In the matter of Exfrig Pty Ltd (deregistered)

The plaintiff in these proceedings, Mr Ronald Bainbridge, passed away on 5 July 2020.

On 9 April 2020, Mr Bainbridge commenced proceedings in the Dust Diseases Tribunal of New South Wales (the Tribunal) against Exfrig Pty Ltd (formerly Frigrite Limited) (ACN 004 224 080) (the Company) for the Company’s alleged negligence and/or breach of employment contract as a result of which he claimed to have been exposed to and inhaled asbestos dust and fibre whilst employed by the Company between January 1969 and November 1977 (the Tribunal proceedings). The damages claimed in Mr Bainbridge’s amended statement of claim filed in the Tribunal proceedings on 7 May 2020 include general damages for injury (mesothelioma and shock), pain and suffering and decreased life expectancy.

The Company was deregistered on 25 October 2009.

Mr Bainbridge commenced the present proceedings in this Court by originating process filed on 19 June 2020, seeking orders under s 601AH of the Corporations Act 2001 (Cth) that the Australian Securities and Investments Commission (ASIC) reinstate the registration of the Company, an order that the Company be wound up upon reinstatement, an order granting leave to Mr Bainbridge nunc pro tunc to commence the Tribunal proceedings and an order that no step be taken by Mr Bainbridge to enforce any judgment or verdict obtained in the Tribunal proceedings except by resort to the indemnity provided by the Insurers Guarantee Fund (the IGF) established under s 227 of the Workers Compensation Act 1987 (NSW). The Company was named as the first defendant and ASIC was named as the second defendant.

Subject to the operation of s 12B(2) of the Dust Diseases Tribunal Act 1989 (NSW) (the DDT Act), Mr Bainbridge’s estate has no entitlement to pursue his claim for general damages following his death by reason of s 2(2)(d) of the Law Reform (Miscellaneous Provisions) Act 1944 (NSW) (the Law Reform Act).

Section 2 of the Law Reform Act relevantly provides:

Section 12B of the DDT Act provides (emphasis added):

In Re Austral Bronze Pty Ltd; In the matter of John Darlington Pty Limited; In the matter of John Darlington Pty Limited (No. 3) [2020] NSWSC 1633 (Austral Bronze), two former employees of two deregistered companies had commenced proceedings in the Tribunal against those deregistered companies. Legal personal representatives of the deceased estates of the former employees commenced proceedings in this Court seeking orders under s 601AH(2) of the Corporations Act that ASIC reinstate the registration of the two companies together with ancillary orders to validate the commencement of the Tribunal proceedings nunc pro tunc. The former employees had died shortly after the commencement of the Tribunal proceedings.

Rees J held, with reference to authority, that proceedings commenced against a corporate defendant that is deregistered at the time of commencement are a nullity because the defendant does not exist. The reinstatement of that defendant after the death of the plaintiff pursuant to s 601AH of the Corporations Act does not, without more, retrospectively validate the commencement of the proceedings so as to satisfy the requirement in s 12B of the DDT Act that the proceedings were commenced and pending before the Tribunal at the time of the plaintiff’s death: Austral Bronze at [50]-[68].

However, her Honour also held that, where the Court has made an order pursuant to s 601AH(2) of the Corporations Act that ASIC reinstate the registration of a company, the power conferred on the Court by s 601AH(3)(c) to validate anything done during the period in which the company was deregistered extends to validating nunc pro tunc the commencement of legal proceedings purportedly commenced against the company at a time when it was deregistered: Austral Bronze at [60]-[125].

Following delivery of judgment in Austral Bronze, the originating process in the present proceedings was amended on 15 December 2020 to seek an order validating the commencement of the Tribunal proceedings in lieu of an order granting leave to Mr Bainbridge nunc pro tunc to commence the Tribunal proceedings.

The orders sought in the amended originating process are:

On 8 February 2021, I made orders pursuant to r 7.10 of the Uniform Civil Procedure Rules 2005 (NSW) appointing Mr Gary Robert Banbridge (Mr Bainbridge jnr) to represent the estate of Mr Bainbridge and amending the title of the proceedings so that the plaintiff is noted as “Gary Robert Bainbridge appointed by order dated 8 February 2021 to represent the estate of the late Ronald Bainbridge, deceased”. Mr Bainbridge jnr is the son of Mr Bainbridge and an executor of his estate. Mr Bainbridge jnr swore an affidavit on 21 August 2020 consenting to his appointment and confirming that he was aware that he would be responsible for instructing the plaintiff’s solicitors in these proceedings.

After these orders were made, I heard the plaintiff’s application for the relief sought in the amended originating process. Mr Robinson of counsel appeared for the plaintiff. There was no appearance for any defendant.

The plaintiff read three affidavits of Ms Ann-Maree Pascoli, a partner of Turner Freeman Lawyers (the plaintiff’s solicitors).

Those affidavits establish that:

Mr Andrew John Scott of PricewaterhouseCoopers, registered liquidator, signed an instrument consenting to being appointed by the Court and acting as liquidator of the Company.

Section 601AH(2) of the Corporations Act provides:

The test for whether Mr Bainbridge’s estate constitutes a person aggrieved was summarised by Rees J in Austral Bronze (at [127]):

In my opinion, Mr Bainbridge’s estate is an aggrieved person in the requisite sense because deregistration precluded Mr Bainbridge from validly commencing the Tribunal proceedings and preserving his claims for general damages against the Company for the benefit of his estate in accordance with s 12B of the DDT Act.

In assessing whether it would be just to reinstate the registration of the Company, I must have regard to:

The Company came to be deregistered following a members’ voluntary winding up. The plaintiff’s purpose in seeking reinstatement is to enable Mr Bainbridge’s estate to pursue claims against the Company in circumstances where Mr Bainbridge was not aware of those claims until he was diagnosed with mesothelioma in March 2020, many years after the Company had been deregistered. The estate will be able to make good use of a reinstatement to pursue those claims if the Court also makes the ancillary order sought under s 601AH(3) validating the commencement of the Tribunal proceedings.

There is no evidence that any person is likely to be prejudiced by the deregistration. On the contrary:

In my opinion, it is in the public interest that Mr Bainbridge’s estate should have an opportunity to pursue the cause of action against his former employer for allegedly negligently exposing him to asbestos, in circumstances where the cause of action was discovered many years after deregistration of the Company and a very short time before Mr Bainbridge’s death, the Company’s insurer is itself deregistered and the IGF has been established by the Workers Compensation Act for payment of claims, judgments or awards arising from or relating to policies of insurance issued by insolvent insurers.

For those reasons, I am satisfied that it is just that the Company’s registration be reinstated and that it is appropriate to make an ancillary order under s 601AH(3) validating the commencement of the Tribunal proceedings so as to cure the obstacle that the Company’s deregistration otherwise presented to Mr Bainbridge’s commencement of those proceedings and will otherwise continue to present to the pursuit of the claims by his estate.

The order sought in prayer 2 that the Company be wound up is not necessary, as the Company will continue in liquidation upon reinstatement. However, I will make orders under s 601AH(3) appointing Mr Scott as liquidator in addition to the ancillary orders in terms of prayers 4 and 6. Although re‑appointment of the former liquidators is generally preferable, there would be little advantage in doing so in this case where eleven years have passed since the former liquidators ceased to hold office and one of them has failed to respond to correspondence concerning these proceedings. I note that the other liquidator raised no objection to the plaintiff’s proposed course of appointing Mr Scott as liquidator upon reinstatement of the Company. I am satisfied that the costs order sought in prayer 5 is appropriate.

I therefore make the following notation and orders: