12.08 am on the 16th business day, the Deed of Company Arrangement (“DOCA“) was signed and sent to the then Administrator.
Does 8 minutes late render the DOCA void?
Not according to today’s case, where the Court changed the wording of s444B(2)(a) from ’15 business days’ to ’16 business days.’
DOCA = “Deed of Company Arrangement,” which is a proposal made to creditors to allow the company to continue in existence, and one that gives creditors a better return than a liquidation scenario.
There exists a pretty handy provision in the Corporations Act, s447A, which in effect grants the Court an almost unlimited power to order whatever it thinks reasonable.
The High Court even said this in Australasian Memory (2000) 200 CLR 270.
So in our case, the reasonableness issue came down to the fact that:
- the majority of creditors (in value and number) voted in favour of the DOCA;
- the mistiming was inadvertent, and arose as a result of ‘protracted negotiations;’ and
- no opposition (from ASIC included) to the extension of time.
Good to see the Court taking such a pragmatic view and approach.