider and take into account the objects and scheme of pt 5.3A of the Act, as set out in s 435A.
3. This requires the court, in reaching its decision, to maintain an appropriate balance between an expectation that an external administration will be undertaken in a relatively speedy and summary manner, with a need to ensure that an administration is not concluded without consideration of sensible and constructive options directed towards maximising returns for creditors and any possible return for shareholders.[14] The court is also required to take into account any possible detriment to third parties, including the suspension of rights and remedies of secured creditors, lessors, and others.[15]
4. The court will generally exercise its discretion to extend the convening period where one or more of the established categories are satisfied, where there is no evidence of material prejudice to those affected by the extension, and the court is satisfied that the estimate of time required has a reasonable basis.[16]
5. For the following reasons, I am satisfied it is appropriate in the circumstances of this case to grant the requested application for an extension of the convening period until 6 February 2026.
6. First, I accept on the evidence before me that an extension to the convening period is necessary to enable a sale of the Company's assets or a deed of company arrangement (DOCA) to be negotiated by the Administrators, which is likely to provide better return to creditors than a winding up of the Company.[17] These matters are consistent with the purposes and objects of pt 5.3A of the Act, as set out in s 435A.
7. Second, Mr Kirman's evidence, which I accept, is that the Administrators require an extension to enable them to engage with relevant stakeholders, regulatory bodies, and government departments, as well as the Company's customers and employees. They also require time to review the Company's books and records, and to prepare and provide a sensible report to creditors. On the evidence before me, I accept there is a degree of complexity associated with the administration of the Company.[18]
8. Third, the Administrators' opinion is that an extension of time is required for a period of three months.[19] On the evidence before me, I am satisfied that there is a reasonable basis for this estimate.
9. Finally, and importantly, no creditor or any other relevant party has appeared before me today or raised any opposition to the proposed extension. I am satisfied on all the evidence before me that the return to creditors is likely to be enhanced if the requested extension is granted. In my view, the potential benefit of the extension outweighs any possible prejudice to creditors and is in the best interests of creditors as a whole.
10. I am also satisfied that it is appropriate to make orders pursuant to s 447A(1) of the Act that the second creditors' meeting of the Company may be held at any time during the extended period and the period of five business days thereafter, notwithstanding the provisions of s 439A(2) of the Act.

1. 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, and I will make that order.
2. I also accept that the form of the orders sought by the plaintiffs in terms of giving notice to creditors of the court's orders, and the allowance for any aggrieved party to apply to this court to vacate or vary these orders, will protect the creditors of the Company from any possible prejudice of this application.
3. For these reasons, it is my view that it is appropriate to make orders in terms of the plaintiffs' minute of proposed orders.

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

[1] Affidavit of Robert Michael Kirman filed 20 October 2025 [9].

[2] Affidavit of Robert Michael Kirman filed 20 October 2025 [36], [50]; Affidavit of Robert Michael Kirman filed 29 October 2025 [7] - [8], [13], 'RMK-16'.

[3] Affidavit of Robert Michael Kirman filed 20 October 2025 [13] - [15].

[4] Affidavit of Robert Michael Kirman filed 20 October 2025 [3], [12], 'RMK-2' - 'RMK-5'.

[5] Affidavit of Robert Michael Kirman filed 20 October 2025 [17].

[6] Affidavit of Robert Michael Kirman filed 29 October 2025 [7] - [9], 'RMK-13'.

[7] Affidavit of Robert Michael Kirman filed 20 October 2025 [18].

[8] Affidavit of Robert Michael Kirman filed 20 October 2025 [20], 'RM-K'.

[9] Affidavit of Robert Michael Kirman filed 20 October 2025 [25] - [29], 'RMK-10', 'RMK-11'.

[10] Affidavit of Robert Michael Kirman filed 20 October 2025 [35].

[11] Affidavit of Robert Michael Kirman filed 20 October 2025 [41(a) - (b)].

[12] Affidavit of Robert Michael Kirman filed 20 October 2025 [41(c)].

[13] Affidavit of Robert Michael Kirman filed 29 October 2025 [11].

[14] Tucker (Administrator) v Bolten (Trustee), in the matter of Quintis Leasing Pty Ltd (Administrators Appointed) (No 2) [2024] FCA 46 [54], citing in Diamond Press Australia Limited [2001] NSWSC 313 [10].

[15] Shaw and Albarran (Joint and Several Administrators of Home Art Building Group Pty Ltd) v Home Art Building Group Pty Ltd (Administrators Appointed) [2016] WASC 274 [18].

[16] Mighty River International Limited v Hughes [2018] HCA 38 [73].

[17] Affidavit of Robert Michael Kirman filed 20 October 2025 [10(a)], [44].

[18] Affidavit of Robert Michael Kirman filed 20 October 2025 [10(c) - (f)].

[19] Affidavit of Robert Michael Kirman filed 20 October 2025 [43].