Australia, Nov. 12 -- The Federal Court of Australia issued the following judgement on Nov. 8:

1 The salient facts are described in Park, in the matter of Queensland Nickel Pty Ltd (in liq) (No 3) [2022] FCA 1301 (November 2022 judgment) and in Park, in the matter of Queensland Nickel Pty Ltd (in liq) [2024] FCA 912 (August 2024 judgment), and I do not propose to repeat them in these reasons. I will adopt the same defined terms as appear in those judgments except that I will describe the settlement deed referred to at [104] of the November 2022 judgment as the SPL Settlement Deed and the Settlement Deed referred to at [15] of the August 2024 judgment as the Prony Settlement Deed, so as to distinguish between them.

2 Following an appeal brought by the Palmer Parties, the November 2022 judgment was upheld by the Full Court: Queensland Nickel Sales Pty Ltd v Park in his capacity as liquidator of Queensland Nickel Pty Ltd (in liq) (2023) 299 FCR 169; [2023] FCAFC 150 (Markovic, Banks-Smith and Halley JJ).

3 The August 2024 judgment is the subject of a further appeal brought by the Palmer Parties, which appeal is yet to be heard. That judgment and the second appeal concern Prony, a creditor, which filed submissions but did not appear at the hearing on 25 October 2024.

Payment of interest under the Corporations Act

4 The central issue for determination is the proper construction of s 563B of the Corporations Act 2001 (Cth), which provision falls within Part 5.6, Division 6 of that Act.

5 Part 5.6 of the Corporations Act concerns winding up generally, and Division 6 relates to proof and ranking of claims.

6 Within Division 6 there is Subdivision A, which is entitled "Admission to proof of debts and claims".

7 By s 553(1), the debts or claims which are admissible to proof against the company are (generally) those "the circumstances giving rise to which occurred before the relevant date".

8 Section 553D enables (in substance) a debt or claim to be proved formally, and this must occur if the liquidator requires it, or it may be proved in some other way, subject to compliance with the requirements of the Corporations Regulations 2001 (Cth) relating to the informal proof of debts or claims.

9 For example, a liquidator may call for formal proofs, but they are not required to do so, particularly in relation to debts that have already been admitted: see regs 5.6.48(1), 5.6.48(2)(b).

10 In the situation where formal proofs of debt have not been submitted, reg 5.6.47 provides as follows:

(2) If a liquidator admits a debt or claim without formal proof, it is not necessary for the liquidator formally to admit the debt or claim in writing.

(3) If a creditor's debt or claim has been admitted without formal proof, a notice of dividend is sufficient notice of the admission.

(4) A liquidator must not reject a debt or claim without:

(a) notifying the creditor of the grounds of the liquidator's rejection; and

(b) requiring that a formal proof of debt or claim be submitted for that debt or claim.

*Rest of the document and Footnotes can be viewed at: (https://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/single/2024/2024fca1300)

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