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NM Superannuation Pty Ltd v Young

NM Superannuation Pty Ltd v Young

Case [1993] FCA 91 5 February 1993

Corporations Law

Reinstatement of Registration

Trustee Companies

Annual Returns

Costs

Corporate Law & Governance

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IN THE FEDERAL COURT OF AUSTRALIA

) )
NEW SOUTH WALES DISTRICT REGISTRY )

BETWEEN: IAN RUSSELL HENRY & ANOR.
Applicants

AND AUSTRALIAN SECURITIES
COMMISSION
Respondent

No. NG 3 2 8 9 of 1 9 9 2

IN THE MATTER OF TINGARA PTY LIMITED

AUSTRALIAN COMPANY NUMBER 0 0 1 9 0 7 4 2 8

BETWEEN: IAN RUSSELL HENRY AND
HELENE ANNE HENRY
Applicants
AUSTRALIAN SECURITIES
COMMISSION
Respondent

CORAM: BEAUMONT J.

:I.

m: 5 FEBRUARY 1993

EX TEMPORE REASONS FOR JUDGMENT

I wrll deal wlth Tingara and Lakewell together. In

each of these matters, an application was made under S. 574(3) of the Cor~orations Law for the reinstatement of regrstration of the company. The evidence discloses that the registration was cancelled on 27 February 1 9 9 2 in circumstances whlch are

. no,; entirely clear. However, there rs a suggestion in the

,?	11
. .
' '

evfdence that the cancellatron may have occurred by reason of .,*

',!

the failure of the companies to lodge annual returns in the period commencing for the year ended 30 June 1988 and subsequent years. Although complaint about this was made by the Commission in writing, that message was not recelved at its lntended destination by reason of a change of the registered offlce of the companies.
The matter has a somewhat unusual feature because it appears that each of the companies is a trustee under a discretionary trust arrangement in whlch, apart from the exercise of the dlscretions required or permitted under the terms of the trust, no actlve business activlty is in fact embarked upon by elther of the companies or indeed requlred to be embarked upon. In this context, the Comrnisslon has referred me to the decislon of Olney J ln Gambol v
Commissioner for Corporate Affairs (1987) 5 ACLC 378 in which
his Honour held that an appllcant was not a person aggrieved

within the meaning of the subject provision ln the following circumstances.

A company had been acqulred as a shelf company and had three lssued shares. The company acted as a trustee for the applicant's family trust pursuant to a deed of trust, and under the deed, the appllcant was given the power to appolnt any new or additional trustees. At the date of deregistration, the company was stlll actlvely involved in the
trust in its capacity as trustee, but his Honour held that the
applicant's former status as a director andlor shareholder of
the company was insufflclent on its own to show that the
applicant was a person "aggrieved within the meanlng of the

sectlon" . Reading his Honour's reasons as a whole, I am of the opinion that that declslon may be extlngulshed for present purposes.

I have already dealt with a related matter of Glensaugh Proprietary Limited ("Glensaugh") ln whlch the present applicants were also persons aggrieved. It appears from the evidence in the present matters, and ln the earller matter of Glensaugh, that the affalrs of the two…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading NM Superannuation Pty Ltd v Young

Details

AGLC: NM Superannuation Pty Ltd v Young [1993] FCA 91
Case: [1993] FCA 91
Decision Date: 5 Feb 1993

CaseChat Overview and Summary

In the Federal Court of Australia, the case of NM Superannuation Pty Ltd v Young involved an application for the reinstatement of the registration of Tingara Pty Limited and Lakewell Pty Limited. The applicants, Ian Russell Henry and Helene Anne Henry, sought reinstatement under section 574(3) of the Corporations Law. The Australian Securities Commission (ASC) was the respondent. The case was presided over by Beaumont J, who delivered his reasons for judgment on 5 February 1993.

The primary legal issue before the court was whether the applicants were "persons aggrieved" within the meaning of the Corporations Law, entitling them to seek reinstatement of the companies' registration, which had been cancelled. The court had to consider whether the mere fact that the companies were trustees under discretionary trusts and were not actively conducting business affected their eligibility to be considered aggrieved parties. The court also had to determine whether the explanation provided by the applicants for the failure to lodge annual returns, which led to the cancellation of registration, was satisfactory.

Beaumont J held that the applicants were indeed persons aggrieved as they had a sufficient interest in the reinstatement of the companies' registration. The court accepted that the companies were in operation in the sense that they were required to exercise discretions under their trust instruments. The explanation given by the applicants for the failure to lodge returns was deemed satisfactory, leading the court to exercise its discretion in favour of reinstatement, subject to certain conditions. The court ordered the reinstatement of the companies' registration and required the applicants to lodge any outstanding annual returns. Additionally, the applicants were ordered to pay the ASC's costs in the sum of $800.

The court's decision underscores the importance of the discretion available under the Corporations Law to reinstate a company's registration and the necessity for companies to comply with statutory obligations to maintain their registration.

Orders