Ward, in the matter of Platinum Quest Pty Ltd (in liq) v OJMAC Pty Ltd as trustee for the Cheree Leanne Family Trust

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

1. These are the amended and revised reasons for judgment given on 24 March 2025. Whilst these reasons refine and develop those that were delivered ex tempore, the substance of what was said on 24 March has not been changed nor has any other material change been made: see Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs v AAM17 [2021] HCA 6; (2021) 272 CLR 329, 344 - 345 [30] - [31].
2. Mr Adam Ward is both the liquidator of Platinum Quest Pty Ltd (in liq) (Platinum Quest) and receiver of the assets of the Cheree Leanne Family Trust (formerly the C & C Callaghan Family Trust) (the Trust). By an interlocutory process filed on 26 February 2025, Mr Ward seeks orders that (a) the Court fix his remuneration for work done as receiver of the Trust assets in the amount of $111,470.53 (incl GST); (b) he be discharged from his appointment as receiver of the Trust assets; and (c) any obligation to file accounts under rule 14.25 of the Federal Court Rules 2011 (Cth) (the Rules) be dispensed with. For the reasons that follow, those orders are entirely appropriate and should be made.

1. The relevant facts can be briefly stated. Platinum Quest is the former trustee of the Trust. On 22 August 2023, Justice Ryan of the Supreme Court of Queensland ordered that the company be wound up in insolvency, with Mr Ward to act as liquidator. Some six months later, on 6 February 2024, Mr Ward was appointed as receiver of the assets of the Trust: see Ward, in the matter of Platinum Quest Pty Ltd (in liq) v OJMAC Pty Ltd as trustee for the Cheree Leanne Family Trust [2024] FCA 84 (Ward v OJMAC (No 1)): and has since realised some $348,000. That sum is, however, not representative of the entirety of the known Trust assets.
2. In his affidavit filed 26 February 2025 (the 26 February 2025 Affidavit), Mr Ward notes that his present ability to gather and realise further assets of the Trust is reliant upon the provision of additional funding, which is not forthcoming. That is by no fault of Mr Ward. Au contraire, and in what has developed into a most unsavoury aspect of this matter, Mr Ward's pursuit of his statutory obligations has been hampered, obfuscated and frustrated by the acts of third-parties such that he would have to risk incurring (likely significant) costs in order to continue his attempts to recover assets of the Trust by court action and the like.
3. Mr Ward now presses the present application. He has taken the view that any further attempt to gather Trust assets would be costly, time-consuming and, in many respects, akin to drawing blood from a stone. As outlined below, the evidence shows that view to be entirely meritorious.
4. The application, alongside the 26 February 2025 Affidavit, has been served on the defendants and they have not indicated any opposition to the orders sought. A circular enclosing the interlocutory process and 26 February 2025 Affidavit was provided to creditors of the Trust on 4 March 2025.

1. In Ward v OJMAC (No 1), orders were made that permitted Mr Ward to take, from the Trust property, the amount of his remuneration incurred in his capacity as receiver of the Trust assets as determined by the Court. He now applies for such an order, and asks the Court to determine his remuneration in the amount of $111,470.53 (incl GST) and authorise that amount be paid from the assets of the Trust. Prima facie, that figure might appear to be somewhat excessive given the value of realised Trust assets ($348,136). That is not the case, bearing in mind, as will be seen, the external difficulties and complications that have been imposed upon Mr Ward.
2. It must be kept steadily in mind that Mr Ward wears two hats. He is the liquidator of Platinum Quest. He is also the receiver of Trust assets (of which Platinum Quest was once the trustee). The application that is presently before the Court relates only to determination of Mr Ward's remuneration for work done in the latter capacity, as receiver of the property of the Trust.
3. The principles relevant to the exercise of the Court's power to fix a receiver's remuneration under rule 14.24 of the Rules were set out in the erudite written submissions of Mr Wacker, counsel for the plaintiffs, which I gratefully adopt:

15. The power of the Court under r 14.24 of the Federal Court Rules 2011 (Cth) to fix a receiver's remuneration is governed by the general principle that the Court should only allow remuneration which is fair and reasonable [citing Staatz, as liquidator of Wollumbin Horizons Pty Ltd (in liq) v Berry (2023) 165 ACSR 524].

16. In Linchpin, Derrington J stated (at [7]):

The process of that assessment is analogous to the Court's adjudication of remuneration plans by liquidators or provisional liquidators under the erstwhile s 473 of the Corporations Act 2001 (Cth). It is generally recognised that the objective is to award a sum which will reasonably compensate for the time and trouble expended in the execution of the receivers' duties and for the responsibility which they have assumed: Mohamed v Hurstville Tower Medical Clinic Pty Ltd (in liq) [2006] NSWSC 4 at [8]. Although reference is made to the concept of "compensation", the assessment of reasonable remuneration must be understood in the context in which receivers and managers or liquidators or administrators for that purpose operate. This was recognised by Jackson J in Park v Whyte (No 2) [2018] 2 Qd R 413; [2017] QSC 229, where his Honour observed:

163. ...[I]n determining remuneration it is not the function of the court to hypercritically assess the day by day activities or tasks carried out in the course of a complex administration over a lengthy period of time with the benefit of hindsight. In this context, it is sometimes remarked that the remuneration available to insolvency practitioners should be sufficient to encourage them to carry out the important public function of the administration of insolvent entities for the benefit of creditors, investors (whether company members or fund members) and the public administration of the insolvency laws in general.

164. As well, the preparation of detailed affidavit material setting out extensive support for the correlation of individual or groups of line items and charges to particular tasks and functions of sufficient utility to be classed as reasonable remuneration is itself a time consuming and expensive exercise. In the usual course, those costs must be added to the costs of the application for remuneration to be paid to the relevant administrators or liquidators.

17. There is no "absolute rule" that a "detailed affidavit" must be filed by a receiver when seeking their remuneration to be determined. What is necessary will depend on the circumstances of each case and the overriding principle remains that sufficient information must be provided to the Court to enable it to perform its function of determining an appropriate level of remuneration [citing Venetian Nominees Pty Ltd v Conlan [1998] WASCA 273; (1998) 20 WAR 96].

18. The onus is on the receiver to establish that the remuneration claimed is fair and reasonable. It is the function of the Court to determine the remuneration by considering the material proffered and bringing an independent mind to bear on the relevant issues. That requires the Court to consider the difficulty encountered by the receiver in performing his or her work and, in particular, with respect to the collection and realisation of assets and the volume and complexity of the work undertaken. Those matters necessarily impact upon the amount of time which the receiver was required to expend and the level of expertise applied to that work.

(1) What time and trouble was Mr Ward put to in the execution of his duties as receiver of the Trust property?

(2) What is "fair and reasonable" remuneration for that work?

Identification of the work done by Mr Ward as receiver of the Trust assets

1. At the commencement of his appointment as receiver, Mr Ward identified 38 individual assets of the Trust. Six were in the possession of Ms Sharp, the controlling mind of the first defendant (being the current trustee of the Trust). 32 were in the possession of Mr Callaghan, Ms Sharp's former husband, or otherwise at their former matrimonial property (Fairlight Station).

The difficulties presented by Ms Sharp and Mr Callaghan

1. Ms Sharp and Mr Callaghan were the relevant persons behind Platinum Quest: Ward v OJMAC (No 1), [5]. The difficulties encountered by that company are, in many respects, ostensibly referable to a series of matrimonial disputations between the pair. That observation is relevant only insofar as it explains the involvement of the Federal Circuit and Family Court of Australia (Division 2) in the matter, which ordered, on 20 March 2024, that Ms Sharp and Mr Callaghan (a) facilitate Mr Ward's receivership of the Trust assets; and (b) refrain from doing any act, or causing any act to be done, which adversely impacts upon that receivership.
2. It is plain from the material filed today that neither Ms Sharp nor Mr Callaghan complied with those orders. Indeed, in the 26 February 2025 Affidavit, Mr Ward has carefully catalogued a detailed history of the efforts made by both parties to frustrate, and therefore unduly inflate the costs associated with, his receivership. In the case of Ms Sharp, that includes both (a) refusing to hand over Trust assets in her possession; and (b) asserting equitable interests in certain Trust assets and then failing to respond to enquiries which were necessary to establish those interests.
3. In the case of Mr Callaghan, the circumstances of his hindrance of the receivership are worse. He threatened and, indeed, carried out threats to hide assets of the Trust. He threatened to damage Trust assets. Most seriously, he threatened to cause harm to Mr Ward's agents seeking to collect Trust assets. He also relocated assets, including a helicopter, prime mover, front-end loader, other vehicles and plant equipment, from Fairlight Station. In all cases, he refused to hand over possession of the Trust's assets to Mr Ward.
4. It is trite to say that that conduct is deplorable and should not be countenanced.
5. Nor should it be overlooked that the geography of Fairlight Station - being located in a remote region that was, more than occasionally, cut off from convenient access - only complicated the task imposed upon Mr Ward.
6. Of the 32 Trust assets identified as being either in Mr Callaghan's possession or on Fairlight Station, Mr Callaghan delivered up six for collection and purchased two. Ms Sharp delivered up no Trust assets in her possession. In the result, Mr Ward has realised those assets made available to him for a total sum of $348,136. He estimates that a further $900,000 worth of Trust assets remain in the possession of Ms Sharp and Mr Callaghan although, accounting for realisation costs and amounts due to secured creditors, the net realisable value of those assets is thought to be closer to $433,000.
7. One can only commend Mr Ward for the work that he has done. It is regretful that persons who have both, prima facie, failed to comply with orders of this court and sought to obstruct Mr Ward in his fulfilment of legal obligations appear, in a way, to have succeeded, and that is to the detriment of the creditors.

What is fair and reasonable remuneration for that work?

1. It is in those circumstances that one should address the remuneration sought by Mr Ward. The objective, for present purposes, is to ascertain the sum which will reasonably compensate Mr Ward for the time and trouble expended in the execution of his duties and the responsibility he has assumed: Mohamed v Hurstville Tower Medical Clinic Pty Ltd (in liq) [2006] NSWSC 4, [8].
2. To that end, he has prepared a careful schedule, extracted from his firm's time-based recording system, of the work performed by him and his staff in respect of his appointment as receiver of the Trust assets. It provides significant detail as to the amount of remuneration claimed and, very appropriately, sets out:

(1) each individual who carried out work in respect of the receivership of the Trust assets;

(2) the date and amount of time spent on carrying out each task;

(3) the work, description, and summary of the work performed; and

(4) the amount of remuneration sought in respect of each task.

1. Mr Ward has gone further and, indeed, set out in detail the nature of the tasks undertaken in the receivership and, in general terms, the amounts spent. He provides more than adequate detail and a summary of that work to satisfy the Court that the amount claimed has been undertaken in respect of each of the categories of remuneration and that tasks were often appropriately delegated to more junior staff with much lower hourly rates.
2. In those circumstances, it is appropriate that Mr Ward be entitled to the amount he claimed for the work carried out by him in his capacity as receiver. That amount should be paid from the assets of the Trust.

1. It is not in dispute that Mr Ward has, in all good faith and reasonableness, fulfilled his duties as receiver of the Trust assets to the fullest extent possible. He now seeks to be discharged forthwith from those duties. There is very good reason for that.
2. Mr Ward presently holds $228,241 in the receivership bank account. Of that amount, he is obliged to pay $118,239 to the Queensland Rural and Industry Development Authority, being the entity which has funded the costs associated with his receivership to date. It necessarily follows that, following payment of the remuneration sought in this application, there will be no remaining funds in the receivership. In those circumstances, and absent further funding, the receivership should only continue if, inter alia, it would not be futile to do so. That is not the case here, in no small part, due to the conduct of Ms Sharp and Mr Callaghan.
3. On the evidence before the Court, Ms Sharp and Mr Callaghan persistently frustrate efforts to gather in the Trust assets. It is unfortunate that the costs of (and time associated with) enforcing their compliance with the orders of the federal judiciary outweighs any net benefit that might be received from doing so. In these circumstances, where Mr Ward has collected as much of the property as is reasonably possible to do so and there is no purpose to be served in continuing the receivership, it is appropriate that he be discharged from the receivership.

Dispensation of requirements in rule 14.25 of the Rules

1. Finally, Mr Ward seeks an order dispensing with the requirement to submit accounts in accordance with r 14.25 of the Federal Court Rules. That rule relevantly provides:

Accounts

(1) A receiver must file accounts at the times ordered by the Court.

(2) On the date on which the receiver files an account, the receiver must serve a copy of the account, endorsed with the time and the return date for the examination of the account, on:

(a) each party who has an address for service in the proceeding; and

(b) any interested person.

Note: A Registrar will fix a return date and a place for hearing on the account.

(3) The receiver must attend the appointment for examination of an account.

1. The principles relating to the making of such order have been set out, again, in Mr Wacker's careful written submissions:

41. In Golden Star Resources Ltd v Keryn Beatrice Rosel [2010] QSC 28, White J stated (at [24]):

Rule 270 [of the Uniform Civil Procedure Rules] places the onus upon a receiver to persuade the court that accounts need not be ordered. Young CJ at Common Law when CJ in Equity observed in Ide v Ide that there are benefits associated in taking a holistic approach to this question. Here the Receivership was straight forward, the defendant has not sought to challenge any basis upon which the Receivers proceeded to discharge their obligations under the order of 25 February 2009 and there is nothing which calls for the cumbersome procedure of an account. His Honour mentioned that the court will usually work off time sheets created in the receiver's office provided that they do significantly more than merely detail the total number of hours spent by the receiver and officers of particular grades on his or her staff. That is what the Receivers have done here.

42. That was cited by Williams J in Re Kirman & Harris [2020] QSC 99. In that case her Honour considered it appropriate to relieve the receivers of the obligation to submit accounts (at [36]). Her Honour adopted (at [35]) a similarly "holistic approach". In that case the receiverships were straightforward and to the date of the application there were no objections seeking to challenge the receiver's remuneration or conduct. Further, there were no factual matters which called for the procedure on account.

1. In the circumstance of this case, where Mr Ward has provided a clear and concise analysis of the costs and expenses of his receivership and set them out in pellucid and clear form, it would be an improper additional expenditure for him to produce further accounts. He will not be able to recover any further remuneration for the preparation of such accounts and there is no utility in doing so.
2. In the circumstances, he ought to be relieved from submitting any further accounts.
3. In those circumstances, I am prepared to make the orders in the revised draft handed to me this morning.

I certify that the preceding thirty (30) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Derrington.