Ozer & Ozer
[2021] FedCFamC1F 323
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Ozer & Ozer [2021] FedCFamC1F 323
File number(s): PAC 2375 of 2018 Judgment of: WILSON J Date of judgment: 17 December 2021 Catchwords: FAMILY LAW – ARBITRATION – company owned and operated by the parties deregistered – arbitrator unable to deal with company or funds owned by it while it remains deregistered – husband seeking reinstatement of registration – detailed examination of relevant principles under s 601AH of the Corporation Act.
FAMILY LAW – COMPANY LAW – reinstatement of registration of deregistered company – application granted.
Legislation: Corporations Act 2001 ss 601AH, 601AB Cases cited: ACN 078 272 867 Pty Ltd (in liq) (formerly Advance Finances Pty Ltd) v Deputy Commissioner of Taxation; Binetter v Deputy Commissioner of Taxation (2011) 85 ACSR 247
AMP General Insurance Ltd v Victorian WorkCover Authority [2006] 15 VR 175
Arnold World Trading Pty Ltd v ACN 133 427 335 Pty Ltd (2010) 80 ACSR 670
Attorney-General (Gambia) v N'Jie [1961] AC 617
Australian Competition and Consumer Commission v Australian Securities and Investments Commission (2000) 174 ALR 688
Bell Group Ltd v Australian Securities and Investments Commission (2018) 128 ACSR 247
Blazai Pty Ltd v Gateway Development (St Marys) Pty Ltd [2009] NSWSC 800
Brereton v Australian Securities and Investments Commission [2007] FCA 651
Callegher v Australian Securities and Investments Commission (2007) 218 FCR 81
Casali v Crisp (2001) 165 FLR 79
Day v Hunter [1964] VR 845
Deputy Commissioner of Taxation v Australian Securities & Investments Commission [2013] FCA 623
Deputy Commissioner of Taxation v Australian Securities and Investments Commission; in the matter of Civic Finance Pty Limited (Deregistered) [2010] FCA 1411
Deputy Commissioner of Taxation v Lanstel Pty Ltd (1996) 22 ACSR 314
Deputy Commissioner of Taxation, Re James Hardie Australia Finance Pty Ltd (deregistered) (2008) 170 FCR 545
Dougherty v Dougherty (1987) 163 CLR 278
Euphron Pty Ltd v Hunter Valley Piggery Pty Ltd [2003] NSWSC 543
Fencott v Muller (1983) 152 CLR 570
GIS Electrical Pty Ltd v Melsom (2002) 43 ACSR 481
Gronow v Gronow (1979) 144 CLR 513
Herbert v Nozala Pty Ltd [2006] NSWSC 1437
House v The King (1936) 55 CLR 499
In the Marriage of Scaggiante & Harrison (1978) 30 FLR 561
Ji Woo International Education Centre Pty Ltd (Deregistered), Re; Yeo v Australian Securities and Investments Commission [2017] FCA 1480
Jones v 3R Gas Pty Ltd (2006) 24 ACLC 450
JP Morgan Portfolio Services Ltd v Deloitte Touche Tohmatsu (2008) 167 FCR 212
Mallet v Mallet (1984) 156 CLR 605
Melluish v Underwood Development Pty Ltd [2004] NSWSC 429
Middleton Nominees Pty Ltd v Westpac Banking Corp [2007] FCA 845
Norbis v Norbis (1986) 161 CLR 513
Pacanowski v Australian Securities Commission (1995) 57 FCR 173
Piccoli Tesori Pty Ltd (deregistered); Ex parte Bertuol (2006) 151 FCR 109
Pilarinos v Australian Securities and Investment Commission [2006] VSC 301
Promnitz v Australian Securities and Investments Commission (2004) 22 ACLC 108
R v Watson; Ex parte Armstrong (1976) 136 CLR 248
Re Brockweir Pty Ltd [2012] VSC 225
Re ERB International Pty Ltd (deregistered), Re Fiorentino v Australian Securities and Investment Commission (2014) 98 ACSR 124
Re Formcrete Services Pty Ltd (1976) 2 ACLR 46
Re GA & RJ Elliot Pty Ltd (1978) 3 ACLR 523
Re NETIVEEDU PTY LTD (ACN 610 391 690) (deregistered) (2021) 153 ACSR 110
Re Newfront Pty Ltd (deregistered) [2008] SASC 127
Re Proserpine Pty Ltd & the Companies Act [1980] 1 NSWLR 745
Re Wakim; Ex parte McNally and Another (1999) 198 CLR 511
Re Wood & Martin (Bricklaying Contractors) Ltd [1971] 1 WLR 293
Stack v Coast Securities (No 9) Pty Ltd (1983) 154 CLR 261
Stanford v Stanford (2012) 247 CLR 108
Vukasin v Australian Securities and Investments Commission (2007) 25 ACLC 1554
Warton v Harris (2005) 56 ACSR 122
Division: Division 1 First Instance Number of paragraphs: 50 Date of hearing: 1 December 2021 Place: Melbourne Counsel for the Applicant: Mr J. F Heazlewood Solicitor for the Applicant: Penhall & Co Lawyers Counsel for the Respondent: Mr J. Shaw Solicitor for the Respondent: Hutchinson Lawyers ORDERS
PAC 2375 of 2018 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR OZER
Applicant
AND: MS OZER
Respondent
ORDER MADE BY:
WILSON J
DATE OF ORDER:
17 DECEMBER 2021
THE COURT ORDERS THAT:
1.Mr B is appointed liquidator of C Pty Ltd (in liquidation) ACN … immediately upon its reregistration this day, in lieu of the former liquidator Mr D who died in 2020.
2.Pursuant to s 601AH of the Corporations Act I order the reinstatement of the registration of C Pty Ltd (in liquidation).
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonyms Ozer & Ozer has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
WILSON J
INTRODUCTION
The arbitration of this proceeding is presently part-heard and has been interrupted to enable the issue raised before me to be determined. This application is brought pursuant to s 13F of the Family Law Act for the purpose of the facilitation of the effective conduct of the arbitration.
These reasons explain why I have ordered the reinstatement of the registration of the company.
The parties agreed on a minute of consent orders which they requested me to make so that the arbitration might resume once those orders were made. Those consent orders were as follows –
1.That Australian securities and Investment Commission be joined as second respondent to this Application in the proceedings.
2.That Mr B be appointed Liquidator of C Pty Ltd A.C.N. … (In Liquidation) immediately upon its re-registration today, and in lieu of the former Liquidator Mr D who died during 2020.
3.That leave be granted to make this application returnable before his Honour Justice Wilson a 2:15 pm on 1 December 2021.
4.Declaration that the applicant Mr Ozer is a person aggrieved by the de-registration of C Pty Ltd ACN ….
5.That the registration of C Pty Ltd ACN … be reinstated pursuant to section 601AH Corporations Act 2001.
6.That with respect to the land and premises know as E Street Suburb F NSW, being the whole of the land in folio identifier … (“E Street”), that the name of the registered proprietor thereof presently recorded with the NSW Land Registry Services be rectified to read “C Pty Ltd” in lieu of “J Pty Ltd”.
The main arena of debate on the hearing of this application was proposed paragraph six of the minute. While the amendment proposal was seemingly minor, this court’s power to make the order sought was the subject of considerable controversy. As the records of the New South Wales Land Registry Services presently reveal, C Pty Ltd (“CPL”) is currently erroneously registered as J Pty Ltd. Parts of that company’s name have been inverted.[1]
[1] A current and historical extract obtained from the Australian Securities and Investment Commission (“ASIC”) in respect of C Pty Ltd ACN … was exhibited to the affidavit of Garry Neville Penhall made 25 November 2021 and filed in this application.
RELEVANT BACKGROUND
Pursuant to a resolution of creditors passed at a meeting held on 7 June 2016, CPL was placed in voluntary liquidation and a liquidator whose name was Mr D was appointed as liquidator of CPL. The liquidator convened a meeting of creditors on 21 June 2016 attended by creditors who included the parties to this litigation as well as a representative of the Australian Taxation Office and two independent creditors from which the liquidator held a proxy. The liquidator convened a final meeting of creditors on 29 November 2016. No dividend to creditors was payable.
Mr Penhall, the deponent on this application, also exhibited to his affidavit an extract form the records of New South Wales Land Registry Services conducted at 13 November 2019 at 9:06am in relation to folio … recording the registered proprietor of a particular parcel of land as being J Pty Ltd. That entry was wrong in two respects. First, the name was wrongly recorded. Second, by the date of the search CPL had been placed in voluntary liquidation.
Mr Penhall[2] made a further affidavit on 30 November 2021. To that affidavit Mr Penhall exhibit additional documentation including correspondence with the Australian Securities and Investments Commission (“ASIC”) and with the liquidator’s firm. The more important aspects of that correspondence were the following –
[2] Mr Penhall is a practising solicitor with over 50 years’ experience in litigation. His speed and efficiency in this application was of particular help in the administration and speedy disposition of urgent interlocutory applications in the National Arbitration List.
(a)from ASIC, taken from its 29 November 2021 letter to Mr Penhall –
ASIC's position regarding the application
As the company was in liquidation prior to deregistration, the applicant must prove the former liquidator is aware of the application and that their role will resume if the application is successful (as the company will be reinstated 'in liquidation'). We understand from your letter to us that you have advised the liquidator (now deceased) of this application and another liquidator from that some office is now assisting you.
Subject to the strict understanding that no order for costs will be sought against the Australian Securities and Investments Commission (ASIC), ASIC does not oppose the Application and will not attend the hearing of the matter; and
(b)from G Accountants, taken from its 30 November 2021 letter to Mr Penhall –
As discussed, it is my understanding that upon reinstatement of the Company, a liquidator will need to be appointed. Unfortunately, the former liquidator Mr D passed away last year. However, I am happy to provide my consent to act should the Company be reinstated and, as requested, I have attached a Consent to Act, a schedule of hourly rates and Declaration of Independence Relevant Relationships and Indemnities.
The letter from G Accountants also revealed that creditors of CPL stood at approximately $133,200 and that CPL may not be solvent despite the two businesses having been sold for approximately $2,665,000. That said, a replacement liquidator was nominated to fill that role consequent upon the death of Mr D and Mr B declared his consent to act by notice dated 30 November 2021. It is important to observe that ASIC did not oppose the reinstatement of the deregistered company (formerly CPL prior to its winding up) so long as costs were not sought against it. No costs were sought against ASIC on this application.
At this juncture it is appropriate to record the financial position of CPL.
One of the major issues on the hearing of this application was the reinstatement application under s 601AH(2) of the Corporations Act. The parties’ submissions did not address the legal matter raised by the section so I called for submissions on s 601AH and its application to the facts of this case. The following emerged from those submissions –
(a)a total deposit amount of $266,500 was paid for the two businesses and a net amount of $2,650,566.43 was paid for the two businesses;
(b)certain amounts were paid from net proceeds derived from the sale of the businesses, those amounts totalling $2,073,621;
(c)the husband alleged that from other funds he applied $400,00 towards the acquisition of properties in Country K;
(d)the husband also alleged that the wife applied more than $600,800 to her own accounts or towards assisting her daughter in Country L;
(e)prior to its deregistration,[3] CPL was the registered proprietor of the land known and described as E Street, Suburb F, New South Wales;
(f)real estate agents hold the sum $35,000 in a trust account (which I infer is a sum to which CPL is entitled);
(g)tax returns have not been filed in respect of CPL since 2017 nor has CPL accounted for GST received by it since then; and
(h)a liability for capital gains tax is also likely due and payable by CPL.
[3] Consequent upon CPL’s deregistration, its assets vest in ASIC pursuant to s 601AD of the Corporations Act 2001.
Inadequate information was supplied by the parties in respect for the reason of placing CPL in voluntary liquidation. The parties’ submissions on this issue were as follows –
It appears from the documentation[4] that a meeting of members of the corporation C Pty Limited was held at 9.00am on 7 June 2016 where both parties (being the only shareholders of the corporation) were present at the meeting where it was resolved that the company be wound up[5]. However, please note that Ms. H states that the meeting was held on 1 June 2016, not 7 June 2016.
In evidence the wife denied that she attended that meeting of Creditors. The husband gave evidence that he attended the meeting. It is in explicable (sic) why a corporation which owned real estate and had liabilities, including the liabilities to the ATO, would have been wound up in circumstances where the corporation owned unencumbered real estate.
[4] Affidavit of Ms H affirmed 19 October 2021.
[5] Affidavit of Ms H affirmed 19 October 2021 at [4] and p7.
The submissions of Mr Heazlewood proceeded on the basis that the most likely explanation for placing the company in liquidation when it was solvent is that the parties “had forgotten that it owned real estate in its name”.
That was a surprising submission. Even recognising that the meeting of creditors held on 21 June 2016 lasted for no more than five minutes (the minutes of the meeting opened at 10am and closed at 10:05am) the liquidator was not told of the businesses or the land, each of which was valuable. It seems most peculiar that no attention was directed to those assets. I am unable to accept that the parties “forgot” about the businesses and the land.
So far as the utility of the reinstatement of the registration of CPL was concerned, Mr Heazlewood submitted as follows –
The parties are seeking a division of their property in accordance with s.79 of the Family Law Act. They will benefit because upon reinstatement and following action by the corporation to deal with outstanding issues such as tax returns and returning a liability for the payment of income tax and GST; it is likely that there will be a substantial payment to the ATO.
SECTION 601AH OF THE CORPORATIONS ACT
A deregistered company may be reinstated to the register of the companies under s 601AH of the Corporations Act by ASIC or by the Court.Relevantly to this application “the Court” includes the Family Court of Australia,[6] and since the enactment of the Federal and Family Court of Australia Act, includes the Federal Circuit and Family Court of Australia (“FCFCOA”).
[6] Section 58AA of the Corporations Act.
The persons entitled to apply to the Court for the reinstatement of the registration of CPL under s 601AH(2) include “a person aggrieved by the deregistration” (s 601AH(2)(a)(i)) or a former liquidator (s 601AH(2))(a)(ii)). In this case, the husband applied for the order for the reinstatement of CPL.
The first issue is whether the husband is “a person aggrieved” within the contemplation of s 601AH(2)(a)(i) of the Corporations Act. In my view he is. The learning in the authorities on point is dense yet tolerably consistent. Having regard to the fact that no detailed examination of s 601AH has been given by this Court, it seemed to me to be appropriate to record the results of my research. Counsels’ submissions did not address this issue, surprisingly.
The expression “a person aggrieved by the deregistration” should not be narrowly construed.[7]
[7] Re Proserpine Pty Ltd & the Companies Act [1980] 1 NSWLR 745, Pacanowski v Australian Securities Commission (1995) 57 FCR 173, GIS Electrical Pty Ltd v Melsom (2002) 43 ACSR 481, Deputy Commissioner of Taxation, Re James Hardie Australia Finance Pty Ltd (deregistered) (2008) 170 FCR 545 and Ji Woo International Education Centre Pty Ltd (Deregistered), Re Yeo v Australian Securities and Investments Commission [2017] FCA 1480.
The ascertainment of whether a person is an aggrieved person attracts a low threshold. It is not therefore necessary to embark upon an exhaustive analysis of the facts and law underpinning the claim in this case because the assessment must be dealt with in a summary way with a view to making a determination on whether the claim is not plainly hopeless and bound to fail.[8]
[8] Re Brockweir Pty Ltd [2012] VSC 225 and Deputy Commissioner of Taxation v Australian Securities and Investments Commission; in the matter of Civic Finance Pty Limited (Deregistered) [2010] FCA 1411.
A person aggrieved is not the same as a person dissatisfied with an event and must be a person damaged or insured in the legal sense.[9]
[9] Callegher v Australian Securities and Investments Commission (2007) 218 FCR 81 and Re Newfront Pty Ltd (deregistered) [2008] SASC 127.
Under analogous English legislation a person aggrieved is expected to have “an interest of a proprietary or pecuniary nature in resuscitating the company”.[10]
[10] Re Wood & Martin (Bricklaying Contractors) Ltd [1971] 1 WLR 293, Re GA & RJ Elliot Pty Ltd (1978) 3 ACLR 523 and Arnold World Trading Pty Ltd v ACN 133 427 335 Pty Ltd (2010) 80 ACSR 670.
Disputed factual questions will ordinarily not be resolved on the hearing of the reinstatement application.[11]
[11] Pilarinos v Australian Securities and Investment Commission [2006] VSC 301.
If the applicant for an order under s 601AH(2)(a)(i) is a former shareholder, the phenomenon of being “aggrieved” might involve a consideration of the manner in which he or she may benefit from reinstatement by sharing in the assets of the company or by obtaining a dividend of some kind.[12]
[12] Casali v Crisp (2001) 165 FLR 79, Euphron Pty Ltd v Hunter Valley Piggery Pty Ltd [2003] NSWSC 543, Melluish v Underwood Development Pty Ltd [2004] NSWSC 429, Warton v Harris (2005) 56 ACSR 122, Jones v 3R Gas Pty Ltd (2006) 24 ACLC 450, Piccoli Tesori Pty Ltd (deregistered); Ex parte Bertuol (2006) 151 FCR 109, Herbert v Nozala Pty Ltd [2006] NSWSC 1437, Middleton Nominees Pty Ltd v Westpac Banking Corp [2007] FCA 845 and Vukasin v Australian Securities and Investments Commission (2007) 25 ACLC 1554.
The expression “person aggrieved” is a phrase of wide import and has been interpreted to mean “a person who has a genuine grievance because of prejudice suffered to his interest from an act complained of”.[13]
[13] Citing Attorney-General (Gambia) v N'Jie [1961] AC 617 and Brereton v Australian Securities and Investments Commission [2007] FCA 651.
A person who is deprived of something or who is deprived affected by an act is “a person aggrieved”.[14]
[14] Re Formcrete Services Pty Ltd (1976) 2 ACLR 46, 48.
Citing Day v Hunter,[15] in Brereton Finklestein J held that the person aggrieved must have an interest that is a real and direct interest in the act or in the consequence of the act and he must be dissatisfied with it. Yet the expression “person aggrieved” does not include a mere busy-body who is interfering in things that do not concern him.[16]
[15] [1964] VR 845.
[16] Deputy Commissioner of Taxation v Lanstel Pty Ltd (1996) 22 ACSR 314.
Applying most of those criteria to the circumstances of the applicant husband in this case, the matters set out below are relevant to him in this application for orders for the reinstatement of the registration of CPL. In no special order –
(a)he seeks reinstatement because CPL owns valuable land and personal assets to be divided in the arbitration presently part-heard;
(b)the applicant was a shareholder of CPL;
(c)CPL was the registered proprietor of real estate in Suburb F;
(d)certain funds to which CPL is or may be entitled are held in trust;
(e)tax is likely to be payable by CPL in respect of assessment due based on returns that need to be lodged; and
(f)in order for the parties’ s 79 application to be properly and exhaustively addressed by the arbitrator, the matters set out in the foregoing subparagraph need to be considered.
As has been recorded above, the threshold in the ascertainment of an applicant’s status as a “person aggrieved” is low and the Court ordinarily determines the issue in a summary manner without resolving contested issues of fact and law. Further, where the person allegedly aggrieved is asserting that he or she is a former shareholder, one relevant matter is the manner in which the applicant might benefit from reinstatement from, say, sharing in the company’s assets or receiving a distribution. Further, any assessment of the phrase “person aggrieved” necessarily enlivens a consideration the wide import of the phrase especially whether, and if so, the extent to which the claimant’s interest is real and direct.
On any of those criteria, I am persuaded that the applicant in this case is a “person aggrieved” for the purposes of s 601AH(2)(a)(i) of the Corporations Act.
IS IT “JUST” TO ORDER REINSTATEMENT?
Section 601AH(2)(b) uses the phrase “the Court is satisfied that it is just that the company’s registration be reinstated.” The word “just” in that context is entirely different to the interpretation of the word “just” when used in the phrase “just and equitable” in the context of s 79 of the Family Law Act. A large body of authority has been developed in relation to the word “just” in the context of s 601AH(2)(b) of the Corporations Act.
On an application for an order under s 601AH(2)(b) for the reinstatement of the registration of a deregistered company, the Court is concerned with the reinstatement being “just”, not with the justice of any proceeding which it is proved that the company, upon reregistration, might commence.[17]
[17] Re ERB International Pty Ltd (deregistered), Re Fiorentino v Australian Securities and Investment Commission (2014) 98 ACSR 124 and Ji Woo International Education Centre Pty Ltd (Deregistered), Re; Yeo v Australian Securities and Investments Commission [2017] FCA 1480.
Relevant considerations in the ascertainment of whether it is just to make an order for the reinstatement of the registration of the company include several matters. They are –
(a)the circumstances in which the registration of the company came to an end and the company became deregistered;
(b)the purpose in seeking reinstatement of the company’s registration;
(c)whether any person is likely to be prejudiced by the reinstatement of the company’s registration; and
(d)the public interest.[18]
[18]Australian Competition and Consumer Commission v Australian Securities and Investments Commission (2000) 174 ALR 688, Promnitz v Australian Securities and Investments Commission (2004) 22 ACLC 108, JP Morgan Portfolio Services Ltd v Deloitte Touche Tohmatsu (2008) 167 FCR 212 and AMP General Insurance Ltd v Victorian WorkCover Authority [2006] 15 VR 175.
In Blazai Pty Ltd v Gateway Development (St Marys) Pty Ltd[19] reinstalment of registration was refused for “several interrelated reasons”. Those included –
(a)the length of the delay in the time elapsed between registration and the company pursuing its alleged rights;
(b)the contingent and speculative nature of the proceeding proposed to be brought against the company’s director; and
(c)the prejudice and difficulties likely to be faced by the director against whom the proceeding was proposed to be brought having regard to the lapse of time.
[19] [2009] NSWSC 800.
Of course, the nature of the claim in that case is fundamentally different to the claim proposed in this case.
In ACN 078 272 867 Pty Ltd (in liq) (formerly Advance Finances Pty Ltd) v Deputy Commissioner of Taxation; Binetter v Deputy Commissioner of Taxation[20] Heydon J of the High Court of Australia addressed the issue of whether the company, once deregistered, comes back into existence upon the reinstatement of its registration in the same form as it was upon deregistration. Howsoever interesting that issue may be, that issue is of no present relevance in this case.
[20] (2011) 85 ACSR 247.
A different constellation of considerations was agitated by Kenny J as being relevant in the exercise of the discretion conferred pursuant to s 601AH(2)(b) to reinstate the registration of a deregistered company. Her Honour held that the relevant considerations were –
(a)the circumstances in which the company became deregistered;
(b)whether good use will be made of the reinstatement order, if granted;
(c)whether any person is likely to be prejudiced by any order for reinstatement; and
(d)the public interest.[21]
[21] Deputy Commissioner of Taxation v Australian Securities & Investments Commission [2013] FCA 623.
While not expressly referring to Kenny J’s formulation as set out immediately above, McKerracher J applied the same criteria in Bell Group Ltd v Australian Securities and Investments Commission.[22] On 30 June 2021, Cheeseman J in Re NETIVEEDU PTY LTD (ACN 610 391 690) (deregistered)[23] held, among other things, that the considerations on which Gleeson J pronounced in Yeo, on which Kenny J pronounced in Deputy Commissioner of Taxation v Australian Securities & Investments Commission and on which McKerracher J pronounced in Bell were relevant, ultimately no limit exists on the court’s power to make an order granting or refusing the application for an order for the reinstatement of the registration of a company. While I respectfully agree in general terms and at a high level of abstraction, nevertheless it must be said that s 601AH(2) of the Corporations Act confers a discretionary power and the exercise of any such discretionary power must be done judicially.[24]
[22] (2018) 128 ACSR 247.
[23] (2021) 153 ACSR 110.
[24] House v The King (1936) 55 CLR 499, R v Watson; Ex parte Armstrong (1976) 136 CLR 248, Gronow v Gronow (1979) 144 CLR 513, Mallet v Mallet (1984) 156 CLR 605, Norbis v Norbis (1986) 161 CLR 513, Dougherty v Dougherty (1987) 163 CLR 278 and Stanford v Stanford (2012) 247 CLR 108 to name a few.
When applying the four criteria adumbrated by Kenny J, I am persuaded to make the order for the reinstatement of CPL’s registration. I say that for several reasons. First, while the circumstances of the deregistration of CPL were poorly explained in the evidence on this application, the most likely explanation leading to CPL’s deregistration was that the company was erroneously placed in voluntary liquidation on 21 June 2016 after which nothing was done to wind the company up by reason of there being no funds to do so. Thereafter, no steps were taken in the winding up and no documentation was lodged with the Australian Securities and Investment Commission to record that CPL had in fact been wound up.
Under s 601AB of the Corporations Act, ASIC is entitled to deregister a company where the filing of a company’s annual return is at least six months late and where the company has not lodged any other documentation required to be lodged under the Corporations Act in the preceding 18 months and where ASIC has no reason to believe that the company was carrying on business.
Expressed most simply, CPL was placed in voluntary liquidation in June 2016 after which no event in its corporate life thereafter occurred until the arbitration that is presently part heard.
Second, in my view, good use is likely to be made of an order for the reinstatement of the registration of CPL. The most immediate use is likely to be to procure funds held by estate-agents to be released and for real estate in Suburb F to be sold.
Third, no evidence exists that any person is likely to be prejudiced by the order reinstating CPL’s registration.
Fourth, in my view it is in the public interest for an order to be made reinstating the registration of CPL for the very good reason that CPL’s tax obligations may be met and discharged by payment. The payment of tax obligations is, self-evidently, in the public interest.
For those reasons I order the reinstatement of CPL’s registration pursuant to s 601AH of the Corporations Act.
I also make an order in accordance with paragraph two of the proposed consent minutes. I decline to make an order in terms of paragraph one of the consent minutes on the basis that such an order is not necessary. Similarly, the declaration sought in paragraph four is likewise unnecessary. Paragraph five has already been addressed. That leaves paragraph six.
AMENDING THE LAND REGISTER
I take the view that no power is reposed in a Justice of the Federal Circuit and Family Court of Australia to make the order sought.
The parties’ submissions did not squarely address this issue except in imprecise and ephemeral terms. They contended that pursuant to the accrued power possessed by the FCFCOA,[25] the FCFCOA had power to direct a state official in the emanation of the Registrar General to amend the details of the relevant certificate of title. They argued that the cross-vesting legislation was the source of power in that regard citing Re Wakim; Ex parte McNally. [26] Yet they concurrently cited the decision in In the Marriage of Scaggiante & Harrison[27] where the Family Court of Australia (as the FCFCOA (Division One) was then known) refused an application for an equivalent order.
[25] They did not mention the key cases in the High Court on point such as Stack v Coast Securities (No 9) Pty Ltd (1983) 154 CLR 261 and Fencott v Muller (1983) 152 CLR 570.
[26] (1999) 198 CLR 511.
[27] (1978) 30 FLR 561.
In my view the proper court in this case to make order in relation to amendments to a certificate of title in respect of real property in New South Wales is the Supreme Court of New South Wales. I entertain very real doubt that this Court possesses the requisite power under its accrued jurisdiction. But if I am wrong in that view, I would only entertain such an application at trial after exhaustive debate in which authorities can be were canvased beyond In the Marriage of Scaggiante & Harrison. That case seemingly stands for a position opposite to the one favouring the parties.
In those circumstances, it seems to me that this proceeding should to be returned to the learned arbitrator forthwith for the arbitrator to determine how long the arbitration should remain interrupted while the parties apply to the Supreme Court of New South Wales for orders amending the relevant certificate of title. Intuitively and without more, it seems to me that a three month adjournment may (repeat, may) be appropriate. Beyond saying that, the arbitrator is seized of this proceeding so he is best placed to assess the necessary duration of any further adjournment and it would be otherwise unwise and inappropriate to trammel upon the learned arbitrator’s ongoing conduct of this case.
ORDERS
Accordingly, orders are made as recorded in the earlier paragraphs of these reasons.
I certify that the preceding fifty (50) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Wilson. Associate:
Dated: 17 December 2021
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