AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION v GLENN J FRANKLIN, STIRLING L HORNE, JASON G STONE, WALTON CONSTRUCTION PTY LTD (ACN 060 900 218) (IN LIQ) and WALTON CONSTRUCTION (QLD) PTY LTD (ACN 100 833 225) (IN LIQ)
In this matter the Court considered that a conflict of interest was more than theoretical and notwithstanding inconvenience or expense it was held that the Court had no apparent practical alternative other than to order the removal of the liquidators.
Notably at paragraph 61 the Court said:
“Liquidators are officers of the court and are, accordingly, expected to conduct themselves with independence, impartiality and integrity. However, questions of bias in relation to liquidators arise in a context which differs in material respects from that of the judiciary or administrative decision makers. Liquidators are themselves engaged in business in a competitive environment. They have to attract work. This makes it almost inevitable that they will develop contacts and relationships with those who are actual or prospective sources of referrals. Further, the success or otherwise of liquidators will depend in part on their maintaining good professional reputations.”