Australian Securities and Investments Commission v Marco (No 9)

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judgment Date: 26 October 2021
• Neutral Citation: [2021] FCA 1306
• Date: 26 October 2021

Federal Court of Australia

Australian Securities and Investments Commission v Marco (No 9) [2021] FCA 1306

File number:	WAD 481 of 2018
Judgment of:	MCKERRACHER J
Date of judgment:	26 October 2021
Catchwords:	CORPORATIONS – application by external administrator for a remuneration determination under s 60-10(1)(c) of the Insolvency Practice Schedule, Sch 2 of the Corporations Act 2001 (Cth) – whether the administrators are entitled to remuneration from the company’s assets – where the company holds all of its assets as trustee ; EQUITY – trustee’s right of exoneration and indemnity from trust property – whether the indemnity extends to remuneration of a voluntary administrator – where all of the company’s property was at all times controlled by court-appointed receivers – consideration of the nature of the trustee’s proprietary interest in the trust property to the extent of the right of indemnity
Legislation:	Corporations Act 2001 (Cth) ss 9, 438A, 438D, 439(c), 446A, 443D, 443D(b), 443F, 449E(rep); Sch 2, Pt 3, ss 60-5(1), 60-10(1)(c), 60-12
Cases cited:	13 Coromandel Place Pty Ltd v CL Custodians Pty Ltd (In Liq) [1999] FCA 144; (1999) 30 ACSR 377 Alphena Pty Ltd (In Liq) v PS Securities Pty Ltd [2013] NSWSC 447; (2013) 9 ASTLR 63 Australian Securities and Investments Commission v Marco (No 3) [2020] FCA 719 Australian Securities and Investments Commission v Marco (No 6) [2020] FCA 1781 Bastion v Gideon Investments Pty Ltd [2000] NSWSC 939; (2000) 35 ACSR 466 Baxter Global Investments Pty Ltd v Marco [2020] NSWSC 1293 Carter Holt Harvey Woodproducts Australia Pty Ltd v Commonwealth [2019] HCA 20; (2019) 268 CLR 524 Caterpillar Financial Australia Ltd v Ovens Nominees Pty Ltd [2011] FCA 677 Grimaldi v Chameleon Mining NL (No 2) [2012] FCAFC 6; (2012) 200 FCR 296 Imam Ali Islamic Centre v Imam Ali Islamic Centre Inc [2018] VSC 413 Jones v Matrix Partners Pty Ltd [2018] FCAFC 40; (2018) 260 FCR 310 Kelly, in the matter of Halifax Investment Services Pty Ltd (in liquidation) (No 6) [2019] FCA 2111 Markopoulus v Marco [2020] WASC 79 Muschinski v Dodds (1985) 160 CLR 583 Nolan v Nolan [2004] VSCA 109 Octavo Investments Pty Ltd v Knight [1979] HCA 61; (1979) 144 CLR 360 Paragon Finance plc v DB Thakerar & Co (a firm) [1999] 1 All ER 400 Re AAA Financial Intelligence Ltd (in liq) ACN 093 616 445 (in liq) [2014] NSWSC 1004 Re BBY Ltd (in liq) (No 3) [2018] NSWSC 1718 Re Dalewon Pty Ltd [2010] QSC 311; (2010) 79 ACSR 530 Re Fearndale Holdings Pty Ltd (in liq) (Recs & Mgrs Apptd) [2020] NSWSC 901 Re French Caledonia Travel Service Pty Ltd (in liq) [2003] NSWSC 1008; (2003) 59 NSWLR 361 Re GB Nathan & Co Pty Ltd (in liq) (1991) 24 NSWLR 674 Re Hiebert Estate [1934] 4 DLR 799 Re Mackie Group Pty Ltd (in liq) [2017] VSC 477; (2017) 122 ACSR 537 Re Substar Holdings Pty Ltd (in liq) [2020] FCA 1863 Re Suco Gold Pty Ltd (1983) 33 SASR 99 Re Sutherland [2004] NSWSC 798; (2004) 50 ACSR 297 Shiu Shing Sze Tu v Lowe [2014] NSWCA 462; (2014) NSWLR 317 Staatz v Berry (No 3) [2019] FCA 924; (2019) 138 ACSR 231 Tang v Wright (No 3) [2020] FCA 1122 Trio Capital Limited (Admin App) v ACT Superannuation Management Pty Ltd [2010] NSWSC 941
Division:	General Division
Registry:	Western Australia
National Practice Area:	Commercial and Corporations
Sub-area:	Corporations and Corporate Insolvency
Number of paragraphs:	90
Date of last submissions:	13 August 2021 (Former Administrators) 21 July 2021 (Liquidators) The plaintiff and defendants did not file submissions
Date of hearing:	Determined on the papers
Counsel for the Former Administrators:	Mr P Edgar
Solicitors for the Former Administrators:	Thynne + Macartney
Counsel for the Liquidators:	Mr A Chai
Solicitors for the Liquidators:	Ashurst Australia

ORDERS

		WAD 481 of 2018
BETWEEN:	AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION Plaintiff
AND:	CHRIS MARCO First Defendant ; AMS HOLDINGS (WA) PTY LTD (RECEIVERS APPOINTED) (ADMINISTRATORS APPOINTED) (ACN 164 700 485) Second Defendant ; AMS HOLDINGS (WA) PTY LTD (RECEIVERS APPOINTED) (ADMINISTRATORS APPOINTED) (ACN 164 700 485) AS TRUSTEE FOR AMS HOLDINGS TRUST Third Defendant ; ROBERT MICHAEL KIRMAN AND ROBERT CONRY BRAUER AS RECEIVERS Interested Persons ; CAMERON HUGH SHAW, RICHARD ALBARRAN and MARCUS JON WATTERS OF HALL CHADWICK Interested Persons

order made by:	MCKERRACHER J
DATE OF ORDER:	26 OCTOBER 2021

THE COURT DECLARES THAT:

1. The former administrators (and liquidators) of the second and third defendant are entitled to remuneration and payment of disbursements and costs from the property of the second and third defendant.

THE COURT ORDERS THAT:

2. For the purpose of a remuneration determination being made by the Court pursuant to s 60-10(1)(c) of the Insolvency Practice Schedule, Sch 2 of the Corporations Act 2001 (Cth):

   1. the issue of quantum be referred to mediation by a Registrar of the Court; and

   2. if an agreed position on quantum is reached at the mediation, the Registrar is to consider whether a remuneration determination should be made; alternatively,

   3. if an agreed position on quantum cannot be reached at mediation, the question be referred back to a Judge of the Court for resolution.

3. Costs of this application be reserved to the mediation or to further order of the Court.

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

REASONS FOR JUDGMENT

MCKERRACHER J:

INTRODUCTION

1. From 24 September 2020 to 7 December 2020, Mr Cameron Shaw and Messrs Richard Albarran and Marcus Watters were the voluntary Administrators (and for a short time liquidators) of AMS Holdings (WA) Pty Ltd. AMS is the second defendant in its own right in these proceedings and is also the third defendant in its capacity as trustee of the AMS Holdings Trust. The sole shareholder, a director and controlling mind of AMS is the first defendant, Mr Chris Marco who operated a managed investment Scheme. On 7 December 2020, on the application of the plaintiff (ASIC), the Scheme operated by Mr Marco and AMS was wound up: Australian Securities and Investments Commission v Marco (No 6) [2020] FCA 1781. The orders in Marco (No 6) provided for the appointment of Mr Robert Kirman and Mr Robert Brauer as Liquidators of the entire Scheme operated by the defendants. The Liquidators had previously (from 27 May 2020) occupied the office of Interim Receivers of the defendants’ property: see Australian Securities and Investments Commission v Marco (No 3) [2020] FCA 719. The appointment of the Liquidators over the entire Scheme had the effect of terminating the voluntary appointment of the Administrators to AMS.

2. By interlocutory application, the Administrators seek certain remuneration orders in...