HP Mercantile v Australian Rural Group [2005] NSWSC 895

HP Mercantile v Australian Rural Group [2005] NSWSC 895

Leave was refused because the plaintiff's actual pleaded claims against the first defendant were either claims for payment provable in the liquidation or were not viable at the plaintiff's suit, since the plaintiff was only an assignee of debts and not an assignee of rights to enforce contractual or equitable obligations owed under the scheme deeds. As to the second defendant, any breach of contract claim was provable in the administration under the deed of company arrangement, the plaintiff faced the same standing problem, and there was no evidence giving the claim a solid foundation or serious dispute; the separate trust declaration claim did not require leave.

Jurisdiction
Australia
Judgment Date
31 August 2005
Procedural Posture
Interlocutory Process Seeking Leave to Continue Proceedings Against a Company in Liquidation and a Company Subject to a Deed of Company Arrangement / Hearing of Interlocutory Process
Outcome
Leave refused; interlocutory process dismissed; plaintiff ordered to pay costs.
Legal Topics
['winding Up' 'leave to Proceed Against Company in Liquidation' 'deed of Company Arrangement' 'prescribed Interest Schemes' 'standing to Sue' 'managed Investment Schemes']
['corporations' 'equity'] ['winding Up' 'leave to Proceed Against Company in Liquidation' 'deed of Company Arrangement' 'prescribed Interest Schemes' 'standing to Sue' 'managed Investment Schemes']

Case Brief

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Procedural Posture

Interlocutory Process Seeking Leave to Continue Proceedings Against a Company in Liquidation and a Company Subject to a Deed of Company Arrangement / Hearing of Interlocutory Process

Legal Issues

  1. 1 ['Whether leave should be granted under section 471B Corporations Act 2001 (Cth) to continue proceedings against the first defendant, a company in liquidation.' 'Whether the plaintiff had standing to enforce alleged contractual or equitable obligations under deeds establishing prescribed interest schemes.' 'Whether claims that appeared provable in liquidation or administration should be permitted to proceed outside those processes.' 'Whether leave should be granted under section 444E Corporations Act 2001 (Cth) to proceed against the second defendant, a company subject to a deed of company arrangement.' 'Whether the plaintiff showed that its claims had a solid foundation and gave rise to a serious dispute.']

Ratio Decidendi

Leave was refused because the plaintiff's actual pleaded claims against the first defendant were either claims for payment provable in the liquidation or were not viable at the plaintiff's suit, since the plaintiff was only an assignee of debts and not an assignee of rights to enforce contractual or equitable obligations owed under the scheme deeds. As to the second defendant, any breach of contract claim was provable in the administration under the deed of company arrangement, the plaintiff faced the same standing problem, and there was no evidence giving the claim a solid foundation or serious dispute; the separate trust declaration claim did not require leave.

Court Disposition

Leave refused; interlocutory process dismissed; plaintiff ordered to pay costs.

Orders

  • ['The interlocutory process filed 6 July 2005 be dismissed.' 'The plaintiff pay the costs of the defendants of the interlocutory process, and of the originating process in number 3681/2005 in the Equity Division.']