In the Matter of the Companies (Tasmania) Code and in the Matter of an Application for Winding up Pursuant to Section 364(1)(a) by Richmond No 2 Pty Ltd

[1988] TASSC 112

Serial No: B44/1988

List "B"

COURT:                 SUPREME COURT OF TASMANIA

CITATION:IN THE MATTER OF THE COMPANIES (TASMANIA) CODE

and
IN THE MATTER OF AN APPLICATION FOR WINDING UP PURSUANT TO SECTION 364(1)(a) BY RICHMOND No 2 PTY LTD [1988] TASSC 112; B44/1988

FILE NO/S:  CWU 370/1988
DELIVERED ON:  15 December 1988
JUDGMENT OF:  Wright J

Judgment Number:  B44/1988
Number of paragraphs:  6

Serial No: B44/1988

List "B"

File No: CWU 370/1988

IN THE MATTER OF THE COMPANIES (TASMANIA) CODE
 and
IN THE MATTER OF AN APPLICATION FOR WINDING UP
PURSUANT TO SECTION 364(1)(a) BY RICHMOND No 2 PTY LTD

REASONS FOR JUDGMENT  WRIGHT J

15 December 1988

1. This application for winding up the above company came before me in Hobart on 10 October 1988. At the conclusion of proceedings, I invited counsel for the petitioner to make further written submissions as to her clients' non–compliance with s392(2)(b) of the Companies (Tasmania) Code. At that time, notice of the special resolution to wind up the company had not been published in the Tasmanian Government Gazette. On 19 October 1988 that procedural deficiency was remedied and the remedial action was verified by affidavit by the petitioner’s solicitor on 7 November 1988.

1. Originally I was invited to take the course of dispensing with this step altogether, it having been submitted that it was a mere procedural irregularity which could be dispensed with by the Court under s367(2)(b) of the Code or Rule 99 of the Rules of Court. This is not a course which I would be prepared to take. In the first place non–compliance with the requirements of s392(2) is constituted an offence by s392(3). This of itself does not prevent a Court exercising a dispensing power but it seems to me that strong persuasive reasons should exist before it does so where the relevant rule has been totally ignored. Secondly, r99 speaks of "a formal defect or irregularity" in proceedings. I think it is difficult to regard a failure to comply with s392(2) as a mere formal defect or irregularity and accordingly, I do not think that r99 applies to this type of situation at all.

1. Rule 42(2) provides that "No order except an order for the dismissal or adjournment of the petition shall be made on the petition of the petitioner who has not, before the hearing of the petition attended before the Registrar at the time appointed and satisfied him in the manner prescribed by this rule". This is a reference to r42(1) which requires a petitioner or his solicitor to attend the Registrar and satisfy him that (inter alia)

"(d) the provisions of the rules as to petitions have been duly complied with by the petitioner".  (My emphasis.)

1. As this requirement only relates to compliance with the rules, I think that the draconian consequences of r42(2) can be avoided where the procedural deficiencies arise from non–observance of the provisions of the Code rather than the Rules.

1. It has been submitted to me that as notice of the special resolution to wind up the company has now been published in the Gazette, an order for winding up by the Court may be made. It has been submitted that "it is the fact of publication rather than the time limit which is the essential element in Section 392(2)(b)".  No authority has been cited for this proposition. However, it seems to me plain enough upon the affidavit material before me, that creditors of the company will not be disadvantaged and that it would be a quite needless extravagance to require the petitioner to go back to the beginning of the requisite procedural steps and start all over again. From a common sense and practical viewpoint this should be avoided if possible.

1. It seems to me that as the s392(2) procedure has been complied with except in respect of the time limit therein imposed, it would be appropriate to exercise the dispensing power provided in s367(2)(b). To do so would not be inconsistent with the views expressed by Sholl J in Re Testro Bros Consolidated Ltd [1965] VR 18 and indeed would seem to me to accord generally with his view that procedural irregularities of this type do not wholly invalidate a proceeding and deprive the Court of jurisdiction. In my view, it would be a sound exercise of discretion to permit the publication of the notice in the Gazette on 19 October 1988 to constitute sufficient compliance with the Code and to thus enable the making of the orders sought by the petitioner. This is the course I propose to take.