Australian Catering Equipment Holdings Pty Ltd v Australian Securities and Investments Commission

[2025] WASC 24

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   AUSTRALIAN CATERING EQUIPMENT HOLDINGS PTY LTD -v- AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION [2025] WASC 24

CORAM:   HILL J

HEARD:   6 DECEMBER 2024 & 24 JANUARY 2025 (WRITTEN SUBMISSIONS FILED 30 JANUARY 2025)

DELIVERED          :   5 FEBRUARY 2025

FILE NO/S:   COR 184 of 2024

BETWEEN:   AUSTRALIAN CATERING EQUIPMENT HOLDINGS PTY LTD

Plaintiff

AND

AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

Defendant

Catchwords:

Corporations law - Application to reinstate deregistered company - Whether plaintiff is a 'person aggrieved' - Whether 'just' to reinstate deregistered company - Turns on own facts

Legislation:

Corporations Act 2001 (Cth), s 601AD(5), s 601AH

Result:

Application dismissed

Category:    B

Representation:

Counsel:

Plaintiff	:	D Singh
Defendant	:	No appearance

Solicitors:

Plaintiff	:	Cornerstone Legal
Defendant	:	No appearance

Cases referred to in decision:

ACN 009 009 072 (in liquidation) v Australian Securities & Investments Commission [2022] WASC 221

Endless Solar Corporation Ltd v Australian Securities and Investments Commission, in the matter of Speedpanel Australia Ltd [2023] FCA 720

Jit Sun Investments Pte Ltd v Australian Securities and Investments Commission [2021] WASC 235

Pavey v Matthews [1987] HCA 5; (1987) 162 CLR 221

The Bell Group Ltd v Australian Securities and Investments Commission [2018] FCA 884; (2018) ACSR 247

HILL J:

1. On 18 October 2023, Coweso Pty Ltd (ACN 647 444 791) (Company) was deregistered pursuant to s 601AA of the Corporations Act 2001 (Cth) (Act), which enables a company to be voluntarily deregistered.[1]

   [1] Affidavit of Dara Singh filed 21 November 2024 [6], 'DS1'.

2. On 20 November 2024, the plaintiff filed an originating process seeking orders pursuant to s 601AH of the Act directing the Australian Securities and Investments Commission (ASIC) to reinstate the registration of the Company.

3. ASIC has been served with the application.  ASIC has indicated that it does not oppose the application or seek to be heard on the application, and did not attend the hearings of the application.[2]

   [2] Affidavit of Dara Singh filed 5 December 2024, 'DS6'.

4. The plaintiff advanced two reasons as to why it seeks the reinstatement of the Company.  First, if the Company is reinstated, the plaintiff intends to apply to add the Company as an additional defendant in separate proceedings that have been commenced by the plaintiff in this court (CIV 1050 of 2024 (Existing Proceedings)).[3]  Second, the plaintiff wishes to obtain discovery of the accounts and other documentary records of the Company.[4]

   [3] Affidavit of Dara Singh filed 21 November 2024 [11]; Affidavit of Dara Singh filed 21 January 2025 [6].

   [4] Affidavit of Dara Singh filed 21 January 2025 [7].

5. After the second hearing of the application, the solicitors for the plaintiff sought and were granted leave to file a further affidavit in support of the application, as well as submissions on s 601AD(5) of the Act.[5]  I have taken both of these documents into account in reaching my decision on the application. 

   [5] Plaintiff's submissions filed 30 January 2025; Affidavit of Dara Singh filed 31 January 2025.

6. For the reasons that follow, it is my view that the application should be dismissed.  At this stage, I am not satisfied that the plaintiff is a party aggrieved by the deregistration of the Company, or that it would be just to order the reinstatement of the Company.  This conclusion is based on the evidence before the court at the hearings of the application, and the subsequent affidavit of Mr Singh.  This conclusion does not prevent the plaintiff from renewing its application once it has an opportunity to consider these reasons for decision.

Should an order be made to reinstate the Company?

1. In considering an application under s 601AH(2) of the Act, the court is required to consider: first, whether the plaintiff is a 'person aggrieved by the deregistration' of the company; and second, whether it is 'just' that the registration of the company be reinstated.

Is the plaintiff a person aggrieved by the deregistration of the Company?

1. The phrase 'person aggrieved' is not defined in the Act and should not be construed narrowly.[6]  In determining whether the plaintiff is a person aggrieved by the deregistration of the Company, the court must consider whether the plaintiff has shown that the deregistration has deprived them of something, or injured or damaged them in a legal sense, or that they have become entitled in a legal sense to regard the deregistration as the cause of dissatisfaction.[7]

   [6] The Bell Group Ltd v Australian Securities and Investments Commission [2018] FCA 884; (2018) ACSR 247 [47].

   [7] Jit Sun Investments Pte Ltd v Australian Securities and Investments Commission [2021] WASC 235 [6] and the authorities cited there.

2. There is no temporal limitation in the term 'person aggrieved'; there need only be a causal link between the grievance and the deregistration of the Company.[8]  It follows that a person can become aggrieved as a result of events which occur after the time of the deregistration.[9]

   [8] The Bell Group Ltd v Australian Securities and Investments Commission [49].

   [9] Jit Sun Investments Pte Ltd v Australian Securities and Investments Commission [7] and the authority cited there.

3. The threshold for determining whether a person is an aggrieved person for the purpose of s 601AH(2) of the Act is low. Provided that the claim or claims advanced by the plaintiff are not hopeless or bound to fail, the plaintiff will be considered an aggrieved person and any further analysis of its claim or claims is not required.[10]

   [10] Endless Solar Corporation Ltd v Australian Securities and Investments Commission, in the matter of Speedpanel Australia Ltd [2023] FCA 720 [48].

4. In this case, the plaintiff says that the Company's deregistration has deprived it of the abilities to (a) seek to join the Company as a defendant to the Existing Proceedings, and (b) obtain documents from the Company.

5. The evidence before the court is that on 18 January 2024, the plaintiff commenced the Existing Proceedings against another party. In the Existing Proceedings, the plaintiff contends that one of its former employees breached the contractual and statutory obligations owed to the plaintiff by, among other things, advising the plaintiff to engage the Company to provide services to the plaintiff without disclosing that the employee's wife was a director and shareholder of the Company.  The Existing Proceedings then pleads that the former employee was the plaintiff's main instructor of the Company in relation to the services provided by the Company to the Plaintiff.  This conduct is pleaded to be a breach of contract, as well as a breach of s 183 of the Act.  The plaintiff says that between July 2020 and August 2023, rates were paid to the Company which were approximately $500,000 above market rates.  Repayment of this amount is sought from the former employee.

6. At the first hearing of this application, the plaintiff contended that it has a claim against the Company.  At this hearing, the claim was described as a claim that the Company has been unjustly enriched by the payments that it received from the plaintiff and should be required to disgorge any profits that the Company made from these payments.[11]  Counsel for the plaintiff accepted that if any profits had been distributed by the Company, the plaintiff would 'probably want to have some sort of tracing remedy that goes back to the shareholders'.[12]  In the affidavit of Mr Singh filed after the hearings, Mr Singh deposed that 'the plaintiff's potential cause of action of action against [the Company] is based on unjust enrichment and the remedy of restitution and based on the underlying principle of the law of restitution, being the stripping of gains made by [the Company] at the expense of the plaintiff'.[13]

   [11] Affidavit of Dara Singh filed 21 November 2024 [10] - [11].

   [12] ts 5 (6 December 2024).

   [13] Affidavit of Dara Singh filed 31 January 2025 [15].

7. The difficulty with this submission and evidence is that unjust enrichment is not a 'definitive legal principle' but a 'a unifying legal concept which explains why the law recognizes, in a variety of distinct categories of case, an obligation on the part of a defendant to make fair and just restitution for a benefit derived at the expense of a plaintiff and which assists in the determination, by the ordinary processes of legal reasoning, of the question whether the law should, in justice, recognize such an obligation in a new or developing category of case'.[14]  No attempt has been made by the plaintiff to identify the legal basis or category on which it is contended that the Company is required to 'make restitution' to the plaintiff.  In addition, it is unnecessary for the Company to be reinstated if the plaintiff ultimately seeks a 'tracing remedy' to recover funds paid to the shareholders of the Company.

   [14] Pavey v Matthews [1987] HCA 5; (1987) 162 CLR 221, 256 - 257.

8. In the affidavit filed by Mr Singh after the first hearing, the plaintiff expressed its claims against the Company somewhat differently.  In Mr Singh's affidavit filed 21 January 2025, the potential causes of action against the Company were said to be fraud and/or the tort of deceit, negligent misstatement or misrepresentation, misleading and deceptive conduct, equitable compensation, and 'any other cause of action' that may be identified.  None of the affidavits filed by the plaintiff annexed a draft pleading or adduced evidence of any statement or conduct on behalf of the Company which could give rise to these any of these causes of action.  The affidavit filed by Mr Singh after the second hearing did not alter this position.  This affidavit set out the basis on which the plaintiff would seek to prove elements of the potential causes of action but did not adduce evidence of any of these elements.  Instead, the affidavit further complicates the position by asserting that the statements were made by the plaintiff's former employee on behalf of the Company (in direct contrast to what is pleaded in the Existing Proceedings) and that the various presentations were 'repeated/confirmed' by a director of the Company 'orally or email correspondence', without any detail as to what was said or written.

9. While the plaintiff says it is a person aggrieved because its legal rights have been affected by the deregistration of the Company, no evidence has been adduced on which any proposed claim or claims against the Company could be advanced.  At the hearing before me on 24 January 2025, counsel for the plaintiff submitted that these claims could only be 'fleshed out' after obtaining discovery from the Company.[15]  The further affidavit filed after the hearing provided some further information as to the basis on which the plaintiff's claims may be advanced but without any evidence as to what the oral or written representations are said to be.

   [15] ts 4 (24 January 2025).

10. At present, there is no evidence that the plaintiff has sought to obtain any Company documents. Pursuant to s 601AD(5) of the Act, the directors of the Company are required to keep the Company's books for a period of three years after deregistration, namely until on or about 18 October 2026. This obligation extends to the requirement to keep 'any other record of information' or 'document' of the Company.[16] In my view, the obligation under s 601AD(5) would, on its face, extend to an obligation to keep email exchanges and correspondence.[17]  Given this obligation, I am not satisfied that it is necessary for the Company to be reinstated in order for the plaintiff to obtain Company documents.

    [16] Corporations Act 2001 (Cth) s 9 (definition of 'books').

    [17] Evidence Act 1995 (Cth) dictionary (definition of 'document'); Acts Interpretation Act 1901 (Cth) pt 2B (definition of 'document').

11. In my view, unless and until the plaintiff adduces some evidence of the basis on which it advances its claim or claims against the Company, I am unable to reach any conclusion as to whether the plaintiff is a person aggrieved by the deregistration of the Company.  At present, I am not persuaded that the plaintiff is a person aggrieved by the deregistration of the Company. 

Is it just to order the reinstatement of the Company?

1. Even if I am wrong in my assessment as to whether the plaintiff is a person aggrieved by the deregistration of the Company, for the same reasons, I am not persuaded that, in the exercise of the court's discretion, it would be just at this stage to order the reinstatement of the Company.

2. In considering whether it is 'just' to order the reinstatement of the company, the court's discretion under s 601AH(2) of the Act is wide. The court is obliged to take into account all relevant circumstances, including the circumstances in which the company came to be deregistered; whether, if an order was made, good use could be made of it; and whether any person is likely to be prejudiced by the reinstatement.[18]  The court will also take into account the public interest generally.[19]

   [18] ACN 009 009 072 (in liquidation) v Australian Securities & Investments Commission [2022] WASC 221 [47] and the authorities cited there.

   [19] Jit Sun Investments Pte Ltd v Australian Securities and Investments Commission [8] and the authorities cited there.

3. The evidence before the court is that a director of the Company applied to deregister the Company on 16 August 2023.  At that time, the director declared that the Company's assets were worth less than $1,000, had no outstanding liabilities, and was not party to any legal proceedings.[20]  There is no evidence that the Company was insolvent at that time or that any of these statements were incorrect at the time they were made.  No factual basis is provided for the plaintiff's opinion set out at [12] of Mr Singh's fifth affidavit.  For this reason, I have not given this opinion any weight. At the time that the Company was deregistered, the plaintiff had not commenced the Existing Proceedings and there is no evidence that they were foreshadowed.

   [20] Affidavit of Dara Singh filed 21 January 2025, 'DS7'.

4. As set out above, the evidence filed by the plaintiff does not establish that the plaintiff has any viable claim against the Company or that it could make good use of the Company's reinstatement.  On this basis, I am not satisfied that an order for reinstatement would be just in all the circumstances. 

5. In reaching this conclusion, I am not pre-judging the likely success of any claim the plaintiff may have against the Company.  It is simply not possible on the evidence before me to form any view as to whether the plaintiff has any claim against the Company or whether good use could be made from the reinstatement of the Company. 

Conclusion

1. For these reasons, it is my view that the application should be dismissed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

KS

Associate to the Hon Justice Hill

5 FEBRUARY 2025