Kyara Pty Ltd v Coghlan
[2018] VCC 1828
•14 November 2018
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERCIAL DIVISION | Revised Not Restricted Suitable for Publication |
Case No. CI-18-03398
| Kyara Pty Ltd atf Pendergast Family Trust | Plaintiff |
| v | |
| John Leo Coghlan & Coghlan Duffy & Co. Pty Ltd formerly Coghlan & Co. Pty Ltd | Defendants |
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JUDGE: | His Honour Judge Woodward | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 13 November 2018 | |
DATE OF RULING: | 14 November 2018 | |
CASE MAY BE CITED AS: | Kyara Pty Ltd v Coghlan | |
MEDIUM NEUTRAL CITATION: | [2018] VCC 1828 | |
REASONS FOR RULING
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Ryan Solicitors | |
| For the Defendants | Colin Biggers & Paisley Lawyers |
HIS HONOUR:
1 By summons dated 23 October 2018 the defendants apply for orders pursuant to s24AL of the Wrongs Act 1958 (Vic) (“Act”) and r9.06 of the County Court Civil Procedure Rules 2008 (Vic), that Leon Pendergast be joined as the third defendant to the proceeding. The application relies on the affidavit of Andrew Probert, the solicitor for the defendants, sworn 23 October 2018 which in substance deposes that, if the defendants have any liability to the plaintiff (which is denied) the defendants contend that Mr Pendergast is a concurrent wrongdoer within the meaning of s24AH of the Act in respect of that liability.
2 I am satisfied on the material that there are proper grounds for a grant of leave pursuant to s24AL of the Act for Mr Pendergast to be joined as a defendant in the proceeding. However, the evidence is that Mr Pendergast is an undischarged bankrupt. Thus, in the course of reviewing the material, I became concerned that it may be necessary for the defendants first to obtain leave of the “Court” (within the meaning of the Bankruptcy Act 1966 (Cth)), pursuant to s58(3)(b) of that Act.
3 Whether such leave is required essentially turns on whether a claim for apportionment pursuant to Part IVAA of the Act is a “provable debt” within the meaning of the Bankruptcy Act 1966 (Cth). There is authority for the proposition that a claim for contribution pursuant to s23B of the Act is a provable debt (Sutherland v Jatkar [2014] FCA 532). But neither I nor the solicitor appearing for the defendants at the hearing of the application, have been able to locate any authority or other discussion on the question of whether an apportionable claim is likewise a provable debt.
4 The need for an order joining Mr Pendergast as a defendant is beyond doubt. Section 24AI of the Act provides:
“In apportioning responsibility between defendants in the proceeding the court must not have regard to the comparative responsibility of any person who is not a party to the proceeding unless the person is not a party to the proceeding because the person is dead or, if the person is a corporation, the corporation has been wound-up.”
No exception is created in s24AI or otherwise in Part IVAA of the Act for a person who is an undischarged bankrupt.
5 Considering the issue from first principles, in my view, a claim for apportionment under Part IVAA of the Act is not a provable debt. There is no sense in which such a claim impinges upon the bankrupt estate of Mr Pendergast. It operates merely to permit the party making the claim to apply to reduce that party’s liability to the plaintiff. This is to be contrasted with a claim for contribution which, if successful, will result in an order for a share of the damages being made directly against the party against whom the contribution claim is made.
6 This approach is also consistent with the line of authority confirming that s24AL of the Act is a procedural provision only, which does not determine the person is a concurrent wrongdoer for the purposes of Part IVAA (Civil Procedure Victoria at [7696.0]). In the circumstances, I propose to make the orders sought by the summons notwithstanding my initial reservations.
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Certificate
I certify that these 3 pages are a true copy of the reasons for decision of His Honour Judge Woodward delivered on 14 November 2018.
Dated: 14 November 2018
Simone Karmis
Associate to His Honour Judge Woodward
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