Cresvale Far East v Cresvale Securities (No.2)

(2001) 39 ACSR 622; [2001] NSWSC 791

Supreme Court of NSW

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Interrogate

Catchwords

1. Practice and Procedure
2. › Costs
3. › Costs against officeholders
4. › Personal costs orders against deed administrators
5. › Whether administrator personally liable for costs
6. › Whether order should be limited to assets of company under administration
7. › Principles governing exercise of discretion
1. Corporations
2. › Deed of company arrangement
3. › Administrator
4. › Right of indemnity
5. › Equitable right of indemnity and lien
6. › When defeated by administrator's improper conduct
7. › Whether costs reasonably and properly incurred
8. › Corporations Act 2001 (Cth), ss 443D, 443F, 447E
1. Corporations
2. › Deed of company arrangement
3. › Administrator
4. › Statutory right of indemnity
5. › Whether s 443D applies to administrator under deed of company arrangement as distinct from administrator of company under administration
6. › Corporations Act 2001 (Cth), ss 435C, 443D
1. Practice and Procedure
2. › Costs
3. › Costs against non-parties
4. › Whether court may order costs against administrator who is not a party
5. › Supreme Court Rules, Pt 52A r 4

Quick Take

A deed administrator's equitable right of indemnity out of the company's assets is defeated where the administrator's conduct has been improper, applying the Adsett v Berlouis test that costs must be 'properly incurred' — meaning reasonably as well as honestly incurred. The statutory indemnity under s 443D of the Corporations Act does not extend to administrators under a deed of company arrangement, because the administration of the company ends when the deed is executed. The normal costs order against a deed administrator as unsuccessful defendant is not limited to the company's assets, unlike the position of a court-appointed liquidator.