ACN 079 638 501 Pty Ltd (in liq) (recs & mgrs apptd) v Pattison & Anor [2012] VSC 445 (1 October 2012): whether work in progress an asset and covered by charge, whether insolvency practitioner employee of company
October 30, 2012
In ACN 079 638 501 Pty Ltd (in liq) (recs & mgrs apptd) v Pattison & Anor [2012] VSC 445 Justice Ferguson considered whether work in progress was covered by a charge given by company.
FACTS
Mr Paul Pattison (“Pattison”), a qualified chartered accountant and registered liquidator and trustee in bankruptcy established and was sole director and secretary of the Plaintiff. Until April 2010 he conducted his insolvency practice through the Plaintiff [1]. In November 2006 the Plaintiff charged its assets in favour of bank of Western Australia Ltd (“BankWest”). In 2010 BankWest appointed receivers and managers over the assets of the Plaintiff under the charge [2] & [10] – [11].
The issue in the proceeding was whether the work in progress recorded in the books of the Plaintiff, being time spent by Pattison working on insolvency administrations was an asset caught by the charge [3]. Pattison contended that his appointments were personal to him and the Plaintiff provided services to him in connection with those appointments [4]. The receivers contended that all work performed by him pursuant to his appointments as liquidator, deed administrator or trustee in bankruptcy was performed as an employee of the Plaintiff and his work in progress was an asset of the Plaintiff.
DECISION
Her Honour found:
- the Plaintiff would raise invoices for fees and disbursements payable [7]. The time spent by Pattison was included in the Plaintiff”s invoice on a separate charge made by him personally;
- cheques would be paid to Pattison and he would endorse them as payable to the Plaintiff. Payment was made into the company’s bank account [7]; and
- the Plaintiff’s payslips evidence fortnightly wages payable to Pattison as an employee although this was disputed in part [8].
Ferguson J framed the question as, at [15]:
..the real question is as to the relationship between Mr Pattison and the Company and the effect (if any) that that had on ownership of the work in progress.
The fact that Pattison had certain obligations arising Read the rest of this entry »