FEDERAL COURT OF AUSTRALIA
Murphy v Astute Projects Pty Ltd [2018] FCA 2118
File number: QUD 790 of 2018 Judge: LOGAN J Date of judgment: 19 December 2018 Catchwords: CORPORATIONS LAW – application for pecuniary penalties and compensation under Fair Work Act 2009 (Cth) against corporation in administration – application for order under s 444(e)(3) of the Corporations Act 2001 (Cth) for leave to proceed – whether factors to allow for granting of leave are sufficiently engaged – no public interest abroad. Held – leave refused. Legislation: Fair Work Act 2009 (Cth) ss 44, 45, 357, 535, 536, 537, 550
Corporations Act 2001 (Cth) ss 436M 439C(a), 444E(3)
Cases cited: Attard v James Legal Pty Ltd [2010] NSWCA 311
Australian Competition and Consumer Commission v Advanced Medical Institute Pty Ltd(Administrator Appointed)(No 3) [2011] FCA 348
Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640
Commissioner of Taxation v International Indigenous Football Foundation (Australia) Pty Ltd (in Liquidation) (2017) FCA 538
Commonwealth of Australia v Director Fair Work Building Industry Inspectorate (2015) 258 CLR 482
Meehan v Stockmans Australian Café Holdings Pty Ltd (1996) 22 ASCR 123
Ogilvie-Grant v East (1983) 7 ACLR 669
Phoenix Institute of Australia Proprietary Limited v Australian Competition and Consumer Commission (2017) FCAFC 155
Singtel Optus Pty Ltd v Australian Competition and Consumer Commission (2012) 287 ALR at 265
Date of hearing: 19 December 2018 Date of last submissions: 19 December 2018 Registry: Queensland Division: Fair Work Division National Practice Area: Employment & Industrial Relations Category: Catchwords Number of paragraphs: 30 Counsel for the Applicant: Mr C Martin Solicitor for the Applicant: Davidson Ryan Lawyers Counsel for the Respondents: Mr P O’Brien Solicitor for the First Respondent: Norton Rose Fulbright Solicitor for the Second and Third Respondents: Minter Ellison ORDERS
QUD 790 of 2018 BETWEEN: MICHAEL JAMES MURPHY
Applicant
AND: ASTUTE PROJECTS PTY LTD (SUBJECT TO A DEED OF COMPANY ARRANGEMENT) ACN 138 111 092
First Respondent
PAUL GREGORY CHAPPLE
Second Respondent
BRADLEY KANE HOOK
Third Respondent
JUDGE:
LOGAN J
DATE OF ORDER:
19 DECEMBER 2018
THE COURT ORDERS THAT:
1.The application for leave to proceed against the first respondent be dismissed.
2.Costs reserved.
3.The first respondent is to file and serve an outline of submissions, of not more than 5 pages, in support of its application for costs, on or before 18 January 2019.
4.The applicant is to file and serve an outline of submissions in response, of no more than 5 pages, together with such affidavits, if any, upon which he intends to rely in relation to the costs application, by 1 February 2109.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
(Revised From Transcript)LOGAN J:
This case illustrates how a degree of artificiality can attend, at times, the division of the Court’s…
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- Case
- [2018] FCA 2118
- Decision Date
CaseChat Overview and Summary
The Federal Court examined whether the application met the stringent criteria for granting leave under the Corporations Act, particularly considering the public interest and the nature of the civil penalty regime under the Fair Work Act. The Court noted that the decision to grant leave was inherently fact-specific and required a detailed assessment of the circumstances. It referenced past jurisprudence, including Ogilvie-Grant v East, which emphasised the balance between expedience and perfect justice in the administration process. The Court concluded that Mr Murphy had not demonstrated sufficient grounds to warrant an exception to the standard procedure, thereby refusing the application for leave.
Consequently, the Court dismissed the application for leave to proceed against Astute Projects. The matter of costs was reserved, with specific directions issued for the parties to file outlines of their submissions on the costs application by specified dates. The orders mandated that Astute Projects file an outline of submissions by 18 January 2019, and Mr Murphy respond by 1 February 2019, along with any relevant affidavits.
Orders
Orders of the court
1. The application for leave to proceed against the first respondent be dismissed.
2. Costs reserved.
3. The first respondent is to file and serve an outline of submissions, of not more than 5 pages, in support of its application for costs, on or before 18 January 2019.
4. The applicant is to file and serve an outline of submissions in response, of no more than 5 pages, together with such affidavits, if any, upon which he intends to rely in relation to the costs application, by 1 February 2109.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
In order for proceedings to be begun and continued against it, it is necessary for Mr Murphy to secure an order pursuant to s 444E(3) of the Corporations Act 2001 (Cth) (Corporations Act), granting leave nunc pro tunc to begin and continue the proceeding as against Astute Projects. Thus, in terms of the Court’s National Practice Areas, the case bridges jointly the Fair Work and Corporations Areas. It is not merely a matter of form as an understanding of the nature and purpose of the civil penalty regime under the Fair Work Act that is a material consideration in relation to whether or not to grant leave under the Corporations Act, hence the opening on summation. However that may be, it would be inappropriate in what is an industrial case, for the Court to embark upon a demarcation process as to who, within its ranks, ought to exercise the Court’s jurisdiction. In relation to the subject of whether or not to grant leave, the question is always fact-specific: see in this regard, Ogilvie-Grant v East (1983) 7 ACLR 669 at 672, per McPherson J. Referring to that case in Attard v James Legal Pty Ltd [2010] NSWCA 311 (Attard v James Legal Pty Ltd), the New South Wales Court of Appeal stated:At 126-127 his Honour quoted at length from the judgment in McPherson J (again a highly experienced corporations law judge), with whom Wanstall CJ and Sheahan J agreed, in Ogilvie-Grant v East (1983) 7 ACLR 669 at 672; 1 ACLC 742 at 744 where he relevantly observed:As a matter of history, a winding up by the Court was and remains today an administration conducted by the Court ... Both because of this ... it was inevitable that there should be restrictions on the bringing of proceedings, whether at common law or otherwise, during the course of that administration. What is substituted for litigation in the ordinary form is a procedure by which a claimant lodges a verified proof of debt with the liquidator, who admits or rejects it wholly or in part, and from whom an appeal lies to a Judge, who determines that appeal de novo primarily on affidavit material ... There can be no doubt that ordinarily such a procedure is, and is designed to be, much more expeditious and less expensive than ordinary proceedings by way of action. If this means that it occasionally has the consequence that the attainment of perfect justice is sacrificed to expedience, it may be justified by the circumstance that on appeal it is possible that under modern rules of procedure for the Judge in appropriate cases to make orders for discovery and even for the delivery of pleadings where it appears necessary or desirable to do so.The question whether a claimant should be permitted to proceed by action, or should be required to submit his proof of debt and, if dissatisfied, appeal to a judge, is therefore reduced largely to one of choosing between alternative forms of procedure. The effect of [the section] is to require the claimant to adopt the course of lodging proof of debt unless he can demonstrate that there is some good reason why a departure from that procedure is justified in the case of the particular claim in dispute ... It, of course, follows that it is quite impossible to state in an exhaustive manner all the circumstances in which leave to proceed may be appropriate, but in the past they have been said to include factors such as the amount and seriousness of the claim, the degree of complexity of the legal and factual issues involved, and the stage to which the proceedings, if already commenced, may have progressed.[Emphasis added]