FEDERAL COURT OF AUSTRALIA
Wily, in his capacity as administrator of APH Hope Island Pty Ltd (Administrator Appointed) (Receivers and Managers Appointed)
[2012] FCA 1444
Citation:
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Wily, in his capacity as administrator of APH Hope Island Pty Ltd (Administrator Appointed) (Receivers and Managers Appointed) [2012] FCA 1444
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Parties:
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File number:
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QUD 728 of 2012
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Judge:
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GREENWOOD J
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Date of judgment:
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Catchwords:
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Legislation:
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10 December 2012
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Date of last submissions:
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10 December 2012
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Place:
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Brisbane
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Division:
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GENERAL DIVISION
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Category:
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Catchwords
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Number of paragraphs:
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12
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Solicitor for the Applicant:
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Mr G Shaw, MSB Lawyers
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IN THE FEDERAL COURT OF AUSTRALIA
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IN THE MATTER OF APH HOPE ISLAND PTY LTD (ADMINISTRATOR APPOINTED) (RECEIVERS AND MANAGERS APPOINTED) aCn 107 657 465
ANDREW HUGH JENNER WILY IN HIS CAPACITY AS ADMINISTRATOR OF APH HOPE ISLAND PTY LTD (ADMINISTRATOR APPOINTED) (RECEIVERS AND MANAGERS APPOINTED) ACN 107 657 465
Applicant
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DATE OF ORDER:
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WHERE MADE:
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THE COURT ORDERS THAT:
1. The convening period within which the applicant must convene a meeting of the creditors of APH Hope Island Pty Ltd (administrator appointed) (receivers and managers appointed) ACN 107 657 465 (‘the Company’) as fixed by s 439A(5) of the Corporations Act 2001 (Cth) (Corporations Act), be extended under s 439A(6) of the Corporations Act, up to an including 13 December 2012.
2. Pursuant to s 447A(1) of the Corporations Act, that Part 5.3A of the Corporations Act operate in relation to the Company so that the second meeting of creditors of the Company required by s 439A of the Corporations Act may be held at any time during, or within 5 business days after the end of, the convening period as extended, provided that the applicant gives notice of the meeting in accordance with s 439A(3) of the Corporations Act.
3. Any person having a sufficient interest may apply to the Court to vary orders 1 and 2 above upon providing 5 days notice in writing to the applicant’s solicitors.
4. As soon as practicable, the applicant give notice to the creditors of the Company of the terms of these orders by email if the applicant has an email address for the creditors, or by way of correspondence sent to their last known address.
5. The costs of this application are to be paid out of the assets of the Company.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011
QUEENSLAND DISTRICT REGISTRY
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GENERAL DIVISION
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QUD 728 of 2012
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IN THE MATTER OF APH HOPE ISLAND PTY LTD (ADMINISTRATOR APPOINTED) (RECEIVERS AND MANAGERS APPOINTED) aCn 107 657 465
ANDREW HUGH JENNER WILY IN HIS CAPACITY AS ADMINISTRATOR OF APH HOPE ISLAND PTY LTD (ADMINISTRATOR APPOINTED) (RECEIVERS AND MANAGERS APPOINTED) ACN 107 657 465
Applicant
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JUDGE:
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GREENWOOD J
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DATE:
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10 DECEMBER 2012
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PLACE:
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BRISBANE
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EX TEMPORE REASONS FOR JUDGMENT
1 This is an application made under s 439A, subsection 6 of the Corporations Act 2001 (Cth) (the “Act”) for an order extending the convening period for the second meeting of the creditors of a company called APH Hope Island Pty Ltd. Section 439A, subsection 1 of the Act provides that an administrator of a company under administration must convene a second meeting of the company’s creditors within the convening period as determined by subsection 5 of that section, or, alternatively, as extended under subsection 6 of that section. This application, as I say, is an application for an extension of the time.
2 Section 439A(5) provides that the convening period is the period of 20 business days beginning on the day after the administration begins. As the administration began on 23 October 2012, the last day of the convening period was 20 November 2012. It will be transparently plain that the application today is made after the expiration of the time limited by the section. However, subsection 7 of section 439A provides that if an application is made under subsection 6 after the period referred to in subsection 5 as the convening period, as the case may be, the Court may only extend the convening period if satisfied that it would be in the best interests of the creditors to do so.
3 It follows, then, that the central consideration in today’s application is whether the Court can be satisfied that it is in the best interests of the creditors for the convening period to be extended. The application is supported by a number of affidavits, the principal affidavit of which is an affidavit by Mr Andrew Hugh Jenner Wily sworn 4 December 2012. There is also an affidavit by Mr Marc Galler, also sworn 4 December 2012.
4 The relevant background considerations are that Mr Wily was appointed as the administrator of the company on 23 October 2012. The company conducts the business of property development but ceased trading prior to the appointment of Mr Wily on 23 October 2012. Mr John Stephen Wilson is the sole director of the company and was appointed to that role on 16 January 2004. Mr Lee James Wilson is the sole secretary of the company. The current shareholders of the company are a company called Stemport Pty Ltd and Endoro Pty Ltd. Mr Wilson is the sole director and secretary of the first of those companies, Stemport, and, Mr Lee Wilson is the sole director and sole secretary and sole shareholder of Endoro.
5 There are a number of factors that inform the question of whether or not the convening period ought to be extended. The following factors loom large in that consideration, it seems to me. In Mr Wily’s affidavit he says that he has been making, together with Mr Galler, various attempts to obtain accurate financial accounts of, and information in relation to, the financial affairs of the company. By a letter dated 24 October 2012, Mr Wily wrote to Mr Wilson, the director of the company, and requested that he complete and return to the administrator a questionnaire and statement of affairs of the company.
6 At the date of swearing Mr Wily’s affidavit on 4 December 2012, Mr Wilson has not returned the questionnaire, nor has he provided a statement of affairs of the company. Mr Wily swears that he does not have any accurate or current financial accounts of the company such that he can conduct an examination of the affairs and determine with any accuracy, the creditors of the company, and make assessments of proofs of debt. Mr Wily also swears that on 29 October 2012, he received a Proof of Debt from a law firm called Henry Davis York, the lawyers acting on behalf of a company called Broadbeach BV, and that company claims to be a creditor of the company in question in an amount of $14,481,947.88 on the basis of a facility agreement dated 1 August 2012.
7 On 31 October 2012, Mr Wily received a Proof of Debt from a company called APH Capital Partners that claims to be a creditor of the company in an amount of $4,975,000 plus interest on the basis of a loan transaction. Having regard to those two Proofs of Debt, Mr Wily sought information from APH Capital Partners about its claim, and also sought information from Broadbeach BV. No appropriate information about those matters has been properly forthcoming. In addition to these matters, Mr Wily has set out at para 42 of his affidavit a list of apparent creditors of the company. That list represents the parties to whom notice of this application was given.
8 At para 43 of his affidavit, Mr Wily says that the principal asset of the company is land, described by various allotments and it is not necessary for me to repeat the lot numbers in these reasons. The fundamental point is that the company conducts a land development undertaking. In relation to the assets comprising that undertaking, there are, or have been, numerous mortgages, releases of mortgages, and transfers of mortgages in relation to the land. Not surprisingly, the administrator would wish to understand the nature of those transactions; the various releases; and other matters, as they represent dealings in the assets of the company in circumstances where there are substantial claims by unsecured creditors of the company.
9 A further consideration is this.
10 On 29 October 2012, Mr Peter Smith, a partner of the firm Herbert Smith Freehills Lawyers, and Mr Andrew Griffin, a director of Balmain NB Corporation Limited, proposed that a Deed of Company Arrangement might be entered into with the creditors. That, as they say, was a proposal foreshadowed on 29 October 2012. The administrator has been waiting for the receipt of the proposed deed, which would then, of course, indicate the content of the proposal that might be put to the creditors. It was not until a month later, 29 October 2012, that the document was actually received setting out the content of the proposed terms.
11 An extension of the time for convening a meeting of creditors is sought because Mr Wily seeks to conduct further investigation of the Proofs of Debt having regard to the matters I have already mentioned. He also seeks to obtain a valuation or valuations of the relevant allotments of land. He seeks to receive and consider further Proofs of Debt from potential creditors, and he seeks to properly analyse and understand, consider and determine his position in relation to the proposed Deed of Company Arrangement. None of these matters of investigation are surprising, and represent complete orthodoxy in the administration of the affairs of the company.
12 The administrator requests an extension of time until 13 December 2012 on the footing that such an extension is in the interests of the creditors so that Mr Wily can undertake the various investigations I have mentioned; form a view about the relevant matters, and put a proposition to the creditors for their informed consideration. The period of the extension is a relatively small period. I am entirely satisfied that the circumstances of the application warrant an extension of time. The Australian Securities and Investments Commission has been advised of the application. No objection is taken to the extension of time, and accordingly, I so order in terms of the application.
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