Segal v Sharma - [2020] NSWCA 192

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Segal v Sharma [2020] NSWCA 192
Hearing dates: 24 August 2020
Date of orders: 24 August 2020
Decision date: 24 August 2020
Before: Gleeson JA
Decision:
(1) Leave be granted to the appellants under s 471B of the Corporations Act 2001 (Cth) nunc pro tunc to commence and proceed with the appeal against the second respondent, South-West Radiology Pty Ltd (in liq).

Catchwords:
CORPORATIONS – application for leave to proceed against a company in liquidation – Corporations Act 2001 (Cth), s 471B – whether necessary to join company as proper party where equitable assignment of part of a debt – leave granted

Legislation Cited:
Corporations Act 2001 (Cth), s 471B

Cases Cited:
Distinctive FX 9 Pty Ltd v Statewide Developments Pty Ltd [2012] NSWCA 393
DSG Holdings Australia Pty Ltd v Hellenic Pty Ltd [2014] NSWCA 96; (2014) 99 ACSR 121
Federal Commissioner of Taxation v Everett (1980) 143 CLR 440
Norman v Federal Commissioner of Taxation (1963) 109 CLR 9
Oceanic Life Ltd v Insurance and Retirement Services Pty Ltd (in liq) (1993) 11 ACSR 516
Ong v Lottwo Pty Ltd (in liq) [2013] SASCFC 57; (2013) 116 SASR 280
Thomas v National Australia Bank Limited [2000] 2 Qd R 448
Zervas v Burkitt [2019] NSWCA 112

Category: Procedural and other rulings
Parties: Phillip Segal (First applicant)
Melita Segal (Second applicant)
Praneal Dutt Sharma (First respondent)
South West Radiology Pty Ltd (in liq) (Second respondent)
Representation:
Counsel:
G P Gee (Applicants)
Solicitors:
Keypoint Law (Applicants)
Carneys Lawyers (First respondent)
Bridges Lawyers (Second respondent)

File Number(s): 2020/148680
Decision under appeal

Court or tribunal:

District Court of New South Wales

Jurisdiction:

Civil

Citation:

[2020] NSWDC 121

Date of Decision:

22 April 2020

Before:

Russell SC DCJ

File Number(s):

2018/363950

Judgment

GLEESON JA: Application is made by the appellants, Dr Phillip Segal and Mrs Melita Segal (the Segals), for leave to proceed against the second respondent, South-West Radiology Pty Ltd (SWR), a company in liquidation, under s 471B of the Corporations Act 2001 (Cth).
SWR was placed in liquidation by court order on 20 May 2020. Mr Glenn Livingstone was appointed liquidator of the company by the Court on 17 September 2019 in place of the previous appointee. The liquidator has indicated through his solicitors that he neither consents to nor opposes the grant of leave to proceed.
As the applicants for leave, the Segals accept the line of authority that an appeal is a new proceeding for which a separate grant of leave is required: Distinctive FX 9 Pty Ltd v Statewide Developments Pty Ltd [2012] NSWCA 393 at [13] (see also the discussion in Zervas v Burkitt [2019] NSWCA 112 at [11]-[14]).
The purpose of the requirement of leave is to ensure that a company in liquidation is not subjected to the multiplicity of actions which would be both expensive and time-consuming, as well as in some cases unnecessary. Ordinarily, claims against such companies should be pursued…

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 Segal v Sharma

Details

AGLC: Segal v Sharma [2020] NSWCA 192
Case: [2020] NSWCA 192
Decision Date: 24 August 2020

CaseChat Overview and Summary

The appellants, Segal and others, sought leave under section 471B of the *Corporations Act 2001* (Cth) to proceed with an appeal against the second respondent, South-West Radiology Pty Ltd, which was in liquidation. The dispute concerned an equitable assignment of part of a debt owed to the company.

The primary legal issue before the court was whether leave to proceed against a company in liquidation was necessary under section 471B of the *Corporations Act 2001* (Cth) in circumstances where the company was the assignee of a debt, and the appellants sought to pursue an appeal against that company in relation to the assigned debt.

The court considered the application of section 471B, which generally prohibits proceedings against a company under external administration without leave. Gleeson JA granted leave to the appellants nunc pro tunc to commence and proceed with the appeal against the second respondent. The court's reasoning, though not detailed in the provided text, evidently concluded that such leave was required and appropriate in this instance, notwithstanding the nature of the assignment.

The court ordered that leave be granted to the appellants under section 471B of the *Corporations Act 2001* (Cth) nunc pro tunc to commence and proceed with the appeal against the second respondent, South-West Radiology Pty Ltd (in liq).

Orders

Orders of the court

(1) Leave be granted to the appellants under s 471B of the Corporations Act 2001 (Cth) nunc pro tunc to commence and proceed with the appeal against the second respondent, South-West Radiology Pty Ltd (in liq).

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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Medium Neutral Citation:	Segal v Sharma [2020] NSWCA 192
Hearing dates:	24 August 2020
Date of orders:	24 August 2020
Decision date:	24 August 2020
Before:	Gleeson JA
Decision:	(1) Leave be granted to the appellants under s 471B of the Corporations Act 2001 (Cth) nunc pro tunc to commence and proceed with the appeal against the second respondent, South-West Radiology Pty Ltd (in liq).
Catchwords:	CORPORATIONS – application for leave to proceed against a company in liquidation – Corporations Act 2001 (Cth), s 471B – whether necessary to join company as proper party where equitable assignment of part of a debt – leave granted
Legislation Cited:	Corporations Act 2001 (Cth), s 471B
Cases Cited:	Distinctive FX 9 Pty Ltd v Statewide Developments Pty Ltd [2012] NSWCA 393 DSG Holdings Australia Pty Ltd v Hellenic Pty Ltd [2014] NSWCA 96; (2014) 99 ACSR 121 Federal Commissioner of Taxation v Everett (1980) 143 CLR 440 Norman v Federal Commissioner of Taxation (1963) 109 CLR 9 Oceanic Life Ltd v Insurance and Retirement Services Pty Ltd (in liq) (1993) 11 ACSR 516 Ong v Lottwo Pty Ltd (in liq) [2013] SASCFC 57; (2013) 116 SASR 280 Thomas v National Australia Bank Limited [2000] 2 Qd R 448 Zervas v Burkitt [2019] NSWCA 112
Category:	Procedural and other rulings
Parties:	Phillip Segal (First applicant) Melita Segal (Second applicant) Praneal Dutt Sharma (First respondent) South West Radiology Pty Ltd (in liq) (Second respondent)
Representation:	Counsel: G P Gee (Applicants) Solicitors: Keypoint Law (Applicants) Carneys Lawyers (First respondent) Bridges Lawyers (Second respondent)
File Number(s):	2020/148680
Decision under appeal	Court or tribunal: District Court of New South Wales Jurisdiction: Civil Citation: [2020] NSWDC 121 Date of Decision: 22 April 2020 Before: Russell SC DCJ File Number(s): 2018/363950