Dickerson, in the matter of McWilliam's Wines Group Ltd (subject to Deed of Company Arrangement) (No 3)

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judgment Date: 19 October 2020
• Neutral Citation: [2020] FCA 1564
• Date: 19 October 2020

Federal Court of Australia

Dickerson, in the matter of McWilliam’s Wines Group Ltd (subject to Deed of Company Arrangement) (No 3) [2020] FCA 1564

File number(s):	NSD 92 of 2020
Judgment of:	FARRELL J
Date of judgment:	19 October 2020
Date of publication of reasons:	28 October 2020
Catchwords:	BANKRUPTCY AND INSOLVENCY – application for leave to transfer shares under s 444GA of the Corporations Act 2001 (Cth) – whether transfer would unfairly prejudice interests of members of company – where creditors would receive less in a winding up than under deed of company arrangement – where no realistic prospect of surplus for distribution to members upon liquidation – where members have a prospect of distribution under creditors’ trust associated with deed of company arrangement – application granted
Legislation:	Corporations Act 2001 (Cth) ss 444GA, 447A Corporations Act 2001 (Cth) Sch 2, Insolvency Practice Schedule (Corporations) s 90-15
Cases cited:	Dickerson (Administrator), in the matter of McWilliam’s Wines Group Ltd (Administrators Appointed) [2020] FCA 57 Dickerson, in the matter of McWilliam’s Wines Group Ltd (Administrators Appointed) (No 2) [2020] FCA 417 In the matter of Mirabela Nickel Ltd (subject to deed of company arrangement) [2014] NSWSC 836 In the Matter of OrotonGroup Limited (Subject to Deed of Company Arrangement) ACN 000 038 675; Application of Strawbridge and Kanevsky [2018] NSWSC 1213 In the matter of Paladin Energy Limited (subject to Deed of Company Arrangement) [2018] NSWSC 11 Tucker, in the matter of Black Oak Minerals Ltd (Subject to a Deed of Company Arrangement) (in liq) [2019] FCA 293
Division:	General Division
Registry:	New South Wales
National Practice Area:	Commercial and Corporations
Sub-area:	Corporations and Corporate Insolvency
Number of paragraphs:	55
Date of hearing:	19 October 2020
Counsel for the Applicants	Mr D Krochmalik
Solicitor for the Applicants	HWL Ebsworth Lawyers

ORDERS

		NSD 92 of 2020
IN THE MATTER OF MCWILLIAM’S WINES GROUP LTD (SUBJECT TO DEED OF COMPANY ARRANGEMENT) ACN 000 024 108
	GAYLE DICKERSON, TIM MABLESON AND RYAN EAGLE IN THEIR CAPACITY AS JOINT AND SEVERAL DEED ADMINISTRATORS OF MCWILLIAM'S WINES GROUP LTD (SUBJECT TO DEED OF COMPANY ARRANGEMENT) ACN 000 024 108 First applicants ; MCWILLIAM'S WINES GROUP LTD (SUBJECT TO DEED OF COMPANY ARRANGEMENT) ACN 000 024 108 Second applicant

order made by:	FARRELL J
DATE OF ORDER:	19 October 2020

THE COURT ORDERS THAT:

1. Pursuant to s 444GA(1)(b) of the Corporations Act 2001 (Cth), the first applicants, in their capacity as joint and several deed administrators of the second applicant, McWilliam’s Wines Group Ltd (Subject to Deed of Company Arrangement) (McWilliam’s), be granted leave to transfer all of the issued shares in McWilliam’s (Shares) from the “members” (as defined by the Corporations Act) of McWilliam’s (together, the Members) to MCW BidCo Pty Ltd (MCW) or its nominee, in accordance with the terms of the deed of company arrangement dated 3 August 2020 executed by the applicants and MCW.

2. Pursuant to s 447A(1) of the Corporations Act and/or s 90-15(1) of the Insolvency Practice Schedule (Corporations), any of the first applicants may jointly or severally:

   1. execute, on behalf of any of the Members, share transfer forms and any other documents as are necessary to effect the transfer of the Shares referred to in Order 1; and

   2. enter or procure the entry of the name of MCW or its nominee in McWilliam’s’ register of members in respect of all Shares transferred to MCW or its nominee in accordance with Order 1.

3. The applicants’ costs of and incidental to this application be costs in the deed administration of McWilliam’s.

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

REASONS FOR JUDGMENT

FARRELL J:

Introduction

1. By an interlocutory process filed on 29 September 2020, the applicants sought orders under s 444GA(1)(b) of the Corporations Act 2001 (Cth) granting the first applicants leave to transfer all of the issued shares in McWilliam’s Wines Group Ltd (subject to a deed of company arrangement) (McWilliam’s) (Shares) from the members of McWilliam’s to MCW BidCo Pty Ltd ACN 642 488 524 or its nominee (MCW).

2. Gayle Dickerson, Tim Mableson and Ryan Eagle, in their capacity as joint and several deed administrators of McWilliam’s (together the deed administrators, formerly the administrators), are the first applicants in these proceedings. McWilliam’s is the second applicant. McWilliam’s is the immediate parent company of Mount Pleasant Wines Pty Ltd (ACN 000 024 813) (subject to a deed of company arrangement) (Mount Pleasant) and they are together referred to as the Companies.

3. The deed administrators were appointed as administrators of each of the Companies on 8 January 2020.

4. Pursuant to resolutions of the creditors of the Companies passed at the second meeting of creditors held on 24 July 2020, the following documents were executed on 3 August 2020:

1. A deed of company arrangement between the Companies, the administrators and MCW (as deed proponent) (DOCA) pursuant to which the deed administrators were appointed as such; and

2. A trust deed establishing the McWilliam’s Creditors’ Trust between the Companies, the deed administrators and MCW (as deed proponent) (Creditors’ Trust) pursuant to which, among other things, the deed administrators were appointed as trustees of the Creditors’ Trust.

5. The applicants also seek orders:

1. Under s 447A(1) of the Corporations Act and/or s 90-15(1) of the Insolvency Practice Schedule (Corporations) (being Sch 2 to the Corporations Act) authorising any of the applicants, jointly or severally to:

1. execute, on behalf of the members of McWilliam’s, share transfer forms and any other documents as are necessary to effect the transfer of the Shares; and

2. enter, or procure the entry, of the name of MCW in McWilliam’s register of members in respect of the Shares; and

1. That the applicants’ costs of and incidental to this application be costs in the deed administration of McWilliam’s.

6. It is a condition precedent to completion of the DOCA that the Court makes orders under s 444GA(1)(b) of the Corporations Act granting leave to effect the transfer of the Shares to MCW.

7. In accordance with the procedural orders made by the Court on 29 September 2020, the applicants have given notice of the hearing of the application (including Ms Dickerson’s affidavit sworn on 29 September 2020 and exhibit GD-1) to interested parties, including creditors and members of McWilliam’s and the Australian Securities and Investments Commission (ASIC), substantially in the form of exhibit B in the proceedings (the Notice). Included in the Notice was a link to an explanatory statement dated 30 September 2020 and the expert’s...