In the matter of Lysaght Civil Products Pty Ltd

The plaintiff in these proceedings, Mr Charles O’Shea, passed away on 4 March 2021.

In proceedings commenced in the Dust Diseases Tribunal of New South Wales on 14 December 2020 against Lysaght Civil Products Pty Ltd (ACN 004 188 916) (the Company) and various other defendants, Mr O’Shea claims damages for malignant pleural mesothelioma contracted as a consequence of his exposure to asbestos. As against the Company, Mr O’Shea claims that he was exposed to asbestos in the course of his employment with the Company during the period from late 1972 to late 1975. It is convenient to refer to Mr O’Shea’s proceedings in the Dust Diseases Tribunal as the Tribunal proceedings.

The Company had several name changes during its corporate life. During the period from late 1972 to late 1975 the name of the Company was Armco (Australia) Pty Ltd.

A liquidator was appointed to the Company on 27 May 1994 and it was deregistered on 31 August 1996 pursuant to s 509 of the Corporations Law set out in s 82 of the Corporations Act 1989 (Cth). As at that date, s 509 of the Corporations Law provided:

Mr O’Shea commenced the present proceedings in this Court by originating process filed on 2 March 2021, 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 O’Shea nunc pro tunc to commence the Tribunal proceedings and an order that no step be taken by Mr O’Shea 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 O’Shea’s estate has no entitlement to pursue his claim for damages for non-economic loss 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. 2) [2020] NSWSC 1633 (Austral Bronze), two former employees of two deregistered companies had commenced proceedings in the Tribunal against those deregistered companies. The former employees died and the legal personal representatives of their deceased estates 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.

One of the companies had been dissolved in 1997 pursuant to s 509 of the Corporations Law, which was then in the same terms as it was when the Company in the present proceedings was dissolved pursuant to that section on 31 August 1996. Rees J undertook a detailed analysis of the history of the Court’s statutory power to reinstate a deregistered company from 1997 to date and concluded that the Court has power under s 601AH(2) of the Corporations Act as it applies today to reinstate the registration of a company that was dissolved or deregistered under the former s 509 of the Corporations Law: Austral Bronze at [19]-[49]. I respectfully agree with and adopt her Honour’s analysis and conclusion, the correctness of which was not challenged on appeal: Allianz Australia Insurance Ltd v Viksne [2021] NSWCA 268 (Allianz v Viksne) at [15].

By reason of s 601AH(5) of the Corporations Act, a company that is reinstated pursuant to s 601AH(2) is taken to have continued in existence as if it had not been deregistered. Thus, legal proceedings that were a nullity at the time they were commenced against the deregistered company because the defendant did not exist are taken to have been validly commenced: Allianz v Viksne at [20]-[42], [58]-[59], [61].

The orders sought in the amended originating process filed in these proceedings on 23 March 2021 are:

On 10 May 2021, I made orders pursuant to r 7.10 of the Uniform Civil Procedure Rules 2005 (NSW) appointing Julie Maria O’Shea (Mrs O’Shea) to represent the estate of Mr O’Shea and amending the title of the proceedings so that the plaintiff is noted as “Julie Maria O’Shea appointed by order dated 10 May 2021 to represent the estate of the late Charles John O’Shea”. Mrs O’Shea is the widow of Mr O’Shea and the executrix of his estate. Mrs O’Shea swore an affidavit on 16 April 2021 consenting to her appointment and confirming that she is aware that she will 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 two affidavits of Gerard Anthony McMahon, a partner of Turner Freeman Lawyers (the plaintiff’s solicitors), sworn on 26 February 2021 and 20 April 2021.

The 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.

SIRA and the IGF do not stand in the shoes of NEM as the insurer. It was not open to the plaintiff to simply commence the Tribunal proceedings against SIRA pursuant to s 601AG of the Corporations Act. The plaintiff’s only means of prosecuting the claims in the Tribunal proceedings is to proceed against the Company and, if the Company’s liability is established, make a claim against SIRA (as manager of the IGF) for payment of that liability out of the IGF pursuant to ss 231-236 of the Workers Compensation Act: Richards Contracting Co Management Pty Ltd [2021] NSWCA 34 (Richards Contracting) at [19]-[54].

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

In my opinion, Mr O’Shea’s estate is a person aggrieved by the deregistration because it precluded Mr O’Shea from validly commencing the Tribunal proceedings and preserving his claims against the Company for damages for non-economic loss for the benefit of his estate in accordance with s 12B of the DDT Act: Re European Metal Recyclers Pty Ltd (in liquidation) (deregistered) [2018] NSWSC 946 at [17]-[18].

The Company came to be deregistered following a voluntary winding up. The plaintiff’s purpose in seeking reinstatement is to enable Mr O’Shea’s estate to pursue claims against the Company in circumstances where he was not aware of those claims until he was diagnosed with mesothelioma in September 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.

There is no evidence that the Company’s former directors or any other person is likely to be prejudiced by the reinstatement of registration. On the contrary:

In my opinion, it is in the public interest that Mr O’Shea’s estate should have an opportunity to pursue the cause of action against his former employer for allegedly 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 O’Shea’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: Allianz v Viksne at [46]-[53]. I accept the plaintiff’s submission that there is no reason in this case to exercise the residual discretion to decline to make the order: Richards Contracting at [107].

The order sought in prayer 2 of the amended originating process 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 prayer 4. Although re‑appointment of the former liquidator is generally preferable, there would be little advantage in doing so in this case where 25 years have passed since the former liquidator ceased to hold office and the former liquidator has raised no objection to the orders sought in these proceedings, including the order for the appointment of Mr Scott. I am satisfied that the costs order sought in prayer 5 is appropriate. The order sought in prayer 6 is not necessary given the operation of s 601AH(5) to which I have referred above: Allianz v Viksne at [20]-[42], [58]-[59], [61].

I therefore make the following notation and orders: