Rathner, in the matter of Citius Property Pty Ltd (Administrator Appointed)

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judgment Date: 24 January 2023
• Neutral Citation: [2023] FCA 26
• Date: 24 January 2023

FEDERAL COURT OF AUSTRALIA

Rathner, in the matter of Citius Property Pty Ltd (Administrator Appointed) [2023] FCA 26

File number:	VID 35 of 2023
Judgment of:	O'BRYAN J
Date of judgment:	24 January 2023
Date of publication of reasons:	2 February 2023
Catchwords:	CORPORATIONS – proposed extension of convening period for second meeting of creditors under s 439A of the Corporations Act 2001(Cth) –Court satisfied that extending administration is in the best interests of creditors
Legislation:	Corporations Act 2001 (Cth), ss 435A, 436A, 439A, 443B, 447A, 451E, Schedule 2, s 90-15 Insolvency Practice Rules (Corporations) 2016 (Cth), rr 75-140, 75-225 Fair Entitlements Guarantee Act 2012 (Cth)
Cases cited:	Algeri, in the matter of Colorado Group Ltd (administrators appointed) (receivers and managers appointed) [2011] VSC 260 Australasian Memory Pty Ltd v Brien (2000) 200 CLR 270 Bumbak, in the matter of Duro Felguera Australia Pty Limited (administrators appointed) [2020] FCA 422 In the matter of Daisytek Australia Pty Ltd (administrators appointed) [2003] FCA 575; 45 ACSR 446 Dallinger v Halcha Holdings Pty Ltd (administrator appointed) (1995) 60 FCR 594 In the matter of Kavia Holdings Pty Limited (administrators appointed) (receivers and managers appointed) [2013] NSWSC 737 In the matter of LED Builders Pty Ltd (administrators appointed) [2008] NSWSC 633 In the matter of Lift Capital Partners Pty Ltd (administrators appointed) [2008] NSWSC 446 In the matter of Sirius Corporation Limited (administrators appointed) [2013] NSWSC 2003 Lewis (Liquidator), Re Concrete Supply Pty Ltd (in liquidation) [2020] FCA 841; 145 ACSR 459 Mentha, in the matter of Arrium Ltd (administrators appointed) [2016] FCA 487; 113 ACSR 302 Mighty River International Ltd v Hughes (2018) 265 CLR 480 Owen, in the matter of Rivercity Motorway Pty Limited (administrators appointed) (receivers and managers Appointed) v Madden [2011] FCA 295 Owen and Others in their capacity as joint and several administrators of Rivercity Motorway Pty Ltd (administrators appointed) (receivers and managers appointed) v Madden (No 4) [2012] FCA 1491; 92 ACSR 255 Strawbridge, in the matter of Virgin Australia Holdings Ltd (administrators appointed) (No 2) [2020] FCA 717; 144 ACSR 437 Walker, in the matter of ABC Learning Centres Ltd (administrators appointed) (receivers and managers appointed) (No 8) [2009] FCA 994; 73 ACSR 478
Division:	General Division
Registry:	Victoria
National Practice Area:	Commercial and Corporations
Sub-area:	Corporations and Corporate Insolvency
Number of paragraphs:	65
Date of hearing:	24 January 2023
Counsel for the Plaintiffs:	Mr S L Freire
Solicitor for the Plaintiffs:	BlueRock Law

ORDERS

		VID 35 of 2023
IN THE MATTER OF CITIUS PROPERTY PTY LTD (ADMINISTRATOR APPOINTED)
	GIDEON ISAAC RATHNER IN HIS CAPACITY AS ADMINISTRATOR OF CITIUS PROPERTY PTY LTD (ADMINISTRATOR APPOINTED) ACN 102 392 923 First Plaintiff ; CITIUS PROPERTY PTY LTD (ADMINISTRATOR APPOINTED) ACN 102 392 923 Second Plaintiff

order made by:	O'BRYAN J
DATE OF ORDER:	24 JANUARY 2023

THE COURT ORDERS THAT:

Convening Period

1. Pursuant to section 439A(6) of the Corporations Act 2001 (Cth) (the Act), the period within which the first plaintiff must convene the second meeting of the creditors of Citius Property Pty Ltd (administrator appointed) ACN 102 392 923 (the Company) is extended to and includes 3 February 2024.

2. Pursuant to s 447A(1) of the Act, that Part 5.3A of the Act is to operate in relation to the Company as if the second meeting of the creditors of the Company required by s 439A of the Act be held at any time during, or within 5 business days after the end of, the convening period as extended by order 1 above, notwithstanding the provisions of s 439A(2) of the Act.

Notices to creditors to be provided electronically

3. Pursuant to s 447A(1) of the Act and s 90-15 of the Insolvency Practice Schedule (Corporations) (Schedule 2 to the Act) (the IPSC) that if, pursuant to any provision in any of Part 5.3A of the Act, the IPSC, or the Insolvency Practice Rules 2016 (Cth) (the IPR), the first plaintiff is required to provide any other notification to creditors during the administration of the Company, the applicable notice requirements will be satisfied if the first plaintiff gives such notice by taking the following steps:

(a) where the plaintiffs are in possession of an email address for a creditor, by notifying each such creditor of the relevant matter by an email sent to that email address;

(b) where the plaintiffs are not in possession of an email address for a creditor, but have a postal address for that creditor (or have received notification of non-delivery of a notice sent by email in accordance with paragraph (a) above), by notifying each such creditor in writing of the relevant matter via ordinary pre-paid post; and

(c) to the extent that the matter relates to a meeting that is the subject of s 75-40(4) of the IPR, by causing notice of the meeting to be published on the ASIC published notices website at https://insolvencynotices.asic.gov.au/.

Ancillary Orders

4. Within 2 business days of these orders, the plaintiffs cause notice of this originating process, and the orders made, to be given to creditors of the Company in accordance with order 3 above.

5. Liberty to apply is granted to any person who can demonstrate sufficient interest to modify or discharge any or all of orders 1 to 3 above on not less than 48 hours’ written notice to the plaintiffs.

6. The plaintiffs’ costs of the application are costs in the administration of the Company.

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

REASONS FOR JUDGMENT

O’BRYAN J

Introduction

1 On 29 December 2022, the first plaintiff, Mr Gideon Rathner (the Administrator), was appointed as administrator of the second plaintiff, Citius Property Pty Ltd (Citius), pursuant to s 436A of the Corporations Act 2001 (Cth) (Act).

2 By originating process filed on 20 January 2023, the Administrator applied to extend the convening period for the second meeting of creditors of Citius up to and including 3 February 2024, pursuant to s 439A(6) of the Act. The Administrator also sought an order under s 447A(1) that Part 5.3A operate in relation to Citius such that the second meeting of creditors of Citius required by s 439A of the Act be held at any time during, or within five business days after the end of, the convening period as extended by the Court. This type of order is colloquially known as a “Daisytek” order named after the decision in In the matter of Daisytek Australia Pty Ltd (administrators appointed) [2003] FCA 575; 45 ACSR 446.

3 The Administrator also sought orders pursuant to s 451E(3)(a) of the Act and s 90-15 of the Insolvency Practice Schedule (Corporations) (Schedule 2 to the Act) (IPSC) to the effect that, if the administration of Citius ends because of a resolution or order for Citius to be wound up, the stay on the enforcement of certain contractual rights described in s 451E(1) of the Act continues to operate until the winding up of Citius is complete, and that the Administrator is justified and acting reasonably in proceeding on that basis.

4 The Administrator also sought various ancillary orders, including orders concerning the form...