Corporations Act 2001

CHAPTER 5 - EXTERNAL ADMINISTRATION  

PART 5.9 - MISCELLANEOUS  

Note: This Part applies to a sub-fund of a CCIV in a modified form: see Division 8 of Part 8B.6 .

Division 1 - Examining a person about a corporation  

SECTION 596A  

596A   MANDATORY EXAMINATION  
The Court is to summon a person for examination about a corporation ' s examinable affairs if:

(a)    an eligible applicant applies for the summons; and

(b)    

the Court is satisfied that the person is an officer or provisional liquidator of the corporation or was such an officer or provisional liquidator during or after the 2 years ending:

(i) if the corporation is under administration - on the section 513C day in relation to the administration; or

(ii) if the corporation has executed a deed of company arrangement that has not yet terminated - on the section 513C day in relation to the administration that ended when the deed was executed; or

(iia) if the corporation is under restructuring - on the section 513CA day in relation to the restructuring; or

(iib) if the corporation has made a restructuring plan that has not yet terminated - on the section 513CA day in relation to the restructuring that ended when the plan was made; or

(iii) if the corporation is being, or has been, wound up - when the winding up began; or

(iv) otherwise - when the application is made.

Note: This section applies to a CCIV in a modified form: see section 1237U .

SECTION 596B   DISCRETIONARY EXAMINATION  

596B(1)   [ Grounds for discretionary examination]  

The Court may summon a person for examination about a corporation's examinable affairs if:

(a) an eligible applicant applies for the summons; and

(b) the Court is satisfied that the person:

(i) has taken part or been concerned in examinable affairs of the corporation and has been, or may have been, guilty of misconduct in relation to the corporation; or

(ii) may be able to give information about examinable affairs of the corporation.

596B(2)   [ Limitation]  

This section has effect subject to section 596A.

SECTION 596C   AFFIDAVIT IN SUPPORT OF APPLICATION UNDER SECTION 596B  

596C(1)    

A person who applies under section 596B must file an affidavit that supports the application and complies with the rules of court.

596C(2)    
The affidavit is not available for inspection except so far as the Court orders.

SECTION 596D   CONTENT OF SUMMONS  

596D(1)    
A summons to a person under section 596A or 596B is to require the person to attend before the Court:

(a)    at a specified place and at a specified time on a specified day, being a place, time and day that are reasonable in the circumstances; and

(b)    

to be examined on oath or affirmation about the corporation ' s examinable affairs.

596D(2)    
A summons to a person under section 596A or 596B may require the person to produce at the examination specified books that:

(a)    are in the person ' s possession; and

(b)    relate to the corporation or to any of its examinable affairs.

596D(3)    
A summons under section 596A is to require under subsection (2) of this section the production of such of the books requested in the application for the summons as the summons may so require.

SECTION 596E  

596E   NOTICE OF EXAMINATION  
If the Court summons a person for examination, the person who applied for the summons must give written notice of the examination to:

(a) as many of the corporation's creditors as reasonably practicable; and

(b) each eligible applicant in relation to the corporation, except:

(i) the person who applied for the examination; and

(ii) if a person authorised by ASIC applied for the examination - ASIC; and

(iii) a person who is such an eligible applicant only because the person is authorised by ASIC.

SECTION 596F   COURT MAY GIVE DIRECTIONS ABOUT EXAMINATION  

596F(1)   [ Directions that Court may give]  

Subject to section 597, the Court may at any time give one or more of the following:

(a) a direction about the matters to be inquired into at an examination;

(b) a direction about the procedure to be followed at an examination;

(c) a direction about who may be present at an examination while it is being held in private;

(d) a direction that a person be excluded from an examination, even while it is being held in public;

(e) a direction about access to records of the examination;

(f) a direction prohibiting publication or communication of information about the examination (including questions asked, and answers given, at the examination);

(g) a direction that a document that relates to the examination and was created at the examination be destroyed.

596F(2)   [ Effect of public examination]  

The Court may give a direction under paragraph (1)(e), (f) or (g) in relation to all or part of an examination even if the examination, or that part, was held in public.

596F(3)   [ Contravention]  

A person must not contravene a direction under subsection (1).

SECTION 597   CONDUCT OF EXAMINATION  

597(4)    
An examination is to be held in public except to such extent (if any) as the Court considers that, by reason of special circumstances, it is desirable to hold the examination in private.

597(5A)    
Any of the following may take part in an examination:

(a)    ASIC;

(b)    any other eligible applicant in relation to the corporation;

and for that purpose may be represented by a lawyer or by an agent authorised in writing for the purpose.

597(5B)    
The Court may put, or allow to be put, to a person being examined such questions about the corporation or any of its examinable affairs as the Court thinks appropriate.

597(6)    

A person who is summoned under section 596A or 596B to attend before the Court must not intentionally or recklessly:

(a)    fail to attend as required by the summons; or

(b)    fail to attend from day to day until the conclusion of the examination.

597(6A)    

Subsection (6) does not apply to the extent that the person has a reasonable excuse.

Note: A defendant bears an evidential burden in relation to the matter in subsection (6A) , see subsection 13.3(3) of the Criminal Code .

597(7)    
A person who attends before the Court for examination must not:

(a)    without reasonable excuse, refuse or fail to take an oath or make an affirmation; or

(b)    without reasonable excuse, refuse or fail to answer a question that the Court directs him or her to answer; or

(c)    make a statement that is false or misleading in a material particular; or

(d)    without reasonable excuse, refuse or fail to produce books that the summons requires him or her to produce.

597(9)    
The Court may direct a person to produce, at an examination of that or any other person, books that are in the first-mentioned person's possession and are relevant to matters to which the examination relates or will relate.

597(9A)    
A person may comply with a direction under subsection (9) by causing the books to be produced at the examination.

597(10)    
Where the Court so directs a person to produce any books and the person has a lien on the books, the production of the books does not prejudice the lien.

597(10A)    

A person must not refuse, or intentionally or recklessly fail, to comply with a direction under subsection (9) .

597(11)    

Subsection (10A) does not apply to the extent that the person has a reasonable excuse.

Note: A defendant bears an evidential burden in relation to the matter in subsection (11) , see subsection 13.3(3) of the Criminal Code .

597(12)    
A person is not excused from answering a question put to the person at an examination on the ground that the answer might tend to incriminate the person or make the person liable to a penalty.

597(12A)    
Where:

(a)    before answering a question put to a person (other than a body corporate) at an examination, the person claims that the answer might tend to incriminate the person or make the person liable to a penalty; and

(b)    the answer might in fact tend to incriminate the person or make the person so liable;

the answer is not admissible in evidence against the person in:

(c)    a criminal proceeding; or

(d)    a proceeding for the imposition of a penalty;

other than a proceeding under this section, or any other proceeding in respect of the falsity of the answer.

597(13)    
The Court may order the questions put to a person and the answers given by him or her at an examination to be recorded in writing and may require him or her to sign that written record.

597(14)    

Subject to subsection (12A) , any written record of an examination so signed by a person, or any transcript of an examination of a person that is authenticated as provided by the rules of court, may be used in evidence in any legal proceedings against the person.

597(14A)    
A written record made under subsection (13) :

(a)    is to be open for inspection, without fee, by:

(i) the person who applied for the examination; or

(ii) an officer of the corporation; or

(iii) a creditor of the corporation; and

(b)    is to be open for inspection by anyone else on paying the prescribed fee.

597(15)    

An examination under this Division may, if the Court so directs and subject to the rules of court, be held before such other court as is specified by the Court and the powers of the Court under this Division may be exercised by that other court.

597(16)    
A person ordered to attend before the Court or another court for examination under this Division may, at his or her own expense, employ a solicitor, or a solicitor and counsel, and the solicitor or counsel, as the case may be, may put to the person such questions as the Court, or the other court, as the case may be, considers just for the purpose of enabling the person to explain or qualify any answers or evidence given by the person.

597(17)    
The Court or another court before which an examination under this Division takes place may, if it thinks fit, adjourn the examination from time to time.

SECTION 597A   WHEN COURT IS TO REQUIRE AFFIDAVIT ABOUT CORPORATION ' S EXAMINABLE AFFAIRS  

597A(1)    
The Court is to require a person to file an affidavit about a corporation ' s examinable affairs if:

(a) an eligible applicant applies for the requirement to be made; and

(b) the Court is satisfied that the person is an officer or provisional liquidator of the corporation or was such an officer or provisional liquidator during or after the 2 years ending:

(i) if the corporation is under administration - on the section 513C day in relation to the administration; or

(ii) if the corporation has executed a deed of company arrangement that has not yet terminated - on the section 513C day in relation to the administration that ended when the deed was executed; or

(iia) if the corporation is under restructuring - on the section 513CA day in relation to the restructuring; or

(iib) if the corporation has made a restructuring plan that has not yet terminated - on the section 513CA day in relation to the restructuring that ended when the plan was made; or

(iii) if the corporation is being, or has been, wound up - when the winding up began; or

(iv) otherwise - when the application is made;

even if the person has been summoned under section 596A or 596B for examination about those affairs.

597A(2)    
The requirement is to:

(a) specify such of the information requested in the application as relates to examinable affairs of the corporation; and

(b) require the affidavit to set out the specified information; and

(c) require the affidavit to be filed on or before a specified day that is reasonable in the circumstances.

597A(3)    

A person must not refuse, or intentionally or recklessly fail, to comply with a requirement made of the person under subsection (1).

597A(3A)    

Subsection (3) does not apply to the extent that the person has a reasonable excuse.

Note: A defendant bears an evidential burden in relation to the matter in subsection (3A), see subsection 13.3(3) of the Criminal Code .

597A(4)    
The Court may excuse a person from answering a question at an examination about a corporation ' s examinable affairs if the person has already filed an affidavit under this section about that corporation ' s examinable affairs that sets out information that answers the question.

SECTION 597B  

597B   COSTS OF UNNECESSARY EXAMINATION OR AFFIDAVIT  
Where the Court is satisfied that a summons to a person under section 596A or 596B, or a requirement made of a person under section 597A, was obtained without reasonable cause, the Court may order some or all of the costs incurred by the person because of the summons or requirement to be paid by:

(a) in any case - the applicant for the summons or requirement; or

(b) in the case of a summons - any person who took part in the examination.

Division 2 - Orders against a person in relation to a corporation  

SECTION 598   ORDER AGAINST PERSON CONCERNED WITH CORPORATION  

598(2)   [ Court's powers]  

Subject to subsection (3), where, on application by an eligible applicant, the Court is satisfied that:

(a) a person is guilty of fraud, negligence, default, breach of trust or breach of duty in relation to a corporation; and

(b) the corporation has suffered, or is likely to suffer, loss or damage as a result of the fraud, negligence, default, breach of trust or breach of duty;

the Court may make such order or orders as it thinks appropriate against or in relation to the person (including either or both of the orders specified in subsection (4)) and may so make an orderagainst or in relation to a person even though the person may have committed an offence in respect of the matter to which the order relates.

598(3)   [ Preconditions to making of order]  

The Court must not make an order against a person under subsection (2) unless the Court has given the person the opportunity:

(a) to give evidence; and

(b) to call witnesses to give evidence; and

(c) to bring other evidence in relation to the matters to which the application relates; and

(d) to employ, at the person's own expense, a solicitor, or a solicitor and counsel, to put to the person, or to any other witness, such questions as the Court considers just for the purpose of enabling the person to explain or qualify any answers or evidence given by the person.

598(4)   [ Types of orders]  

The orders that may be made under subsection (2) against a person include:

(a) an order directing the person to pay money or transfer property to the corporation; and

(b) an order directing the person to pay to the corporation the amount of the loss or damage.

598(5)   [ Other proceedings]  

Nothing in this section prevents any person from instituting any other proceedings in relation to matters in respect of which an application may be made under this section.

Division 3 - Provisions applying to various kinds of external administration  

SECTION 599   APPEALS FROM DECISIONS OF RECEIVERS ETC.  

599(1)    
A person aggrieved by any act, omission or decision of:

(a) a person administering a compromise, arrangement or scheme referred to in Part 5.1 ; or

(b) a controller, or a managing controller, of property of a corporation;

may appeal to the Court in respect of the act, omission or decision and the Court may confirm, reverse or modify the act or decision, or remedy the omission, as the case may be, and make such orders and give such directions as it thinks fit.

599(2)    
Paragraph (1)(b) does not apply to a corporation that is an Aboriginal and Torres Strait Islander corporation.

Note: Similar provision is made in relation to Aboriginal and Torres Strait Islander corporations under section 576-10 of the Corporations (Aboriginal and Torres Strait Islander) Act 2006 .

SECTION 600AA   DUTY OF RECEIVER, ADMINISTRATOR OR LIQUIDATOR - PARENTAL LEAVE PAY  

600AA(1)    
A person who:

(a) is appointed (whether or not by a court), and acts, as a receiver and manager in respect of property of a body corporate; or

(b) is appointed as the administrator of a body corporate under Division 2 of Part 5.3A ; or

(ba) is appointed as the restructuring practitioner for a body corporate under Subdivision B of Division 2 of Part 5.3B ; or

(c) is appointed as the liquidator or provisional liquidator of a body corporate;

must, as soon as possible, notify the Secretary (within the meaning of the Paid Parental Leave Act 2010 ) of the person ' s appointment, if the body corporate was a paid parental leave employer just before the appointment.

600AA(2)    
A person is a paid parental leave employer at a particular time if:

(a) the person must pay an instalment under section 72 of the Paid Parental Leave Act 2010 ; and

(b) either:

(i) that time occurs during the instalment period (within the meaning of that Act) to which the instalment relates; or

(ii) that time occurs after the end of the instalment period to which the instalment relates, but the person has not paid the instalment by that time.

SECTION 600A  

600A   POWERS OF COURT WHERE OUTCOME OF VOTING AT CREDITORS ' MEETING DETERMINED BY RELATED ENTITY  
(Repealed by No 11 of 2016, s 3, Sch 2 [ 195] (effective 1 March 2017).)

SECTION 600B  

600B   REVIEW BY COURT OF RESOLUTION OF CREDITORS PASSED ON CASTING VOTE OF PERSON PRESIDING AT MEETING  
(Repealed by No 11 of 2016, s 3, Sch 2 [ 195] (effective 1 March 2017).)

SECTION 600C  

600C   COURT ' S POWERS WHERE PROPOSED RESOLUTION OF CREDITORS LOST AS CASTING VOTE OF PERSON PRESIDING AT MEETING  
(Repealed by No 11 of 2016, s 3, Sch 2 [ 195] (effective 1 March 2017).)

SECTION 600D  

600D   INTERIM ORDER ON APPLICATION UNDER SECTION 600A, 600B OR 600C  
(Repealed by No 11 of 2016, s 3, Sch 2 [ 195] (effective 1 March 2017).)

SECTION 600E  

600E   ORDER UNDER SECTION 600A OR 600B DOES NOT AFFECT ACT ALREADY DONE PURSUANT TO RESOLUTION  
(Repealed by No 11 of 2016, s 3, Sch 2 [ 195] (effective 1 March 2017).)

SECTION 600F   LIMITATION ON RIGHT OF SUPPLIERS OF ESSENTIAL SERVICES TO INSIST ON PAYMENT AS CONDITION OF SUPPLY  

600F(1)    
If:

(a)    a relevant authority of an eligible company requests, or authorises someone else to request, a person or authority ( the supplier ) to supply an essential service to the company in Australia; and

(b)    the company owes an amount to the supplier in respect of the supply of the essential service before the effective day;

the supplier must not:

(c)    refuse to comply with the request for the reason only that the amount is owing; or

(d)    make it a condition of the supply of the essential service pursuant to the request that the amount is to be paid.

600F(2)    

In this section:

effective day
, in relation to a relevant authority of an eligible company, means the day when the relevant authority became a relevant authority of the company, even if that day began before this Act commenced.

eligible company
means a company:

(a) that is being wound up; or

(b) a provisional liquidator of which is acting; or

(c) that is under administration; or

(d) that has executed a deed of company arrangement that has not yet terminated; or

(da) that is under restructuring; or

(db) that has made a restructuring plan that has not yet terminated; or

(e) a receiver, or receiver and manager, of property of which is acting.

essential service
(Repealed by No 87 of 2024, s 3, Sch 1[8] (effective 24 September 2024).)

relevant authority
, in relation to an eligible company, means:

(a) the liquidator; or

(b) the provisional liquidator; or

(c) the administrator of the company; or

(d) the administrator of the deed of company arrangement; or

(da) the restructuring practitioner for the company; or

(db) the restructuring practitioner for the restructuring plan; or

(e) the receiver, or receiver and manager;

as the case requires.

SECTION 600G  

600G   ELECTRONIC COMMUNICATION OF DOCUMENTS  
(Repealed by No 69 of 2023, s 3, Sch 1[37] (effective 15 September 2023).)

SECTION 600H   RIGHTS IF CLAIM AGAINST THE COMPANY POSTPONED  

600H(1)    
A person whose claim against a company is postponed under section 563A is entitled:

(a) to receive a copy of any notice, report or statement to creditors only if the person asks the administrator, the restructuring practitioner or liquidator of the company, in writing, for a copy of the notice, report or statement; and

(b) to vote in their capacity as a creditor of the company, at a meeting ordered under subsection 411(1) or during the external administration of the company, only if the Court so orders.

600H(2)    

In this section:

external administration
includes the following:

(a) voluntary administration;

(b) a compromise or arrangement under Part 5.1;

(c) administration under a deed of company arrangement;

(ca) restructuring;

(cb) restructuring under a restructuring plan;

(d) winding up by the Court;

(e) voluntary winding up.

SECTION 600J   ACTS OF EXTERNAL ADMINISTRATOR VALID ETC.  

600J(1)    
The acts of an external administrator are valid despite any defects that may afterwards be discovered in his or her appointment or qualification.

600J(2)    
A disposition of a company ' s property by an external administrator (including a disposition by way of conveyance, assignment, transfer or an instrument giving rise to a security interest) is, despite any defect or irregularity affecting the validity of the winding up or the appointment of the external administrator, valid in favour of any person taking such property in good faith and for value and without actual knowledge of the defect or irregularity.

600J(3)    
A person making or permitting a disposition of property to an external administrator is to be protected and indemnified in so doing despite any defect or irregularity affecting the validity of the winding up or the appointment of the external administrator that is not then known to that person.

600J(4)    
For the purposes of this section, a disposition of property is taken to include a payment of money.

600J(5)    
In this section:

external administrator
of a company has the same meaning as in Schedule 2 .

Division 4 - Insolvency Practice Schedule (Corporations)  

SECTION 600K  

600K   INSOLVENCY PRACTICE SCHEDULE (CORPORATIONS)  

Schedule 2 has effect.