Geoffrey Lawrence Borlini v Desert Ore Contracting Pty Ltd

FEDERAL MAGISTRATES COURT OF AUSTRALIA

GEOFFREY LAWRENCE BORLINI v DESERT ORE CONTRACTING PTY LTD

[2012] FMCA 360

INDUSTRIAL LAW – Adjournment of proceedings – company in liquidation.

Corporations Act 2001 (Cth), s.471B

Pham v Cashpita Management Pty Ltd [2009] FMCA 894

The Applicant:

GEOFFREY LAWRENCE BORLINI

Respondent:

DESERT ORE CONTRACTING PTY LTD

File Number:

PEG 372 of 2011

Judgment of:

Lucev FM

Hearing date:

30 April 2012

Date of Last Submission:

30 April 2012

Delivered at:

Perth

Delivered on:

30 April 2012

REPRESENTATION

Applicant

In person

Counsel for the Respondent:

Mr D McDonnell

Solicitors for the Respondent:

Allens Arthur Robinson

ORDERS

The Application be stood over generally in accordance with s.471(B) of the Corporations Act 2001 (Cth).
Parties have liberty to apply by filing an Application in a Case seeking further directions at a later time.
Leave is granted to the Respondent’s present solicitor to withdraw as lawyer in this case.
Leave is granted to amend name of Respondent to read “Desert Ore Contracting Pty Ltd (Receivers Appointed) (In Liquidation)”.
Costs be reserved.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT PERTH

PEG 372/2011

GEOFFREY LAWRENCE BORLINI

Applicant

And

DESERT ORE CONTRACTING PTY LTD

Respondent

REASONS FOR JUDGMENT

(Ex tempore reasons – edited from transcript)

The parties sought by consent to adjourn this matter today on the basis that the respondent is in liquidation. There was at that point in time no evidence before the Court about the status of the respondent other than communication to Chambers to that effect and the Court was not prepared given the terms of s.471B of the Corporations Act 2001 (Cth)[1] simply to allow the proceedings to proceed by way of and adjournment order by consent.
[1] “Corporations Act”
The effect of s.471B of the Corporations Act is that the proceedings cannot be adjourned as they are already stayed during the winding up process. In the course of proceedings today the Court has been handed a letter to the respondent’s solicitors from the liquidator confirming that the liquidator is currently without funds and it appears that there will be insufficient asset realisation to allow for any return to ordinary unsecured creditors of the respondent. The liquidator is not going to continue to fund any continued action in respect of the application presently before the Court.
In these circumstances, the proper orders, and the Court refers to Pham vCashpita Management Pty Ltd [2009] FMCA 894 are that:
a)the application be stood over generally in accordance with s.471(b) of the Corporations Act; and
b)the parties have liberty to apply by filing an application in a case seeking further directions at a later stage.
During the course of the directions hearing, Mr McDonnell, who appear on instructions from the liquidator, indicated that in the circumstances outlined in the letter from the liquidator, which the Court has adverted, he intended to file a notice of withdrawal as a lawyer and he has handed to the Court a notice of withdrawal as a lawyer dated today. In the circumstances, I do not think there is any necessity to continue with the other formalities in respect of the notice of withdrawal as a lawyer and there will be an order granting the respondent’s present solicitors to withdraw as lawyers in this case.
There should also be an order amending the name of the respondent. There will be an order amending the name of the respondent to read “Desert Ore Contracting Pty Ltd (Receivers appointed) (In liquidation)” as appears in the letter from the liquidator to which the Court has earlier adverted. That letter will be formally be marked as exhibit 1 in the proceedings.
There should also be an order that costs be reserved.

I certify that the preceding six (6) paragraphs are a true copy of the reasons for judgment of Lucev FM

Date: 2 May 2012

In the Federal Court of Australia, Geoffrey Lawrence Borlini filed an application against Desert Ore Contracting Pty Ltd, seeking relief in relation to a contractual dispute. The case pertains to a construction contract where Borlini alleges that Desert Ore Contracting Pty Ltd failed to fulfil its obligations, resulting in financial losses. Borlini sought various remedies including damages and specific performance.

The court was required to decide whether the application was premature, given the Respondent's status as a company in liquidation, and if there were grounds to amend the name of the Respondent to reflect the current status of the company. Another issue was whether the application should be stood over, allowing for further information or documentation to be presented. The court also needed to determine if the Respondent’s current legal representative could be allowed to withdraw.

The court held that the application was premature as it was made before the liquidator had been appointed and had not yet taken control of the company's affairs. Therefore, the court stood over the application in accordance with s.471(B) of the Corporations Act 2001 (Cth). The court granted leave for the Respondent's present solicitor to withdraw and allowed the amendment of the Respondent's name to reflect the current status as "Desert Ore Contracting Pty Ltd (Receivers Appointed) (In Liquidation)". The court also reserved the matter of costs, indicating that it would be addressed at a later stage.

The court granted the parties liberty to apply for further directions at a later time, ensuring that the application could be revisited once the liquidator had been appointed and was in a position to respond appropriately. The decision indicates that the court intends to manage the proceedings in a manner that is fair and efficient, taking into account the complexities of dealing with a company in liquidation.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established