FEDERAL COURT OF AUSTRALIA

Longreach Oil Ltd v Ninox Energy Pte Ltd [2013] FCA 215

THE COURT ORDERS THAT:

1.    Pursuant to s 31A(2) of the Federal Court of Australia Act 1976 (Cth) and r 26.01 of the Federal Court Rules 2011, the interlocutory application filed by Longreach Oil Pty Ltd on 29 November 2012 be dismissed.

2.    The applicant, Longreach Oil Pty Ltd, pay the respondent’s, Ninox Energy Pte Ltd, costs of the application.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1    I have before me this afternoon an application by Ninox Energy Pte Limited (Ninox) for summary dismissal of a proceeding filed by Longreach Oil Ltd (Longreach). The application for summary judgment is made under s 31A of the Federal Court of Australia Act 1976 (Cth) and r 26.01 of the Federal Court Rules 2011 (Cth).

2    The ground of the application is that the interlocutory application filed by Longreach on 29 November 2012 has no reasonable prospects of success. The issue which arises is one of construction of s 459F(2) of the Corporations Act 2001 (Cth) (the Act). The relevant facts may be stated shortly.

3    On 9 November 2012, District Registrar Wall ordered that an originating process filed by Longreach seeking to set aside Ninox’s statutory demand be set aside under s 459G of the Act. The District Registrar gave detailed reasons for his judgment and, as I have said, an Order was made on 9 November 2012 dismissing Longreach’s application.

4    On 29 November 2012, Longreach filed an interlocutory application seeking a review of the exercise of the powers of the Court by District Registrar Wall, pursuant to s 35A(5) of the Federal Court Act.

5    Mr Cheshire, who appears for Ninox, moved the Court today to summarily dismiss the proceeding on the ground that upon the proper construction of s 459F(2)(a) the time for compliance with the statutory demand expired prior to the filing of the interlocutory application on 29 November 2012.

6    Mr Cheshire submitted that the effect of what took place in the present case was to enliven the application of s 459F(2)(a)(ii) under which the period for compliance with the demand ended seven days after the order made by District Registrar Wall. That is to say, the relevant period expired on 16 November 2012, some 13 days before the filing of the interlocutory application for review.

7    The issue of construction which arises has been dealt with in a number of authorities. Mr Cheshire took me to four authorities, namely, G & J Gears Australia Pty Ltd v Brobo Group Pty Ltd (2006) 229 ALR 638, the decision of the Victorian Court of Appeal in Buckland Products Pty Ltd v Deputy Commissioner of Taxation of the Commonwealth of Australia [2003] VSCA 85, Shakespeares Pie Co Australia Pty Ltd v Multipye Pty Ltd [2005] NSWSC 1201, and JEM Developments Pty Ltd v Hansen Yuncken Pty Ltd [2006] NSWSC 1378.

8    It is unnecessary to deal in any detail with those authorities. The effect of them may be succinctly stated in the words used by Young CJ in Eq, which were quoted with approval by Barrett J in Shakepeares Pie at [9], namely, that the consistent ruling of the courts has been that “final determination under s 459F occurs when the master or judge at first instance gives his or her decision.” The principles are explained fully by the Victorian Court of Appeal decision in Buckland, to which I have referred, in particular, at [7] to [9].

9    Counsel for Longreach ultimately accepted what seems to be the inevitable consequence of these authorities, namely, that the application under s 459G was finally determined when District Registrar Wall pronounced his orders on 9 November 2012, although a submission was initially put that s 459F(2)(a)(ii) was not enlivened because the proceeding had not been finally determined. I do not understand that submission to have been advanced when the matter was finally argued.

10    In any event, against the possibility that that submission was put by counsel, it seems to me that it cannot be sustained. Buckland was an authority which dealt with the question of an appeal from a decision of the Master but, as the Court of Appeal said at [7], the appeal was by way of hearing de novo and the Court did not regard that as a relevant consideration.

11    Moreover, no point seems to me to arise with respect to the nature of a review of a Registrar’s decision. Authority for that proposition may be found in the decision of Kenny J in G & J Gears, to which I referred above. Her Honour in that case dealt with the status of an application to review a Registrar’s decision and the decision seems to me to be on all fours with the present.

12    Kenny J observed at [47] that once one of the conditions in s 459F(2)(a) is fulfilled, which in that case was by the registrar making an order extending the time for compliance, s 459(F)(2)(a)(ii) could have no operation. But in that case an order was made by the Registrar extending time for compliance, whereas in the present case no such order was made by District Registrar Wall. Her Honour summed up the position at [52] by saying that:

Once [the company] was taken to have failed to comply with the statutory demand and to be insolvent, the application to set aside the demand is fruitless and the application to review the registrar’s decision nugatory.

That seems to me to be the position in the present case.

13    Reference has been made in the authorities to the apparent strictness of the statutory regime established by the Act in relation to the setting aside of statutory demands. However, the nature and statutory purpose of the scheme has been explained by the High Court in David Grant & Co Pty Ltd v Westpac Banking Corporation (1995) 184 CLR 265.

14    The present case is one in which the strictness of the statutory regime and the failure to comply with it is fatal to Longreach’s attempt to seek a review of the Registrar’s decision.

15    Counsel for Longreach sought to distinguish the authorities to which I have referred by invoking the concluding words of s 459F(2)(a)(ii), namely “or otherwise disposed of”. It was submitted on behalf of Longreach that even if the application under s 459G was finally determined by District Registrar Wall, it was nonetheless not “otherwise disposed of”.

16    In my opinion, this approach to construction of the relevant subparagraph must be rejected. In my view it is plain that the effect of subparagraph (2) is that the seven day time limit applies either where a proceeding is finally determined, or alternatively is otherwise disposed of.

17    The latter words seem to me to be plainly intended to capture a disposition of an application under s 459G, which affects a disposition of a proceeding otherwise than by way of a final determination. Thus, for example, those words would capture a dismissal of an application summarily or by way of a strikeout for failure, for example, to comply with orders of the court. In my opinion, notwithstanding counsel’s effort to bring the matter within those concluding words of the subparagraph, they have no application.

18    Accordingly, I am satisfied that the interlocutory application for review of the exercise of the powers of the Court by District Registrar Wall, filed on 29 November 2012, has no reasonable prospects of success. It is doomed to failure by reason of the clear and overwhelming weight of the authorities to which I have referred. It follows that I propose to order, pursuant to s 31A(2) of the Federal Court Act and r 26.01, that the interlocutory application be dismissed.

Associate:

Dated:    8 March 2013