The High Court has ordered a fresh creditors’ meeting to decide who will serve as liquidator of Stainless Pipeline Supplies (IRL.) Limited, after finding that proxies from Outokumpu and Watercut were not properly executed. The court suspended Frank Lafferty’s exercise of liquidator powers pending the vote, scheduled for 17 August 2010.
The company is in creditors’ voluntary liquidation. At a meeting on 25 June, creditors voted on competing nominations: Lafferty, nominated by the company’s members, and Paul McCann, proposed on behalf of creditor Clive Tyner. The chairman announced votes worth €354,080 for Lafferty and €280,636 for McCann. Tyner asked the court to invalidate Lafferty’s appointment and appoint McCann instead.
Justice Laffoy found that the Outokumpu proxy did not meet the formal requirements for execution. The proxy was issued by Outokumpu Limited, but the three Outokumpu entities were listed separately as creditors. The court said the Swedish and Finnish companies should each have submitted a proxy complying with the rules; Outokumpu Limited’s role as their collecting agent did not excuse that requirement. The Watercut proxy was also defective: its common seal was not properly attested, and the form did not state that Liam Duffy was authorised to sign for the company.
The court set aside the chairman’s decision to accept the Outokumpu and Watercut proxies as valid voting proofs. It did not, however, appoint McCann or declare him the successful nominee. Justice Laffoy considered evidence about other proxies as well, including objections to Macro Stainless Limited’s proxy, which she said was not clearly valid on the material before her. She concluded that a result excluding the two disputed proxies would not reflect the wishes of creditors who had submitted proxies, many of them technically defective.
Instead, the court directed the company to summon a further creditors’ meeting and follow the statutory requirements for notice, advertising and conduct. The liquidator’s appointment is to be made at that meeting under section 267 of the Companies Act 1963. The order did not affect the appointment of the committee of inspection, of which Tyner was a member.