Efektiv Pty Ltd v Madgwicks - [2022] VSCA 72

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2020 0003

EFEKTIV PTY LTD (ACN 625 719 566)	Applicant
v
MADGWICKS (A FIRM) (ABN 82 199 611 971)	Respondent

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JUDGE:	BEACH JA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	On the papers
DATE OF JUDGMENT:	20 April 2022
MEDIUM NEUTRAL CITATION:	[2022] VSCA 72
JUDGMENT APPEALED FROM:	[2019] VSC 802 (Sifris J); [2020] VSC 7 (Sifris J)

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PRACTICE AND PROCEDURE – Application for leave to appeal decisions by primary judge to decline to recuse himself from further hearing winding up proceeding or declining to hear an application seeking that he do so – No substantive steps taken in relation to application by either liquidator on behalf of applicant or respondent since 24 January 2020 – Former director of applicant company objected to proceeding being dismissed for want of prosecution – No application made for approval of the Court for former director to pursue application for leave to appeal – Application for leave to appeal dismissed for want of prosecution – Supreme Court (General Civil Procedure) Rules 2015, r 64.46(1)(d), Corporations Act 2001 (Cth) s 198G.

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REPRESENTATION:	Counsel	Solicitors
For the Applicant	New Edge Law
For the Respondent	Madgwicks Lawyers

BEACH JA:

On 23 January 2020, Efektiv Pty Ltd filed an application for leave to appeal from four decisions made by Sifris J (as his Honour then was) sitting in the Trial Division in December 2019 and January 2020. The primary proceeding from which the application for leave to appeal arises was an application by Madgwicks to wind up Efektiv following its failure to comply with a statutory demand. By its application for leave to appeal, Efektiv seeks to appeal decisions made by his Honour declining to recuse himself from further hearing the winding up proceeding, or declining to hear an application that he recuse himself. The decisions were variously made on 5, 16 and 20 December 2019 and 2 January 2020. The reasons for the first decision were given on 9 December 2019,[1] and reasons for the second, third and fourth decisions were given on 24 January 2020.[2]
[1]In the Matter ofKornucopia Pty Ltd [No 2] [2019] VSC 802.
[2]In the Matter ofKornucopia Pty Ltd [No 4] [2020] VSC 7, [406]–[407], [409]–[413], [432]–[444] (‘Principal Reasons’).

On 24 January 2020, Sifris J ordered that Efektiv be wound up in insolvency. On the same day, Efektiv made two unsuccessful applications to this Court[3] in an attempt to prevent the winding up: one before the winding up order was made; and one (on the application of Shivesh Kuksal), after the winding up order was made. Mr Kuksal was the sole director of Efektiv until he resigned on 29 January 2019. In the proceeding before Sifris J, he described himself as the ‘beneficial owner’ of Efektiv. As Sifris J put it, while the precise corporate structure involving Efektiv had not been explained to him, it appeared that Mr Kuksal (at least at the time 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: [2022] VSCA 72
Decision Date: 20 April 2022

CaseChat Overview and Summary

Efektiv Pty Ltd sought leave to appeal against decisions of the primary judge declining to recuse himself from further hearing winding up proceedings or to hear an application seeking that he do so. The application for leave to appeal was made by the liquidator of Efektiv on behalf of the applicant. The respondent, Madgwicks, did not participate in the proceedings. The court was required to determine whether the application for leave to appeal had been abandoned or dismissed for want of prosecution. The court examined the relevant rules and statutes to determine if the application met the criteria for dismissal.

The court found that no substantive steps had been taken in relation to the application for leave to appeal since 24 January 2020. The former director of Efektiv had objected to the proceeding being dismissed for want of prosecution, but no application had been made for approval of the Court for the former director to pursue the application for leave to appeal. The court concluded that the application for leave to appeal was abandoned or dismissed for want of prosecution under Supreme Court (General Civil Procedure) Rules 2015, rule 64.46(1)(d) and Corporations Act 2001 (Cth) section 198G.

The application for leave to appeal was dismissed for want of prosecution. The court found that no substantive steps had been taken in relation to the application for leave to appeal since 24 January 2020. The court also found that no application had been made for approval of the Court for the former director to pursue the application for leave to appeal. The court held that the application for leave to appeal was abandoned or dismissed for want of prosecution under the relevant rules and statutes.

No further orders were made by the court. The application for leave to appeal was dismissed for want of prosecution, and no substantive steps had been taken in relation to the application since 24 January 2020. The court found that the application for leave to appeal was abandoned or dismissed for want of prosecution under the relevant rules and statutes.

Orders