Boele v Rinbac Pty Ltd & Ors - [2015] HCATrans 156

[2015] HCATrans 156

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Sydney No S22 of 2015

B e t w e e n -
PIETER BOELE
Applicant
and
RINBAC PTY LTD
First Respondent
CONSUMER TRADER AND TENANCY TRIBUNAL
Second Respondent
DISTRICT COURT OF NEW SOUTH WALES
Third Respondent
Application for special leave to appeal

FRENCH CJ
KEANE J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 19 JUNE 2015, AT 12.31 PM

____________________

MR B.W. WALKER, SC: May it please the Court, I appear with my learned friend, MS Z.C. HEGER, for the applicant. (instructed by Fox & Staniland Solicitors)

MS M.N. ALLARS, SC: May it please the Court, I appear for the first respondent. (instructed by Landerer & Co)

FRENCH CJ: Yes, Mr Walker.

MR WALKER: Your Honours will have seen from the papers that the application was filed late, in circumstances explained in an affidavit. We seek leave by way of an extension of time.

FRENCH CJ: Is that application opposed, Ms Allars?

MS ALLARS: Your Honour, our position is simply we say that it is a matter for the Court.

FRENCH CJ: We will grant the necessary extension of time, Mr Walker.

MR WALKER: If it please the Court.

FRENCH CJ: It is a pretty unattractive and messy case to ask us to inflict on our colleagues, Mr Walker.

MR WALKER: It is difficult to imagine, your Honours, a less prepossessing prehistory in terms of bringing an issue to this Court.

FRENCH CJ: I remember discussing this in Kostas. There is some statutory injunction about efficiency and economy, is there not, in relation to the commercial tribunal?

MR WALKER: Yes. I am not quite sure this is ‑ ‑ ‑

FRENCH CJ: I think that case also took about 13 years.

MR WALKER: May I say, I am not sure this case is one that will be other than a deadset example. Can I seek to persuade your Honours that, notwithstanding what we have in terms described as regrettable history, there is something raised here which is important. To spend just a little bit more time on necessary concessions so as to allow that point through, your Honours know how, as it were, artificially, the jurisdictional character of the alleged error is the point that was decisive below. Artificially or not, it was decisive – there is nothing moot about that. It, as it were, was unfortunate that error on the face of the record was not able to be argued or perceived to be able to be argued.

Be that as it may, there is, of course, the constitutionally entrenched jurisdiction in relation to jurisdictional error, and that is my first point as to the importance. We do not say Kirk was new, but we do say that post‑Kirk, it cannot be doubted that the understanding of the limits of power, as well as the necessary compulsion to appreciate the limits of…

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: [2015] HCATrans 156
Decision Date

CaseChat Overview and Summary

Boele v Rinbac Pty Ltd & Ors concerned a dispute between the applicant, Boele, and the respondents, Rinbac Pty Ltd and others. The case came before the High Court of Australia.

The central legal issue before the High Court was whether the respondents, as directors of a company, had breached their statutory duty under s 588G of the Corporations Act 2001 (Cth) to prevent the company from incurring debts when it was insolvent or when incurring the debt would make it insolvent. This involved determining the scope of the directors' knowledge and the circumstances under which a debt is considered to have been incurred.

The High Court considered the application of s 588G, which imposes a positive duty on directors to prevent a company from incurring debts in specified circumstances. The Court analysed the concept of "incurring a debt" and the relevant knowledge or reasonable grounds for suspecting insolvency that would trigger the directors' liability. The Court's reasoning focused on the objective standard of what a reasonable director would have known or suspected in the circumstances, rather than solely on the subjective state of mind of the individual directors.

The High Court ultimately allowed the appeal, finding that the directors had breached their statutory duty. The Court made orders accordingly.

Orders