Australia, Jan. 11 -- New South Wales Land and Environment Court issued text of the following judgement on Dec. 16:

1. A substituted creditor, LDA Capital LLC ("LDA"), applies to wind up Care A2 Plus Pty Ltd ("Care A2") in insolvency. LDA is the third creditor that has sought to wind up Care A2 in these proceedings, after two other creditors ultimately did not proceed with their winding-up applications.

Three preliminary issues arise before turning to the winding-up application. The first is whether an application made by LDA to extend the period within which the winding-up application must be determined, under s 459R(2) of the Corporations Act 2001 (Cth) ("Act") should be adjourned, to be heard not today (in mid-December 2024) but in the new Court term (in February 2025). The second is whether the order under s 459R of the Act should be made, in respect of the exercise of the Court's power under the slip rule. The third, if that order is made, is whether the winding up application should then be adjourned.

3. I have regard to the chronology of events in this matter in dealing with these issues. By Originating Process filed on 29 April 2024, now some seven or eight months ago, GI 305 Pty Ltd ("GI 305") applied to wind up Care A2. It subsequently resolved its claim against Care A2 and did not proceed with its winding-up application. On 9 September 2024, a substituted creditor, Piper Alderman, filed an Amended Originating Process which sought to proceed with the winding-up application, relying on the presumption of insolvency that was available to it as a substituted creditor and, on 16 September 2024, I extended the time for determination of the winding-up application under s 459R of the Act to 9 December 2024, having then been satisfied that special circumstances existed to justify that extension. Subsequently, Piper Alderman also resolved its claim against Care A2 and also did not proceed with its winding-up application.

4. LDA then sought to be substituted as the petitioning creditor in the winding-up application. On 14 October 2024, I made orders directing LDA to file and serve its Interlocutory Process seeking substitution, directing Care A2 to file and serve any affidavit in opposition to the substitution application and in opposition to the winding-up by 28 October 2024, and listing the substitution application and the winding-up application for directions or hearing as appropriate in the Corporations Motions List on 4 November 2024. If those orders had been complied with, Care A2's evidence in opposition to the winding-up would have been filed and served by 28 October 2024 and the winding-up could and likely would have proceeded to hearing on 4 November 2024.

5. In the event, that timetable was further extended at the parties' request by orders made on 4 November 2024, which, inter alia, extended the time for LDA to file and serve any Amended Interlocutory Process or new Interlocutory Process and its evidence to 18 November and extended the time for Care A2 to file and serve its evidence to 21 November and stood over the winding-up application with a view to hearing in the Corporations Motions List on 25 November 2024. If those orders been complied with, the matter would have been ready for hearing and would likely have been heard on 25 November 2024.

6. When the matter was listed before Nixon J on 25 November 2024, his Honour made an order substituting LDA as the creditor in the winding up application and (presumably at Care A2' request) further extended the time for Care A2 to file and serve any evidence in response to the winding-up application to 9 December 2024, rather than hearing the winding-up application on 25 November as the earlier orders had provided. That was the third order for Care A2 to file and serve its evidence in the winding-up application, since I had previously ordered it to file that evidence on 14 October 2024 and again on 4 November 2024, before Nixon J made that order for the third time on 25 November 2024. His Honour also then made orders for LDA to file and serve its evidence in reply and listed the matter for directions or hearing today, noting that the matter would only proceed with a hearing if it could be accommodated today.

7. The matter can be accommodated for hearing today, but it has been twice adjourned in the course of today, to allow the parties an opportunity to consider a matter which was apparently identified this morning. That issues arises because, as I noted above, I had previously extended the time for determination of the winding-up application under s 459R of the Act to 9 December 2024, but Nixon J was not, when the matter was before him on 25 November, asked to further extend the time for determination of the winding-up application. Had that been raised with his Honour, he would obviously have recognised that a winding-up order could not be made at the hearing he had listed for today, unless he also made a further order was made under s 459R of the Act extending the time for determination of the winding up at least until today.

8. As noted above, the questions which then arise are, first, whether the application now made by LDA to extend the time for the determination of the winding up under s 459R of the Act, nunc pro tunc, should be further adjourned to February 2025, as Care A2 seeks, to allow Care A2 or its solicitors to further research any relevant legal issues arising from this matter. I am satisfied that application should not be further adjourned. First, the application of s 459R of the Act is not a mystery to Care A2, because this is the second occasion on which the question of such an extension has arisen. Second, the question whether an order under that section can be made nunc pro tunc is also not a mystery to Care A2, because its solicitor, Mr Di Bello, has properly recognised the detailed treatment of that issue in a leading text, Assaf's Winding Up and Insolvency 3rd ed [10.95] and has indicated that he has read the relevant cases. Third, the Court's obligation, in proceedings generally, is to bring about the just, quick and cheap resolution of the real issues in dispute in the proceedings, and it can hardly be said that a further adjournment for nearly two months of a winding-up application that has continued since April 2024 would promote either the just or quick determination of the real issues in dispute. Fourth, s 459R of the Act itself reflects a legislative intention that winding-up applications should be determined without unnecessary delay, and it would not be consistent with that legislative intention to now further delay the determination of the application.

*Rest of the document and Footnotes can be viewed at: (https://www.caselaw.nsw.gov.au/decision/19404d07f8f5aa1aba8bbd7a)

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