Mizuho Bank Ltd -v- Mark Anthony Ackroyd [2016] NSWSC 1148

Mizuho Bank Ltd -v- Mark Anthony Ackroyd [2016] NSWSC 1148

Section 440J(1), construed textually and contextually, does not prohibit the continuation of proceedings on a director's guarantee that were regularly commenced before the company entered administration. The section expressly prohibits enforcement and the beginning of proceedings, but does not clearly or unmistakably extend to staying or requiring leave for proceedings already on foot. The motion for a stay was therefore dismissed.

Jurisdiction
Australia
Judgment Date
19 August 2016
Procedural Posture
Commercial List Proceedings on a Director's Guarantee / Defendant/applicant's Motion for Stay of Proceedings
Outcome
Motion for stay of proceedings filed on 26 July 2016 dismissed.
Legal Topics
['voluntary Administration' 'director Guarantees' 'stay of Proceedings' 'corporations Act 2001 (cth) S 440 J(1)' 'construction of Statute']
['corporations' 'equity Commercial List'] ['voluntary Administration' 'director Guarantees' 'stay of Proceedings' 'corporations Act 2001 (cth) S 440 J(1)' 'construction of Statute']

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Procedural Posture

Commercial List Proceedings on a Director's Guarantee / Defendant/applicant's Motion for Stay of Proceedings

Legal Issues

  1. 1 ["Whether Corporations Act 2001 (Cth) s 440J(1) applies to proceedings on a director's guarantee that were begun before the company entered administration." 'Whether furthering proceedings commenced before administration amounts to enforcing a guarantee under s 440J(1)(a), so as to require leave of the Court.']

Ratio Decidendi

Section 440J(1), construed textually and contextually, does not prohibit the continuation of proceedings on a director's guarantee that were regularly commenced before the company entered administration. The section expressly prohibits enforcement and the beginning of proceedings, but does not clearly or unmistakably extend to staying or requiring leave for proceedings already on foot. The motion for a stay was therefore dismissed.

Court Disposition

Motion for stay of proceedings filed on 26 July 2016 dismissed.

Orders

  • ['The motion is dismissed.' 'The Court will hear the parties on costs should this be necessary and on the further conduct of the proceedings.']