Centaur Mining class action

Centaur Mining & Exploration Ltd was listed on the Australian Stock Exchange, and carried on business as a gold exploration and mining company. Its head office was based in Melbourne, and its mining activities were based in Western Australia. Its wholly-owned subsidiary, Centaur Nickel Pty Ltd, carried on a nickel mining business, also in Western Australia.

During the year 2000 the financial condition of both companies deteriorated significantly. Although various attempts were made by the directors to solve the continuing problems, those attempts proved unsuccessful.  On 14 March 2001 both companies were placed in receivership, and on the same day administrators were appointed to both companies (which ultimately led to them being wound up)

The action

Maurice Blackburn acted for McGrath Nicol, the liquidators of both companies, in proceedings against the former directors.  It was alleged that both companies were insolvent from 31 December 2000 onwards, and that during the period from then until 14 March 2001, they incurred a substantial amount of unsecured debts, which remained unpaid. The liquidators sought compensation of around $17 million (plus interest) from the directors of the companies under the insolvent trading provisions of the Corporations Act. The proceedings were issued in the Federal Court on 6 March 2007.

Settlement

On 19 February 2009 the proceedings were settled for a substantial sum, representing a successful outcome for the liquidators and, thus, for the creditors of the two companies.

This case was conducted by Steven Foale, an experienced litigator in the area of insolvency, as part of Maurice Blackburn's growing insolvency practice.

Supporting information