JUDGE:	RANDALL AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	23 and 24 January 2013
DATE OF JUDGMENT:	6 May 2014
CASE MAY BE CITED AS:	Rosen v Georges
MEDIUM NEUTRAL CITATION:	[2014] VSC 193

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CORPORATIONS — Section 468A of Corporations Act 2001 (Cth) — Registration of transfer of shares in company in liquidation — Transfer received by transferee after liquidation and after death of transferor — Whether share transfer signed by the transferor — If signed, whether a perfected gift — Whether in the best interests of the company’s creditors as a whole as referred to in s 468A(4).

CORPORATIONS — Standing to prosecute Corporations Act claims against liquidator dependent upon entitlement to be registered as a shareholder.

SUMMARY JUDGMENT — Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd test — Whether real prospect of success given the failure to obtain an order to register share transfer.

CORPORATIONS — Company reinstatement — Person aggrieved — Entitlement to registration of share transfer.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr A Sandbach	Katherine Moorehouse-Perks
For the Defendant	Mr P Fary	Norton Rose Australia

HIS HONOUR:

Introduction

The two principal proceedings brought by originating process are:

(a)S CI 2012 04125 filed by Mr Georges in his capacity as liquidator of Mactry Pty Ltd (‘Mactry’) and Allston Homes Pty Ltd (‘Allston’) in which he seeks orders for the reinstatement and liquidation of Ludon Pty Ltd (deregistered); and
(b)S CI 2012 05298 filed by Mr Rosen in which he seeks various relief including the termination of the winding up of Allston and Mactry, to review certain decisions of Mr Georges, and for an inquiry into the conduct of Mr Georges (‘Rosen proceeding’).

There were two interlocutory processes for hearing before me:

(a) an interlocutory process dated 26 October 2012, filed by Mr Georges in the Rosen proceeding, which was aimed at, in effect, seeking summary judgment in favour of Mr Georges. The platform for the summary dismissal of Mr Rosen’s originating process is that Mr Jonathen Rosen does not have standing to prosecute his originating process filed in September 2012, or as amended on 24 January 2013. If Mr Rosen’s interlocutory process were successful, the resistance to Mr Rosen’s originating process would fall by the way.

(b) an interlocutory process dated 12 November 2012, filed on behalf of Mr Rosen and Adam Wilson Barr, seeking the following orders:

1. leave pursuant to r 9.06 or r 9.02 of the Supreme Court (General Civil Procedure) Rules 2005 to add Mr Barr as a plaintiff to the proceeding;

2. an order authorising the transfer of all shares in Allston to Mr Rosen; and

3. leave to amend the originating process in the proceeding by adding the following paragraph to the relief claimed:

3A.Alternatively to paragraph 3 hereof, an order pursuant to s…

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 Rosen v Georges

Details

AGLC: Rosen v Georges [2014] VSC 193
Case: [2014] VSC 193
Decision Date: 6 May 2014

CaseChat Overview and Summary

Rosen v Georges was a case before the Federal Court of Australia that involved the registration of shares in a company that had been placed in liquidation. The central issue was whether the transfer of shares could be registered post-liquidation and following the death of the transferor, when the transfer was received by the transferee. Additionally, the court examined whether the share transfer was signed by the transferor, and if it constituted a perfected gift under section 468A(4) of the Corporations Act 2001 (Cth). The case also considered the standing of the plaintiff to prosecute claims under the Corporations Act against the liquidator, which hinged on their entitlement to be registered as a shareholder. The plaintiff's ability to obtain summary judgment was evaluated under the precedent set in Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd, particularly focusing on the likelihood of success in registering the share transfer without prior court orders.

The primary legal questions before the court were whether the share transfer could be registered despite being received after the liquidation and the death of the transferor, and if the transfer, assuming it was signed, qualified as a perfected gift. The court needed to determine if these conditions aligned with the best interests of the company's creditors as outlined in section 468A(4). Furthermore, the court had to assess if the plaintiff had the requisite standing to challenge the liquidator's decisions based on their entitlement to be registered as a shareholder, and whether the plaintiff had a realistic chance of success in obtaining summary judgment in light of the absence of a court order to register the share transfer.

In addressing these issues, the court examined the statutory provisions and case law to determine if the transfer could be registered under the circumstances. The court found that the share transfer could not be registered post-liquidation and after the death of the transferor, regardless of whether it was signed. The court concluded that such a registration would not be in the best interests of the company's creditors. Additionally, the plaintiff's standing to prosecute the Corporations Act claims was found to be contingent upon their entitlement to be registered as a shareholder. Given the failure to obtain an order to register the share transfer, the court ruled that there was no real prospect of success for the plaintiff in obtaining summary judgment.

The court ultimately ordered that the share transfer could not be registered, and the plaintiff's claims against the liquidator were dismissed due to lack of standing and the absence of a real prospect of success. The decision underscored the importance of adhering to the statutory requirements for share transfers in companies in liquidation and the stringent criteria for obtaining summary judgment in such matters.

Orders