MOHEN AS LIQUIDATOR OF MBP (WA) PTY LTD

Case

[2023] WASC 81

21 MARCH 2023


JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   MOHEN AS LIQUIDATOR OF MBP (WA) PTY LTD [2023] WASC 81

CORAM:   LUNDBERG J

HEARD:   17 MARCH 2023

DELIVERED          :   17 MARCH 2023

PUBLISHED           :   21 MARCH 2023

FILE NO/S:   COR 40 of 2023

BETWEEN:   JEROME HALL MOHEN AS LIQUIDATOR OF MBP (WA) PTY LTD ACN 104 743 599

Plaintiff


Catchwords:

Corporations law - Application for extension of time under s 588FF(3)(b) of the Corporations Act 2001 (Cth) - Extension sought to allow liquidator to complete public examinations and to continue investigations into possible voidable transactions - Whether shelf order appropriate - Turns on own facts

Legislation:

Corporations Act 2001 (Cth), s 588FF(1), s 588FF(3)(a), s 588FF(3)(b)

Result:

Application granted

Category:    B

Representation:

Counsel:

Plaintiff : Mr N F Malone

Solicitors:

Plaintiff : Pragma Lawyers

Case(s) referred to in decision(s):

Brisbane South Regional Health Authority v Taylor [1996] HCA 25; (1996) 186 CLR 541.

Cussen, in the matter of Monarch Towers Pty Ltd (in liquidation) [2023] FCA 192.

Fortress Credit Corporation (Australia) II Pty Ltd v Fletcher [2015] HCA 10; (2015) 254 CLR 489.

Grant Samuel Corporate Finance Pty Ltd v Fletcher [2015] HCA 8; (2015) 254 CLR 477.

Green v Chiswell Furniture Pty Ltd (in liq) [1999] NSWSC 608.

Greig v Stramit Corporation Pty Ltd [2003] QCA 298; [2004] 2 Qd R 17.

Griffiths v Nillumbik Shire Council [2022] VSCA 212.

Matthew David Woods as joint and several liquidator of Brierty Limited (In Liquidation) [2022] WASC 310.

Robert Michael Kirman as Liquidator of ACN 142 745 337 (in liq) [2020] WASC 129.

Walker and Moloney v CBA Corporate Services (NSW) Pty Limited [2012] FCA 328.

Table of Contents

A.           INTRODUCTION AND SUMMARY

B.           PROCEDURAL HISTORY

C.           LEGISLATION AND PRINCIPLES

D.           THE BASES FOR THE EXTENSION

E.           DISPOSITION

Explanation for the delay

Merits of the proposed proceedings

Prejudice

Further matters

Length of the extension

Whether a shelf order is appropriate

F.           ORDERS

LUNDBERG J:

(This judgment was delivered ex temporaneously on 17 March 2023 and has been edited from the transcript to correct matters of grammar, add headings, and include complete references.)

A.     INTRODUCTION AND SUMMARY

  1. These reasons concern an application brought by the liquidator of MBP (WA) Pty Ltd (MBP) seeking orders pursuant to s 588FF(3)(b) of the Corporations Act 2001 (Cth) (Act) to extend the time for making an application under s 588FF(1) of the Act. The extension is sought to enable the liquidator of MBP further time to commence proceedings about voidable transactions under s 588FF(1) of the Act.[1]  The extension is sought up to and including 7 March 2024 (which is almost a further 12 month extension). 

    [1] Originating Process dated 13 March 2023, proposed order 1 (Originating Process).

  2. Relatedly, orders were sought pursuant to O 67B r 5(3) of the Rules of the Supreme Court 1971 (WA) (RSC) to restrict access to the supporting affidavit sworn by the liquidator.[2]  I dealt with this aspect of the application on 15 March 2023 by granting the restriction orders sought and will publish separate reasons in that regard.  Given the orders to restrict access which I made, I will refer in these reasons to the background circumstances which are deposed to in the Mohen Affidavit in general terms only.

    [2] Originating Process, proposed order 2.  The supporting affidavit of Jerome Hall Mohen was sworn on 10 March 2023 (Mohen Affidavit).

  3. For the reasons set out below, I propose to grant the extension of time sought by the plaintiff.

B.     PROCEDURAL HISTORY

  1. The application was filed on 13 March 2023 and brought on for hearing in circumstances of urgency given the limitation date under s 588FF(3)(a) of the Act expires on 26 March 2023. That date falls on a Sunday, meaning the effective expiry date is Friday, 24 March 2023. The limitation period in question is a 3 year period which commenced running from the relation-back date, namely 26 March 2020. The power in s 588FF(3)(b) allows the court to mitigate the strictness of the time limits imposed by s 588FF(1) in an appropriate case.

  2. The Originating Process foreshadowed an intention on the part of the plaintiff to serve the papers on several interested persons, being two directors of MBP and three creditors who received payments from the company at a time at which it may have been insolvent.  I will refer to these persons collectively as the Interested Persons.

  3. The application was first brought on for a directions hearing on the afternoon of 15 March 2023.  At that hearing, counsel for the plaintiff informed the court that steps had been taken to serve the Interested Persons with the proceedings.  The nature of those steps, and the written and verbal communications with the Interested Persons, were deposed to in the affidavit of Nicholas Francis Malone sworn 15 March 2023 (Malone Affidavit). 

  4. It being appropriate that the Interested Persons have proper notice of the plaintiff's application, and they have an opportunity to be heard in opposition,[3] the plaintiff proposed that the matter be adjourned to a final hearing today (17 March 2023).  I agreed with that course and also directed that the plaintiff give further notice of this listing to the Interested Persons.  There was no appearance at the hearing today (17 March 2023) by any of those persons.  I am satisfied that reasonable efforts have been made to serve the proceedings on the Interested Persons, and that those persons have been given notice of the hearing listed for this afternoon.

    [3] As to which, see Greig v Stramit Corporation Pty Ltd [2003] QCA 298; [2004] 2 Qd R 17 [34] (Williams JA), [109] (Jerrard JA), and [140] (Fryberg J).

C.     LEGISLATION AND PRINCIPLES

  1. Section 588FF of the Act relevantly provides as follows:

    Courts may make orders about voidable transactions

    (1)Where, on the application of a company's liquidator, a court is satisfied that a transaction of the company is voidable because of section 588FE, the court may make one or more of the following orders:

    (a)an order directing a person to pay to the company an amount equal to some or all of the money that the company has paid under the transaction;

    (b)an order directing a person to transfer to the company property that the company has transferred under the transaction;

    (c)an order requiring a person to pay to the company an amount that, in the court's opinion, fairly represents some or all of the benefits that the person has received because of the transaction;

    (d)an order requiring a person to transfer to the company property that, in the court's opinion, fairly represents the application of either or both of the following:

    (i) money that the company has paid under the transaction;

    (ii) proceeds of property that the company has transferred under the transaction;

    (2)Nothing in subsection (1) limits the generality of anything else in it.

    (3)An application under subsection (1) may only be made:

    (a)during the period beginning on the relation-back day and ending:

    (i)3 years after the relation-back day; or

    (ii)12 months after the first appointment of a liquidator in relation to the winding up of the company;

    whichever is the later; or

    (b)within such longer period as the Court orders on an application under this paragraph made by the liquidator during the paragraph (a) period.

  2. The principles which are applicable to the question whether time should be extended under s 588FF(3)(b) of the Act are relatively settled. The plaintiff filed an outline of submissions on 17 March 2023 which included a summary of those principles.

  3. In Robert Michael Kirman as Liquidator of ACN 142 745 337 (in liq) [2020] WASC 129, Sanderson M made the following observation regarding the extension power (at [6]):

    What is striking about s 588FF(3)(b) is that the power of the court is unqualified.  The subsection embodies a discretion and no doubt that discretion is to be exercised judicially.  There is nothing in the subsection which indicates in any way what factors are to be taken into account in the exercise of discretion.  Nonetheless in various cases principles have been laid down which, while not necessarily binding, provide a guide as to the thinking of various judges.  For instance, in Onefone Australia Pty Ltd v One.Tel Limited (2007) 61 ACSR 246 the court determined that an indeterminate extension could not be granted but instead there must be a fixed definite period for making the substantive applications. In Greig v Stramit Corporation Pty Ltd [2004] 2 Qd R 17 the court determined that although applications are generally made on an ex parte basis notice should be given to persons affected by the application as they have a right to be heard on the application.

  4. In Walker and Moloney v CBA Corporate Services (NSW) Pty Limited [2012] FCA 328, Nicholas J described three matters which would usually be considered in deciding whether to grant an extension of time. His Honour said at [43]:

    The matters to be considered for the purpose of determining an application under s 588FF(3) are well settled. There are three matters which must usually be considered. First, the court must consider the explanation for the delay in commencing the proposed proceedings within the three year period provided for by the statute. Secondly, it is necessary, subject to what follows, for the court to undertake a preliminary review of the merits of the proposed proceeding. Thirdly, the court must consider any prejudice likely to be suffered in the event the extension sought is granted.

  5. Importantly, and to give content to the caveat expressed by Nicholas J in the passage referred to above, a review of the merits may be unnecessary if the purpose of the application for an extension of time is to allow the liquidator time in which to properly decide whether or not to bring the proposed proceedings: see Green v Chiswell Furniture Pty Ltd (in liq) [1999] NSWSC 608 [15] (Austin J).

  6. In a recent decision in this Court, Matthew David Woods as joint and several liquidator of Brierty Limited (In Liquidation) [2022] WASC 310, Sanderson M observed that the phrase 'preliminary review of the merits' has been explained in a manner which suggests the bar is rather modest for the purposes of this enquiry.  The Learned Master referred to Austin J's description in Chiswell Furniture [15] to the effect that the review involves a consideration of whether the proposed proceeding 'would be so devoid of prospects that it would be unfair, by granting an extension, to expose the other party to the continuing prospect of suit'. 

  7. The court undoubtedly has power make an order extending time without specifying the particular transaction or transactions to which it would apply.  Commonly, this is known as a 'shelf order'.  The validity of such an order was resolved in Fortress Credit  Corporation (Australia) II Pty Ltd v Fletcher [2015] HCA 10; (2015) 254 CLR 489, 496 [3] and [27] (French CJ, Hayne, Kiefel, Gageler and Keane JJ). The following passages from their Honours' reasons provide an explanation of the policy which underpins the provision generally, and which explains their conclusion in relation to the power to make such orders:

    [24] The function of s 588FF(3)(b), which reflects its immediate purpose, is to confer a discretion on the court to mitigate, in an appropriate case, the rigours of the time limits imposed by par (a). That is a discretion to be exercised having regard to the scope and purposes of Pt 5.7B, characterised in the Harmer Report as the continuing "policy" which underpinned its recommendations. That policy included the avoidance of transactions by which an insolvent company has disposed of property in circumstances that are regarded by the legislature as unfair to the general body of unsecured creditors. It is, however, a policy qualified in its application by the requirement that liquidators be placed under a reasonable time limitation for taking action under the voidable transaction provisions. A purpose of that qualification, expressed in "clear and emphatic" terms, is to favour certainty for those who have entered into transactions with the company during the periods in respect of which designated transactions may be voidable [Grant Samuel Corporate Finance Pty Ltd v Fletcher [2015] HCA 8 at [21], citing Texel Pty Ltd v Commonwealth Bank of Australia [1994] VicRp 62; [1994] 2 VR 298 at 300]. There is, however, no independent basis for the assertion that any extension of time which does not identify a particular transaction or transactions must be an unreasonable prolongation of uncertainty militating against a construction which would allow such an order to be made. The section provides for the exercise of discretion by the court. Questions of what is a reasonable or an unreasonable prolongation of uncertainty and the scope of such uncertainty are more appropriately considered case-by-case in the exercise of judicial discretion than globally in judicial interpretation of the provision.

    [27] In the end, as the appellants accepted, the availability of shelf orders is a construction open on the text of s 588FF(3)(b). It is a construction which is consistent with the evident purpose of that provision, to allow the court to mitigate the strictness of the time limits imposed by par (a) in an appropriate case. The effect of re-enactment of s 588FF(3), in light of the construction adopted by the Court of Appeal, is no barrier to that construction. Indeed it may be taken to support it.[4]

    [4] Fortress Credit [24] and [27] (French CJ, Hayne, Kiefel, Gageler and Keane JJ).

  8. The power to make a shelf order, as with the power to make any order under s 588FF(3)(b) of the Act, is a discretionary one.[5] 

    [5] Cussen, in the matter of Monarch Towers Pty Ltd (in liquidation) [2023] FCA 192 [15] (O'Callaghan J).

D.     THE BASES FOR THE EXTENSION

  1. Mr Mohen is a registered liquidator and a partner of the firm RSM Australia Partners.

  2. It appears from the Mohen Affidavit that Mr Mohen has been undertaking investigations into the affairs of MBP since being appointed on 12 May 2020.  That company initially traded as a commercial laundry business, and operated as such between about May 2003 and June 2019. 

  3. Mr Mohen's investigative work since being appointed has included analysing the financial records of the company, liaising with one of the long-standing directors of the company and the company's pre-appointment accountant in relation to the affairs of the company, and reviewing the internal management accounts of the company concerning two material matters.  Those matters are a suspected transfer of the company's assets to a related entity and the suspected transfer of the company's business to another entity.

  4. Mr Mohen has engaged solicitors to assist him with the task of reviewing the affairs of the company, and in undertaking certain examinations. 

  5. In 2020, a public examination of one of the directors was undertaken by the liquidator in the Federal Court of Australia.  This process led to a deed of settlement being entered between that director and the liquidator.  The Federal Court proceedings were thereafter stayed and ultimately dismissed. 

  6. It appears the deed of settlement was then terminated and further without prejudice discussions were explored with the director. 

  7. Subsequently, in around October 2022, Mr Mohen initiated steps to commence a second round of public examinations in the Federal Court and to seek production of documents from third parties.  It appears there have been some delays in having that application issued.  A summons seeking production of documents was filed by the liquidator with the Federal Court on 18 November 2022 and a summons for examination of the director was then issued by that Court on 2 March 2023.  I understand that director is due to be examined on 4 May 2023. 

  8. The fresh examination proceedings are being pursued, it would seem, to allow the liquidator to better understand the potential claims he may have at his disposal.

  9. The delay in bringing a proceeding under s 588FF(1) of the Act is principally attributed to the delays arising from the matters mentioned in the preceding paragraphs. There is also evidence before me of deficiencies in the corporate records of MBP which I infer have also contributed to the delays.

  10. More recently, Mr Mohen issued a report to creditors of MBP.  I refer to the second report to creditors dated 1 February 2023.  A meeting of creditors was also recently held, on 16 February 2023.  I understand the second report to creditors is a publicly available document.  The report incorporates additional detail as to the steps which Mr Mohen has been undertaking in relation to recovery actions.  My attention has been drawn to the following extract of the second report, which comments on the fresh public examination process which Mr Mohen has initiated:

    The public examination process will assist the progression of my investigations in that it:

    1.Compels the production of documents to enable an assessment of the merits and strengths of potential claims.  In particular, obtaining documents that may be fatal to any potential claims.

    2.Compels the production of documents to establish the financial position of any potential defendants to litigation and to ascertain whether they hold sufficient assets to justify proceeding with litigation; and

    3.May facilitate a commercial settlement of any potential claims.

    Due to potential recovery actions being sensitive in nature, I am unable to provide further details on the nature of the claims to creditors at this time.[6]

    [6] Second Report to Creditors, pg 2.

  11. Mr Mohen deposes that he has also undertaken work to engage a litigation funder to provide funding for any litigation arising from the liquidation and the public examination process.

  12. Mr Mohen understandably wishes to gather further information about the affairs of the company before he launches any legal proceedings against third parties. 

  13. Mr Mohen nonetheless deposes that, on the information presently available to him, he believes he has a reasonable basis to mount various claims on behalf of MBP in connection with the sale of assets by the business, payments to certain creditors, and the question of employee entitlements.

E.     DISPOSITION

Explanation for the delay

  1. I turn first to consider the explanation for the delay in the liquidator commencing any proceedings. 

  2. I am comfortably satisfied that the plaintiff has demonstrated adequate reasons for the delay in commencing proceedings pursuant to s 588FF(1) of the Act. The evidence discloses that a series of meaningful steps have been undertaken by the plaintiff in his capacity as the liquidator of MBP, including examinations in the Federal Court, and further steps remain to be completed, including further examinations. The fact that applications have been filed seeking further examinations, which are now listed and due to commence in a number of weeks, provides direct evidence that the liquidator is continuing to pursue evidence and material which will allow him to better understand the potential claims he may have at his disposal.

  3. There is also evidence of funding difficulties, although they appear to have now been addressed through a litigation funding arrangement, and evidence of deficiencies in the corporate records of MBP.  These matters have contributed in part to the delays experienced by Mr Mohen.

  4. I observe that there is no evidence to suggest that the liquidator has been materially hampered in any way by other parties, such as the Interested Persons.  That is to say, there is no evidence of any lack of cooperation on the part of these other persons.  It simply appears that the tasks required to be undertaken by the liquidator have occupied a considerable time, and although the liquidator has formed the view that he has a reasonable basis to mount various claims on behalf of MBP in connection with various matters, further time is needed to identify and assemble additional evidence.

  1. I note the liquidator and one of the directors (being the long-standing director of the company) had entered a deed of settlement (which was ultimately not effectuated).  I do not have evidence before me of the content of that deed, but the fact a deed was entered into with the director, which led to a lengthy stay of the first examination process, and that deed was ultimately terminated, does provide a further reasonable explanation for the delay.

Merits of the proposed proceedings

  1. As to the merits of the proposed proceedings, this is not a case, in my view, in which a detailed review is required in this regard.  This is because the liquidator is seeking an extension of time to properly decide whether or not to bring proceedings. 

  2. That said, the supporting affidavit provides an explanation of the nature of the claims which are being considered, it provides some evidentiary material and explanation to indicate that the potential claims are not frivolous or vexatious. The types of claims being considered are breaches of director's duties, unfair preference and insolvent transactions, and a potential creditor-defeating disposition. Put another way, the affidavit of Mr Mohen sketches out a narrative of circumstances which call for enquiry by a liquidator to assess whether the powers afforded to the liquidator under the Act should be exercised, to claw back or restore funds to the company for the benefit of all creditors.

Prejudice

  1. As to the question of prejudice, I am conscious that an extension of time may, inferentially at least, cause prejudice to the Interested Persons and to others in the sense that they remain exposed to suit for a further period.  The principle of general or presumptive prejudice reflects the adverse effect of the effluxion of time on a putative defendant's ability to prepare their defences.  The Interested Persons are facing potential legal proceedings that would require an examination of their conduct and various transactions that allegedly took place from about 2019 through to around May 2020. 

  2. This general prejudice to the Interested Persons cannot be ignored by the court. Delay leads to prejudice and that prejudice will be heightened where the matter involves complicated transactions which require examination many years later. There is a general public interest in ensuring that litigation is brought and prosecuted in a timely fashion. Provisions such as s 588FF(3)(a) of the Act, as with statutory limitation periods generally, represent a judgment by the legislature that a right of a party to pursue a cause of action is not unlimited.[7]

    [7] Griffiths v Nillumbik Shire Council [2022] VSCA 212 [64] (J Forrest AJA), referring to Brisbane South Regional Health Authority v Taylor [1996] HCA 25; (1996) 186 CLR 541, 522 - 533 (McHugh J).

  3. The Interested Persons have not appeared today nor produced any material to identify specific prejudice.  The solicitors for the liquidator have adduced on affidavit a letter from the solicitors for the long-standing director of the company (dated 14 March 2023, and sent in response to the service of these proceedings), however that letter does not identify any specific prejudice.  I should also say that the transactions in the present case do not strike me as being overly complicated or complex, although that is a preliminary observation at best, given the nature of this application. 

  4. In my view, on balance, the fact there may be general prejudice to the Interested Persons from the overall delay does not materially weigh against the making of the extension order sought.  

Further matters

  1. There are two further matters to address on this application. 

  2. The first is the length of the extension sought.  The second is whether a shelf order should be made, or some other, more tailored order, is appropriate.  Prior to the hearing today, I had my associate raise these issues with counsel for the plaintiff by email.  I have heard oral submissions from counsel on both issues this afternoon and conclude as follows.

Length of the extension

  1. As to the length of the extension, I consider the extension of a further 12 months, through to 7 March 2024, is justified.  As the liquidator is undertaking further examinations which begin in May 2023, and further work will be required to consider the prospective claims, an extension into the first quarter of the 2024 calendar year will allow the liquidator sufficient time to decide whether to commence proceedings.

  2. In support of the requested extension, counsel for the plaintiff emphasised that once an extension has been granted under s 588FF(3)(b), and the extension period lapses, no further extension may be sought. Counsel referred to the decision of the High Court in Grant Samuel Corporate Finance Pty Ltd v Fletcher [2015] HCA 8; (2015) 254 CLR 477 [24] (French CJ, Hayne, Kiefel, Bell, Gageler and Keane JJ) in this regard. The import of that authority is that there can be only one opportunity for the liquidator to seek a relevant extension under s 588FF(3)(b). Further, the only power held by the court to order an extension is given by s 588FF(3)(b) and that cannot be supplemented or varied by the rules of this court. This restriction in the operation of the provision is a relevant matter to take into account in determining whether the 12 month extension that is presently sought is appropriate.

  3. Further, I recognise that, in considering the length of the extension which has been sought by the liquidator, it is not difficult to see the looming examination process conceivably running for some months.  As a matter of practical experience, public examination processes are not matters which are always finalised by one hearing before the court.  Adjournments can be sought, multiple hearings may be required, and there may well be delays in the process for document production by the recipient of the examination summons.  So, while the process for further examinations has already been commenced by the plaintiff, and I would expect the plaintiff to act as expeditiously as reasonably possible, it is appropriate to build in some additional time to allow the process to conclude.

  4. Taking the above matters into account, I am satisfied the extension of time sought through until 7 March 2024 is reasonable and appropriate in all the circumstances.

Whether a shelf order is appropriate

  1. I turn lastly to consider the appropriateness of a shelf order being made.  The solicitors for the long-standing director (through their letter to the liquidator's solicitors) raised a concern as to why a shelf order was being sought in this case, particularly in circumstances in which the liquidator had identified an alleged claim against that director and other relevant parties. 

  2. Those solicitors noted that, at least as a matter of assumption on their part, in order for the liquidator to have obtained litigation funding it would have been necessary for the liquidator to identify and explain relevant impugned transactions.  That is, generally speaking, a reasonable assumption.  Litigation funders, in my experience, are typically astute enough to require identification of the targets of any proposed proceedings and the nature and merits of the claims which are to be brought, prior to a grant of funding.  There may be exceptions to this general proposition though.  Indeed, I note in the present circumstances that the litigation funding arrangement has been obtained in order to 'fund any litigation arising from the findings of the public examination'.[8] 

    [8] Mohen Affidavit [38].

  3. In response to these matters, my attention has been drawn to passages within the liquidator's affidavit which tend to support a finding that, as matters presently stand, the liquidator has some degree of uncertainty about the actions undertaken by, and the purposes of, the longstanding director of the company.  This is particularly relevant in the context of the alleged transfer of the business from the company for a negligible sum, and also particularly relevant in the context of the employee entitlement issue. 

  4. Accordingly, when the matter is viewed in totality, the presence of litigation funding in this case in and of itself does not necessarily provide evidence that clear litigation targets, or specific claims, have fully crystallised. 

  5. Further, as the next round of examinations are yet to be concluded (and do not commence until May 2023) I accept there remains the possibility that further targets and different claims may be identified by the liquidator.  So, while it is apparent from the application that the liquidator seems to already have a clear sense of the prospective defendants and the broad nature of the claims he wishes to pursue, I consider there is less prejudice involved in the grant of a shelf order compared to the refusal of such an order.  One relevant consideration in this regard is to ensure that, if a specific extension order was made (in contrast to a shelf order), the liquidator might inadvertently be precluded from commencing viable proceedings against an as yet unknown party which could ultimately benefit all creditors.

  6. The prejudice which might arise from the making of a shelf order should also be seen in the context of the types of claims which are being considered by the liquidator.  For example, where the types of voidable transactions which are the subject of the liquidator's focus arise from legitimate commercial activity, one might have a greater concern about a shelf order being made (as the consequential prejudice to third party, arms-length creditors may be amplified).  In the present circumstances, there are transactions that, as presently articulated by the liquidator, do not fall into this category and might be described as creditor-defeating style transactions.  In those types of cases, less weight should be given to the prejudice which might arise from the third party's perspective. 

  7. Finally, in assessing the appropriateness of the shelf order, I again note the proposition which counsel for the plaintiff identified falling from the Grant Samuel decision, to the effect that no further extensions are capable of being sought by the liquidator under the relevant statutory framework. 

  8. There is no doubt a shelf order may represent a valid exercise of the power to extend time in s 588FF(3)(b) of the Act. The section calls for the exercise of discretion by the court. As the High Court recognised in Fortress Credit, questions of what is either a reasonable or an unreasonable prolongation of uncertainty and the scope of such uncertainty are appropriately considered on a case-by-case basis.  

  9. In the circumstances of this case, I am prepared to make the shelf order as sought by the liquidator.

F.     ORDERS

  1. In the circumstances, I am satisfied that the justice of the case favours the making of orders for an extension of time and that it is appropriate to exercise the discretion under s 588FF(3) of the Act in favour of that extension.

  2. I therefore propose to make the orders sought by the plaintiff in its Originating Process.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

SAO

Associate to the Honourable Justice Lundberg

21 MARCH 2023


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Cases Cited

12

Statutory Material Cited

1