144Power to compromise with creditors

#### 144 Power to compromise with creditors 144 Power to compromise with creditors > > (1) Where a compromise or arrangement is proposed between an authority and its creditors or any class of them, the Court may, on the application in a summary way of the authority or of any creditor of the authority, or, in the case of an authority being wound up, of the liquidator, order a meeting or meetings of the creditors or class of creditors to be convened in such manner, and to be held in such place or places within the State, as the Court directs and, where the Court makes such an order, the Court may approve the explanatory statement required by section 145 (1) (a) to accompany notices of the meeting or meetings. > > > (2) A compromise or arrangement is binding on the creditors, or on a class of creditors, as the case may be, of the authority and, if the authority is being wound up, on the liquidator, if, and only if— > > > > > (a) at a meeting convened in accordance with an order of the Court under subsection (1), the compromise or arrangement is agreed to by a majority in number of the creditors, or of the creditors included in that class of creditors, present and voting, either in person or by proxy, being a majority whose debts or claims against the authority amount in the aggregate to not less than 75 per cent of the total amount of the debts and claims of the creditors present and voting in person or by proxy, or of the creditors included in that class present and voting in person or by proxy, as the case may be, and > > > > > (b) it is approved by order of the Court. > > > (3) Where the Court orders 2 or more meetings of creditors or of a class of creditors to be held in relation to the proposed compromise or arrangement, the meetings shall, for the purposes of subsection (2), be deemed together to constitute a single meeting and the votes in favour of the proposed compromise or arrangement cast at each of the meetings shall be aggregated, and the votes against the proposed compromise or arrangement cast at each of the meetings shall be aggregated, accordingly. > > > (4) The Court may grant its approval to a compromise or arrangement subject to such alterations or conditions as it thinks just. > > > (5) Except with the leave of the Court, a person shall not be appointed to administer, and shall not administer, a compromise or arrangement approved under this Act between an authority and its creditors or any class of them, whether by the terms of that compromise or arrangement or pursuant to a power given by the terms of a compromise or arrangement, if the person is— > > > > > (a) a mortgagee of any property of the authority, > > > > > (b) an auditor or an officer of the authority, > > > > > (c) an officer of any corporation that is a mortgagee of property of the authority, or > > > > > (d) a person who is not a registered liquidator. > > > (6) Nothing in subsection (5) (d) prohibits the appointment to administer a compromise or arrangement of a corporation authorised by any Act or any law of the State to administer such a compromise or arrangement. > > > (7) Any person or persons so appointed to administer a compromise or arrangement referred to in this section (whether by the terms of a compromise or arrangement or pursuant to a power given by the terms of a compromise or arrangement) are declared to be applied Corporations legislation matters for the purposes of Part 3 of the [Corporations (Ancillary Provisions) Act 2001](/view/html/inforce/current/act-2001-032) in relation to the provisions of sections 425, 428, 432, 434 and 536 the [Corporations Act 2001](http://www.legislation.gov.au/) of the Commonwealth, subject to the following modifications— > > > > > (a) in relation the provisions of sections 425, 428, 432 and 434—the provisions apply in relation to that person or those persons as if— > > > > > > > (i) the appointment of the person or persons to administer the compromise or arrangement were an appointment of the person or persons as a receiver and manager, or as receiver and managers, of the property of the authority, and > > > > > > > (ii) a reference in any of those provisions to a receiver or controller, or to a receiver or controller of the property, of a corporation were a reference to that person or to those persons, and > > > > > > > (iii) a reference in any of those provisions to ASIC were a reference to the Minister for Agriculture, and > > > > > (b) in relation to the provisions of section 536—the provisions apply in relation to that person or those persons as if— > > > > > > > (i) the appointment of the person or persons to administer the compromise or arrangement were an appointment of the person or persons as a liquidator of the authority, and > > > > > > > (ii) a reference in that section to a liquidator were a reference to that person or to those persons, and > > > > > > > (iii) a reference in that section to ASIC were a reference to the Minister for Agriculture. > > > > Note— > > > > Part 3 of the [Corporations (Ancillary Provisions) Act 2001](/view/html/inforce/current/act-2001-032) provides for the application of provisions of the [Corporations Act 2001](http://www.legislation.gov.au/) and Part 3 of the [Australian Securities and Investments Commission Act 2001](http://www.legislation.gov.au/) of the Commonwealth as laws of the State in respect of any matter declared by a law of the State (whether with or without modification) to be an applied Corporations legislation matter for the purposes of that Part in relation to those Commonwealth provisions. Section 14 (2) of the [Corporations (Ancillary Provisions) Act 2001](/view/html/inforce/current/act-2001-032) ensures that a declaration made for the purposes of Part 3 of that Act only operates to apply a provision of the Corporations legislation to a matter as a law of the State if that provision does not already apply to the matter as a law of the Commonwealth. If a provision referred to in a declaration already applies as a law of the Commonwealth, nothing in the declaration will affect its continued operation as a law of the Commonwealth. > > > (8) An order of the Court made for the purposes of subsection (2) (b) does not have any effect until an office copy of the order is lodged with the Minister, and upon being so lodged the order takes effect, or shall be deemed to have taken effect, on and from the date of lodgment or such earlier date as the Court determines and specifies in the order. > > > (9) Where a compromise or arrangement referred to in subsection (1) has been proposed, the authority— > > > > > (a) may instruct such accountants or solicitors or both as are named in the resolution to report on the proposals and send their report or reports to the authority as soon as practicable, and > > > > > (b) if a report or reports is or are obtained pursuant to paragraph (a)—shall make the report or reports available at the principal place of business of the authority for inspection by the creditors of the authority at least 7 days before the date of any meeting ordered by the Court to be convened as provided in subsection (1). > > > (10) Where no order has been made for the winding up of an authority and a compromise or arrangement has been proposed between the authority and its creditors or any class of them, the Court may, in addition to exercising any of its other powers, on the application in a summary way of the authority or of any creditor of the authority, restrain further proceedings in any action or other civil proceeding against the authority except by leave of the Court and subject to such terms as the Court imposes. > > **s 144:** Am 1988 No 20, Sch 12 (2); 2001 No 34, Sch 2.34 \[4\].