Re BBY Limited (Receivers and Managers Appointed) (in liq) and BBY Holdings Pty Ltd (Receivers and Managers Appointed) (in liq) (No 2)

The case before the court involved the liquidators of BBY Limited and BBY Holdings Pty Ltd, who sought to recover unfair preferences made to certain creditors. The defendants contested the liquidators' claims, and the key issue was whether the liquidators' reliance on the presumption of insolvency, as provided for in section 588E(8) of the Corporations Act 2001, was permissible and consistent with their case as presented at trial. The liquidators applied to amend their pleadings to include this reliance on the presumption, but this application was made late, outside the scope of the originally pleaded case.

The court had to determine whether the liquidators' amendment was permissible under the circumstances. It considered the timing of the amendment, the consistency of the amendment with the case as notified in advance of trial, and the absence of any objection by the defendants until closing submissions. The court weighed these factors against the principles of fairness and justice in the administration of civil proceedings, as well as the statutory provisions governing amendments to pleadings.

In reaching its decision, the court found that the amendment was consistent with the liquidators' case as notified before the trial and that no prejudice was caused to the defendants. Given that the defendants did not object to the amendment until the closing submissions, the court determined that the amendment was permissible and did not infringe on the principles of fairness and justice. The court allowed the amendment and proceeded to consider the merits of the liquidators' claims.

The court ultimately ruled in favour of the liquidators, allowing them to recover the unfair preferences. The defendants' appeal was dismissed, and the liquidators were permitted to rely on the presumption of insolvency as part of their case. The court's decision underscores the importance of timely notification of a case and the flexibility afforded in amending pleadings to ensure that justice is served.