Tang, in the matter of Wright's Transport Pty Limited (in liq) v Wright (No 3)

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judge: MARKOVIC J
• Judgment Date: 10 July 2020
• Neutral Citation: [2020] FCA 1122
• Date: 10 July 2020

FEDERAL COURT OF AUSTRALIA

Tang, in the matter of Wright’s Transport Pty Limited (in liq) v Wright (No 3) [2020] FCA 1122

File number:	NSD 548 of 2020
Judge:	MARKOVIC J
Date of judgment:	10 July 2020
Date of publication of reasons:	6 August 2020
Catchwords:	CORPORATIONS – application by liquidators seeking to be appointed as receivers and managers of assets and undertakings of trusts – application for orders pursuant to s 530C of the Corporations Act 2001 (Cth) authorising liquidators to dispose of property seized under a warrant – applications allowed
Legislation:	Corporations Act 2001 (Cth), ss 420, 530C Federal Court of Australia Act 1976 (Cth), s 57
Cases cited:	Apostolou v VA Corporation Aust Pty Ltd [2010] FCA 64; (2010) 77 ACSR 84 Australian Securities Commission v Fuller [1998] FCA 145 Bailey (liquidator) of Bruce Bros Floor Coverings Pty Ltd (in liq) v Trustee of the Bruce Bros Floor Coverings Trust, in the matter of Bruce Bros Floor Coverings Pty Ltd (in liq) [2018] FCA 1838 Caterpillar Financial Australia Limited v Ovens Nominees Pty Ltd [2011] FCA 677 In the matter of AAA Financial Intelligence Ltd (in liquidation) [2014] NSWSC 1004 In the matter of Double Bay Property Management Pty Ltd (in liq) [2020] NSWSC 203 In the matter of MINMXT Holdings Pty Ltd (In liquidation) [2017] NSWSC 156 Jones (Liquidator) v Matrix Partners Pty Ltd; in the matter of Killarnee Civil & Concrete Contractors Pty Ltd (in liq) [2018] FCAFC 40; (2018) 354 ALR 436 Suco Gold Pty Ltd (in liq) (1983) 33 SASR 99 Sutherland Re; French Caledonia Travel Service Pty Ltd (in liq) (2003) 59 NSWLR 361 University of Western Australia v Gray (No 6) [2006] FCA 1825
Date of hearing:	10 July 2020
Registry:	New South Wales
Division:	General Division
National Practice Area:	Commercial and Corporations
Sub-area:	Corporations and Corporate Insolvency
Category:	Catchwords
Number of paragraphs:	27
Counsel for the Plaintiffs:	Mr D Krochmalik
Solicitor for the Plaintiffs:	Hilton Bradley Lawyers
Counsel for the Defendant:	The Defendant appeared in person

ORDERS

		NSD 548 of 2020
BETWEEN:	JASON BING-FAI TANG AND OZEM AZZAM KASSEM IN THEIR CAPACITY AS LIQUIDATORS OF WRIGHT'S TRANSPORT PTY LIMITED (IN LIQUIDATION) ACN 110 737 838 First Plaintiff ; WRIGHT'S TRANSPORT PTY LIMITED (IN LIQUIDATION) Second Plaintiff
AND:	ROBERT WRIGHT Defendant

JUDGE:	MARKOVIC J
DATE OF ORDER:	10 july 2020

THE COURT ORDERS THAT:

1. Pursuant to s 530C(4) of the Corporations Act 2001 (Cth) (Corporations Act), the plaintiffs are authorised to dispose of the property and books seized under the warrant issued pursuant to the orders made on 26 May 2020.

2. Pursuant to s 57 of the Federal Court of Australia Act 1976 (Cth), the first plaintiffs, Jason Bing-Fai Tang and Ozem Azzam Kassem of One Wharf Lane, Level 20, 171 Sussex Street, Sydney NSW 2000, be appointed until further order as receivers and managers (Receivers), without security, of the assets and undertakings of each of:

   1. RJ & D Wright Asset Holding Trust, being the trust established by Deed of Trust between David O’Brien, as settlor, and Wright’s Transport (in Liquidation) (Company), as trustee; and

   2. Wright’s Transport Family Trust, being the trust established by Deed of Trust between David O’Brien, as settlor, and the Company, as trustee,

(together, the Trusts).

3. Anything that may be done required or authorised to be done by the Receivers may be done by any one of them.

4. The Receivers have all the powers that a receiver has in respect of the business and property of a company under s 420 of the Corporations Act (other than in s 420(2)(s), (t), (u) and (w)) as if the reference in that section to “the corporation” were a reference to the Trusts including, without limitation, the power to do all things necessary or convenient to:

   1. investigate transactions made using funds derived from the assets beneficially held by the Trusts;

   2. demand the books and records of the Trusts from any person;

   3. determine, settle and make payment of any claims made against the assets beneficially held by the Trusts;

   4. sell and convert into cash any property or asset beneficially held by the Trusts;

   5. enable the first plaintiffs, as Receivers, to realise assets beneficially held by the Trusts to enforce the second plaintiff’s right of indemnity as trustee, and apply the proceeds to discharge the liabilities of the second plaintiff;

   6. enable the first plaintiff to recover the costs of the receivership and the general costs of the liquidation of the second plaintiff;

   7. distribute the proceeds of the sale of the assets beneficially held by the Trusts (after payment of the costs, expenses and remuneration of the Receivers in their capacity as the Receivers and as liquidators of the second plaintiff) to any creditors of the second plaintiff in its capacity as trustee of the Trusts; and

   8. distribute any surplus thereafter to the beneficiaries of the Trusts.

5. Other than to determine or settle any claims made against the assets beneficially held by the Trusts (and to make any payment as part of such determination or settlement), the Receivers are not to make any distribution of the assets of the Trusts to the creditors of the second plaintiff or to the beneficiaries of the Trusts without further order or direction of the Court.

6. The costs, expenses and remuneration of the Receivers in acting as the receivers and managers of the assets and undertakings of the Trusts, be paid from the assets of the Trusts.

7. The plaintiffs’ costs of this proceeding are to be costs in the winding up of the second plaintiff and costs in the receivership of the Trusts.

8. The parties have liberty to apply on three days’ notice.

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

REASONS FOR JUDGMENT

MARKOVIC J:

1. On 10 July 2020 on the application of the plaintiffs, Jason Bing-Fai Tang and Ozem Azzam Kassem in their capacity as liquidators of Wright’s Transport Pty Limited (in liquidation) (Liquidators) and Wright’s Transport Pty Limited (in liquidation) (Wright’s Transport), I made an order pursuant to s 530C(4) of the Corporations Act 2001 (Cth) (Act) and orders appointing the Liquidators as receivers and managers of the RJ & D Wright Asset Holding Trust (Asset Holding Trust) and the Wright’s Transport Family Trust (Trading Trust) (collectively, Trusts). These are my reasons for making those orders.

2. The application and evidence upon which the plaintiffs relied was served on the defendant, Robert Wright, who participated in the hearing with the assistance of his accountant, David O’Brien. Mr Wright did not oppose the making of the orders sought by the plaintiffs but raised issues about the payment of the Liquidators’ and, if appointed, the receivers and managers’ remuneration, costs and expenses, and the mode of disposal of the assets of the Trusts. Those issues are addressed below.

Background

3. The history of the affairs and operations of Wright’s Transport, including its entry into voluntary administration and then liquidation, are set out in Tang (liquidator) v Wright, in the matter Wright’s Transport Pty Limited (in liq) [2020] FCA 709 (Wright’s Transport (No 1)) at [4]-[10] as follows:

4 Prior to its external administration the company operated a long-range freight transport business as a subcontractor for two...