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Mentha, in the matter of The Griffin Coal Mining Company Pty Ltd (administrators appointed) (ACN 008 667 285) (No 2) [2010] FCA 499 (20 May 2010)

Last Updated: 24 May 2010

FEDERAL COURT OF AUSTRALIA

Mentha, in the matter of The Griffin Coal Mining Company Pty Ltd
(administrators appointed) (ACN 008 667 285) (No 2) [2010] FCA 499

Citation:		Mentha, in the matter of The Griffin Coal Mining Company Pty Ltd (administrators appointed) (ACN 008 667 285) (No 2) [2010] FCA 499

Parties:		IN THE MATTER OF THE GRIFFIN COAL MINING COMPANY LIMITED (ADMINISTRATORS APPOINTED) (ACN 008 667 285), GRIFFIN ENERGY GROUP PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 681 696), CARPENTER MINE MANAGEMENT PTY LTD (ADMINISTRATORS APPOINTED) (ACN 106 053 703), W.R. CARPENTER HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 401 796), CARPENTER MINE MANAGEMENT HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 122 080 684) AND W.R. CARPENTER AUSTRALIA PTY LTD (ADMINISTRATORS APPOINTED) (ACN 000 032 315); MARK FRANCIS XAVIER MENTHA, CLIFFORD STUART ROCKE, SCOTT BRADLEY KERSHAW, BRIAN KEITH MCMASTER IN THEIR CAPACITIES AS JOINT AND SEVERAL ADMINISTRATORS OF THE GRIFFIN COAL MINING COMPANY PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 667 285), CLIFFORD STUART ROCKE, SCOTT BRADLEY KERSHAW AND BRIAN KEITH MCMASTER IN THEIR CAPACITIES AS JOINT AND SEVERAL ADMINISTRATORS OF GRIFFIN ENERGY GROUP PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 681 696), CARPENTER MINE MANAGEMENT PTY LTD (ADMINISTRATORS APPOINTED) (ACN 106 053 703), W.R. CARPENTER HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED), (ACN 008 401 796), CARPENTER MINE MANAGEMENT HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 122 080 684) AND W.R. CARPENTER AUSTRALIA PTY LTD (ADMINISTRATORS APPOINTED) (ACN 000 032 315)

File number:		WAD 15 of 2010

Judge:		MCKERRACHER J

Date of judgment:		20 May 2010

Catchwords:		CORPORATIONS - liquidation – extension of time for convening second creditors’ meeting pursuant to s 439A(6) of the Corporations Act 2001 (Cth) - reasons justifying further extension – complex liquidation – position of creditors – extension granted

Legislation:		Corporations Act 2001 (Cth) ss 439A, 440C

Cases cited:		ABC Learning Centres Ltd, Re; Application by Walker (No 7) (2009) 71 ACSR 560 ABC Learning Centres Ltd, Re; Application by Walker (No 8) (2009) 73 ACSR 478 Chamberlain, Re; South Wagga Sports and Bowling Club Ltd (admin apptd) [2009] FCA 25 Henry Walker Eltin Group Ltd, Re [2005] FCA 984; (2005) 54 ACSR 383 Lombe, Re; Australian Discount Retail Pty Ltd [2009] NSWSC 110 Mentha, in the matter of The Griffin Coal Mining Company Pty Ltd (administrators appointed) (ACN 008 667 285) [2010] FCA 30 Windimurra Vanadium Ltd & Midwest Vanadium Pty Ltd, Re; Ex parte Weaver [2009] WASC 71 Windimurra Vanadium Ltd, Re; Ex parte Weaver (No 2) [2009] WASC 182 Windimurra Vanadium Ltd, Re; Ex parte Weaver (No 3) [2009] WASC 302 Windimurra Vanadium Ltd, Re; Ex parte Weaver (No 4) [2009] WASC 373

Date of hearing:	21 April 2010

Place:	Perth

Division:	GENERAL DIVISION

Category:	Catchwords

Number of paragraphs:	43

Counsel for the Plaintiffs:	JA Thompson

Solicitor for the Plaintiffs:	Johnson Winter & Slattery

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 15 of 2010

IN THE MATTER OF THE GRIFFIN COAL MINING COMPANY LIMITED (ADMINISTRATORS APPOINTED) (ACN 008 667 285), GRIFFIN ENERGY GROUP PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 681 696), CARPENTER MINE MANAGEMENT PTY LTD (ADMINISTRATORS APPOINTED) (ACN 106 053 703), W.R. CARPENTER HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 401 796), CARPENTER MINE MANAGEMENT HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 122 080 684) AND W.R. CARPENTER AUSTRALIA PTY LTD (ADMINISTRATORS APPOINTED) (ACN 000 032 315)

MARK FRANCIS XAVIER MENTHA, CLIFFORD STUART ROCKE, SCOTT BRADLEY KERSHAW, BRIAN KEITH MCMASTER IN THEIR CAPACITIES AS JOINT AND SEVERAL ADMINISTRATORS OF THE GRIFFIN COAL MINING COMPANY PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 667 285)
First Plaintiffs

CLIFFORD STUART ROCKE, SCOTT BRADLEY KERSHAW AND BRIAN KEITH MCMASTER IN THEIR CAPACITIES AS JOINT AND SEVERAL ADMINISTRATORS OF GRIFFIN ENERGY GROUP PTY LTD (ADMINISTRATORS APPOINTED) (ACN 008 681 696), CARPENTER MINE MANAGEMENT PTY LTD (ADMINISTRATORS APPOINTED) (ACN 106 053 703), W.R. CARPENTER HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED), (ACN 008 401 796), CARPENTER MINE MANAGEMENT HOLDINGS PTY LTD (ADMINISTRATORS APPOINTED) (ACN 122 080 684) AND W.R. CARPENTER AUSTRALIA PTY LTD (ADMINISTRATORS APPOINTED) (ACN 000 032 315)
Second Plaintiffs

JUDGE:	MCKERRACHER J
DATE OF ORDER:	21 APRIL 2010
WHERE MADE:	PERTH

THE COURT ORDERS THAT:

The convening period for the meetings of creditors of each of The Griffin Coal Mining Company Pty Ltd (administrators appointed), Griffin Energy Group Pty Ltd (administrators appointed), Carpenter Mine Management Pty Ltd (administrators appointed), W.R. Carpenter Holdings Pty Ltd (administrators appointed), Carpenter Mine Management Holdings Pty Ltd (administrators appointed) and W.R. Carpenter Australia Pty Ltd (administrators appointed) (Companies and each a Company) required to be held pursuant to section 439A of the Corporations Act be extended to midnight on 28 September 2010.
Pursuant to section 447A(1) of the Corporations Act, that, with respect to each Company, Part 5.3A of the Corporations Act is to operate as if:
1. section 439A(1) also provided that the meeting of creditors required by that section may be convened and held within the convening period (including within the convening period as extended pursuant to subsection 439A(6));
2. section 439A(2) of the Corporations Act provided that the meeting must be held within five business days from being convened in accordance with subsections 439A(3) and (4), being a date not necessarily within five business days from the end of the convening period (including the convening period as extended pursuant to subsection 439A(6)); and
1. section 439A of the Corporations Act operated generally to permit the convening and holding of the meeting of creditors of the Company during the convening period (including the convening period as extended pursuant to section 439A(6)) provided the requirements of subsection 439A(3) and (4) are complied with.
The exhibit marked "Confidential Exhibit BKM-4" be kept confidential on the Court file and not be made available for inspection by any person (other than the First Plaintiffs and Second Plaintiffs) without an order of a judge of this Court.
The First Plaintiffs' and Second Plaintiffs' costs of this proceeding be paid pro rata as a cost of the administration of each Company.
The First Plaintiffs and Second Plaintiffs have liberty to apply to the Court for any further extensions of the convening periods referred to in Order 1 at any time prior to 28 September 2010.
Any person, including any creditor of any of the Companies, or the Australian Securities and Investments Commission, who can demonstrate sufficient interest to make such application as he, she, or it may be advised, have liberty to apply to the Court to vary or discharge these Orders on 48 hours notice being given to the First Plaintiffs and Second Plaintiffs and to the Court.
The First Plaintiffs and Second Plaintiffs cause notice of these Orders, within two business days after the making of these Orders:
1. to be placed on the website maintained by the First Plaintiffs and the Second Plaintiffs at www.kordamentha.com and on the website maintained by the Companies at www.griffincoal.com.au; and
2. to be sent by email to all creditors of the Companies who have provided the First Plaintiffs and the Second Plaintiffs with an email address, and to all other creditors of the Companies who have provided the First Plaintiffs and Second Plaintiffs with a mailing address, by mail.
1. These orders be entered forthwith.
1. The Court reserves for further consideration any application to further extend the convening period for the meeting of creditors required to be held pursuant to s 439A of the Corporations Act with respect to each Company.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 15 of 2010

JUDGE:	MCKERRACHER J
DATE:	20 MAY 2010
PLACE:	PERTH

REASONS FOR JUDGMENT

On 21 April 2010, I indicated I would provide short reasons for the orders then made. Those orders appear at the end of these reasons.

BACKGROUND

On 3 January 2010, the first plaintiffs were appointed as the joint and several administrators of The Griffin Coal Mining Company Pty Ltd (Administrators Appointed) (Griffin Coal) and the second plaintiffs were appointed as the joint and several administrators of Griffin Energy Group Pty Ltd (Administrators Appointed) (Griffin Energy), Carpenter Mine Management Pty Ltd (Administrators Appointed) (CMM), W. R. Carpenter Holdings Pty Ltd(Administrators Appointed) (WR Carpenter), Carpenter Mine Management Holdings Pty Ltd (Administrators Appointed) (CMMH). On 21 January 2010, the second plaintiffs were appointed as the joint and several administrators of W. R. Carpenter Australia Pty Ltd (Administrators Appointed) (WR Carpenter Australia) (together, the Companies).
By originating process filed on 27 January 2010 the first and second plaintiffs (the Administrators) sought an extension of the convening periods in respect of the Companies until midnight on 1 May 2010 (the First Application) for the reasons set out in the affidavit of Mr Brian Keith McMaster affirmed on 27 January 2010 (the First McMaster Affidavit). In essence, the extension was sought given the complex nature of the structure and business of the Companies and to enable a sale or recapitalisation process to be initiated while preserving the potential for a deed or deeds of company arrangement to be a feature of any sale or recapitalisation.
On 28 January 2010, I made orders pursuant to section 439A(6) of the Corporations Act 2001 (Cth) (CA) relevantly extending the convening period for the meeting of creditors of each of the Companies required to be held pursuant to s 439A CA until midnight on 1 May 2010 (the First Orders). To appreciate a full understating of the task facing the Administrators, a reading of these short reasons should be accompanied by reading those supporting the First Orders (see Mentha, in the matter of The Griffin Coal Mining Company Pty Ltd (administrators appointed) (ACN 008 667 285) [2010] FCA 30) (Mentha No 1).
Relevantly, s 439A CA provides:

439A Administrator to convene meeting and inform creditors

(1) The administrator of a company under administration must convene a meeting of the company’s creditors within the convening period as fixed by subsection (5) or extended under subsection (6).

(2) The meeting must be held within 5 business days before, or within 5 business days after, the end of the convening period.

...

(4) The notice given to a creditor under paragraph (3)(a) must be accompanied by a copy of:

(a) a report by the administrator about the company’s business, property, affairs and financial circumstances; and
(b) a statement setting out the administrator’s opinion about each of the following matters:

(i) whether it would be in the creditors’ interests for the company to execute a deed of company arrangement;
(ii) whether it would be in the creditors’ interests for the administration to end;
(iii) whether it would be in the creditors’ interests for the company to be wound up;
and also setting out:
(iv) his or her reasons for those opinions; and
(v) such other information known to the administrator as will enable the creditors to make an informed decision about each matter covered by subparagraph (i), (ii) or (iii); and

(c) if a deed of company arrangement is proposed—a statement setting out details of the proposed deed.

(5) The convening period is:

(a) if the day after the administration begins is in December, or is less than 25 business days before Good Friday—the period of 25 business days beginning on:

(i) that day; or
(ii) if that day is not a business day—the next business day; or

(b) otherwise—the period of 20 business days beginning on:

(i) the day after the administration begins; or
(ii) if that day is not a business day—the next business day.

(6) The Court may extend the convening period on an application made during or after the period referred to in paragraph (5)(a) or (b), as the case requires.
...

It was anticipated, as foreshadowed in Mentha No 1, that an application for a further extension may be made.

APPLICATION FOR A FURTHER EXTENSION OF THE CONVENING PERIODS

The Administrators sought a further extension of the convening periods in respect of each of the Companies, of 150 days, that is, until midnight on 28 September 2010 (the Further Application). The Administrators relied on a further affidavit of Mr McMaster affirmed on 20 April 2010 (the Further McMaster Affidavit) in support of their application.
As explained in the Further McMaster Affidavit at paras 28-34, the Administrators sought the further extension to enable them to progress the possible sale/recapitalisation of the Companies or their businesses as a going concern to substantially progress their investigations into both the Companies' affairs and the attitudes of creditors toward the ongoing conduct of the administrations. The Administrators stated that, based on:

(a) their opinion it was and is in creditors' best interests that the Companies continue to trade, with a view to realising the maximum value for the Companies' business and assets as a going concern;

(b) the consequential desirability of a competitive sale process in relation to the Companies, their businesses and assets, and the time needed to properly conduct such a process given the nature and value of the assets involved;

(d) the likelihood that a deed or deeds of company arrangement proposal will be an important feature of the sale process, and that the availability of the option of deeds of company arrangement ought to be preserved pending responses from potential bidders;
the convening and holding the second meetings of creditors in the timetable prescribed by the First Orders would have limited utility to the creditors of each of the Companies. In addition, the Administrators considered that the complex financial structure of the Companies would take some time for them to fully investigate. There is a large volume of work involved in the continued administration of the Companies, including the continued operation of the business of the Companies.

The Administrators also deposed that it was also critical for the continued operation of the business of the Companies and the maximisation of the value on a sale that the Administrators continue to have the benefit of the statutory moratoria and other structural features of Pt 5.3A, and therefore desirable that the administrations continue. For example, most (if not all) mining equipment used by Griffin Coal is leased, and if the Administrators were to lose the benefit of the s 440C moratorium, it is likely that this would have a substantial impact on the operations of Griffin Coal. Section 440C CA provides:

440C Owner or lessor cannot recover property used by company

During the administration of a company, the owner or lessor of property that is used or occupied by, or is in the possession of, the company cannot take possession of the property or otherwise recover it, except:
(a) with the administrator’s written consent; or
(b) with the leave of the Court.

The steps taken in the administrations of the Companies since the First Orders were made have been explained as including:

(a) Progressing the potential recapitalisation or sale of the Companies or their assets, including preparing the data room materials, undertaking modelling and cashflows and planning for the implementation of the sale process;

(b) Dealing with approaches from interested parties in relation to the recapitalisation or sale of the Companies or their assets;

(d) Continuing to operate the businesses of the Companies and dealing with operational issues including retention of title suppliers, finance lease suppliers and insurers;

(e) Continuing to liaise with employees and their union representatives;

(f) Meeting with Company management;

(g) Continuing to liaise with creditors including committees of creditors, bondholder creditors, secured creditors, lease creditors and retention of title claimants;

(h) Dealing with litigation commenced by Griffin Coal in the Administrative Appeals Tribunal against the Deputy Commissioner of Taxation in relation to the 2003 tax assessment;

(i) Instructing lawyers to deal with various legal matters involving the Companies;

(j) Providing information to bondholder creditors, including by holding bondholder conference calls and providing additional financial information;

(k) Continuing investigations into the Companies’ businesses, property, affairs and financial circumstances, with particular reference to the cash-flow and trading position of the Companies in the period leading up to the plaintiffs’ appointment, and potential recovery actions that might be available to a liquidator of the Companies in respect of voidable transactions, breaches of directors’ duties and related party transactions;

(l) Progressing the completion of the Bluewaters II project;

(m) Defending and settling litigation with coal customer Verve Energy in the Supreme Court of Western Australia;

(n) Preparing and lodging various applications with the WA Department of Mines and Petroleum in connection with a number of exploration licenses held by Griffin Coal;

(o) Meeting with the Environment Protection Authority (EPA) in connection with environmental approvals issued to Griffin Coal;

(p) Discussing with the Fremantle Port Authority (FPA) ongoing access by Griffin Coal to the Kwinana Bulk Terminal which is essential for the operations of Griffin Coal;

(q) Negotiating a coal supply agreement with Perdaman Chemicals and Fertilisers Pty Ltd (Perdaman);

(r) Having discussions with the WA Government to keep them informed of developments in relation to the administrations of the Companies;

(s) Progressing an ‘in principle’ agreement for the sale of the Emu Downs wind farm, a joint venture between Griffin Coal subsidiary EDWF Holdings 2 Pty Ltd and Stanwell Corporation Limited; and

(t) Preparing and despatching a Report to Creditors on 16 April 2010 is discussed below.

The dealings with creditors subsequent to the First Orders have included the following.
A Report to Creditors was despatched by the Administrators on 16 April 2010 to all creditors of the Companies (the Report to Creditors).
The Administrators have so far held two meetings of the Committees of Creditors of the Companies on 12 February 2010 (in respect of all of the Companies apart from WR Carpenter Australia), which reconvened in relation to Griffin Energy and CMMH on 19 February 2010 due to a lack of quorum (the February Minutes) and on 26 March 2010 (in respect of Griffin Coal only) (the 26 March Minutes).
The Administrators have held two conference calls with representatives of bondholder creditors on 29 January and 23 March 2010. All known bondholders were invited to participate in those calls. In addition, the plaintiffs have provided additional unaudited financial information in respect of Griffin Coal for the year ended 30 June 2009 to the bondholders, sought by them pursuant to the Indenture governing their bonds. It was only possible to release unverified information.
An update was also deposed to as to the position taken by secured creditors since Mentha No 1. That detail does not need to be set out in these reasons.
In relation to the timing of the sale and recapitalisation process, the Administrators have engaged UBS and Macquarie Capital Advisers (the Advisers) to jointly advise in respect of the sale process. The Advisers have prepared an indicative timetable for the planning and implementation of the sale process which indicates that the sale process will take approximately six to eight months to the stage of the execution of transaction documentation.

ATTITUDE OF THE CREDITORS OF THE COMPANIES TO THE PROPOSED FURTHER EXTENSION

On 13 April 2010, the Administrators caused a staff member to email a circular to members of the Committees of Creditors for each of Griffin Coal, CMM, CMMH, Griffin Energy and WR Carpenter seeking the consent of the members of each committee to the Further Application and requested a response by close of business on 16 April 2010 (the Circular).
All of the members of the Committee of Creditors who responded to the Circular consented to the Administrators seeking a further extension of the convening period for up to a further 150 days except for one who consented to a further extension of 90 days, having raised concerns about the provision of information, as to which the Administrators assure the Court that they intend to provide similar reports during the period of the administrations of the Companies and will continue to convene regular meetings of the Committees, as appropriate, to update them about the progress of the Administrations with particular reference to the sale process.
There are only three known creditors of WR Carpenter Australia. They have consented to a further extension of the convening period for up to a further 150 days.
All creditors of the Companies (including secured creditors) have been notified of the Further Application in the Report to Creditors that was despatched on 16 April 2010 and no communications had been received by the Administrators in relation to the Further Application apart from those discussed above.

EFFECT ON THE COMPANIES' CREDITORS OF ADMINISTRATIONS CONTINUING

The Administrators confirmed they are conscious of the impact that the statutory moratoria provided by Pt 5.3A CA will have on the Companies’ creditors, however, they remain of the view that the further extension of the convening period will not unduly prejudice the Companies' creditors for the reasons that all creditors of the Companies (including secured creditors) have been notified of the application for extension of convening period in the Report to Creditors despatched on 16 April 2010.
The plaintiffs had not received any comments from any of the Companies’ creditors in relation to the matters raised in the Report to Creditors save for those set out above.
The Companies have several remaining secured creditors whose security is not such as would otherwise enable them to enforce their security during the Companies’ administrations. One has confirmed that it does not object to the further extension sought. Another has not expressed any opposition to the further extension sought.
The Administrators are continuing to cause Griffin Coal and CMM to pay each of the lessor creditors of those Companies in the ordinary course of applicable trading terms for all lease payments relevant to the period of the administrations.
None of the lessor creditors has expressed any opposition to the further convening period extension being sought by the Administrators.
Griffin Energy, WR Carpenter, CMMH and WR Carpenter Australia do not have any owner/lessor creditors.
Negotiations with retention of title claimants have concluded, with the Administrators either purchasing the relevant goods or having returned those goods to the supplier. None of the parties asserting ‘retention of title’ claims has expressed any opposition to the further extension of the convening period for the administrations of Griffin Coal and CMM.
Griffin Energy, WR Carpenter, CMMH and WR Carpenter Australia do not have any counterparties who have asserted ‘retention of title’ claims.
The Administrators are continuing to cause Griffin Coal and CMM to pay those Companies’ trade and employee creditors in the ordinary course of applicable trading or employment terms for all goods supplied or services rendered during the period of the administrations. The Administrators are currently comfortable that, from internally generated cash flows, possibly with the assistance of a third party working capital facility, those payments will continue to be made during the administration of the Companies.
Significantly, none of the trade or employee creditors of Griffin Coal or CMM has expressed any opposition to the further convening period extension being sought by the Administrators.
Griffin Energy, WR Carpenter, CMMH and WR Carpenter Australia each do not have any trade or employee creditors.
From the Administrators’ investigations to date, their appointment has not resulted in any litigation involving the Company being stayed or otherwise postponed which ought otherwise proceed in the interests of protecting either the Companies’ assets or the rights of the other party to that litigation (including having regard to the operation of s 451D CA in respect of limitation that might apply).
Similarly, the Administrators’ investigations to date have not revealed any potential claims held by any of the Companies that should be urgently commenced by a liquidator appointed to the Companies in order to preserve the potential fruits of that litigation.

AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

The Australian Securities and Investments Commission (ASIC) was provided with notice of the Further Application. It confirmed it did not wish to intervene or seek leave to appear at the hearing of the application.

POWER TO GRANT A FURTHER EXTENSION OF THE CONVENING PERIOD

Section 439A does not extend to authorising a further extension under s 439A(6) CA: Henry Walker Eltin Group Ltd, Re [2005] FCA 984; (2005) 54 ACSR 383 (per Hely J at [1]), and Chamberlain, Re; South Wagga Sports and Bowling Club Ltd (admin apptd) [2009] FCA 25 (per Jacobson J at [2]).
Henry Walker Eltin was decided prior to amendments to s 439A CA which took effect on 31 December 2007. Justice Jacobson in Chamberlain was not apparently addressed on the effect of the amendments but, in any event, as his Honour held, the power to grant a subsequent extension of the convening period exists in s 447A(1) CA which empowers the Court to ‘make such order as it thinks appropriate about how [Part 5.3A] is to operate in relation to a particular company’: see also Lombe, Re; Australian Discount Retail Pty Ltd [2009] NSWSC 110 (at [32] per Barrett J).

CONSIDERATIONS ON AN APPLICATION TO EXTEND THE CONVENING PERIOD

The relevant legal principles applicable to an application to extend the convening period were largely summarised Mentha No 1 (at [15]-[22]). I will not repeat them in detail.
There are recent instances in which the Court has granted a further extension of the convening period, in circumstances similar to the present, involving complex sale processes of substantial assets.
In ABC Learning Centres Ltd, Re; Application by Walker (No 7) (2009) 71 ACSR 560, a further extension of the convening period of six months was granted. The further extension was sought to enable the sale of the ABC Group's business by the receivers and managers of the companies. The reasons for the application for the further extension included to provide the receivers with sufficient time to prepare for the sale, including to consider the appointment of investment banks to advise on the sale process, to prepare an information memorandum to provide to prospective buyers, to advertise the business for sale and to assemble information necessary to facilitate due diligence investigations on behalf of prospective buyers (at [11]).
In ABC Learning Centres Ltd, Re; Application by Walker (No 8) (2009) 73 ACSR 478, a yet further extension of the convening period of another six months was granted. The application was opposed by two of the companies' lessors. The basis of the application for the further extension of time was that the receivers were still endeavouring to sell the undertaking and business of the ABC Group (at [20]). In support of the application, the receivers submitted that the orderly sale was the only practical means of preserving the business of the ABC Group and maximising the chances of the business continuing in existence under new operators. It was also submitted by the receivers that such a sale would maximise the return to creditors (at [25]). Justice Emmett concluded that it would be appropriate to extend the convening period for a further six months, although noted certain terms might be agreed to for the protection of the companies' lessors (at [63]).
In applications made by the administrators of Windimurra Vanadium Ltd and Midwest Vanadium Pty Ltd in the context of the sale process for a vanadium mine under construction, a series of four separate extensions were granted, being for 3 months, 3 months, 2 months and then 2 months respectively: Windimurra Vanadium Ltd & Midwest Vanadium Pty Ltd, Re; Ex parte Weaver [2009] WASC 71; Windimurra Vanadium Ltd, Re; Ex parte Weaver (No 2) [2009] WASC 182; Windimurra Vanadium Ltd, Re; Ex parte Weaver (No 3) [2009] WASC 302 and Windimurra Vanadium Ltd, Re; Ex parte Weaver (No 4) [2009] WASC 373.
For the reasons relied upon by the plaintiffs in support of this application for a further extension and as set out above, (particularly at [8] to [34]), the extension sought is appropriate, as is the reservation of liberty to apply.
I will order as follows:
1. The convening period for the meetings of creditors of each of The Griffin Coal Mining Company Pty Ltd (administrators appointed), Griffin Energy Group Pty Ltd (administrators appointed), Carpenter Mine Management Pty Ltd (administrators appointed), W.R. Carpenter Holdings Pty Ltd (administrators appointed), Carpenter Mine Management Holdings Pty Ltd (administrators appointed) and W.R. Carpenter Australia Pty Ltd (administrators appointed) (Companies and each a Company) required to be held pursuant to section 439A of the Corporations Act be extended to midnight on 28 September 2010.
2. Pursuant to section 447A(1) of the Corporations Act, that, with respect to each Company, Part 5.3A of the Corporations Act is to operate as if:
  1. section 439A(1) also provided that the meeting of creditors required by that section may be convened and held within the convening period (including within the convening period as extended pursuant to subsection 439A(6));
  2. section 439A(2) of the Corporations Act provided that the meeting must be held within five business days from being convened in accordance with subsections 439A(3) and (4), being a date not necessarily within five business days from the end of the convening period (including the convening period as extended pursuant to subsection 439A(6)); and
  1. section 439A of the Corporations Act operated generally to permit the convening and holding of the meeting of creditors of the Company during the convening period (including the convening period as extended pursuant to section 439A(6)) provided the requirements of subsection 439A(3) and (4) are complied with.
3. The exhibit marked "Confidential Exhibit BKM-4" be kept confidential on the Court file and not be made available for inspection by any person (other than the First Plaintiffs and Second Plaintiffs) without an order of a judge of this Court.
4. The First Plaintiffs' and Second Plaintiffs' costs of this proceeding be paid pro rata as a cost of the administration of each Company.
5. The First Plaintiffs and Second Plaintiffs have liberty to apply to the Court for any further extensions of the convening periods referred to in Order 1 at any time prior to 28 September 2010.
6. Any person, including any creditor of any of the Companies, or the Australian Securities and Investments Commission, who can demonstrate sufficient interest to make such application as he, she, or it may be advised, have liberty to apply to the Court to vary or discharge these Orders on 48 hours notice being given to the First Plaintiffs and Second Plaintiffs and to the Court.
7. The First Plaintiffs and Second Plaintiffs cause notice of these Orders, within two business days after the making of these Orders:
  1. to be placed on the website maintained by the First Plaintiffs and the Second Plaintiffs at www.kordamentha.com and on the website maintained by the Companies at www.griffincoal.com.au; and
  2. to be sent by email to all creditors of the Companies who have provided the First Plaintiffs and the Second Plaintiffs with an email address, and to all other creditors of the Companies who have provided the First Plaintiffs and Second Plaintiffs with a mailing address, by mail.
  1. These orders be entered forthwith.
  1. The Court reserves for further consideration any application to further extend the convening period for the meeting of creditors required to be held pursuant to s 439A of the Corporations Act with respect to each Company.

I certify that the preceding forty-three (43) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice McKerracher.

Associate:

Dated: 20 May 2010

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