Orr v LakeCoal Pty Ltd

[2019] NSWDC 178

District Court

New South Wales

Medium Neutral Citation:

Orr v LakeCoal Pty Limited [2019] NSWDC 178

Hearing dates:

14 May 2019

Date of orders:

16 May 2019

Decision date:

16 May 2019

Jurisdiction:

Criminal

Before:

Russell SC DCJ

Decision:

(1)   I find that the prosecutor does not need leave to continue this prosecution.

 

(2) Pursuant to r 53.28 of the District Court Rules 1973, the prosecutor is granted leave to tender the following expert reports as the evidence-in-chief of those expert witnesses:

 

(a)   Report of Mr Jason Wagstaffe, engineer and workplace safety risk management expert, dated 3 July 2018;

 

(b)   Report of Mr Martin Burns, registered land surveyor, undated but finalised 3 December 2018;

 

(c)   Report of Ms Judy Turnbull, metallurgist, dated 7 December 2018;

 

(d)   Report of Mr Tim White, forensic mechanical engineer, dated 7 December 2018.

 

(3) Pursuant to r 53.28 of the District Court Rules 1973, the prosecutor is granted leave to file affidavits of the following witnesses and to tender those affidavits as the evidence-in-chief of those witnesses:

 

(a)   Inspector Gregory Delmenico;
(b)   Inspector Steven Bath;
(c)   Inspector Andrew Tull; and
(d)   Inspector Timothy Flowers.

 

(4)   The prosecutor shall provide to the court a hearing plan setting out the proposed order of witnesses by 28 May 2019.

 (5)   Liberty to apply on three days notice.

Catchwords:

CORPORATIONS - company subject to creditors’ voluntary winding up – whether prosecutor needs leave to continue prosecution – s 471B, s 500(2) Corporations Act 2001 (C’th)

Legislation Cited:

Corporations Act 2001 (C’th)
District Court Rules 1973
Occupational Safety and Health Act 1984 (WA)
Work Health and Safety Act 2011

Cases Cited:

WorkCover Authority of New South Wales (Inspector Maltby) v Josef & Sons Contracting Pty Ltd (In Liquidation) [2002] NSWIRComm 226
Worksafe Western Australia Commissioner v Australian Countertop Pty Limited (In Liquidation) [2014] WASC 413

Category:

Procedural and other rulings

Parties:

Stephen James Orr (Prosecutor)
LakeCoal Pty Limited (Defendant)

Representation:

Counsel:
K Nomchong SC (Prosecutor)

  Solicitors:
Lander & Rogers (Prosecutor)

File Number(s):

2018/23681

Judgment

Introduction

1. This prosecution under the Work Health and Safety Act 2011 is listed for an undefended hearing before me commencing on 3 June 2019. Senior counsel for the prosecutor appeared before me on 14 May 2019 to raise two issues in preparation for the trial. The first concerned the corporate status of the defendant, and whether leave would need to be sought to continue these proceedings against it. The second matter concerned directions for the matter of presentation of evidence at the undefended hearing.

Corporate status of the defendant

2. Pursuant to a direction made on 14 May 2019, the prosecutor filed an affidavit of Mr Battagello solicitor dated 15 May 2019, setting out evidence in relation to the corporate status of the defendant. In summary, the affidavit proves the following matters:

1. Prior to 5 March 2019 the defendant was a company in external administration, under the control of an administrator;

2. On 5 March 2019 a special resolution of the creditors of the defendant was passed, resolving that the company be wound up under s 439C(c) of the Corporations Act 2001 (C’th) (the Act);

3. The creditors also resolved that the administrator be appointed as the liquidator of the company;

4. Thus since 5 March 2019 the defendant has been administered in liquidation pursuant to a creditors’ voluntary winding up.

The legislation

3. While the defendant was still in administration, no leave to continue the proceedings was required, because by s 440D(2)(a) of the Act, there was no leave necessary in respect of a criminal proceeding.

4. Pursuant to s 446A of the Act, the defendant is being administered in liquidation pursuant to a creditors’ voluntary winding up. Part 5.5 of the Act contains provisions concerning a voluntary winding up. Section 500 of the Act provides as follows:

“Execution and Civil Proceedings

(1)   [Effect on claims to property] Any attachment, sequestration, distress or execution put in force against the property of the company after the passing of the resolution for voluntary winding up is void.

(2)   [Where civil proceedings must cease] After the passing of the resolution for voluntary winding up, no action or other civil proceeding is to be proceeded with or commenced against the company except by leave of the Court and subject to such terms as the Court imposes.”

Consideration

5. Read alone, s 500(2) seems to apply only where proceedings of a civil nature are pending against the company. Section 500(2) speaks of “no action or other civil proceeding”. This phrase by itself connotes that the word “action” is confined to a proceeding which is a type of “civil proceeding”.

6. The terms of s 500(2) are to be contrasted with s 471B of the Act, which is contained in Pt 5.4B dealing with winding up in insolvency or by the Court. Section 471B provides:

“While a company is being wound up in insolvency or by the Court, or a provisional liquidator of a company is acting, a person cannot begin or proceed with:

(a)   a proceeding in a court against the company or in relation to the property of the company; or

(b)   enforcement process in relation to such property;

except with the leave of the Court and in accordance with such terms (if any) as the Court imposes.”

7. It can be seen that there is no restriction in s 471B on the nature of the proceeding against the company. The plain words of s 471B are broad enough to apply to both a civil proceeding and a criminal proceeding.

8. That was the conclusion reached in Worksafe Western Australia Commissioner v Australian Countertop Pty Limited (In Liquidation) [2014] WASC 413. In that case the court held that where a company was being wound up in insolvency, pursuant to an order of the court, leave was required under s 471B of the Act to proceed with a criminal prosecution under the Occupational Safety and Health Act 1984 (WA).

9. The precise point which arises in these proceedings was the subject of a decision by Justice Schmidt in WorkCover Authority of New South Wales (Inspector Maltby) v Josef & Sons Contracting Pty Ltd (In Liquidation) [2002] NSWIRComm 226.

10. The conclusion reached by her Honour was expressed in paragraph [35] as follows:

“I am satisfied, for the reasons which I have explained, that s 471B requires leave to begin or proceed with any proceeding in a court, whether civil or criminal, and that s 500(2) only requires leave to proceed with, or commence, civil proceedings and actions.”

11. Her Honour’s judgment contained a detailed analysis of the Act and relevant cases, leading to the conclusion reproduced above. I respectfully agree with her Honour’s reasoning and conclusions. In the present case the relevant provision in relation to corporate defendant is s 500(2) of the Act and not s 471B. I therefore find that the prosecutor does not need leave to continue with the prosecution.

Directions

12. I have considered the directions put forward on 14 May 2019 in Proposed Short Minutes Of Order which were handed up in court. The directions are appropriate, particularly given that the hearing will be proceeding as an undefended matter.

Orders

13. My orders are as follows:

1. I find that the prosecutor does not need leave to continue this prosecution.

2. Pursuant to r 53.28 of the District Court Rules 1973, the prosecutor is granted leave to tender the following expert reports as the evidence-in-chief of those expert witnesses:

1. Report of Mr Jason Wagstaffe, engineer and workplace safety risk management expert, dated 3 July 2018;

2. Report of Mr Martin Burns, registered land surveyor, undated but finalised 3 December 2018;

3. Report of Ms Judy Turnbull, metallurgist, dated 7 December 2018;

4. Report of Mr Tim White, forensic mechanical engineer, dated 7 December 2018.

3. Pursuant to r 53.28 of the District Court Rules 1973, the prosecutor is granted leave to file affidavits of the following witnesses and to tender those affidavits as the evidence-in-chief of those witnesses:

1. Inspector Gregory Delmenico;

2. Inspector Steven Bath;

3. Inspector Andrew Tull; and

4. Inspector Timothy Flowers.

4. The prosecutor shall provide to the court a hearing plan setting out the proposed order of witnesses by 28 May 2019.

5. Liberty to apply on three days notice.

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Decision last updated: 16 May 2019