Florgale Uniforms Pty Ltd and Ors v Orders and National

(2004) 11 VR 54; [2004] VSC 65

Supreme Court of Victoria

Built by Barristers,
For Australian Law.

See how it works

Interrogate

Catchwords

1. Corporations
2. › Receivers and managers
3. › Duty of care in exercising power of sale
4. › Sale of special purpose stock
5. › Whether breach by auctioning stock rather than closing-down sale to existing customer base
6. › Whether breach in process by failure to compare and evaluate different methods of realisation
7. › Corporations Law, s 420A
1. Corporations
2. › Receivers and managers
3. › Duty of care in exercising power of sale
4. › Whether failure to accept favourable pre-auction offer constituted breach
5. › Conditional offer withdrawn before acceptance
6. › Corporations Law, s 420A
1. Corporations
2. › Receivers and managers
3. › Duty of care in exercising power of sale
4. › Preparation and advertising of auction
5. › Whether inadequate advertising and lot composition constituted breach
6. › Corporations Law, s 420A
1. Corporations
2. › Receivers and managers
3. › Statutory duty under s 420A
4. › Whether right of action conferred on guarantors and third-party mortgagors
5. › Corporations Law, s 420A

Quick Take

A receiver's duty under s.420A does not require a formal documented comparative analysis of different methods of realisation in every case; the process of weighing costs, benefits and risks is informed by the circumstances including the receiver's expertise, expert advice, trading history and other relevant variables. Specialised stock with no established market price falls to be assessed under s.420A(1)(b) rather than s.420A(1)(a). A receiver is not required to accept a conditional offer immediately or within a single working day where the offer is stated to be open for a longer period and there is no indication of urgency. The question whether s.420A confers a private right of action on guarantors and third-party mortgagors was left open.