In the matter of Antqip Hire Pty Ltd (in liq)

1. [1]

   The first defendant Antqip Hire Pty Ltd (“Antqip Hire”) and the second defendant Antqip Pty Ltd (“Antqip”) (together, “the Companies”), went into voluntary administration under Part 5.3A of the (CTH) Corporations Act 2001 (“CORPA”) on 3 February 2014. On or about 8 May 2014, they entered into Deeds of Company Arrangement (“DoCAs”). On or about 26 October 2014, both Companies executed a deed of charge (“the Deed of Charge”) in favour of the plaintiff National Funding Group Pty Ltd (“National”), securing advances of $3,357,000 documented in a deed of loan of the same date, which were applied to refinance an existing secured debt of the Companies to Bibby Financial Services Pty Ltd (“Bibby”), which was an “excluded secured creditor” under the DoCAs. A security interest in respect of “all present and after-acquired property” was registered on the Personal Property Securities Register (“PPSR”), numbered 2014-10270026615, with a start time of 27 October 2014, and an end time on 27 October 2017 – a period of three years (“the Original AllPAP 6615 Registration”). In April 2019, National realised that the Original AllPAP 6615 Registration had lapsed, and further AllPAP registrations, numbered 2019-04240002907 and 2019-04240003175 (“the 2019 Registrations”) were made on 23 April 2019. The Companies went into voluntary liquidation on 27 May 2019, and the third defendants Alan Walker and Ozem Kassem are their liquidators (“the Liquidators”).

2. [2]

   Pursuant to an originating process filed on 22 October 2019 and amended on 22 July 2020, National applies, pursuant to CORPA, s 588FM, for an order fixing 23 April 2019, when the 2019 Registrations were registered, as the “later time” for the purposes of s 588FL(2)(b)(iv), so that its security interest will not vest in the Companies, pursuant to s 588FL(4), for the benefit of the unsecured creditors. The Liquidators, who were joined as third defendants by order made on 20 July 2020, do not oppose the plaintiff’s application. Pursuant to directions made by the Court on 3 August 2020, notice of the proceedings was also given to the former deed administrators, the Registrar of Personal Property Securities (“the PPS Registrar”), and the Australian Taxation Office. The former deed administrators indicated on 3 August 2020 that they did not oppose the plaintiff’s application, which was refined on 31 August 2020 to a statement that they did not have a position in the proceedings and did not intend to appear. The PPS Registrar indicated that he did not intend to appear. The Deputy Commissioner of Taxation, who in 2014 had proved in the administrations for a debt of $4,884,523.48, appeared to oppose the application.

Background

1. [3]

   The Companies were engaged in the business of hiring equipment. Their sole director Mr Tony Russell caused them to go into voluntary administration on 3 February 2014. On 28 February 2014, the administrators circulated a report to creditors, including the Deputy Commissioner for Taxation. On or about 1 March 2014, the Commissioner proved in the administrations, for a debt of $4,884,523.48.

2. [4]

   On 4 April 2014, the administrators circulated a supplementary report to creditors, in which it was assessed that the ATO’s claim at $3,680,484, comprising $1,781,864 for unpaid superannuation guarantee charge in relation to Antqip Hire, which claim was entitled to priority under CORPA, s 556(1)(e), and $1,898,620 in respect of GST and PAYG (which was not entitled to priority). The supplementary report analysed a number of scenarios, including under proposed DoCAs and in the event of liquidation. Under the DoCAs, in the case of Antqip Hire, a deed fund of $400,000 was to be constituted, payable as to $150,000 within one month, and as to $250,000 over fifty months commencing six months after execution, from the profits of a related entity, Antqip Plant Hire Pty Ltd (“APH”). Although the deed fund would be exhausted by the ATO’s priority claim, it was estimated that it would receive a greater dividend in respect of it under the DoCA than upon liquidation. In the case of Antqip, a deed fund of $3,100,000 was to be constituted, payable as to $750,000 within one month, and as to $2,350,000 over fifty months commencing six months after execution, from the profits of APH. It was estimated that while on liquidation ordinary unsecured creditors would receive a dividend between nil and 9 cents in the dollar, under the DoCA they would receive 21 cents in the dollar. The administrators recommended that the creditors approve the Companies entering into proposed DoCAs.

3. [5]

   On or about 8 May 2014, the creditors resolved that the Companies enter into the DoCAs, and in due course the Companies did so. Consequent thereon, the administrators became Deed Administrators.

4. [6]

   When they went into administration, the Companies were indebted to Bibby, which held security for its debts. Under the DoCAs, Bibby was an “excluded secured creditor”, with the consequence that it was not entitled to share in the deed fund, but its remedies as a secured creditor were preserved.

5. [7]

   The Deed of Charge of 26 October 2014 in favour of National secured loan funds which were applied to refinance the loans from Bibby. Although the DoCAs each contained a provision to the effect that the Company must not charge, encumber, or dispose of any property other than in the ordinary course of business without the written permission of the deed administrator, there is no evidence of any such written permission. However, it is clear that the deed administrators were aware of and did not object to the transaction, apparently regarding it as “in the ordinary course of business” on the basis that it did no more than refinance the existing secured debt and did not adversely affect the position of unsecured creditors.

6. [8]

   On 27 October 2014, PPSR financing statements were lodged by Bransgroves, the solicitors then acting for National, in respect of the security interests created by the Deed of Charge. As a result, numerous PPSR registrations were effected. They fall into three categories. The first category, which comprised most of the registrations, were in respect of collateral identified in each case as a specific item in the class “other goods and motor vehicle”. They specified a registration start time on 28 October 2014, with “no stated end time”. They identified the secured party’s address for service as Paul Reese, then of Bransgroves. The second category of registrations were also in respect of collateral identified in each case as a specific item in the class “other goods and motor vehicle”. They specified a registration start time on 19 November 2014 and end time on 19 November 2021, that is to say a period of seven years, and provided as the address for service Sonya Wilcan, at “NWC Finance”. Ms Wilcan was an employee of National. The third, and for present purposes most relevant category, comprised a single registration – the Original AllPAP 6615 Registration. It was in respect of “all present and after-acquired property” of the Companies, and had a start time on 27 October 2014 and an end time on 27 October 2017 – a period of three years. The address for service was Katie.B@Bransgroves.com.au.

7. [9]

   On 4 November 2014, Mr Reese sent an email to Ms Wilcan, as follows (emphasis added):

8. [10]

   On 14 November, Ms Wilcan responded:

9. [11]

   Mr Reese replied on 17 November, as follows:

10. [12]

    On 24 November 2014, Mr Eddy Saade of “GlobalX” sent an email to Mr Reese, with a copy to “Kate.C” at Bransgroves:

11. [13]

    It appears that GlobalX Legal Solutions had been engaged by Bransgroves to lodge the 270-odd registrations which were referred to in Mr Reese’s email of 4 November 2014. The “matter summary” which accompanied their invoice and lists each of the registrations which they effected identifies each PPSR registration as (emphasis added) “PPSR registration – no end time”, and that the relevant registrations were effected on 28 October 2014. The registrations so listed do not include the Original AllPAP 6615 Registration.

12. [14]

    However, an invoice dated 27 October 2014, issued by the PPSR to “SAI Global Property Division Pty Ltd”, refers to the Original AllPAP 6615 Registration only, for which the transaction date is stated to be 27 October 2014. It therefore appears that the Original AllPAP 6615 Registration was not one of those outsourced to GlobalX; however, it may be inferred from the address for service (being Katie.B@Bransgroves.com.au), that it was effected by Bransgroves.

13. [15]

    In December 2014, the Antqip DoCA was varied, to increase the contribution to the deed fund to $3,318,633, and to substitute National for Bibby in the DoCA as the “excluded secured creditor”. In a circular to creditors of 12 December 2014, the deed administrators advised that Bibby was to be replaced by National, and that “[the change] does not have any material impact on the priorities as it is a straight replacement of the securities held by Bibby, which ranked above that of the deed administrators”.

14. [16]

    On or about 13 March 2015, National advanced a further $215,000 to Antqip.

15. [17]

    Between March 2015 and May 2019, contributions were made to the deed funds, with the final contribution being received on 9 April 2019.

16. [18]

    The Original AllPAP 6615 Registration expired on 27 October 2017. There is nothing to suggest that anyone in National’s camp adverted to this, and it is in the ordinary course of things that no-one would have done so, given the circumstances in which it had been registered contemporaneously with numerous other registrations which had either seven-year or open-ended end dates.

17. [19]

    Mr Morello, a director of National, deposed that on or about 8 October 2018, he began to become concerned that it might be necessary to enforce National’s security in respect of the Companies, and so he instructed ERA Legal (“ERA”), solicitors, to obtain the file in relation to the loans from National’s previous solicitors. In January 2019, the Companies defaulted in respect of their interest obligations to National. In about April 2019, National instructed ERA to advise on and assist in respect of the defaults, including as to recovery options against the borrowers and the guarantors. ERA undertook PPSR searches on 2 April 2019. Having reviewed them, on 18 April 2019 ERA ascertained that there was no extant AllPAP security registration in favour of National over the property of the Companies, as the Original AllPAP 6615 Registration had lapsed on 27 October 2017. ERA informed National of this that day. Mr Morello deposed:

18. [20]

    Mr Morello also deposed:

19. [21]

    19 April 2019 was Good Friday, and 22 April 2019 Easter Monday. On 23 April 2019, ERA created a new “secured party” for National on the PPSR, and on 24 April 2019 lodged the two 2019 AllPAP registrations (numbered 2781 and 2907) the subject of the present application.

20. [22]

    Mr Morello deposed that National did not immediately apply for an extension of time for the 2019 Registrations, as it considered that its position was protected by the extant other goods and motor vehicle registrations, that the Companies had not traded since entering into the DoCAs, and that there was not a significant risk of the AllPAP securities vesting, as it did not foresee the Companies going into liquidation or administration as they were subject to the DoCAs. Mr Anderson, solicitor of ERA, deposed that he advised Mr Morello that the 2019 Registrations, coupled with the extant other goods and motor vehicle registrations, protected National’s interests. It had not occurred to him prior to 27 May 2019 that there was any risk of the 2019 Registrations vesting under s 588FL, because he perceived no risk of the Companies being placed into liquidation or administration, as both were subject to a DoCA and not trading.

21. [23]

    Both Companies went into voluntary liquidation as a result of a resolution passed on 27 May 2019, when the Liquidators were appointed. By this time, National’s secured debt had increased to $7,040,219. On 28 May 2019, National appointed receivers of all of the property of the Companies the subject of the PPSR registrations.

22. [24]

    Mr Anderson deposed that even after becoming aware that the Companies had gone into liquidation, he did not give advice to bring an application for an extension of time, because the Companies remained subject to the DoCAs, and so far as he was aware had no other assets, so that there appeared to be no utility in obtaining an extension. However, on 27 June 2019, Mr Anderson was informed that proceedings had been commenced by the Liquidators seeking to set aside the DoCAs (“the DoCA Proceedings”). As an excluded secured creditor, National had no claim on the deed funds, comprising $1,828,323 in relation to Antqip and $41,788 for Antqip Hire, but if the DoCAs were set aside, those funds would become assets of the Companies in liquidation and caught by the Deed of Charge. He then considered it prudent to commence the present proceedings, pending the determination of the DoCA Proceedings. The originating process was filed on 22 October 2019.

23. [25]

    The DoCA Proceedings, in which the Liquidators sought orders confirming the validity of their appointment, terminating the DoCAs, and requiring the deed funds to be paid to the Liquidators, were heard before Rees J on 23 October 2019 and determined on 5 May 2020, when her Honour declared that the appointment of the Liquidators was valid, and that the deed funds had vested in the Liquidators. [1] The practical consequence of National’s application, if successful, is that the proceeds of the deed funds, having vested in the Liquidators as a result of the liquidation, would now be available to, and exhausted by, National, whereas previously, as an “excluded secured creditor”, it had no recourse to the deed funds, which were solely for the benefit of the unsecured creditors.

Leave to proceed: CORPA, s 500(2)

1. [26]

   As the companies are in liquidation, the plaintiff sought leave to proceed against them, pursuant to CORPA, s 500(2). It is unnecessary to resolve whether leave is required, in the sense that this is a “proceeding” of the kind contemplated by s 500. Assuming that it is, where leave is sought by a secured creditor it is not for the Court to exercise some sort of general discretionary judgment, nor to consider what course of action will best serve the interests of creditors generally and shareholders, but leave is granted “as of right”. [2] The Liquidators did not appear to oppose leave, which should be granted, [3] insofar as it is required.

The statutory provisions: CORPA, ss 588FL, 588FM

1. [27]

   CORPA, s 588FL, has the effect that certain (CTH) Personal Property Securities Act 2009 (“PPSA”) security interests granted by a company vest in the company if a relevant insolvency event (an order or resolution for winding up, the appointment of administrators, or the execution of a DoCA) occurs, and the security interest has not been registered earlier than six months before the commencement of the winding up or administration, or within twenty business days after it was granted:

2. [28]

   Section 588FM permits an interested party to apply to the Court to fix a later time for the purposes of s 588FL(2)(b)(iv):

3. [29]

   Any order made under s 588FM “fixing a later time” is “for the purposes of subparagraph 588FL(2)(b)(iv)”.

4. [30]

   Under the PPSA, a security interest is “perfected by registration” if, for any collateral, “a registration is effective with respect to the collateral”. [4] A registration is effective from the registration time until, relevantly, the registered end time. [5] Accordingly, the Original AllPAP 6615 registration ceased to be effective, and the AllPAP security interest granted by the Deed of Charge ceased to be “perfected”, once it lapsed in 2017.

The “critical time”

1. [31]

   The “critical time” is an important integer in determining whether a particular security interest is “covered by subsection (2)” for the purposes of s 588FL(1)(b). In s 588FL(7), “critical time” is defined as follows:

2. [32]

   Read in the context of s 588FL(1)(a), which contemplates three classes of triggering insolvency events – an order or resolution for the winding up of a company, the appointment of an administrator, and the execution of a DoCA – s 588FL(7) deals with the first of those events (winding up) in para (a) of the definition; and the other events (administration and execution of a DoCA) in para (b). In the present case, because the Companies are being wound up, it is para (a) that applies. The effect of the definition in s 588FL(7)(a) is that, for a company that is being wound up, the “critical time” is a time on the day upon which the winding up is taken to have begun or commenced under section 513A or 513B. Section 513A applies to windings up ordered by the Court and is not presently relevant. Section 513B applies to voluntary windings up, and relevantly provides as follows:

3. [33]

   As, immediately before the winding up resolution was passed on 27 May 2019, a deed of company arrangement had been executed by the Companies and had not yet terminated, it is para (c) that is applicable. It in turn refers to “the section 513C day in relation to the administration that ended when the deed was executed”. Section 513C relevantly provides as follows:

4. [34]

   Paragraph (b) is applicable and specifies “the day on which the administration began”. The day on which the administration began was 3 February 2014, when the administrators were appointed.

5. [35]

   It follows that the winding up of the Companies is taken to have begun or commenced on 3 February 2014, which is the “critical time” for the purposes of s 588FL. The submissions of the parties did not recognise this.

6. [36]

   The plaintiff – disregarding the effect of the definition in s 588FL(7)(a) – argued, in supposed reliance on the decision of Gleeson J (when her Honour was a judge of the Federal Court) in De Lage Landen Pty Ltd v Blayney Crane Services Pty Ltd, in the matter of Blayney Crane Services Pty Ltd (“Blayney Crane Services”), [6] to the effect that, the Companies having effectively “emerged from external administration by having control restored to the director on and from execution of the DoCAs”, s 588FL did not automatically vest any security interest entered in the grantor, unless there was a further s 588FL(1)(a) event (as there admittedly was, in the context of the liquidation in May 2019). However, Blayney Crane Services was a case in which the DoCA had terminated and the company was no longer under any form of administration. The question was whether a company which had once been in administration, and which had executed a DoCA, but which was no longer in external administration, still had a s 513C day. In holding that it did not, her Honour said (emphasis added): [7]

7. [37]

   In those circumstances her Honour’s decision was, with respect, plainly correct. The decision of Davies J in K J Renfrey Nominees Pty Ltd (atf Renfrey Family Trustee) v OneSteel Manufacturing Pty Ltd (subject to deed of company arrangement) (“K J Renfrey”), [8] holding that s 588FL did operate in respect of a company that granted a security interest while it was subject to a DoCA, was rightly distinguished on the basis that it was not concerned with a case of a grantor that had been but was no longer under external administration: unlike the grantor in K J Renfrey, the grantor in Blayney Crane Services did not remain subject to a DoCA, the DoCA having terminated. [9]

8. [38]

   In the present case, the plaintiff argued that, given that the Companies had emerged from external administration by having control restored to the director on and from execution of the DoCAs, the external administration had ended because “control for all intents and purposes” had returned to the Companies’ director. I reject this submission. There is no basis whatsoever for extending to a company that remains subject to a DoCA a principle which depends on the DoCA having terminated. The fact that the DoCA may return management to the directors does not deprive the company of the quality of one that is subject to a DoCA. In this case, the DoCAs “had not yet terminated”; they remained on foot. Whatever the position was so far as concerned “effective control”, the Companies each remained subject to a DoCA, which had not yet terminated, and accordingly had a “s 513C day”, which provided the relevant critical time.

9. [39]

   In any event, the effect of s 588FL(7)(a) is clear: as the Companies are being wound up, and immediately before the winding up resolution was passed a DoCA had been executed by each Company but had not yet terminated, the critical time is the date on which the antecedent administration began, namely 3 February 2014.

10. [40]

    On any view, the security interest was granted, and arose, after that time, pursuant to a security agreement (the Deed of Charge of 26 October 2014) which was entered into after that time. Moreover, even if the Companies had not gone into liquidation on 27 May 2019, the result would be the same, as they were in administration from 3 February 2014 and subject to DoCAs from 8 May 2014, before the security interest arose and before the security agreement which gave rise to it was made, and (on that hypothesis) the “critical time” would also have been defined, in this case by s 588FL(7)(b), as the s 513C day, namely 3 February 2014.

Does s 588FL apply to security interests granted after the critical time?

1. [41]

   In that context, the question arises whether s 588FL applies to a security interest that is granted after the “critical time”.

2. [42]

   A security interest is covered by s 588FL(2) if the requirements of paras (a) and (b) are satisfied. Paragraph (b) is concerned with the timeliness of registration. Paragraph (a) has the effect that a security interest will be covered if it is enforceable against third parties, and perfected by registration (and by no other means), at the critical time, or, if it arises after the critical time, then when it arises. Thus the provision is to be applied as at two different times, according to whether the security interest arises before or after the “critical time”: if before, as at “the critical time”, and if after, as at the time “when the security interest arises”.

3. [43]

   In In the matter of OneSteel Manufacturing Pty Ltd (admins apptd), [10] I held that an order under s 588FM only immunised a perfected security interest from vesting under s 588FL(4). I said: [11]

4. [44]

   In OneSteel, I was concerned with a security interest which had been granted and arisen before the critical time, but which was not perfected as at the critical time. I did not have to consider the position in respect of a security interest which was granted after the critical time. In K J Renfrey, Davies J was concerned with a security interest that was granted after the critical time, having been created while the company was subject to a DoCA, to which it remained subject – it did not go into liquidation, so s 588FL(7)(b) provided the “critical time”, which was, nonetheless, the date on which the administration began. Her Honour held that s 588FL, read as a whole, extended to PPSA security interests that are granted after a relevant s 588FL(1)(a) insolvency event. [12] Having observed that “The words of s 588FL(2)(a) expressly and unambiguously extend the scope of that subsection to cover a PPSA security interest that “arises after the critical time””, her Honour concluded (emphasis added): [13]

5. [45]

   Her Honour added (emphasis added): [14]

6. [46]

   In Blayney Crane Services, Gleeson J did not have to determine a submission that the proper construction of s 588FL was that it did not apply to security interests granted after the critical time at all, and that the view of Davies J in K J Renfrey to the contrary should not be followed: [15]

7. [47]

   I agree with Davies J that s 588FL(2) can cover a security interest that arises after the critical time; as her Honour emphasised in K J Renfrey, the second limb of s 588FL(2)(a) expressly refers to the circumstance where “the security interest arises after the critical time”. However, in my respectful opinion, there are difficulties in the reasoning in K J Renfrey which extends that to a security interest granted after the critical time, in the following respects (which relate to the portions emphasised in the above extracts from [20] and [24] of her Honour’s judgment):

   1. (1)

      the reference to an interest that arises after the critical time does not indicate, textually or contextually, that that encompasses one that is granted after the critical time. Textually and contextually, the use of the past tense “granted” in s 588FL(1)(b) connotes a security interest that has already been granted when the relevant insolvency event in s 588FL(1)(a) occurs;

   2. (2)

      the concepts of “grant” in s 588FL(1)(b) and “arises” in s 588FL(2)(a) are not congruent, but distinct – as too is the concept of the time “the security agreement that gave rise to the security interest came into force” in s 588FL(2)(b)(ii);

   3. (3)

      if “when” is construed as it was, this would mean either that it had a different meaning in respect of security interests arising after the critical time, or that in respect of security interests arising before the critical time it permitted them to be perfected after the critical time, which is inconsistent with PPSA, s 267, for the reasons explained in OneSteel;

   4. (4)

      the suggested anomaly that s 588FL would only apply to security interests arising after the critical time but registered before they arise, and not to security interests arising after the critical time but registered after they arise, is in fact not anomalous, but is congruent with PPSA, ss 267 and 267A; and

   5. (5)

      the provision does not contemplate that security interests arising after the critical time can thereafter be registered, but that they are already registered when the security interest arises.

8. [48]

   For the reasons that follow, in my opinion, the effect of the words “if the security interest arises after the critical time” in s 588FL(2)(a) is to capture a case in which a security interest granted before the critical time, and perfected by registration, does not arise (by attachment, upon which it also becomes enforceable against third parties) until after the critical time, whereupon it vests in the grantor.

9. [49]

   As I have foreshadowed, the time “when the security interest arises” for the purposes of s 588FL(2)(a) is a different concept from the time when “the security agreement that gave rise to the security interest came into force” referred to in s 588FL(2)(b)(ii). A security agreement will usually come into force when it is executed, as distinct from when the security interest attaches or becomes enforceable. [16] However, the security interest does not necessarily arise at that time. Neither the CORPA nor the PPSA defines when a security interest arises. However, a security interest is only enforceable against a grantor in respect of collateral if the security interest has “attached” to the collateral. [17] The secured party has no security interest in the collateral until it has “attached”. PPSA, s 19, relevantly provides:

10. [50]

    Thus a security interest “attaches” to collateral when the grantor has rights in the collateral, or the power to transfer rights in the collateral to the secured party; and either value is given for the security interest; or “the grantor does an act by which the security interest arises,” unless the parties have agreed that the interest attaches at a later time, in which case it attaches at that later time.

11. [51]

    Importantly, as a security interest cannot attach to collateral until the grantor has rights in it, a security interest over after-acquired property will only attach when the grantor acquires the property or the necessary rights. Under the PPSA, there is no longer any requirement for appropriation, and a security interest in after-acquired property attaches without any specific appropriation by the grantor. [18]

12. [52]

    The PPSA recognises and makes provision for this eventuality (that is, attachment to after-acquired property) in the context of insolvency. The note to CORPA, s 588FL(1), draws attention to the effect of PPSA, ss 267 and 267A, which provide for the vesting in the grantor, upon a relevant insolvency event, of security interests that are unperfected at the critical time. Section 267 relevantly provides:

13. [53]

    It will be noted that insolvency events (a), (b), and (c) correspond with those in CORPA, s 588FL(1)(a). Thus should an order be made, or a resolution passed, for the winding up of a grantor company, or an administrator be appointed, or a DoCA executed, a security interest that is unperfected at the critical time will vest in the grantor immediately before the occurrence of the event which triggers the vesting. Thus, as explained in OneSteel, quite apart from any effect of s 588FL, an unperfected security interest vests under PPSA, s 267, and s 588FM, provides no means for mitigating that consequence. That is why s 588FL is confined in its operation to security interests that have been perfected by registration as at the critical time, albeit belatedly.

14. [54]

    Importantly for the present issue, PPSA, s 267A, supplements s 267 by providing for the situation where, although a security agreement was entered into before one of the critical times referred to in s 267, the security interest only attaches to collateral after that time. It provides:

15. [55]

    Section 267A would catch the situation where a company, before a relevant insolvency event, enters into a security agreement in respect of future property which only comes into existence after the relevant insolvency event, whereupon the security interest attaches. If, at the time of attachment, the security interest is either unperfected, or perfected only by a registration made after the critical time, the security interest will vest in the grantor on attachment.

16. [56]

    In my view, the references in s 588FL(2)(a) to the circumstance where “the security interest arises after the critical time” performs a parallel function to s 267A, in capturing cases where a security interest arises by attachment after the critical time, under a security agreement made before the critical time. This is consistent with the assumptions inherent in s 588FL(2)(a)(i) and (ii) that when the security interest arises it is enforceable against third parties and perfected by registration: in other words, what is contemplated is a security interest that is already perfected by registration, and becomes enforceable against third parties not later than when it “arises”, by attachment.

17. [57]

    Moreover, the difference in the operation of s 588FM in its application to security interests granted after the critical time, if it were to apply to such interests, when compared with its operation in respect of security interests granted before the critical time, as explained later, is an additional reason for concluding that it does not so apply. [19]

18. [58]

    A further and compelling reason for this conclusion is provided by the relationship between CORPA, s 468, and Part 5.7B. Section 468 provides as follows:

19. [59]

    Section 468 is concerned with dispositions of property made after the commencement of a (court-ordered) winding up, whereas Part 5.7B (voidable transactions) – which includes s 588FL – is concerned with transactions that occur before the commencement of the winding up. It would be entirely inconsistent with that scheme for s 588FL to apply to security interests granted by agreement made after the critical time. Any such security agreement would (in the case of a compulsory winding up) be avoided by s 468, unless it were an exempt disposition. Although s 468 does not operate in a voluntary winding up, if it appears that the company has made dispositions which would be void under s 468 if the company were ordered to be wound up by the Court, then the liquidator, having standing under s 459P, may apply for a winding up order. [20] Thus security interests granted after the critical date fall to be determined according to s 468 – not under s 588FL.

20. [60]

    I acknowledge that a number of cases in the Federal Court have held, or proceeded on the assumption that, s 588FL applies to security interests that are granted after the critical date. Before K J Renfrey, Davies J made an order under s 588FM in Mentha, in the matter of Arrium Ltd (admins apptd), [21] but expressly without engaging in a detailed consideration of s 588FL, on the basis that the order was made for more abundant caution. In Mentha, in the matter of Arrium Finance Ltd v National Australia Bank Ltd, [22] Besanko J followed K J Renfrey, as did Markovic J in Korda, in the matter of Ten Network Holdings Ltd (admins apptd) (recs and mgrs apptd). [23] In Hill (admin) in the matter of Flow Systems Pty Ltd (admins apptd), [24] Greenwood J followed those decisions:

21. [61]

    In Dickerson, in the matter of McWilliam’s Wines Group Ltd (admins apptd) (No 2), [25] Gleeson J said:

22. [62]

    None of those decisions binds me. There is no appellate decision on the point. Nor, so far as I am aware, is there any relevant decision, even at first instance, of this Court. I have of course nonetheless carefully considered whether I should depart from what has been held in those decisions, by learned judges well versed in Corporations law. However, none of them considered the distinction between “grant” and “arises”, which Gleeson J was not required to resolve in Blayney Crane Services; and more importantly, none considered what I consider the important matter of the inter-relationship between CORPA, s 588FL, CORPA, s 468, and PPSA, ss 267 and 267A.

23. [63]

    Accordingly, I hold that s 588FL does not apply to security interests granted by a security agreement made after the critical time. It follows that s 588FL(2) does not cover the plaintiff’s security interests. There is no need for, nor utility in, an order under s 588FM fixing a later time for the purposes of s 588FL(2)(b)(iv).

Alternatively, would it be just and equitable to fix a later time?

1. [64]

   Lest I be wrong in that conclusion, it is appropriate to consider the application for an order under s 588FM on the alternative basis that the security interests are caught by s 588FL, as security interests arising after the critical time.

2. [65]

   On this hypothesis, the security interests, having arisen after the critical time, vested in the Companies by operation of s 588FL(4)(b) when they first became enforceable against third parties. Under PPSA, s 20, a security interest is enforceable against a third party in respect of particular collateral only if (a) the security interest is attached to the collateral, and (b) either the secured party possesses the collateral, or the secured party has perfected the security interest by control, or a security agreement that provides for the security interest covers the collateral in accordance with sub-s (2). Subsection (2) provides that a security agreement covers collateral if it is evidenced in writing signed, or adopted or accepted, by the grantor, and the writing contains, inter alia, a statement that a security interest is taken in all the grantor’s present and after-acquired property.

3. [66]

   As value was given for the security interest, and the Companies had rights in the collateral, the security interest would apparently have attached when it was granted. The Deed of Charge is in writing, and is expressed to be “a fixed charge over all the Debtor’s present and future estate, right title and interest in” the “Charged Assets”, and “a floating charge over any of the Charged Assets which is not subject to the Fixed Charge”, and the “Charged Assets” comprise:

4. [67]

   That is a statement to the effect contemplated by s 20(2)(b)(ii), that a security interest is taken in all the grantor’s present and after-acquired property. Accordingly, the security interest became enforceable against third parties when it was granted. It follows that, on this hypothesis, the security interest vested in the company immediately upon the charge being granted. This analysis is consistent with that of Davies J in K J Renfrey, holding that where a security interest is registered after the commencement of the winding up or appointment of administrator as the case may be, it would vest in the company on creation, even if registered within twenty business days after the security agreement came into force, unless an order was made under s 588FM. [26]

5. [68]

   In K J Renfrey, Davies J granted relief under s 588FM on the “just and equitable” ground. Her Honour said: [27]

6. [69]

   As it happens, in the present case, the security interest was, initially, promptly registered – by the Original AllPAP 6615 Registration. However, on this hypothesis, the time of registration is essentially irrelevant, because the security interest vested not because of belated registration, but regardless of when it was registered, by reason that it arose after the critical time, and was not registered before the critical time. Absent an order under s 588FM, it vested regardless of whether and when any registration was made.

7. [70]

   If (as is assumed for present purposes) s 588FL extends to security interests granted after the critical time, then the operation of s 588FM in that context is rather different from its operation in the context of security interests that have been granted and perfected before the critical time, where an order under s 588FM merely immunises such an interest from vesting under s 588FL(4) by reason of belated registration should an insolvency event occur. [28] The effect of ss 588FL and 588FM is that in the insolvent administration of companies, the Court’s authority is required if a security interest is to be treated as valid which was (1) granted more than six months before the insolvency event, but not notified by registration until after six months; or granted within six months before the insolvency event, but not registered within twenty days; or (2) (on the relevant hypothesis) granted after the insolvency event. In the first case, the object is to require timely notification of the security interest, via the PPSR, so that those dealing with the company may ascertain that it has granted a security interest; this is achieved by vesting an interest that has not been the subject of a timely registration in the company if an insolvency event occurs, but in order to avoid injustice provision is made in s 588FM for an order immunising a security interest that has been perfected by registration before the critical time from vesting on account of not having been promptly registered by fixing a later time for registration. In the second case (on the relevant hypothesis), which is that presently relevant, the object is not to require timely notification, but to avoid the creation of security interests after the “critical date”, regardless of whether and when they are registered; this is achieved by vesting the security interest in the company upon creation, but in order to avoid injustice, provision is made in s 588FM for an order validating the security interest, again by the (curious in this context) mechanism of fixing a later time for registration. In the presently relevant context of security interests that are granted after the critical time, s 588FM effectively provides a means for avoiding the vesting that would otherwise deprive them of practical effect, by permitting an order to be made which has the effect of validating what is otherwise a nugatory post-liquidation transaction, in a manner similar to a validating order under s 468(1). This difference in the operation of s 588FM in respect of a security interest granted after the critical time, and the fact that the mechanism of fixing a later registration time is a very strange way of achieving that result, in fact reinforces the view that s 588FL does not catch security interests granted after the critical date at all.

8. [71]

   “Inadvertence” is not relevant where the security interest vested upon creation, even if it was promptly registered. Likewise, as prompt registration would not have avoided vesting, the absence of prejudice from any delay in registration would not be a relevant ground (although prejudice to creditors would be relevant to the discretion to grant relief). The purpose of provisions that avoid dispositions made after the critical time is to preserve the property of the company as at the date on which the interests of the creditors crystallise and convert into a right to prove in the winding up, consistent with the principle that a company’s assets are to be divided pari passu among its creditors in a winding up, and to prevent the “improper alienation and dissipation” of the company’s property after a winding up has commenced. [29] In those circumstances, the plaintiff rightly relies on the “just and equitable” ground, as had the applicant in K J Renfrey.

9. [72]

   The present case is one in which, in effect, after the Companies had entered into deed administration, they granted security interests to National, in order to refinance their existing secured indebtedness to Bibby. In substituting one secured creditor for another, and as an “excluded secured creditor” for the purposes of the DoCAs, there was no material adverse impact on the position of the unsecured creditors. The purpose, referred to above, of preserving the assets of the company, is not frustrated where, as here, the transaction effectively replaced one secured creditor, whose security would otherwise have survived the winding up, with another. Such a transaction does not, in substance, operate to the prejudice of the unsecured creditors. It cannot be supposed that National would have advanced the loan funds without security. The creditors were informed of the transaction, by the deed administrators’ circular of 12 December 2014, and so far as the evidence discloses, none objected. No submission was made that the unsecured creditors generally, or the Commissioner in particular, were worse off as a result of National having replaced Bibby as secured creditor.

10. [73]

    It is not apparent that unsecured creditors generally, or the Commissioner in particular, were prejudiced by the passage of time between the creation of the security interest and its ultimate registration – although it is important to appreciate that in the present context, delay in registration was not the issue – or the institution of these proceedings. There is nothing to suggest that the Liquidators have proceeded on the basis that no application would be made to validate National’s security interest. No evidence was adduced, nor any submission made, that any unsecured creditor acted in a manner or adopted a course of action different from that which would have been embarked on had the National charge not been created, or had it been re-registered earlier than April 2019. Nor is it apparent, as a matter of logic, how or why they would have done so.

11. [74]

    Insofar as the passage of time is relevant, it is not determinative. [30] Its relevance is interrelated with prejudice, because the shorter the period, the less likely it is that the failure promptly to register, or to make an application under s 588FM, will have had any prejudicial impact. The significance of the passage of time is related mainly to the possibility of competing interests having arisen, in particular through others having dealt with the company on the footing that collateral was unencumbered. [31] There is no suggestion that that has been the case.

12. [75]

    As has been noted, in this case there was initially prompt registration, although that could not validate the transaction absent an order under s 588FM. However, despite that initial registration, which was inexplicably for a period of three years only, the registration lapsed. The passage of time until it was re-registered in April 2019 is explained by the circumstance that no-one in National’s camp appreciated that the Original AllPAP 6615 Registration had lapsed. There was no delay in registration after it was identified that the earlier registration had lapsed. The passage of time from the date of the new 2019 Registrations until proceedings were instituted – a period of something less than five months – is explained by the evidence of Mr Morello and Mr Anderson, set out above. [32] Importantly, there is no suggestion that any creditor or shareholder was prejudiced by that delay, such as it was.

13. [76]

    Making an order would undoubtedly adversely affect the interests of unsecured creditors. In the present case, the impact on unsecured creditors goes beyond merely removing from the divisible property of the Companies the property the subject of the charge. Under the DoCA, the deed funds were created to satisfy pro rata the claims of the unsecured creditors that proved in the administration whilst permitting the companies to return to trade. National, like its predecessor Bibby, being an “excluded secured creditor”, had no claim to the deed funds while the DoCAs remained on foot. The effect of the appointment of liquidators was that the deed funds became divisible property, to which the secured creditor would now have access. Thus, upon liquidation, a fund which under the DoCAs was available only for the unsecured creditors, would be exhausted by the secured creditor. The position was summarised by Rees J in Antqip Hire as follows: [33]

14. [77]

    At first sight, what her Honour described is a set of circumstances which might appear to involve prejudice to unsecured creditors. In one sense, it plainly does: their position will be significantly worse off should the order be made, with the effect that the charge is validated, than otherwise. However, as was pointed out in Appleyard, that is the inevitable the consequence of such an order in any case in which it matters: [34]

15. [78]

    In Hewlett Packard Australia Pty Ltd v GE Capital Finance Pty Ltd (“Hewlett Packard”), [35] the Full Federal Court held that an order extending time for registration of a charge can be made, even after liquidation, if the circumstances are such as to render it just and equitable to grant relief, notwithstanding that the grant of relief will defeat rights of unsecured creditors. Branson J, observing that a rule of practice or guide to the exercise of the discretion that had evolved over the years should not lightly be disregarded, continued: [36]

16. [79]

    Allsop J (as his Honour then was) said: [37]

17. [80]

    As Gleeson JA observed in Northern Managed Finance Pty Ltd v 4 in 1 Wyoming Pty Ltd, it is now well established that an order under s 588FM may be made after a company has gone into administration or liquidation. [38] In In the matter of Accolade Wines Ltd (“Accolade Wines”), [39] it was explained that, as in Appleyard, prejudice to other creditors could not be conclusive because otherwise an order would never be made in any case in which it mattered; in any case where an extension was of utility, there would inevitably be prejudice by removing the collateral from the pool available to satisfy unsecured creditors generally, yet enabling that result is the fundamental purpose of the provision.

18. [81]

    The Commissioner invoked the judgment of Moshinsky J in Kaizen Global Investments Ltd v Australian New Agribusiness & Chemical Group Ltd (in liq), in which it was said (emphasis added): [40]

19. [82]

    It is fair to say that the approach enunciated by Moshinsky J is one that gives considerably greater significance to delay, and to prejudice arising from the making of the order (as distinct from prejudice arising from delay), than the approach that I have favoured in Appleyard and Accolade Wines, and to which I continue to adhere for the reasons given in those cases and above. But the difference is one of weight. Nonetheless, in my view, mere delay, even if unexplained, which does not occasion prejudice, is of slight if any significance. Similarly, prejudice arising from making the order, by removing assets from the divisible pool in favour of the secured creditor to the detriment of unsecured creditors, is of limited importance, given that that will be the effect of granting relief in any case in which relief is actually required. The purpose of s 588FM is to avoid injustice to secured parties where their failure strictly to comply with the registration requirements is attributable to inadvertence or has not occasioned prejudice – not to protect windfalls for unsecured creditors.

20. [83]

    National, like its predecessor Bibby, stood outside the DoCAs as an excluded secured creditor. Bibby, and then National, retained all their rights as a secured creditor. The excluded secured creditor was excluded from participating in the distribution of the deed funds under the DoCAs, [41] but unlike the unsecured creditors its claims were not extinguished upon all payments being made under the DoCAs. [42] Nothing in the DoCAs impinged upon the excluded secured creditor’s rights to enforce its securities in the event that the DoCA was terminated. The bar on persons who do not prove under the DoCAs does not apply to the excluded secured creditor. [43] It was always a possibility that the DoCAs would be terminated, and if that happened the deed funds would become divisible property of the Companies. That did not change when National was substituted for Bibby as the excluded secured creditor.

21. [84]

    Had National not replaced Bibby as the “excluded secured creditor”, then in the events which have happened, Bibby’s securities would remain enforceable, including against the proceeds of the deed funds. If National’s security interest is to be allowed to vest in the Companies, then the unsecured creditors will have received a windfall, as a result of the refinancing of the Companies’ debt. The circumstances of prejudice referred to by Rees J, [44] real as they are for the unsecured creditors, are unrelated to the issues to which s 588FL is directed.

22. [85]

    In circumstances where the security interest granted to National was in substitution for a pre-existing interest held by Bibby, where the debt to National refinanced debt previously owed to Bibby, where the transaction was notified to creditors by the deed administrators and there was no objection, where it is unthinkable that National would have made the advance without the security, and where it is not apparent that the substitution of one secured creditor for another prejudiced the position of the unsecured creditors in any way, it is just and equitable to validate the security interest by making an order under s 588FM.

23. [86]

    I am therefore satisfied that if the charge were caught by s 588FL, it would be just and equitable, within s 588FM(2)(b), to validate it by fixing the time of the 2019 Registrations as the registration time.

Alternatively, inadvertence and absence of relevant prejudice?

1. [87]

   Although, for the reasons given above, it is clear that the “critical time” was 3 February 2014, the application was argued as if the critical time was when the winding up resolution was passed on 27 May 2019. For the sake of completeness I will address, albeit less comprehensively than might otherwise have been appropriate, the issues that were argued on that (incorrect) approach.

2. [88]

   On that assumption, then at the assumed critical time the security interest was perfected by registration – being the new 2019 Registrations – but the registration time was later than six months before the assumed critical time, and later than twenty business days after the security agreement came into force. Proceeding on the relevant assumptions, then, the latest time at which registration could have taken place without falling within s 588FL(2) would have been six months before the winding up resolution, which is to say before 27 November 2018. That is the context in which the plaintiff had to show, to obtain relief under s 588FM, that the failure to register the collateral earlier (relevantly, before 27 November 2018), was accidental or due to inadvertence or some other sufficient cause (s 588FM(2)(a)(i)); or was not of such a nature as to prejudice the position of creditors or shareholders (s 588FM(2)(a)(ii)); or alternatively that on other grounds it was just and equitable to grant relief (s 588FM(2)(b)).

3. [89]

   In Appleyard, it was said: [45]

4. [90]

   Reference has been made, above, [46] to excerpts from the evidence of Mr Morello, which to my mind plainly establish that National did not advert, prior to April 2019, to the circumstance that the Original AllPAP 6615 Registration had lapsed, and when they did realise it, acted promptly to effect the new 2019 Registrations. In other words, the failure to make the new 2019 Registrations before November 2018 was attributable to inadvertence.

5. [91]

   The Commissioner submitted, in substance, that there was insufficient explanation as to why the Original AllPAP 6615 Registration had been for three years only. It was submitted that there was no evidence that National relied on the statement in the email of 4 November 2014 that all the registrations had been “with no end date”, and that in any event the registration to which that email referred did not in fact include the Original AllPAP 6615 Registration. First, this submission misses the point: the question is not why the original registration was for only three years, but why the new 2019 Registrations were not made before 27 November 2018. Secondly, in the course of cross-examination, Mr Morello repeatedly maintained, credibly, that he had simply trusted his solicitor to do what was appropriate.

6. [92]

   The Commissioner also submitted that there was no explanation as to why action was not taken earlier, despite concerns about potentially needing to rely on the security arising from late 2018. However, it is not apparent why a secured party in National’s position, believing that it had a valid and enforceable security, would upon considering recovery options necessarily or immediately conduct a PPSR search to ascertain whether its security was still registered.

7. [93]

   In my view, the circumstances as a whole speak very loudly of National simply not adverting to the circumstance that the Original Registration had lapsed, until April 2019. There is, frankly, no other sensible explanation. Had National adverted to the circumstance that the Original Registration had lapsed, then when it became concerned about its position in or about late 2018, it would have made a new registration, just as it did, promptly, when it discovered the position in April 2019.

8. [94]

   I am comfortably satisfied that the failure to (re)register its security interest before 27 November 2018 was due to inadvertence.

9. [95]

   The second ground for relief is that the failure to register the collateral earlier is not of such a nature as to prejudice the position of creditors or shareholders. The prejudice contemplated by this provision is prejudice from the failure to register earlier – not prejudice from making the order. [47] In Accolade Wines, it was explained that the prejudice referred to in s 588FM(2)(a)(ii) being the prejudice to the position of creditors or shareholders from “the failure to register the collateral earlier” – in other words, prejudice attributable to not making a timely registration – to evaluate such prejudice for the purposes of s 588FM one compares the position of the creditors if an extension is granted, with their position if there had been an effective timely registration, and often there will be no difference. [48] That is different from the prejudice arising from “extending the period”.

10. [96]

    It is not apparent how shareholders, or creditors generally, or the Commissioner in particular, were prejudiced by the failure to register the security interest earlier, and in particular, before 27 November 2018. In this case, the Commissioner’s debt had accrued, and was converted into a proof in the deed administration, as were the debts of the other creditors, before the security was created. It is just not apparent how registering the security interest earlier – or more accurately, reregistering it after the initial registration lapsed – could have made the slightest difference to the position of creditors generally, or the Commissioner in particular. This is not a case in which creditors traded with the companies during the time that the security interest was unregistered, let alone on the basis that the Companies’ assets were not encumbered. When expressly asked, Counsel for the Commissioner could not identify any way in which timely registration (before 27 November 2018) would have resulted in any improvement in the position of creditors generally, or the Commissioner in particular.

11. [97]

    I am satisfied that the failure to register the collateral earlier was not such as to prejudice the position of creditors or shareholders.

12. [98]

    Those findings enliven the discretion to grant relief, in the sense that once inadvertence, or absence of relevant prejudice, is established, the Court may grant relief, but retains a discretion. Relevant considerations include delay, and prejudice, in particular to the position of unsecured creditors and shareholders.

13. [99]

    The earlier discussion of questions of delay and prejudice is equally applicable here and produces the same conclusion: those discretionary considerations do not incline me to decline relief.

14. [100]

    Accordingly, if the case were to be resolved on the basis argued, which assumed that the critical time was 27 May 2019, I would make an order under s 588FM fixing 24 April 2019 – the time of the 2019 Registrations – as the registration time.

Conclusion

1. [101]

   My conclusions may be summarised as follows:

2. [102]

   Because the Companies are being wound up, and prior to the winding up resolution were subject to DoCAs which had not been terminated, CORPA, ss 588FL(7)(a), 513B, and 513C, have the effect that the critical time was the day on which the administration, which ended when the DoCA was executed, began, namely 3 February 2014, when the winding up of the Companies is taken to have begun or commenced.

3. [103]

   CORPA, s 588FL, does not apply to security interests granted by a security agreement made after the critical time. It follows that s 588FL(2) does not apply to the plaintiff’s security interests. There is no need for, nor utility in, an order under s 588FM fixing a later time for the purposes of s 588FL(2)(b)(iv).

4. [104]

   On the alternative hypothesis that the security interests are caught by s 588FL, as security interests arising after the critical time, they vested in the Companies upon their creation. In circumstances where the security interest granted to National was in substitution for a pre-existing interest held by Bibby, where the debt to National refinanced debt previously owed to Bibby, where the transaction was notified by the deed administrators to creditors, who did not object, where it is unthinkable that National would have made the advance without the security, where it is not apparent that the substitution of one secured creditor for another prejudiced the position of the unsecured creditors in any way, and where making an order under s 588FM would leave the unsecured creditors in no different a position to that which would have obtained had Bibby remained the “excluded secured creditor”, while not making the order would give unsecured creditors an unintended windfall, to the detriment of the secured creditor, purely as a result of its having taken the security after the administration commenced, when all intended that it have that security, it would be just and equitable, within s 588FM(2)(b), to validate it by fixing 24 April 2019 – the time of the 2019 Registrations – as the registration time.

5. [105]

   On the further alternative hypothesis, which was the basis on which the case was chiefly though incorrectly argued, that the critical time was 27 May 2019, when the winding up resolution was passed, I am comfortably satisfied that the failure to (re)register its security interest before 27 November 2018 was due to inadvertence, in that no-one on behalf of National adverted to the circumstance that the Original AllPAP Registration had lapsed. I am also satisfied that the failure to register the collateral earlier was not such as to prejudice the position of creditors or shareholders; their position is no different to what it would have been had the security interest been registered before 27 November 2018. Such delay as there has been in registration, or in bringing the proceedings, has not operated to the prejudice of shareholders or unsecured creditors. While granting relief will adversely affect unsecured creditors, by removing from the divisible property of the company and effectively exhausting the deed funds, that is not a consequence of any failure to register the security interest promptly. Making an order under s 588FM would leave the unsecured creditors in no worse a position than would have obtained had National re-registered its interest before 27 November 2018, whereas not making the order would give unsecured creditors an unintended windfall, to the detriment of the secured creditor. In circumstances where there is nothing to suggest that the passage of time has resulted in relevant prejudice to creditors, and where the only “prejudice” is that they will be deprived of the windfall that would accrue to them if National were unsecured, I would not decline relief as a matter of discretion. On this hypothesis also, I would make an order under s 588FM fixing 24 April 2019 as the registration time.

6. [106]

   As to costs, although, on the conclusions I have primarily reached, the application was unnecessary, it was, given the state of the authorities, entirely proper that it was made. As the plaintiff came to court seeking an indulgence, it would in any event not ordinarily obtain an order for costs. Although, in circumstances that its application was not opposed by the Liquidators, the costs have been exacerbated by the intervention and unsuccessful opposition of the Commissioner, it must be acknowledged that the Commissioner was granted leave, pursuant to (NSW) Supreme Court (Corporations) Rules 2003, r 2.13, to be heard in the proceedings, having responded to a circular letter which conveyed the Court’s request for the assistance of a contradictor. The Commissioner having responded to that request, it would be inappropriate to make an adverse costs order. In my view, each party should be left to bear its own costs, and there will be no order as to costs to that intent.

7. [107]

   The Court orders that:

   1. (1)

      The plaintiff have leave pursuant to (CTH) Corporations Act 2001, s 500(2), insofar as it be required, to commence and proceed with these proceedings notwithstanding the passing of a resolution for voluntary winding up of the companies.

   2. (2)

      It is declared that registrations 2019-04240002907 and 2019-04240003175 on the Personal Properties Security Register, which are in respect of securities granted after the critical time referred to in (CTH) Corporations Act 2001, s 588FL(7)(a), are not covered by s 588FL(2).

   3. (3)

      There be no order as to costs, to the intent that all parties bear their own costs.