Bristrol Custodians Ltd v Chief Commissioner of State Revenue

Withdrawal and dismissal 1The background of this case is summarised in the reasons for decision at an earlier stage in the proceedings, Bristrol Custodians Ltd v Chief Commissioner of State Revenue (No.2) [2013] NSWADT 128. The case was adjourned from 30 May to 22, 25 and 26 July. It consisted of the application by the respondent to dismiss with costs the substantive proceedings under s 73(5)(g)(ii) and (iv) of the Administrative Decisions Tribunal Act 1997 (ADT Act) as frivolous or vexatious or for want of prosecution. The substantive application and the applicant's own application for costs were also adjourned to those dates 2On the adjourned date the applicant gave notice of withdrawal and sought an order dismissing the substantive application under s 73(5)(g)(i) of the ADT Act. The applicant's application for costs was withdrawn at the same time. 3The applicant's counsel explained that since 30 January 2013 the applicant had been a company in liquidation in New Zealand and subject to the jurisdiction of the High Court of New Zealand. The liquidator, having since submitted his final report in the liquidation, and his role thereby being spent, now applied to withdraw the proceedings under s 73(5)(g)(i) of the ADT Act so as to enable the Supreme Court to deal with the matter. The applicant relied on the affidavit of Rosita Luk dated 21 July 2013 (this affidavit was referred to by both sides in submissions but never formally tendered) in support of the application, which set out how the liquidator was now potentially liable to become a party to the former liquidators' proceedings in that court, as was the respondent in these proceedings. 4In relation to the moneys claimed in these proceedings, the respondent had lodged with the liquidator two proofs of debt, one of which had been satisfied and the other withdrawn. As regards the proof of debt that had been satisfied, s 321 of the Companies Act 1993 (NZ) provided the basis for an objection to removal from the register. It provided expressly that a claim against a company is not "undischarged" if it has been paid in full. Therefore, if the claim has been discharged by payment, the creditor has no basis on which to object to removal from the register or the termination of the liquidation. Similarly, a debt is not undischarged under s 321 if the liquidator has notified the creditor that the assets of the company are insufficient, as was the case here. 5A creditor who lodged a claim but withdrew it on or before the date fixed by the liquidator would be excluded from the benefit of any distribution made before his or her claim was made. That was the case with the respondent's withdrawn claim. 6Such a creditor could only be entitled to receive the benefit of any distribution from which it was previously excluded if any assets remained or, in the opinion of the liquidator, were likely to remain, available for distribution. Late claims could be permitted but without disturbing previous dividends. A creditor who had not proved in time was not entitled to recover from shareholders to whom the liquidator had distributed the surplus. Where there were no remaining assets, that would be pointless. The applicant had no remaining assets in its winding up. 7In view of the above, the applicant submitted, it would be remiss of the liquidator, and indeed the respondent, to continue with this application when it was effectively futile and there were no prospects of recovery by the Chief Commissioner. It would also be inappropriate of the liquidator to ask this tribunal to adjourn the matter until the action in the New Zealand High Court brought by the liquidators of the former trustees was disposed of, when the respondent had no prospect of ever being able to become a party to that application or to make a similar application with any success himself. 8Further, it would not be appropriate for the tribunal to continue with the determination of a controversy which was the subject matter of other litigation in superior courts of record. The policy of the law is against multiplicity of proceedings and the courts seek to avoid the situation that the existence of several lawsuits over the same subject matter might lead to contradictory results. As Waddell J pointed out in Reynolds v Reynolds [1977] 2 NSWLR 295 at 306, the existence of two proceedings was considered prima facie vexatious and one would normally, as a matter of course, be stayed. 9The Supreme Court, having jurisdiction to decide all matters in the current controversy, was better equipped to discharge its obligation to ensure that as far as possible, all matters in controversy between the parties might be completely and finally determined, and all multiplicity of proceedings be avoided. For that reason, this tribunal had effectively become forum non conveniens. 10The respondent did not dispute the applicant's account of the present position but pressed his application to dismiss under paras.(ii) and (iv), pointing out that the applicant had not filed its submissions and evidence until that day and had announced its withdrawal only then. It was unable to discharge its statutory onus of proving that the two properties in issue had been held on trust before being transferred to the applicant. 11Section 73(5)(g) relevantly provides that the tribunal "may dismiss at any stage any proceedings before it...(i) if the applicant (or, if there is more than one applicant, each applicant) withdraws the application to which the proceedings relate". 12The cases show that the right to withdraw an application is for practical purposes unfettered. In Re Stevenson and the Commonwealth (1987) 13 ALD 524 the federal Administrative Appeals Tribunal had to interpret s 42A of the Administrative Appeals Tribunal Act 1975 (Cth), which at that time read: "Where all of the parties consent, the Tribunal may dismiss the application without proceeding to review the decision....". It will be noted that the language of s 42A, requiring the consent of all parties, was more restrictive than s 73(5)(g)(i). The tribunal held that the conditional right set out in s 42A was not inconsistent with the right of an applicant to withdraw an application and did not remove that right. The tribunal could not compel an unwilling party to continue with an application. After withdrawal there was no longer a subsisting application or an effective application. 13In Re Queensland Nickel Management Pty Ltd and Great Barrier Reef Marine Park Authority (1992) 28 ALD 368 at 374, the federal tribunal declared that it ought to be open to an applicant to settle the claim at any time up to the decision. "In the vast bulk of cases, it saves the parties and the public money". Notice of withdrawal was effective to withdraw the application from review, and "the proceeding is to be treated as having been disposed of finally.... That decision stands, as effectively as it would have stood if we had given a reasoned decision rejecting the application for review". 14In the present case, there would be no point in continuing to hear the respondent's dismissal application. If successful, it would achieve no more than the applicant's unilateral withdrawal would. If unsuccessful, the result would be made nugatory by the applicant's withdrawal. In either case, the costs so incurred would be wasted. The substantive application was therefore dismissed under s 73(5)(g)(i).