LAWFUEL – The Legal Newswire – The Australian Securities and Investments Commission (ASIC) has obtained orders in the Supreme Court of Victoria to wind up four companies, Business Strategies No 5 Fund Limited, Business Strategies No 6 Fund Pty Ltd, Paraville Pty Ltd and Dingley Developments Pty Ltd, (the Group) on just and equitable grounds.
Business Strategies No 6 Fund Pty Ltd, Paraville Pty Ltd and Dingley Developments Pty Ltd are all subsidiaries of Business Strategies No 5 Fund Limited and all of the companies were involved in property development projects in Melbourne over the last four years.
Under a prospectus issued in September 2003, Business Strategies No 5 Fund Limited raised approximately $3 million for use in developing the first stage of a retirement village in Taylors Hill. Under a prospectus issued in April 2004, Business Strategies No 6 Fund Limited raised approximately $1 million for use in a property development in Point Cook.
ASIC took action following a formal investigation arising out of notifications by the auditors under section 311 of the Corporations Act.
ASIC was concerned about the management of the Group by the current directors over a period of approximately two years, including the failure to keep proper books and records and repeated failure to provide audited financial reports to ASIC and members of the Group within four months of the end of financial year as required by the Corporations Act.
The Supreme Court of Victoria found that there were compelling reasons why the companies should be wound up on just and equitable grounds, including that there have been persistent breaches of the law by the directors that could have been and have not been rectified.
The Court also found that there was lack of confidence in the conduct and the management of the affairs of the companies by the current directors. The Court also noted that although it was not necessary to decide the issue of solvency, the Group was unable to pay all of its debts as and when they fell due.
The Court appointed Andrew McLellan of PPB Chartered Accountants as liquidator of the Group.