Adelaide Brighton Cement
Forensic investigation and subsequent recovery action arising from the fraudulent concealment by an employee of debts owing from a customer company of Adelaide Brighton Cement Ltd (ABCL).
Lipman Karas represented ABCL, pursuing a recovery action against the relevant employee, and pursued recovery of the debt owed by the customer company and its directors.
This included an application to set aside a Deed of Company Arrangement (DOCA) where administrators failed to adequately investigate deliberate underpayment by the company of a major creditor over many years. The decision contains consideration of the standard required of DOCA administrators and compliance with the obligation to keep financial records in accordance with s 286 of the Corporations Act 2001 (Cth). The Court set aside the DOCA, placed the company in liquidation and held that the company’s books and records did not comply with s 286.
ABCL also obtained costs orders against the administrators personally on the basis that their defence of the DOCA was not for a proper purpose. A subsequent appeal by the administrators to the Full Federal Court was discontinued following settlement.