Insurance Australia Pty Ltd v Crisp
[2010] FCA 166
FEDERAL COURT OF AUSTRALIA
Insurance Australia Pty Ltd v Crisp [2010] FCA 166
Citation: Insurance Australia Pty Ltd v Crisp [2010] FCA 166 Parties: INSURANCE AUSTRALIA PTY LTD ACN 000 016 722 v GLENN ANTHONY CRISP File number(s): NSD 638 of 2009 Judge: JAGOT J Date of judgment: 24 February 2010 Legislation: Corporations Act 2001 (Cth) ss 9, 513B, 588FE, 588FF Date of hearing: 24 February 2010 Place: Sydney Division: GENERAL DIVISION Category: No catchwords Number of paragraphs: 13 Counsel for the Liquidator: R. Francois Solicitor for the Liquidator: William Roberts Lawyers
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
NSD 638 of 2009
BETWEEN: INSURANCE AUSTRALIA PTY LTD ACN 000 016 722
PlaintiffAND: GLENN ANTHONY CRISP
Defendant
JUDGE:
JAGOT J
DATE OF ORDER:
24 FEBRUARY 2010
WHERE MADE:
SYDNEY
THE COURT ORDERS THAT:
1.The period of time for Mark Robinson in his capacity as liquidator of ACN 069 895 585 Pty Ltd to make any application under section 588FF(1) of the Corporations Act 2001 (Cth) be extended until 30 November 2010 to allow Mark Robinson to file proceedings pursuant to that section.
2.The costs of this application be costs in the liquidation of ACN 069 895 585 Pty Ltd.
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
NSD 638 of 2009
BETWEEN: INSURANCE AUSTRALIA PTY LTD ACN 000 016 722
PlaintiffAND: GLENN ANTHONY CRISP
Defendant
JUDGE:
JAGOT J
DATE:
24 FEBRUARY 2010
PLACE:
SYDNEY
REASONS FOR JUDGMENT
This is an application under s 588FF(3)(b) of the Corporations Act 2001 (Cth) by Mark Robinson, the liquidator of a company formerly known as Watermans Collection Pty Ltd, ACN 069 895 585. Mr Robinson applies for an extension of time for a period of 18 months to allow him to file proceedings pursuant to s 588FF(1) of the Corporations Act. That section allows an application by the liquidator of a company to a court to make various orders if satisfied that a transaction of a company is voidable because of s 588FE.
The application is supported by evidence of Mr Robinson (being an affidavit of 17 December 2009), an affidavit of Peter Michael McGee, a solicitor, of 14 September 2009, as well as an affidavit of service sworn on 21 December 2009 by Catherine J. Hollis.
Ms Hollis’s affidavit establishes that relevant court documents, including notification of the hearing today, were served on the persons or parties who may have had an interest in appearing before me today to be heard, namely Mills Oakley Lawyers, but no appearance has taken place.
Ms Francois, counsel for the liquidator, has provided me with oral and written submissions which fully disclose the basis upon which the application is made and the evidence in support of the application. It is not necessary for me to repeat the substance of her written submissions, which set out the background of the matter, the relevant law and also indicate to me the discretionary reasons that are said to support the making of the order which is sought. What it is necessary that I record is limited to the following. The application was filed in court, being an amended application, on 29 October 2009. However, that amended application followed an original application filed in court by the previous liquidator of Watermans, a Mr Crisp. This earlier application was filed on 3 July 2009. As Ms Francois’ submissions ably explained, 3 July 2009 is within the time period for commencing proceedings having regard to the provisions of the Corporations Act imposing the time limitation, namely, s 588FF(3) and the definition of the relation back day in s 9 as well as s 513B(e) of the Act. In other words, the application for the extension of time itself was made within time.
Ms Francois has also drawn my attention to relevant authorities which support the conclusion that the fact that the application was amended on 29 October 2009 so as to alter the identity of the liquidator and the length of the extension of time sought does not have the effect of invalidating the earlier application. Accordingly, consistent with her submissions, I am satisfied that I have power to make the order for the extension of time which is sought.
Ms Francois’ submissions also identified the test which must be applied in determining whether or not an order to extend time should be made, namely, what is fair and just in the circumstances of the particular case, which, of course, includes any explanation for the delay and the prejudice to the various interests involved.
The background to this matter, which is set out in paragraphs 11 through to 31 of Ms Francois’ submissions, can be dealt with very briefly. The plaintiff in the proceedings, Insurance Australia Ltd, is a creditor of Watermans. There is evidence, sufficient at least on this application, to satisfy me of connections between Watermans and persons and entities associated with Mills Oakley Lawyers. There is evidence, sufficient for present purposes, to sustain the submission which Ms Francois makes, that there is a prima facie case against Mills Oakley Lawyers to set aside the deed of assignment dated July 2004 by which Watermans assigned to Mills Oakley Lawyers what is known as the Leong asset. The Leong asset, in effect, is a chose in action which Watermans had the benefit of in relation to what appears to be the alleged wrongful taking of moneys from Watermans by one of its employees.
There is also evidence sufficient to satisfy me that Mr Robinson has not unduly delayed in the making of this application. As Ms Francois has demonstrated by her submissions the passage of time between the events of 2006 and today’s date are largely explained by the apparent lack of action by the former liquidator, Mr Crisp, who was appointed by the members and not by the creditors of Watermans.
In addition, there is evidence which shows that the issues of concern which the plaintiff raised in 2006 go to the heart of the consideration of fairness in respect of the capacity for action to be taken to seek to set aside the transaction which they wish to impugn.
Further, and undoubtedly in response to the lack of action, in 2008 the plaintiff in this matter, in its capacity as an eligible applicant, conducted an examination into the affairs of Watermans. The evidence obtained through the course of those examinations enabled the commencement of this proceeding on 30 June 2009, which included the seeking of orders to replace the liquidator and, in the interim, to require the liquidator to make the application for this extension of time. By consent, orders were made on 7 October 2009 substituting Mr Robinson as the liquidator. The application for the extension of time now made by Mr Robinson is brought against this background.
In short, I accept the submissions which Ms Francois has put. There has not been inappropriate delay by Mr Robinson. He was only appointed the liquidator after the expiration of the three-year time limit, that is, on 7 October 2009. However, as I have also noted, the original application by Mr Crisp made by reason of the plaintiff’s actions was within the period for the making of such an application. I accept also that the delay from the earlier years cannot be sheeted home to the plaintiff in this matter or to Mr Robinson. Indeed, delay is the very reason that steps were taken to substitute Mr Robinson as the liquidator instead of Mr Crisp. I have also noted that Mr Crisp was appointed the liquidator of Watermans by Mills Oakley Lawyers, who are, as Ms Francois has said, the main target of the present application. I also accept the existence of the prima facie case. These two considerations together satisfy me that there will be significant prejudice to the main creditor of Watermans if this extension of time is not granted.
Accordingly I propose to make orders as sought in the amended interlocutory process.
I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jagot. Associate:
Dated: 3 March 2010
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