IN THE MATTER OF the Corporations Law of Victoria and Regulation 5.6.54 of the Corporations Regulations
JACINTO ROMERO & ORS
Applicants
v
M.R. AUTY and G.K. KEITH as Liquidators of WESTBURY JOINERY COMPANY PTY LTD (in liquidation) (ACN 005 605 130)
Respondents
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JUDGE:
Warren J
WHERE HELD:
Melbourne
DATE OF HEARING:
20 and 21 September 2000
DATE OF JUDGMENT:
3 November 2000
CASE MAY BE CITED AS:
Romero & Ors v Auty & Ors
MEDIUM NEUTRAL CITATION:
[2000] VSC 462
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Corporations Law, ss.511 and 1321.
Corporations Regulations, Reg. 5.6.54(1)
Proof of Debt – appeal against liquidator's rejection – whether applicants employees of company or another company.
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APPEARANCES:
Counsel
Solicitors
For the Applicants
Mr D. Staindl
Ryan Carlisle Thomas
For the Respondents
Mr S.P. Gardiner
Rigby Cooke
HER HONOUR:
The applicants bring an appeal under s.1321 of the Corporations Law and Regulation 5.6.54(1) of the Corporations Regulations against the rejection of their formal proofs of debt or claim by the respondents who are the liquidators of the company, Westbury Joinery Company Pty Ltd (in liquidation) ("the company"). The applicants are thirteen in number and claim remuneration from the company on the basis that they were its employees.
The respondent liquidators also make application under s.511 of the Corporations Law for a determination of the question of the identity of the employer of the former employees of the Westbury Joinery enterprise who are not applicants to this proceeding.
The company was registered on 30 November 1979 under the name Vetus Dion Nominees Pty Ltd. On 18 June 1980 the name of the company changed to Westbury Joinery Company Pty Ltd. The directors of the company were Joe Ganci, since deceased, Joe Foxwell, William Strachan and Michael Giurleo. Between 1965 and 1979 the individuals who were ultimately the directors of the company were at various times employed in positions such as a cabinet maker by the businesses that preceded the company.
In April 1984 another company, Westbury Holdings Pty Ltd was incorporated. On 11 July 1986 a further company, Westbury Joinery Services Pty Ltd ("Westbury Joinery Services") was incorporated. Each of Westbury Joinery Company Pty Ltd, Westbury Holdings Pty Ltd and Westbury Joinery Services Pty Ltd formed the Westbury group.
Prior to the incorporation of Westbury Joinery Services four of the applicants commenced employment, they believed, with the company. The relevant applicants were Sam Garretto the sixth-named applicant, Gordon Stephen the eighth-named applicant, Peter Strong the ninth-named applicant and Dominic Zicconi the thirteenth-named applicant.
At various times during the 1980s and 1990s the remaining applicants were employed, again they believed, by the company. The detailed employment history of each of the applicants is dealt with separately together with the relevant industrial history relating to the company.
On 24 July 1998 the company entered voluntary administration as did, also, Westbury Joinery Services. On 3 September 1998 the company and Westbury Joinery Services were…
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.
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AGLC
Romero v Auty [2000] VSC 462
Case
[2000] VSC 462
Decision Date
CaseChat Overview and Summary
The matter before the court was an appeal by Romero and Auty against the liquidator's rejection of their proof of debts. The applicants sought to be recognised as creditors of the company, claiming to be employees owed unpaid wages and entitlements. The dispute centred on whether Romero and Auty were employees of the company or another entity and thus entitled to have their claims recognised. The court was required to determine the validity of the liquidator's decision to reject the applicants' proofs of debt under the relevant sections of the Corporations Act and Regulations.
The applicants argued that they were employees of the company and, as such, were owed unpaid wages and entitlements. The liquidator contested this, asserting that Romero and Auty were employees of another company and thus not entitled to be recognised as creditors of the company in question. The court needed to consider the evidence presented regarding the applicants' employment status and whether they were entitled to have their claims recognised as debts owed by the company. The legal issues revolved around the interpretation of sections 511 and 1321 of the Corporations Act and Regulation 5.6.54(1) of the Corporations Regulations.
The court found that Romero and Auty were indeed employees of the company and not another entity. The applicants' employment contracts, payment records, and other evidence demonstrated that they were owed unpaid wages and entitlements by the company. The liquidator's rejection of the applicants' proofs of debt was thus deemed incorrect. The court emphasised the importance of accurately identifying the creditors of a company in liquidation and ensuring that legitimate debts are recognised and paid. The appeal was allowed, and the liquidator was directed to recognise Romero and Auty as creditors of the company.