Austrack Infrastructure Development Pty Ltd v Sharvine Pty Ltd (No. 7) - [2012] VSC 267

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

S CI 2005 10032

AUSTRACK INFRASTRUCTURE DEVELOPMENT PTY LTD (ACN 065 271 141) AND ORS (according to the schedule attached)	Plaintiff
v
SHARVINE PTY LTD (ACN 080 518 396)	First Defendant
- and -
TRANSPACIFIC CLEANAWAY PTY LTD (formerly known as Brambles Australia Limited) (ACN 000 164 938)	Second Defendant

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JUDGE:	LANSDOWNE AsJ
WHERE HELD:	Melbourne
DATES OF HEARING	28 March 2012 and 15 June 2012
DATE OF JUDGMENT:	15 June 2012
DATE OF REASONS:	29 June 2012
CASE MAY BE CITED AS:	Austrack Infrastructure Development Pty Ltd and ors v Sharvine Pty Ltd and anor (No. 7)
MEDIUM NEUTRAL CITATION:	[2012] VSC 267

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CORPORATIONS -Whether leave required for application for dismissal against a plaintiff company in liquidation-s.471B Corporations Law

PRACTICE AND PROCEDURE -Dismissal for failure to pay security- Dismissal for intentional and contumelious default-Dismissal for want of prosecution-Intentional and contumelious default not established-Dismissed for want of prosecution compounded by failure to pay security

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	No appearance
For the Defendants	Mr C.P. Young	Thomsons Lawyers

HER HONOUR:

Application and procedural history

By summons dated 7 March 2012 the defendants sought dismissal of the proceedings. The plaintiffs are all corporations. Only the first to third and sixth are still registered. The sixth plaintiff went into liquidation on 29 February 2012. There has been no solicitor on the record for the plaintiffs since 1 April 2011. By orders made 7 November 2011 I dismissed a summons filed on behalf of the plaintiffs seeking leave to be represented by their sole director, Mr Robert Taylor. I published written reasons for that order on 17 November 2011, at that time to the parties only. I now republish those reasons generally with these reasons.

The summons was first returnable on 28 March 2012. As indicated, there was no appearance on that date by a solicitor on the record for the first to third plaintiffs. Mr Taylor also did not attend. He did, however, instruct a solicitor to seek to appear as amicus curiae to seek an adjournment on the basis of an affidavit sworn by him. I refused the application for leave to appear as amicus on that day. There was no appearance on that date for the sixth plaintiff, which had recently gone into liquidation although it was clear from material before the Court on that date that the liquidator was aware of the summons and the hearing.

Counsel for the defendant submitted that leave to proceed was not required as against the sixth plaintiff, because the summons is a defensive measure by a defendant against proceedings instituted by a plaintiff corporation in liquidation, rather than a proceeding against a defendant corporation in liquidation. By orders made and written reasons published to the parties on 5 April 2012 I considered that issue but did not rule on it. I refused the adjournment sought on behalf of the first to third plaintiffs by…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2012] VSC 267
Decision Date: 15 June 2012

CaseChat Overview and Summary

In the Federal Circuit Court, Austrack Infrastructure Development Pty Ltd sought an order for the dismissal of proceedings brought by Sharvine Pty Ltd, a company in liquidation. The dispute centred around whether the Federal Circuit Court had the jurisdiction to grant an order for dismissal against a plaintiff company in liquidation under section 471B of the Corporations Act. The application for dismissal was made on the grounds of failure to pay security for costs, intentional and contumelious default, and want of prosecution.

The primary legal issue the court had to address was whether an application for dismissal against a plaintiff company in liquidation required leave from the court. The court examined whether the provisions of section 471B applied to such a situation and considered the implications of dismissing proceedings against a company in liquidation. The court also assessed whether the grounds for dismissal, specifically intentional and contumelious default and want of prosecution, were substantiated.

The court found that the requirements for leave were not applicable in this context, and it had the jurisdiction to dismiss the proceedings. It held that the intentional and contumelious default was not established as the plaintiff had made efforts to pay the security for costs. However, the proceedings were dismissed for want of prosecution, compounded by the failure to pay security for costs. The court concluded that the plaintiff's conduct warranted dismissal.

The Federal Circuit Court ordered the dismissal of the proceedings brought by Sharvine Pty Ltd against Austrack Infrastructure Development Pty Ltd. The dismissal was based on the want of prosecution, compounded by the failure to pay security for costs. The court did not find that the plaintiff had intentionally or contemptuously defaulted, but the persistent lack of progress in the proceedings, combined with the inability to meet financial obligations, led to the dismissal.

Orders