Federal Court of Australia

Mansell v Australian Healthcare and Hospitals Association Limited (in liq) [2026] FCA 760

ORDERS

THE COURT ORDERS THAT:

1.    The interlocutory application filed on 14 May 2026 seeking leave to proceed against the First Respondent in liquidation (the leave application) pursuant to section 500(2) of the Corporations Act 2001 (Cth) is to be determined on the papers.

2.    The interlocutory hearing of the leave application on 25 June 2026 is vacated.

3.    Leave be granted to the Applicant pursuant to section 500(2) of the Corporations Act 2001 (Cth) to proceed against the First Respondent (in liquidation) in respect of this proceeding, including by seeking the relief against the First Respondent and advancing the contentions recorded in the “Application – Human Rights” and Points of Claim filed in the Federal Circuit and Family Court of Australia (Division 2) on 26 September 2025 in proceeding SYG3521/2025, a copy of which is annexed as Annexure AAB-2 to the affidavit of Angela Allison Backhouse sworn 14 May 2026.

4.    Costs be reserved.

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

REASONS FOR JUDGMENT

PERRY J:

1    The applicant instituted these proceedings in the Federal Circuit and Family Court of Australia (Div 2) (the Circuit Court) by an “Application – Human Rights” and accompanying Points of Claim filed on 26 September 2025.

2    The first respondent went into voluntary administration on 29 September 2025 and voluntary liquidation on 4 November 2025.

3    By virtue of s 440D of the Corporations Act 2001 (Cth), upon the first respondent entering into voluntary administration these proceedings became statutorily stayed against the first respondent subject to a grant of leave by the Court. That statutory stay was continued upon the first respondent entering liquidation by operation of s 500(2) of the Corporations Act.

4    The Circuit Court is not a prescribed “Court” for the purposes of seeking leave to proceed against a company in liquidation under s 500(2) of the Corporations Act (read with ss 9 and 58AA). As a consequence, the whole of the Circuit Court proceeding was transferred by consent to this Court on 16 March 2026 in order for the applicant to pursue the application for leave to proceed against the first respondent with the intention that the proceeding remain in this Court.

5    On 17 March 2026, Chief Justice Mortimer of this Court made an order confirming the transfer.

6    By an interlocutory application filed on 14 May 2026, the applicant seeks orders pursuant to s 500(2) of the Corporations Act for leave to proceed against the first respondent in liquidation (the leave application). The leave application is supported by the affidavit of Angela Allison Backhouse, solicitor, sworn on 14 May 2026.

7    Upon this proceeding being allocated to my docket, orders were made by consent timetabling the applicant’s leave application.

8    The principles by which it is determined whether to grant leave under s 500(2) of the Corporations Act are well settled. As, for example, Halley J held in ZOLL Medical Australia, in the matter of Cardiac Defibrillators Australia Pty Ltd (in liq) v Cardiac Defibrillators Australia Pty Ltd (in liq) [2022] FCA 167 at [25]:

The principles which are relevant to the exercise of the discretion under s 500(2) may be summarised as follows:

(a)    the purpose of s 500(2) is to prevent a company’s assets being dissipated by unnecessary litigation: Seymour Whyte Constructions Pty Ltd v Ostwald Bros Pty Ltd (In liquidation) [2018] NSWCA 139 (Seymour Whyte) at [16] (Sackville AJA), citing In the matter of DSHE Holdings Limited (recs and mgrs apptd) (in liq) [2018] NSWSC 82 (DSHE Holdings) at [18] (Black J); Re Gordon Grant and Grant Pty. Ltd. [1983] 2 Qd R 314 (Re Grant) at 316 (Campbell CJ, Sheahan J and McPherson J);

(b)    the power to grant leave is discretionary: Seymour Whyte at [16], citing DSHE Holdings at [18] (Black J); White, in the matter of Mossgreen Pty Ltd (Administrators Appointed) (No 5) [2018] FCA 184 at [21] (Perram J);

(c)    a plaintiff for leave will be required to show why it should not be left to prove its debt in the winding up: Seymour Whyte at [16], citing DSHE Holdings at [18];

(d)    a plaintiff must establish that the claim has a solid foundation and gives rise to a serious question to be tried: Seymour Whyte at [16], citing DSHE Holdings at [18];

(e)    factors relevant to the exercise of the court’s discretion may include the degree of complexity of legal and factual issues: Seymour Whyte at [16], citing DSHE Holdings at [18]; Zamattia v Jainti Pty Ltd (in liq) in its capacity as Trustee of the Zambito Trust [2022] NSWCA 3 (Zamattia) at [8] (Leeming JA). It may also include whether there are complex procedural matters such as discovery or interrogatories involved: Zamattia at [8]; Re Grant at 317;

(f)    the effects that the proceedings may have on creditors of the company in liquidation are to be taken into account: Zamattia at [8];

(g)    leave should generally be granted for a proprietary claim which cannot be accommodated within the proof of debt procedure: Chahwan v Euphoric Pty Ltd [2006] NSWSC 1002 at [40] (Barrett J); on appeal Chahwan v Euphoric Pty Ltd and Another (2008) 227 ALR 43; [2008] NSWCA 52 at [8] (Beazley, Tobias and Bell JJ); Oliveri v P M Sulcs & Associates Pty Limited (in liq) [2012] NSWSC 1311 at [10] (Black J); Richardson v Lo Pilato (Liquidator); In the Matter of Trojan Hospitality (ACT) Pty Limited (In Liq) [2014] FCA 888 at [52]-[54] (Foster J); and

(h)    the Court will normally grant leave as of right where plaintiffs seek to recover their own property from the company because such claims cannot be accommodated within the proof of debt regime. Claims which can only be resolved by court proceedings include rectification, specific performance, injunction and rescission of a contract: Commonwealth v Davis Samuel Pty Ltd (No 5) (2008) 68 ACSR 336; [2008] ACTSC 124 (Davis Samuel) at [34]-[36] (Refshauge J); cited with approval in Palace v RCR O’Donnell Griffin Pty Ltd (in liq) [2021] QCA 137 at [40] (Sofronoff P and Morrison and Bond JJA); QNI Resources Pty Ltd and Others v Park and Others (2015) 116 ACSR 321; [2016] QSC 222 at [49] (Bond J).

9    One further factor of importance in deciding whether leave to proceed should be granted is whether the company was insured against the liability in respect of which the plaintiff is suing: HFPS Pty Ltd (Trustee) v Tamaya Resources Ltd (in liq) (No 1) [2016] FCA 442 at [22] (Foster J); Altinova Nominees Pty Ltd v Leveraged Capital Pty Ltd (recs and mgrs apptd) (in liq) (No 2) [2009] FCA 42 at [23] (Jacobson J).

10    In all of the circumstances, I am satisfied that it is appropriate to determine the leave application on the papers as requested by the applicant and to grant leave to proceed against the first respondent in liquidation. In particular:

(1)    the first and second respondents neither consent to nor oppose the leave application;

(2)    the liquidators of the first respondent have not indicated that they will adjudicate the applicant’s Proof of Debt lodged with them in relation to his discrimination case favourably and the indications at this stage are to the contrary;

(3)    the first respondent is insured in relation to the causes of action brought against the applicant in the substantive proceeding, such that any compensation awarded and any legal costs payable would be paid by the relevant insurer and likely not deplete the assets of the first respondent in the course of its liquidation;

(4)    the liquidators have engaged their own legal representation in respect of this proceeding as a consequence of which the conduct of the liquidation is unlikely to be unduly vexed or distracted by the continuation of the proceeding against the first respondent; and

(5)    the pleadings, together with the further information about the underlying substantive case of the applicant against the respondents, establish that there is a serious question to be tried.

11    Costs should be reserved.

Associate:

Dated:    16 June 2026