Canavan v ICRA Rolleston Pty Ltd

Case [2022] QCA 110


SUPREME COURT OF QUEENSLAND

CITATION: Canavan v ICRA Rolleston Pty Ltd [2022] QCA 110
PARTIES:

JOHN PHILLIP CANAVAN

(appellant)

v

WILLIAM JAMES HARRIS, KEITH ALEXANDER CRAWFORD AND JASON PRESTON AS RECEIVERS AND MANAGERS OF ICRA ROLLESTON PTY LTD (RECEIVERS AND MANAGERS APPOINTED) (ADMINISTRATORS APPOINTED)

(respondent)

FILENOS:

Appeal No 6747 of 2021

SC No 4006 of 2021

DIVISION: Court of Appeal
PROCEEDING: General Civil Appeal
ORIGINATING COURT:

Supreme Court at Brisbane – [2021] QSC 98 (Flanagan J)

DELIVEREDON: 21 June 2022
DELIVEREDAT: Brisbane
HEARINGDATE: 20 October 2021
JUDGES: Sofronoff P and Fraser and Mullins JJA
ORDER: Appeal dismissed with costs.
CATCHWORDS:

STATUTES – ACTS OF PARLIAMENT - INTERPRETATION – OTHER MATTERS – where a party

to the joint venture appointed the respondents as receivers to one of the joint venturers (ICRA) and the receivers entered into a contract to sell ICRA’s interest in the joint venture – where the appellant is ICRA’s sole director and sought to inspect the contract under s 421(2) of the Corporations Act 2001 (Cth) and the respondents disputed his right to do so – where the appellant applied for an order requiring the respondents to permit inspection and the primary judge dismissed the application, concluding that the contract had not been shown to be a financial record within the meaning of s 421 – where the contract was not in evidence – whether the primary judge erred in interpreting the “financial record” in s 421(1)(d)

Corporations Act 2001 (Cth), s 9, s 421

Boulos v Carter (2005) 220 ALR 572; [2005] NSWSC 891, cited

Phillips v Corporate Affairs Commission (SA) (1986) 11 ACLR 182; [1986] SASC 9540, cited

COUNSEL: D B O’Sullivan QC, with C A Wilkins, for the appellant M R Hodge QC, with A R Langshaw, for the respondent
SOLICITORS: Piper Alderman for the appellant Arnold Bloch Leibler for the respondent
  1. THE COURT: ICRA Rolleston Pty Ltd (“ICRA”), Rolleston Coal Holdings Pty Ltd (“Rolleston”) and Sumisho Coal Australia Pty Ltd (“Sumisho”) were parties to a joint venture agreement under which they owned and operated a coal mine in Queensland. Rolleston held a 75 per cent interest in the venture and the other two companies held a 12.5 per cent interest each. On 8 December 2020 Rolleston appointed the respondents as receivers to ICRA pursuant to its rights under a charge. In February 2021 the receivers entered into a contract to sell ICRA’s interest in the joint venture.

  1. The appellant is ICRA’s sole director. On 1 April 2021 the appellant wrote to the respondents asking to inspect the contract. He was seeking to invoke his right of inspection under s 421(2) of the Corporations Act 2001 (Cth). The respondents disputed his right to do so and refused his request. Accordingly, the appellant applied to Flanagan J for an appropriate order that would require the respondents to permit inspection. Flanagan J dismissed the application and the appellant has appealed against that refusal.

  1. Section 421 provides:

  2. A managing controller of property of a…

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Canavan v ICRA Rolleston Pty Ltd [2022] QCA 110
Case
[2022] QCA 110
Decision Date

CaseChat Overview and Summary

Canavan, the sole director of ICRA Rolleston, sought to inspect a contract that the receivers of ICRA had entered into to sell ICRA’s interest in a joint venture. ICRA Rolleston Pty Ltd and the respondents, appointed as receivers to ICRA, disputed Canavan’s right to inspect the contract under section 421(2) of the Corporations Act 2001 (Cth). The primary judge dismissed Canavan's application for an order to permit inspection, concluding that the contract was not a financial record within the meaning of section 421(1)(d). The court of appeal considered whether the primary judge had erred in interpreting the term "financial record" in section 421(1)(d).

The court identified that the term "financial record" in section 421(1)(d) of the Corporations Act 2001 (Cth) requires a broad interpretation to ensure the purposes of the legislation are fulfilled. However, the court found that the primary judge's interpretation of the term was not in error. The primary judge concluded that the contract in question was not a financial record because it was not in evidence. The court of appeal agreed with the primary judge's reasoning and found that the absence of the contract in evidence precluded it from being classified as a financial record.

The appeal was dismissed, and the court held that the primary judge's interpretation of the term "financial record" in section 421(1)(d) was correct. The court also found that the absence of the contract in evidence was a valid reason to conclude that it was not a financial record. Therefore, the primary judge's dismissal of Canavan's application for an order to permit inspection was upheld. The appeal was dismissed with costs.

Orders

Orders of the court

Appeal dismissed with costs.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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