Setting aside a court wind-up with the UCPR

A director, last week, successfully set-aside a court-ordered liquidation using the Uniform Civil Procedure Rules (NSW) (“UCPR”), rather than the Corporations Act (Cth) (“CA”).

The director argued that the wind-up should be set aside under Rule 36.16(2)(b) of the UCPR, because:

(1) he thought he had changed the company’s registered address to his current accountant;

(2) as a result, he did not know about the wind-up proceedings; and

(3) he has since paid the statutory demand in full, along with all of the Liquidators fees and costs.

The NSW Supreme Court (“NSWSC”) agreed, on the basis that the Liquidator (Jason Porter CA RITF) had not objected and had not found anything scrupulous in his investigations.

Some other interesting points:

A. the NSWSC implies that the burden of proving the company’s solvency is a lot lower under the UCPR then in section 482 of the CA (see paragraph 17 of the case); and

B. the director was granted approval to bring the application in the company’s name, as opposed to the Liquidator or as a shareholder (section 198G(3)(b) of the CA).

I am not sure I agree with paragraph 17, but I guess it would anyway be raised as a salient issue in the Liquidator’s investigations that the court would need to consider.

Case link:


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