Lucas, in the matter of Filestock Pty Ltd (in liq)

In the Federal Court of Australia, the liquidators of Filestock Pty Ltd brought an application against two former directors, seeking orders under section 588FF(3)(b) of the Corporations Act 2001. The liquidators sought to extend the time limit for making claims against the directors, arguing that the delay in filing the claims was due to the directors' actions in impeding efforts to secure litigation funding. The former directors opposed the extension, contending that the liquidators had not acted with reasonable diligence in pursuing litigation funding.

The court was required to determine whether the liquidators had provided sufficient evidence to support their claim of delay due to the directors' actions and whether the liquidators had acted with reasonable diligence in pursuing litigation funding. The court needed to consider whether the delay was sufficient to warrant an extension of the statutory time limit for making claims against the directors and whether the liquidators' actions in pursuing funding were reasonable.

The court found that the liquidators had provided evidence that the former directors had impeded their attempts to secure litigation funding, which contributed to the delay in filing the claims. The court also found that the liquidators had acted with reasonable diligence in pursuing litigation funding. The court held that the delay was sufficient to warrant an extension of the statutory time limit for making claims against the directors. The court ordered that the period during which the liquidators could make claims against the former directors be extended until 12 March 2018. The court also ordered that the liquidators' costs of and incidental to the application be costs in the winding up.

The orders were entered in accordance with Rule 39.32 of the Federal Court Rules 2011. The court's decision provides guidance to liquidators on the factors that may be considered in seeking an extension of the statutory time limit for making claims against directors, and the importance of acting with reasonable diligence in pursuing litigation funding.