Fielding v Dushas - [2013] QCA 55

SUPREME COURT OF QUEENSLAND

CITATION:

Andrew Fielding as Liquidator of Lyngray Developments Pty Ltd v Dushas [2013] QCA 55

PARTIES:

ANDREW FIELDING AS LIQUIDATOR OF LYNGRAY DEVELOPMENTS PTY LTD (in liquidation)
ACN 084 052 371
(applicant)
v
SASHA ELIZABETH DUSHAS
(respondent)
SOTIRI DUSHAS
(not a party to the appeal)

FILE NO/S:

Appeal No 5098 of 2012
Appeal No 9608 of 2012
DC No 3517 of 2008

DIVISION:

Court of Appeal

PROCEEDING:

Application for Leave s 118 DCA (Civil)
Application for Extension of Time/General Civil Appeal

ORIGINATING COURT:

District Court at Brisbane

DELIVERED ON:

22 March 2013

DELIVERED AT:

Brisbane

HEARING DATE:

6 November 2012

JUDGE:

Margaret McMurdo P and White JA and Daubney J
Separate reasons for judgment of each member of the Court, Margaret McMurdo P and White JA concurring as to the orders made, Daubney J dissenting in part

ORDERS:

In Appeal No 5098 of 2012:

1.Grant the application for leave to appeal.

2.Allow the appeal.

3.Set aside the order of the District Courtdismissing the claim.

4.Instead, declare that each of the 22 payments totalling $59,758 made from 5 June 2003 by Lyngray Developments Pty Ltd to Sasha Elizabeth Dushas is voidable under s 588FE(6A) Corporations Act 2001 (Cth).

5.Order that Sasha Elizabeth Dushas pay the sum of $44,818.50 to Lyngray Developments Pty Ltd, together with interest at 10 per cent from 15 August 2008.

6.The parties have leave to make submissions as to the appropriate costs order in the appeal and at first instance in accordance with para 52 of Practice Direction No 3 of 2013.

In Appeal No 9608 of 2012:

1.Refuse the application for an extension of time to appeal.

2. leave to make submissions as to the appropriate costs order in this application and at first instance in accordance with para 52 of Practice Direction No 2 of 2010.The parties have

CATCHWORDS:

CORPORATIONS – WINDING UP – CONDUCT AND INCIDENTS OF WINDING UP – EFFECT OF WINDING UP ON OTHER TRANSACTIONS – PREFERENCES UNCOMMERCIAL TRANSACTION – where the applicant liquidator of Lyngray Developments Pty Ltd seeks leave to appeal the decision of the District Court dismissing the application for a declaration under the Corporations Act 2001 (Cth) that transactions concerning payments to the respondent were voidable and for an order to repay the amount of the impugned payments to the company – where impugned payments involved depletion of the company’s assets –where respondent is a close blood-relative of the company director – where there were “suspicious” uses of the company’s funds – where the company’s principal place of business was located in a property owned by the daughter – where the company paid for the rent of this property to the bank account of the daughter – where company's accounts recorded 25 per cent of rental as attributable to the company's use – whether there was evidence of any benefit to the company in entering into the transactions constituted by the impugned payments – whether transactions were voidable as “unreasonable director-related transactions” under

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.

Continue reading Fielding v Dushas

Details

AGLC: Andrew Fielding as Liquidator of Lyngray Developments Pty Ltd v Dushas [2013] QCA 55
Case: [2013] QCA 55
Decision Date: 22 March 2013

CaseChat Overview and Summary

Fielding, the applicant liquidator of Lyngray Developments Pty Ltd, sought leave to appeal against a decision of the District Court which dismissed his application for a declaration under the Corporations Act 2001 (Cth) that certain transactions concerning payments to the respondent, Dushas, were voidable. The applicant also sought an order for Dushas to repay the amount of the impugned payments to the company. The transactions in question involved payments made by the company to Dushas, who is a close blood relative of the company director, and involved the depletion of the company's assets. The District Court dismissed the application, finding that there was no evidence of any benefit to the company in entering into these transactions and that they were not voidable as "unreasonable director-related transactions" under s 588FE(6) of the Corporations Act.

The legal issues before the court were whether there was evidence of any benefit to the company in entering into the impugned transactions, whether these transactions were voidable as "unreasonable director-related transactions" under s 588FE(6) of the Corporations Act, and whether an order should be made under s 588FF(1) Corporations Act to repay the impugned payments. The court was also required to decide whether the applicant should have leave to appeal under s 118 District Court of Queensland Act 1967 (Qld). The court found that the impugned transactions were indeed voidable under s 588FE(6A) of the Corporations Act and that Dushas should repay the amount of the impugned payments to the company. The court held that the applicant had leave to appeal and that the appeal should be allowed, setting aside the order of the District Court dismissing the claim.

In the appeal, the court granted the application for leave to appeal and allowed the appeal. The court set aside the order of the District Court dismissing the claim and instead declared that each of the 22 payments totalling $59,758 made from 5 June 2003 by Lyngray Developments Pty Ltd to Sasha Elizabeth Dushas was voidable under s 588FE(6A) Corporations Act 2001 (Cth). The court further ordered that Sasha Elizabeth Dushas pay the sum of $44,818.50 to Lyngray Developments Pty Ltd, together with interest at 10 per cent from 15 August 2008. The parties were granted leave to make submissions as to the appropriate costs order in the appeal and at first instance in accordance with para 52 of Practice Direction No 3 of 2013. In the second appeal, the application for an extension of time to appeal was refused, and the parties were granted leave to make submissions as to the appropriate costs order in this application and at first instance in accordance with para 52 of Practice Direction No 2 of 2010.

Orders

Orders of the court

In Appeal No 5098 of 2012:

1.Grant the application for leave to appeal.

2.Allow the appeal.

3.Set aside the order of the District Courtdismissing the claim.

4.Instead, declare that each of the 22 payments totalling $59,758 made from 5 June 2003 by Lyngray Developments Pty Ltd to Sasha Elizabeth Dushas is voidable under s 588FE(6A) Corporations Act 2001 (Cth).

5.Order that Sasha Elizabeth Dushas pay the sum of $44,818.50 to Lyngray Developments Pty Ltd, together with interest at 10 per cent from 15 August 2008.

6.The parties have leave to make submissions as to the appropriate costs order in the appeal and at first instance in accordance with para 52 of Practice Direction No 3 of 2013.

In Appeal No 9608 of 2012:

1.Refuse the application for an extension of time to appeal.

2. leave to make submissions as to the appropriate costs order in this application and at first instance in accordance with para 52 of Practice Direction No 2 of 2010.The parties have

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Andrew Fielding as Liquidator of Lyngray Developments Pty Ltd v Dushas [2013] QCA 55
PARTIES:	ANDREW FIELDING AS LIQUIDATOR OF LYNGRAY DEVELOPMENTS PTY LTD (in liquidation) ACN 084 052 371 (applicant) v SASHA ELIZABETH DUSHAS (respondent) SOTIRI DUSHAS (not a party to the appeal)
FILE NO/S:	Appeal No 5098 of 2012 Appeal No 9608 of 2012 DC No 3517 of 2008
DIVISION:	Court of Appeal
PROCEEDING:	Application for Leave s 118 DCA (Civil) Application for Extension of Time/General Civil Appeal
ORIGINATING COURT:	District Court at Brisbane
DELIVERED ON:	22 March 2013
DELIVERED AT:	Brisbane
HEARING DATE:	6 November 2012
JUDGE:	Margaret McMurdo P and White JA and Daubney J Separate reasons for judgment of each member of the Court, Margaret McMurdo P and White JA concurring as to the orders made, Daubney J dissenting in part
ORDERS:	In Appeal No 5098 of 2012: 1.Grant the application for leave to appeal. 2.Allow the appeal. 3.Set aside the order of the District Courtdismissing the claim. 4.Instead, declare that each of the 22 payments totalling $59,758 made from 5 June 2003 by Lyngray Developments Pty Ltd to Sasha Elizabeth Dushas is voidable under s 588FE(6A) Corporations Act 2001 (Cth). 5.Order that Sasha Elizabeth Dushas pay the sum of $44,818.50 to Lyngray Developments Pty Ltd, together with interest at 10 per cent from 15 August 2008. 6.The parties have leave to make submissions as to the appropriate costs order in the appeal and at first instance in accordance with para 52 of Practice Direction No 3 of 2013. In Appeal No 9608 of 2012: 1.Refuse the application for an extension of time to appeal. 2. leave to make submissions as to the appropriate costs order in this application and at first instance in accordance with para 52 of Practice Direction No 2 of 2010.The parties have
CATCHWORDS:	CORPORATIONS – WINDING UP – CONDUCT AND INCIDENTS OF WINDING UP – EFFECT OF WINDING UP ON OTHER TRANSACTIONS – PREFERENCES UNCOMMERCIAL TRANSACTION – where the applicant liquidator of Lyngray Developments Pty Ltd seeks leave to appeal the decision of the District Court dismissing the application for a declaration under the Corporations Act 2001 (Cth) that transactions concerning payments to the respondent were voidable and for an order to repay the amount of the impugned payments to the company – where impugned payments involved depletion of the company’s assets –where respondent is a close blood-relative of the company director – where there were “suspicious” uses of the company’s funds – where the company’s principal place of business was located in a property owned by the daughter – where the company paid for the rent of this property to the bank account of the daughter – where company's accounts recorded 25 per cent of rental as attributable to the company's use – whether there was evidence of any benefit to the company in entering into the transactions constituted by the impugned payments – whether transactions were voidable as “unreasonable director-related transactions” under