BP Australia Ltd v Brown

BP Australia Ltd (the applicant) sought to recover payments made by a company in liquidation to Brown (the respondent), alleging they were voidable preference payments. The primary dispute concerned the applicant's entitlement to recover these payments, particularly in light of a statutory time limit for making such applications and the court's power to extend that time. The matter came before the Court of Appeal of New South Wales.

The central legal issues before the Court of Appeal were whether the time limit for an application to recover voidable preference payments under section 588FF(1) of the *Corporations Act 2001* (Cth) could be extended under section 1322(4)(d) of the Act, and if so, what test applied for the exercise of that discretion. Further, the court considered whether any such extension could be granted in general terms, and the implications of procedural fairness and the joinder of parties on the commencement date of proceedings.

The Court of Appeal considered the interplay between sections 588FF and 1322 of the *Corporations Act 2001* (Cth). It determined that section 1322(4)(d), which permits the court to extend time for doing an act, could apply to the time limit for commencing proceedings to recover voidable preference payments under section 588FF(1). The court held that the appropriate test for exercising the discretion to extend time involved considering the applicant's diligence, the reasons for delay, the prejudice to the respondent, and the merits of the application. The court also addressed the principles of procedural fairness, particularly in relation to ex parte orders, and the effect of joining a party on the commencement date of proceedings.

The appeal and cross-appeal were allowed in part, with specific orders detailed in paragraph [214] of the judgment.