Chartspike v Chahoud

In the case of Chartspike v Chahoud, the dispute arose from the actions of a solicitor who commenced proceedings on behalf of a company without authority. The first liquidator declined to ratify these actions, but the second liquidator subsequently adopted the proceedings by filing an amended statement of claim. The central legal issues before the court involved the ratification of the solicitor's actions by the second liquidator and the applicability of limitations defences under the Limitations Act. Additionally, the court was required to determine whether section 1322(4)(d) of the Corporations Law impliedly repealed section 14(1) of the Limitation Act.

The court found that the solicitor's actions were effectively ratified by the second liquidator, allowing the proceedings to continue. Regarding the limitations defences, the court concluded that the appropriate time for assessing the limitation period depended on when the loss or damage occurred. The court noted that the plaintiff contended the loss was sustained when specific contingencies arose, such as the inability to perform funding obligations or the termination of the joint venture. The court referenced Wardley Australia Ltd v The State of Western Australia, which held that the plaintiff suffered no loss until the contingency was fulfilled and the loss became actual. The court decided that the limitations defence in respect of the claim in tort depended on when the loss or damage actually occurred. The court proposed to strike out the existing contract claim except for the continuing claim of breach and to give leave to replead accordingly.

Ultimately, the court struck out all of the existing contract claim except for the continuing claim of breach in paragraph 15(h) and granted leave to replead accordingly. The limitations defence in respect of the claim in tort hinged on the precise timing of when the loss or damage occurred, contingent on the contingencies outlined by the plaintiff. The court declined to express a final view on the Corporations Law point at that stage, leaving it open for future consideration.