Tamone v How Fast Pty Limited - [1999] NSWSC 570

CITATION: Tamone v How Fast Pty Limited [1999] NSWSC 570

CURRENT JURISDICTION: Equity

FILE NUMBER(S): 1826/99

HEARING DATE(S): 31/05/99, 07/06/99, 08/06/99

JUDGMENT DATE:
8 June 1999

PARTIES :

Mary Tamone and Frank Tamone (Ps)
How Fast Pty Limited (in liquidation) (ACN 056 912 237) (D)

JUDGMENT OF: Santow J

COUNSEL : J K Chippindall (P)
ex party

SOLICITORS: Astridge & Murray (P)

CATCHWORDS: CORPORATIONS — Extension of time to register a charge under s262 of the Corporations Law — Relevant considerations where corporation goes into administration and then liquidation — No invariable rule that dispensation should be precluded.

ACTS CITED: Corporations Law s262(1)(a); s262(1)(b)(i); s266(4)

CASES CITED: J J Leonard Properties v Leonard (WA) Pty Ltd (in liq) No. 2 (1988) 13 ACLR 77
Morris v Woodings & Anor (1997) 25 ACSR 636
Sanwa Australia Finance Limited v Ground-Breakers Pty Limited (in liquidation) (1989-90) 2 ACSR 692
Vector Capital Limited v SNS Software Network Systems Pty Limited (1988) 12 NSWLR 1

DECISION: Application to extend time for registration of charge granted.

Tamone.8June99 — 9 June, 1999: Tamone v How Fast Pty Limited (in liquidation)
7

IN THE SUPREME COURT
OF NEW SOUTH WALES
IN EQUITY

SANTOW J
No. 1826/99

In the matter of HOW FAST PTY LIMITED (in liquidation) (ACN 056 912 237) and the Corporations Law
MARY TAMONE & FRANK TAMONE
Plaintiffs

HOW FAST PTY LIMITED (in liquidation) (ACN 056 912 237)
Defendant

JUDGMENT — ex tempore
8 June 1999 1 What follow are my reasons for making the orders contained in the Short Minutes of Order.

Factual Background

2 The company gave a charge dated 13 November 1998 in favour of Mary Tamone and Frank Tamone. That charge was a fixed and floating charge over the assets of the company and was a charge over the whole of those assets and as such was required to be registered pursuant to s262(1)(a) of the Corporations Law. 3 The requirement of the Law was that it be registered within 45 days of being given. 4 The amount of the advance made under the charge was the sum of $60,000.00 and there appears to be no dispute that the advance was given: see affidavit of Martin Green 19 May 1999 annexure B. 5 The charge, on its face, was prepared by a firm of solicitors and it would appear that it was returned by the company’s accountants to the solicitors on or about 23 December 1998. 6 As the charge was given on 13 November, it was required to be registered within 45 days so that it had to be lodged for registration with the Australian Securities & Investment Commission by 28 December 1998. 7 The 28 December 1998 was a public holiday and by virtue of the Interpretation At the last day for the lodgment of the charge was extended until 29 December 1998. 8 It appears from a letter from the solicitors addressed to the plaintiff’s accountants that the charge was placed on the desk of the firm’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 Tamone v How Fast Pty Limited

Details

AGLC: Tamone v How Fast Pty Limited [1999] NSWSC 570
Case: [1999] NSWSC 570
Decision Date: 8 June 1999

CaseChat Overview and Summary

In the case of Tamone v How Fast Pty Limited, the respondent sought to register a charge over the assets of the company, which had entered into voluntary administration and subsequently liquidation. The applicant, Tamone, challenged the respondent’s application for an extension of time to register the charge under section 262 of the Corporations Law. The dispute was adjudicated in the Federal Court of Australia.

The primary legal issue before the court was whether the respondent was entitled to an extension of time to register a charge over the company's assets, given that the company had entered into administration and subsequently liquidation. The court needed to consider the relevant factors and principles that should guide the exercise of discretion under section 262 of the Corporations Law. Specifically, it had to examine whether the delay in registering the charge was unreasonable, and if so, whether any mitigating circumstances warranted an extension of time.

The court held that there was no invariable rule precluding the grant of dispensation in cases where a corporation goes into administration and then liquidation. The court identified that the discretion under section 262 is not absolute and must be exercised judicially, taking into account all relevant circumstances. It considered factors such as the nature and length of the delay, the reasons for the delay, and whether there was any prejudice to other creditors or to the administration or liquidation process. In this instance, the court found that the delay was not unreasonable and that there were mitigating circumstances that justified the grant of an extension. Consequently, the court allowed the respondent's application to register the charge.

The Federal Court of Australia granted the respondent's application to extend the time to register the charge. The court's decision underscored the need for a flexible and contextual approach in exercising discretion under section 262 of the Corporations Law. The judgment provided guidance on the considerations relevant to such applications, emphasising that each case must be assessed on its unique circumstances.

Orders