Weston Application; Employers Mutual Indemnity (Workers Compensation) Ltd v Omni Corporation Pty Ltd

1089/06 APPLICATION OF PAUL GERARD WESTON; EMPLOYERS MUTUAL (WORKERS COMPENSATION) LTD v OMNI CORPORATION PTY LTD JUDGMENT 1 On 16 January 2009, Mr Weston, as liquidator of Omni Corporation Pty Ltd ("Omni"), filed an interlocutory process in these proceedings 1089/06. By that interlocutory process, he claims an order pursuant to s 588FF(1) of the Corporations Act 2001 (Cth) that Proden Pty Ltd ("Proden"), which is named as respondent to the interlocutory process, pay money to Omni. 2 The proceedings 1089/06 in which the interlocutory process has been filed were commenced on 16 January 2006 when Employers Mutual (Workers Compensation) Ltd filed an originating process seeking an order that the defendant therein named (being Omni) be wound up in insolvency on the basis of non-compliance with a statutory demand. That order was made on 10 March 2006, together with an order appointing Mr Weston liquidator of Omni. 3 Proden contends that there is no valid application under s 588FF(1) before the court. The submissions in support of that contention are, first, that the purported application by interlocutory process (rather than originating process) must be regarded as no application at all; and, second (and in any event), that the purported application was not made within the period allowed by s 588FF(3). 4 Proden has accordingly filed an interlocutory process of its own seeking an order that Mr Weston's interlocutory process be dismissed. It is to that interlocutory process that these reasons relate. 5 I shall deal with Proden's objections in reverse order, concentrating first on the timing question. 6 The winding up order was made on 10 March 2006 upon an application filed on 16 January 2006. It is common ground that, having regard to Division 1A of Part 5.6 and the s 9 definition of "relation-back day", the "relation-back day" of the winding up of Omni is 16 January 2006. Section 588FF(3), concerning the making of an application under s 588FF(1), is in these terms: "An application under subsection (1) may only be made: (a) during the period beginning on the relation-back day and ending: (i) 3 years after the relation-back day; or (ii) 12 months after the first appointment of a liquidator in relation to the winding up of the company; whichever is the later; or (b) within such longer period as the Court orders on an application under this paragraph made by the liquidator during the paragraph (a) period." 7 The matter before me was argued on the basis that, for the purposes of this provision, an application is "made" when the relevant initiating process is filed. Leaving to one side the question whether the interlocutory process may, as Proden suggests, be a nullity, the application was made when the interlocutory process was filed on 16 January 2009. The question is therefore whether that filing occurred "during" the period mentioned in s 588FF(1)(a)(i), it being accepted that that is the governing provision in this case. 8 A provision with respect to the calculation of time is found in s 105 of the Corporations Act: "Without limiting subsection 36(1) of the Acts Interpretation Act 1901 , in calculating how many days a particular day, act or event is before or after another day, act or event, the first-mentioned day, or the day of the first-mentioned act or event, is to be counted but not the other day, or the day of the other act or event." 9 When referring to s 36(1) of the Acts Interpretation Act 1901 (Cth), s 105 must be taken to refer to that provision as in force on 1 January 2005. That is the effect of s 5C of the Corporations Act as it now stands. In any event and since s 36(1) of the Acts Interpretation Act does not seem to have been amended since 1948, we may simply take the section as we currently find it: "Where in an Act any period of time, dating from a given day, act, or event, is prescribed or allowed for any purpose, the time shall, unless the contrary intention appears, be reckoned exclusive of such day or of the day of such act or event." 10 When s 105 of the Corporations Act is read in the way dictated by its opening words, it is in these terms: "Without limiting the rule that where in this Act any period of time, dating from a given day, act, or event is prescribed or allowed for any purpose, the time shall, unless a contrary intention appears, be reckoned exclusive of such day or the day of such act or event, in calculating how many days a particular day, act or event is before or after another day, act or event, the first-mentioned day, or the day of the first-mentioned act or event is to be counted, but not the other day, or the day of the other act or event." 11 Section 588FF(3), as it has existed since 31 December 2007, no longer requires that an application be made "within 3 years after the relation-back day". It now refers to an application made "during" a period beginning on the relation-back day and "ending . . . 3 years after the relation-back day". The last day of the period (that is, the day on which it ends) is therefore the day that is three years after the relation-back day. 12 In calculating whether an application was made within the period of three years "after" 16 January 2006, one leaves out of account 16 January 2006 itself. It is, in s 105 terms, the "other day" or "the day of the other act or event". One counts, however, the date of the making of the application, that being, in terms of s 105, the "first-mentioned day". 13 No period "after" 16 January 2006 started until 16 January 2006 had itself ended. The first day of every period "after" 16 January 2006 was 17 January 2006. At the conclusion of 17 January 2006, one day of every period "after" 16 January 2006 had elapsed. 14 To identify the end of the period of three years "after" 16 January 2006, one applies the "corresponding date" principle discussed by the House of Lords in Dodds v Walker [1981] 1 WLR 1027. Dealing with identification of the period of four months "after" a particular event, their Lordships regarded two principles as well-established: first, that in calculating the period that has elapsed "after" the event, the day of the event itself is excluded from the reckoning (that is the force of s 105 of the Corporations Act as it applies to the present case); and, second, that when the period is a month or a number of months "after" the event, the general rule is that the period ends on the corresponding date in the subsequent month, that is, the day of that subsequent month that bears the same number as the day of the earlier month on which the event happened. The House of Lords discussed adjustments and refinements (irrelevant to the present case) that must be applied where the date in the earlier month is the 31st and the later month has fewer than 31 days and where the starting date is 28 or 29 February. 15 The same approach is appropriate when calculating years. When the question is as to the expiration of a period of three years "after" a particular date, one applies the "corresponding date" principle to a period of 36 months. On this basis, the period of three years "after" 16 January 2006 ended on - and therefore at the conclusion of - the 16th day of the 36th month after January 2006, that is, on - and therefore at the conclusion of - 16 January 2009. 16 I am satisfied that if an application under s 588FF(1) was validly made by the filing of the interlocutory process in fact filed on 16 January 2009, that application was made on the last day of (and therefore within) the period referred to in s 588FF(3). 17 I proceed now to the question whether the application is a nullity because made by interlocutory process in the winding up proceedings. 18 Proden points to rule 2.2 of the Supreme Court (Corporations) Rules 1999. It is sufficient to quote sub-rules (1) and (2): "(1) Unless these Rules otherwise provide, a person must make an application required or permitted by the Corporations Act to be made to the Court: (a) if the application is not made in a proceeding already commenced in the Court - by filing an originating process, and (b) in any other case, and whether interlocutory relief or final relief is claimed - by filing an interlocutory process.

(2) Unless the Court otherwise directs, a person may make an application to the Court in relation to a proceeding in respect of which final relief has been granted by filing an interlocutory process in that proceeding." 19 Rule 2.2 recognises that there exists a concept of making an application to the court "in relation to" a proceeding "in respect of which final relief has been granted". Mr Carolan submitted on behalf of Proden, and I accept, that the winding up proceeding 1089/06 is one in which final relief has been granted in the form of a winding up order and an order for the appointment of a liquidator. In view of rule 2.2, however, Mr Carolan's next submission cannot be accepted, namely that it is now impossible for any application to be brought in proceedings 1089/06. Nor, in my view, is it significant that neither Mr Weston nor Proden was a party to the winding up proceedings. 20 It is commonplace for subsequent applications of various kinds to be brought in winding up proceedings in which final relief has already been granted. Frequently encountered examples are a liquidator's application for directions under s 479(3) of the Corporations Act or for leave under provisions such as s 477(2A) and (2B), an application by a creditor or contributory under s 482 for an order terminating the winding up and an appeal against a liquidator's rejection of a proof of debt. As a matter of practice, applications such as those mentioned are typically brought under the "umbrella", as it were, of the winding up proceedings, and this is so even though such an application may not involve the parties to the original proceeding. In some other cases, an interlocutory process is made by the rules the appropriate vehicle. I refer, by way of example, to an application by a liquidator for release (rule 7.5), a complaint to the court in relation to a liquidator under s 536 (rule 7.11) and an application for the determination of a liquidator's remuneration (rule 9.4). 21 Under the current Commonwealth legislation, the court by which the winding up order was made is not the only court with jurisdiction to deal with the various post-liquidation applications of the kinds mentioned. A particular applicant is free to approach any other "Court" (in the s 58AA capital "C" sense) exercising Corporations Act jurisdiction. Thus, for example, a liquidator appointed by one "Court" may apply to another "Court" for his or her release. Having regard to rule 7.5, it appears that an interlocutory process would be the appropriate means of bringing that application before the other "Court"; and that this would be so even though no other relevant proceeding was, or had been, pending in the other "Court". 22 The other significant point about rule 2.2 of the Supreme Court (Corporations) Rules in the present case is that rule 2.2(1)(b) makes it clear that an interlocutory process may be an appropriate vehicle for advancing a claim for final relief. 23 I accept that an application under s 588FF(1) is an application for final relief. Experience suggests that, as Mr Carolan indicated, such applications are usually initiated by originating process filed by way of a new proceeding distinct from the winding up proceeding in which the applicant liquidator was appointed. It may happen, of course, that a s 588FF(1) application is brought in a court other than that which made the winding up order. That section vests jurisdiction in a "court" (with a small "c"), so that any one of a number of Australian courts in addition to those having jurisdiction to order winding up may be chosen by the applicant liquidator, subject to general limits on jurisdiction. 24 I have not, however, been directed by counsel to any rule of court or any principle of law applying in a case such as the present (where the s 588FF(1) application is brought in the court that made the winding up order) that makes initiation of a s 588FF(1) application by originating process the exclusively available course. While I am of the opinion that, for the sake of good order, it is highly desirable that that course be followed, I cannot say that failure to follow it - and adoption of the course that Mr Weston has taken here - causes the application to be a nullity. No persuasive case has been made in support of that drastic proposition as the necessary consequence of choosing to use Form 3 (interlocutory process) rather than Form 2 (originating process) and intituling the application in the winding up proceeding rather than a new proceeding. 25 The interlocutory process filed by Proden on 16 January 2009 is dismissed with costs. **********

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