Supreme Court New South Wales Medium Neutral Citation: Scharer v Giro Construction Group Pty Ltd (in Liq) (Receiver and Manager Appointed) [2017] NSWSC 1568 Hearing dates: 29 September 2017 Date of orders: 17 November 2017 Decision date: 17 November 2017 Jurisdiction: Common Law Before: Walton J Decision: The Court orders: (1) The applicants are granted leave to appeal from the whole of the decision of the Appeal Panel of the Tribunal on 26 June 2017 in proceedings AP 16/44447. (2) The orders made by the Appeal Panel on 26 June 2017 are set aside. (3) In place of those orders, the proceedings HB 14/495581 in the Tribunal are dismissed with no order as to costs. (4) There is no order as to costs of these proceedings. Catchwords: APPEAL – civil – appeal from the NSW Civil and Administrative Appeal Panel – Appointment of Administrator – subsequent voluntary liquidation – whether Appeal Panel omitted to deal with issue of Tribunal's lack of jurisdiction per s 500 – whether the Appeal Panel erred in law in concluding that it was not necessary to determine whether s 440D of the Corporations Act applied to proceedings in the Tribunal – whether the Appeal Panel erred in law in concluding the consent provided by the Administrator was valid for the purposes of s 440D – whether the Appeal Panel erred in law refusing otherwise to grant leave to appeal from a costs order made in circumstances where the Senor Member was proceeding under a material error of fact – Appeal Panel erred in law in failing to deal with "jurisdiction question" raised regarding s 500 – in effect, the Appeal Panel erroneously found the Tribunal had jurisdiction – failure to determine application of s 440D – limited or qualified consent given by the Administrator in Tribunal proceedings invalid for the purposes of s 440D – leave to appeal granted Legislation Cited: Corporations Act 2001 (Cth) Civil and Administrative Tribunal Act 2013 (NSW) Home Building Act 1989 (NSW) Cases Cited: Arogen v Leighton (2013) 278 FLR 245; [2013] NSWSC 1099 Brash Holdings Ltd (Administration Appointed) v Katile Pty Ltd [1996] 1 VR 24 at 28-29 Burns v Corbett; Gaynor v Burns [2017] NSWCA 3 Gan v Shop 3, 228-230 Hanvaylee Parade Kensington Pty Ltd [2017] NSWSC 1322 In the matter of Oliver Brown Pty Ltd [2012] NSWSC 1046 Mead Corp v Carbonless Papers (Australia) Pty Ltd [2002] WASC 268 Scharer v Giro Construction Group Pty Ltd (in Liq) [2017] NSWCATAP 140 Category: Principal judgment Parties: Wayne Scharer and Judith Anderson (Applicants) Giro Construction Group Pty Ltd (Respondent) Representation: Counsel: M R Pesman SC (Applicants) Solicitors: Chambers Russell Lawyers (Applicants) Edwards Kirby Lawyers (Respondent) File Number(s): 2017/220831 Decision under appeal Court or tribunal: NSW Civil and Administrative Tribunal Jurisdiction: Appeal Panel Citation: [2017] NSWCATAP 140 Date of Decision: 26 June 2017 Before: Dr J Renwick SC, Senior MemberT Simon, Senior Member File Number(s): AP 16/44447 Judgment 1. HIS HONOUR: On 3 October 2014, Wayne Scharer and Judith Anderson ("the applicants") brought proceedings before the Commercial and Consumer Division of the New South Wales Civil and Administrative Tribunal ("the Tribunal") pleading breaches of the statutory warranties implied into a construction contract pursuant to s 18B of the Home Building Act 1989 (NSW) (matter HB 14/49581, hereinafter referred to as "the proceedings"). The alleged breaches concerned general building defects as well as fire resistance issues. 2. The proceedings concerned an alleged defective construction of a three story balcony structure to an existing residential strata building in North Sydney ("the building"). The balcony works were undertaken by Giro Construction Pty Ltd ("the respondent") under a building contract signed on 2 October 2017 by Mr Chris Carroll, the agent for the applicants and other lot owners in the strata scheme for the building. The applicants sought damages from the respondent. 3. The respondent was appointed an external Administrator on 6 January 2016. It moved into voluntary liquidation from 4 April 2016. 4. The merits of that claim were not considered by the Tribunal. Instead, it delivered three interlocutory decisions, the last of which concerned a specific order dismissing the proceedings and costs, which were ultimately featured in an internal appeal before an Appeal Panel of the Tribunal constituted by J Renwick SC and T Simons, Senior Members (hereinafter referred to as "the Appeal Panel proceedings" and "the Appeal Panel", respectively). 5. The respondent did not appear in the Appeal Panel proceedings or in the present proceedings (in which a submitting appearance was entered upon the basis that no order for costs would be sought against the respondent). It might be noted that Brereton J granted the applicants leave to bring this appeal pursuant to s 500 of the Corporations Act 2001 (Cth). The Tribunal's Decision 1. There was some confusion as to the dates of publication of the decisions of the Tribunal constituted by D Goldstein, Senior Member. At least as a matter of logic, the first decision of the Tribunal was given on 10 February 2016. The issue addressed in that decision was whether the Tribunal may determine the preliminary question, as to the standing of the applicants to bring the proceeding, having regard to the constraints within s 440D of the Corporations Act ("the first Tribunal decision"). 2. A second decision was also published on 10 February 2016. That decision was given in the light of the first Tribunal decision and concerned the Tribunal's determination of the preliminary question of the applicants' standing ("the second Tribunal decision"). That issue was raised by the respondent and the subject of hearing on 16 November 2015. A decision on the question was apparently completed on 7 December 2015 but not available for publication until 7 January 2016, one day after the respondent went into administration. 3. By the first Tribunal decision, it was determined that the second Tribunal decision, with respect to standing, may be determined because the proceedings were caught by an exception under s 440D of the Corporations Act, namely, the Administrator had given valid consent to the proceedings. Grounds 1 and 2 of this appeal concern the operation of s 440D of the Corporations Act in the context of the proceedings before the Tribunal. 4. By the second Tribunal decision, the Tribunal determined the building contract was a joint contract entered between six co-principals and the respondent via the co-principal's agent Mr Carroll. The applicants were two of the six co-principals. The Tribunal found the applicants did not have standing to bring the proceedings on their own account. The principal reason for that conclusion was that all six co-principals to the building contract were not party in the proceedings, with the Tribunal finding: "the powers given to them jointly cannot be split" and "must be brought by all of them" (see [49] of the second Tribunal decision). The Tribunal found it unnecessary to rule upon whether the proper party was the owners corporation, known as Owners – Strata Plan No 61428. 5. There was no ground of appeal as to that decision as such but there is a ground of appeal deriving from the orders made in the conclusion of that proceeding. 6. In the second Tribunal decision, the Tribunal made orders which provided that the applicants had 14 working days from the date of "this order" to make an application to the Tribunal for orders joining any other party or parties to the proceedings (presumably to provide standing for the proceedings). There was a self-executing aspect to the orders, namely, that failing such an application the proceedings were "dismissed". 7. On 7 September 2016, the Tribunal made a decision upon an application by the respondent for costs of the proceedings ("the third Tribunal decision"). Orders were made dismissing the proceedings and costs orders were made against the applicants in favour of the respondent. 8. Whilst, in the third Tribunal decision, orders were made formally dismissing the proceedings, it is apparent that the actual dismissal of the proceedings arose from the self-executing orders as it was those orders which triggered the cost proceedings. One ground of this appeal is that the applicants did, in fact, bring the application within the 14 day period specified in the orders to the second Tribunal decision and that any finding to the contrary by the Tribunal was erroneous ("Ground 4"). 9. In addition to costs, the third Tribunal decision dealt with the background of the proceedings and the positions of the parties, which were later referred to in the Appeal Panel proceeding. This is reflected in the following passages of the decision: [2] The Reasons for Decision supporting the above orders were completed on 7 December 2015. For Tribunal administrative reasons, the decision was ready for publication on 7 January 2016, but not available to be given to the parties until 8 January 2016. On 6 January 2016 the respondent went into administration under the Corporations Act (Cth). [3] There was a dispute between the parties about whether the Reasons for Decision supporting the above orders had any effect due to the fact that on 6 January 2016 the respondent went into administration. [4] On 10 February 2016 I published Reasons for Decision stating that my decision dated 7 January 2016 on the separate question/preliminary issue heard on 16 November 2015 be published immediately. [5] On 2 May 2016 I made the following orders: '1. The dismissal of the application pursuant to order 2 of the Tribunal decision on 7 January 2016 is stayed to allow the applicant to file and serve submissions on 13 May 2016 as to why, because of considerations relating to claims on an [sic] Home Owner Warranty Insurer, the application should not be dismissed. 2. The respondent has until 27 May 2016 to file and serve submissions in response to those served in accordance with order 1. 3. The respondent has until 27 May 2016 to file and serve its costs application as referred to in order 4 of the Tribunal decision on 7 January 2016. 4. Orders 5, 6 and 7 of the Tribunal decision on 7 January 2016 will apply in connection with the respondent's costs application to be filed and served pursuant to order 3.' [6] … [7] The applicants' position is that the proceedings be dismissed and that there be no order as to costs. [8] The respondent's position is that the Tribunal should dismiss these proceedings. As regards costs, the respondent's position is that the applicants should pay the respondent's costs of the proceedings, or in the alternative the applicants should pay the costs of and incidental to the issue of standing as agreed or assessed. [9] Once the respondent went into Administration proceedings against it or by it became the subject of the Corporations Act (Cth) the provisions of which have been the subject of detailed submissions by the parties. [10] The question of joinder of other parties to these proceedings was made in context of the proceedings as at 16 November 2015, when the respondent's defence that the applicants had no standing to commence or maintain the proceedings was heard. Of course at that time the respondent's insolvency was not known to the Tribunal or the parties. [12] I see no reason to keep these proceedings on foot in order for the applicants to pursue those parties in these proceedings and indeed the applicants do not seek orders in those terms. [15] The applicants' submissions regarding section 48P of the Home Building Act 1989 do not provide an adequate basis for me to grant an adjournment under that section. In any event the status of the applicants' claim under the Home Owners Warranty Insurance has been resolved as submitted by the respondent, namely that the claim declined on 20 May 2016. The Appeal Panel's Decision 1. The applicants appealed against the final orders made in the third Tribunal decision (Black J heard and granted an application under s 500(2) of the Corporations Act to bring that appeal on 4 October 2016). 2. On 26 June 2017, the appeal panel gave a decision dismissing the appeal brought by the applicants: Scharer v Giro Construction Group Pty Ltd (in Liq) [2017] NSWCATAP 140. 3. The Appeal Panel dealt with the issue that an external Administrator had been appointed to the respondent on 6 January 2016 and the consequences of that administration for the proceeding before the Tribunal having regard to s 440D of the Corporations Act. Despite having the issue of s 500(2) of the Corporations Act raised by the parties, no adjudication as to the effect of that provision is to be found in the Appeal Panel decision. 4. The following passage of the Appeal Panel's decision is relevant, in that respect, to issues arising under Grounds 1 and 2 (as to the operation of s 440D of the Corporations Act): [8] The Respondent's Administrator provided a document in the following terms providing consent to the Tribunal: to deliver judgement [sic] in respect of the preliminary issue that has been heard in File HB 14/495581: whether the Applicant has standing to sue in these proceedings…I do not oppose the delivery of this judgement [sic] and for the respondent, if successful, to make an application for costs. [9] The Applicants then objected to 'discrete consent' being given in relation to the preliminary issue as opposed to the whole proceedings, (we note that at this time there was no submission that if consent could be given to delivery of reasons on the preliminary application then consequential costs orders could not also be made.) … The effect of the Respondent's administration [20] That would normally be the end of the matter but for the fact that there is an asserted question of law as to whether the Tribunal below had jurisdiction to make an order for costs when the Respondent in whose favour the order was made was in liquidation or administration. The Tribunal considered that argument and dismissed it expressly adopting by reference to submissions made by the Respondent: [see 21 below]. We discern no error in those reasons. [21] The essential complaint about that consent made to us is that it was impermissibly piecemeal in relation to costs: that is, it would appear to have precluded an application for costs by the Applicants. [22] However, as the decision below made clear there never was such an application in view; rather the relevant application by the Applicants was dismissal with no order as to costs. Thus, the Respondent's consent was dealing fully with the litigation as it stood. The consent did not impede the Applicants making any submissions it wished as to why there should be no order as to costs as opposed to the order made. [23] In those circumstances no question of law arises: assuming but not deciding that s 440D applied in such a way as to preclude the costs application without the administrator's written consent, there was such consent to all possible circumstances then in view in the litigation. [24] In those circumstances we do not need to decide whether the Tribunal in this matter and below was a "court" within the meaning of s 440D of the Corporations Act, let alone whether it was a "court" for other purposes. [25] Those interesting questions can await the occasion when they must be decided. We are nevertheless grateful for the written submissions received, including from the Attorney-General, when such issues appeared likely to require resolution. The Appeal in this Court 1. By a summons seeking leave to appeal pursuant to s 83 of the Civil and Administrative Tribunal Act 2013 (NSW), the applicants challenged the decision of the Appeal Panel. However, these proceedings were listed for a concurrent hearing of the leave question and the substantive grounds. 2. There were five grounds of appeal, which were as follows: 1. The Appeal Panel erred in law in concluding that it was not necessary to determine whether s 440D of the Corporations Act applied to proceedings in the Tribunal ("Ground 1"). 2. The Appeal Panel erred in law in concluding (in effect) that the consent provided by the (then) Administrator of the respondent on 20 January 2016 was valid for the purposes of s 440D ("Ground 2"). 3. The Appeal Panel erred in law in concluding (in effect) that the Tribunal had jurisdiction to make a costs order in circumstances where the respondent was in voluntary liquidation and neither party had obtained leave pursuant to s 500(2) of the Corporations Act ("Ground 3"). 4. The Appeal Panel erred in law refusing otherwise to grant leave to appeal from the costs order made on 7 September 2016 (and therefore in failing to determine that appeal) in circumstances where the Senior Member was proceeding under a material error of fact (being that the applicants had not sought to join necessary parties within the time directed by the Senior Member when they had in fact done so) ("Ground 4"). 5. The Appeal Panel erred in law in failing to provide adequate reasons for each of the conclusions and decisions in Grounds 1 to 4 ("Ground 5"). 1. The orders sought if leave to appeal was granted and the appeal upheld were four fold as follows: 1. The applicants be granted leave to appeal from the whole of the decision of the Appeal Panel of the Tribunal on 26 June 2017 in proceedings AP 16/44447. 2. Set aside the orders made by the Appeal Panel on 26 June 2017. 3. In place of those orders, order that proceedings HB 14/495581 in the Tribunal be dismissed with no order as to costs. 4. No order as to costs in the event the respondent files a submitting appearance, otherwise an order that the respondent pay the applicants' costs of this appeal. SUBMISSIONS 1. It was submitted that the relevant law and principles as to an appeal from the Appeal Panel, such as the present matter, were those set out in the recent decision of the Court in Gan v Shop 3, 228-230 Hanvaylee Parade Kensington Pty Ltd [2017] NSWSC 1322 ("Gan") at [25]-[32]. 2. In the event the Court agrees that the Appeal Panel's decision contains one or more of the asserted errors, the Court should, it was submitted, grant leave to the extent it is necessary because that is plainly what the interests of justice requires. Ground 3 – Section 500 1. No party had obtained leave to agitate the issue of costs before the Tribunal. The only issue at first instance was whether or not it was required. The reasons at first instance published on 7 September 2016 did not address that question at all although it was extensively addressed by the parties in their written submissions. 2. Although the matter was raised before the Appeal Panel, (found in Ground 1(a) of that appeal) and dealt with in the written submissions, the issue was not addressed by the Appeal Panel at all. 3. By reason of the operation of s 500 of the Corporations Act, the proceedings should have been stayed. It followed that any step the Tribunal purported to take after 4 April 2016 was affected by s 500. It was submitted that the stay could only have been lifted by an order of this Court or the Federal Court. The Tribunal was not a Court for the purposes of s 500 and thus no costs order could have been made. Ground 1 – Section 440D 1. The Appeal Panel had received, but did not consider, detailed submissions from both the applicants and the Attorney General (whose submissions substantially agreed with those of the applicants) regarding s 440D. 2. Each of those submissions argued that s 440D applied to proceedings in the Tribunal and, hence, the proceedings in the Tribunal were stayed from 6 January 2016 unless the consent was valid. 3. It was not open for the Appeal Panel to not determine that question because, if the proceedings were not stayed, the whole of the events in 2016 had proceeded on a false basis. The Appeal Panel should have concluded that s 440D had application. Ground 2 – Administrator's consent 1. Section 440D(1)(a) required an Administrator's written consent. An Administrator's letter was signed on 27 April 2016 after the respondent went into liquidation. 2. It was submitted that no consent was forthcoming in relation to costs if the application had failed. 3. At first instance, and before the Appeal Panel, the applicants' contended that the Administrator had not provided proper consent, for the purposes of s 440D, because it related to only part of the litigation. 4. The Appeal Panel dealt with this argument in its decision at [20]-[23] and concluded that the Administrator had consented "to all possible circumstances then in view in the litigation" and therefore deemed it not necessary to determine the underlying question of whether piecemeal consent was permissible. 5. That finding contained a material error of fact. As much appears on the face of the purported consent because it only permitted the respondent "if successful" to make an application for costs. It did not, for example, permit to applicants to apply for their costs, had they been successful (or, for that matter, to continue the proceedings more generally). It was for that reason the consent may be described as piecemeal. 6. Had the Appeal Panel considered the point, it was submitted that it should have found, the consent was ineffective. 7. Although there has been no authority on this precise question, it is well established that s 440D ought not be interpreted so as to give a procedural advantage to a company in administration. The effect of the Appeal Panel decision was that only the applicants were at risk on costs; the law ought not be interpreted so as to allow that outcome. 8. Further, Black J heard the s 500(2) application in relation to the bringing of the appeal to the Appeal Panel. In his decision of 4 October 2016, his Honour said (at [7]): Two observations should be made at that point. The first is that s 440D of the Corporations Act is, on its face, directed to an administrator's written consent to the continuance of the proceedings, not aspects of them. Second, so far as I am aware, it has never been suggested that it is open to an administrator selectively to consent to the continuance of parts only of the proceedings, such that, for example, the Company could make an application for costs but the Plaintiffs could not 1. His Honour was not expressing concluded views, but suggested that the absence of authority was a function of piecemeal consent obviously not being permissible, rather than the reverse. 2. It was submitted, that there was no valid consent such that the s 440D exception was engaged, with the effect that the Tribunal had no jurisdiction to take any of the steps from and including the handing down of the Joinder decision. Ground 4 1. The applicants made the following submissions to the Appeal Panel in relation Ground 4, those submissions were extracted as follows: In any event, the appellants say that the Costs decision is vitiated by a number of House v R errors: (a) At [1] the Senior Member refers to orders made on 7 January 2016. That was not correct; the orders while prepared on that date, were not made until 10 February 2016. That is not a minor matter, because it appears to have caused the Senior Member to both make the 2 May 2016 orders and proceed on the basis in the Costs decision that the appellants had not filed their joinder application in the time required by the 10 February 2016 orders. (b) The 2 May 2016 orders are set out at [5]. Order 1 clearly proceeds on the basis that the proceedings had been dismissed and that dismissal was stayed. That was in error. The application for joinder was filed on 28 February 216, which was within 14 business days of the 10 February orders (and the respondent fairly acknowledged as much in its written submission - B94 at [2]). (c) The Senior Member then analysed the possible joinder of other parties at [10] to [14]. That analysis included a statement that if "the applicants have valid causes of action against the parties they wish to join, they are at liberty to pursue those causes of action either by new proceedings in the Tribunal or in a court of competent jurisdiction." That finding, with respect, misapprehends the joinder application. The burden of the Joinder decision was that all contracting parties were necessary parties to the proceedings. Joining unwilling contracting parties as defendants is not uncommon. It is not necessary to seek relief against those parties, still less to pursue a cause of action against them. It follows that the possibility of other proceedings was both futile and irrelevant. (d)The conclusion that the respondent "succeeded" in the litigation flowed from those errors (at [27]). In reality, the appellants were faced with a position in which they had a claim (shared with their co-principals) that the respondent had not constructed the balconies in accordance with its statutory contractual requirements. There was substantial evidence in support of that claim. There was no suggestion that it was other than properly and reasonably brought. Given the application to join others had in fact been made, and there being no reason why it would not succeed (the proposed respondents having no reason to object if no relief was sought against them), it was quite wrong to proceed on the basis that the respondent had been successful. The only reason the litigation did not proceed was that the respondent was in liquidation and the appellants would have been throwing good money after bad. That is comfortably within the consideration identified by Justice McHugh in Lai Qin. 1. It was submitted that the Appeal Panel had failed to engage with the complaint in Ground 4 namely, that the Tribunal proceeded on the incorrect factual basis that the proceedings had been dismissed by means of a self-executing order, when it should not have been because the orders, in fact, operated from 10 February. From that date, there was compliance by the applicants. Ground 5 – Absence of Reasons 1. The Appeal Panel either gave no reasons or very limited reasons for the conclusions it reached. It was submitted that where the Court sought to make orders on the basis of the other grounds of appeal, this ground need not be considered further. CONSIDERATION 1. The law and principles governing an appeal from the Appeal Panel to this Court were recently discussed in Gan at [27]-[32], and consistently with the submissions of Mr M R Pesman SC, shall be adopted for the purposes of determining this matter. Ground 3 1. By the time of the September 2016 decision, the respondent had passed into voluntary liquidation and was, therefore, caught by the provisions of s 500 of the Corporations Act. 2. Section 500(2) of the Corporations Act is in the following terms: (2) After the passing of the resolution for voluntary winding up, no action or other civil proceeding is to be proceeded with or commenced against the company except by leave of the Court and subject to such terms as the Court imposes. 1. Section 58AA provides the following meaning of "court" and "Court": 58AA Meaning of court and Court (1) Subject to subsection (2), in this Act: court means any court. Court means any of the following courts: (a) the Federal Court; (b) the Supreme Court of a State or Territory; (c) the Family Court of Australia; (d) a court to which section 41 of the Family Law Act 1975 applies because of a Proclamation made under subsection 41(2) of that Act. (2) Except where there is a clear expression of a contrary intention (for example, by use of the expression "the Court"), proceedings in relation to a matter under this Act may, subject to Part 9.6A, be brought in any court. Note: The matters dealt with in Part 9.6A include the applicability of limits on the jurisdictional competence of courts. 1. As the legislature employed the word "Court", as opposed to the word "court", in s 500(2), it follows, having regard to the provisions of s 58AA, that no civil proceeding may be proceeded with against the respondent except by leave of this Court or the Federal Court. 2. The leave required by s 500(2) was not obtained by any party prior to the orders made for costs in favour of the respondent in the third Tribunal decision. The Tribunal was not authorised to grant leave under that s 500(2) (it made a decision on 2 May 2016 to stay the dismissal of the proceedings pending the receipt of submission to the dismissal and costs, which was lifted upon the giving of the third Tribunal decision. That decision and those orders were of an entirely different character to those arising under s 500(2)). 3. It follows that every step in the proceedings before the Tribunal after 4 April 2017 was affected by the provisions of s 500 of the Corporations Act. The Tribunal lacked jurisdiction to make a costs order. Despite submissions on the issue, the Appeal Panel failed to grapple with the Tribunal's failure to apply s 500 of the Corporations Act to the hearing of the costs application by the respondent and, in effect, erroneously accepted the Tribunal had jurisdiction to determine the issue of costs, notwithstanding the respondent was in voluntary liquidation and no leave had been obtained under that section. 4. So expressed, the ground clearly raises a question of law and leave to appeal, in that respect should be granted. Grounds 1 and 2 1. It is convenient to deal with these grounds together, turning first to the issues raised under Ground 2. 2. There are two aspects of this ground. The first concerned the Appeal Panel's determination that no question of law arose in the proceedings in consequence of the operation of s 440D. It found that the question of consent being given upon a piecemeal basis did not arise because full relevant consent had been given by the Administrator. The Tribunal has not proceeded upon the basis that consent was given by the Administrator on a piecemeal basis because the applicants, it was found, had sought dismissal with no order as to costs and the Administrator's consent, therefore, dealt "fully with the ligation as it stood" (the respondent sought costs if successful in its challenge to the applicants' standing). Secondly, it was held the issue of consent did not impede the applicants making a submission that there should be no order as to costs. Assuming without deciding that s 440D applied to the costs application, the Appeal Panel decided, there was the requisite consent under s 440D having regard to "all possible circumstances then in view in the litigation" (at [23]). 3. On 6 January 2016, an external Administrator of the respondent was appointed. The parties then proceeded on the basis that appointment attracted the operation of s 440D of the Corporations Act with the effect that the proceedings were stayed. On 18 January 2016, the proceedings were listed for mention to consider the impact of administration. Provisions were made for the parties to file submissions on that question. 4. As earlier mentioned, the first Tribunal decision proceeded on the basis that consent was given by the Administrator in his letter of 20 January 2016. That consent was expressed as follows: Pursuant to section 440D of [the Corporations Act], I authorise the Tribunal to deliver judgment in respect of the preliminary issue that has been heard in File No: HB 14/49581; whether the Applicant has standing to sue in these proceedings … I do not oppose the delivery of this judgment, and for the respondent, if successful, to make an application for its costs. 1. The consent wholly preceded the determination of the standing issue and any question of costs arising therefrom. The Administrator gave no consent to the matter of costs of the respondent's application in the event the respondent's application regarding standing failed. 2. In those circumstances, the finding by the Appeal Panel that the requisite consent had been given was flawed. The Administrator's consent was given at time when the outcome of the standing decision was not known. On the face of the Administrator's consent, the determination of the issue of costs was permitted only if the respondent was successful in making such an application. It did not permit the applicant to apply for their costs if they were successful in resisting the standing application or to argue for the continuation of the proceedings more generally. The consent did not therefore, deal fully with the litigation. 3. This conclusion gives rise to the second question as to whether consent given in this fashion was effective under s 440D(1)(a) of the Corporations Act (a consideration not undertaken by the Appeal Panel because of its conclusion as to the first issue). 4. Section 440D(1) is in the following terms: Stay of proceedings (1) During the administration of a company, a proceeding in a court against the company or in relation to any of its property cannot be begun or proceeded with, except: (a) with the administrator's written consent; or (b) with the leave of the Court and in accordance with such terms (if any) as the Court imposes. (2) Subsection (1) does not apply to: (a) a criminal proceeding; or (b) a prescribed proceeding. 1. As Mr Pesman SC properly conceded, there is no authority, as such, addressing whether an Administrator's partial, piecemeal or limited consent is valid for the purposes of s 440D(1)(a) of the Corporations Act. 2. Subject to the limitations arising from the absence of a contradictor in this matter, I have formed the view that the limited or qualified consent given by the Administrator as to the proceedings before the Tribunal as to costs (or more generally) was invalid for the purposes of s 440D(1)(a) for the following reasons: 1. As stated by Black J, s 440D is directed to an Administrator's written consent to "proceeding in a court" and not "aspects of them" (see at [37] above). It was not open to the Administrator to selectively consent to the continuation of a part of the proceedings. 2. The provisions should not be interpreted so as to give a procedural advantage to a company in administration: Mead Corp v Carbonless Papers (Australia) Pty Ltd [2002] WASC 268 at [84] (per Hasluck J); Arogen v Leighton (2013) 278 FLR 245; [2013] NSWSC 1099 at [42] (per McDougall J); and In the matter of Oliver Brown Pty Ltd [2012] NSWSC 1046 at [13] (Black J). 1. Turning then to Ground 1, I agree with the submissions advanced for the applicants that it was not open to the Appeal Panel to fail to determine the question as to whether s 440D, applied as submitted by the applicants and the Attorney General, because, if the proceedings were not stayed, the whole of the events of 2016 proceeded on a false basis. The applicants have made out Ground 1 of the appeal. 2. It also follows that the Appeal Panel was in error in concluding that if s 440D(1)(a) applied, there was the requisite consent under that sub-section in the circumstances operating before the Tribunal. To that extent, Ground 2 is established. 3. The applicants did not develop submissions beyond that point below as to whether the Tribunal was a "court" for the purposes of s 440D of the Corporations Act. It is appropriate that some brief preliminary observations be made in that respect. 4. There is some substance in the contention advanced by the Attorney-General before the Appeal Panel that the proceedings before Senior Member Goldstein were proceedings in "a court" for the purposes of s 440D(1) of the Corporations Act. 5. Part 5.3A of the Corporations Act provides a regime of temporary external administration of a corporation's affairs with a view to executing a deed of company arrangement or winding up or alternatively cessation of administration. This is the period in which a moratorium operates: Brash Holdings Ltd (Administration Appointed) v Katile Pty Ltd [1996] 1 VR 24 at 28-29. 6. This would suggest the word "court" in s 440D, which principally affects the moratorium, should be read broadly. 7. Further, it would seem inconsistent with this statutory purpose for some judicial or quasi-judicial proceedings to be stayed presumptively by force of s 440D but other proceedings to be allowed presumptively to be proceeded with. 8. Further, the proceedings below were sufficiently court like to be regarded as proceedings in a court for the purpose of s 440D of the Corporations Act. It must also be noted that the Tribunal was dealing with building claims which were also capable of adjudication before this Court. 9. This approach to the operation of s 440D would not seem to be affected by the Court of Appeal's decision in Burns v Corbett; Gaynor v Burns [2017] NSWCA 3 at [95] (per Leeming JA, with whom Bathurst CJ and Beazley P agreed) where it was held the Tribunal was not a "court of a State" for constitutional purposes in contrast to the reach of s 440D to a court for the purposes of the aforementioned moratorium of proceedings. 10. For those reasons, I consider that Grounds 1 and 2 represent questions of law and in consequence of the aforementioned reasons, with respect to the same, leave should be granted. Grounds 4 and 5 1. As conceded by the applicants, in the light of these conclusions, it is unnecessary to rule upon the remaining two grounds of the appeal. However, I note there is considerable substance to Ground 4. CONCLUSION 1. In the circumstances, leave should be granted to bring Grounds 1-3 of the appeal each of which raise questions of law. The applicants have succeeded in making out the merits of those grounds. It is unnecessary to decide Grounds 4 and 5. ORDERS 1. The Court makes the following orders: 1. The applicants are granted leave to appeal from the whole of the decision of the Appeal Panel of the Tribunal on 26 June 2017 in proceedings AP 16/44447. 2. The orders made by the Appeal Panel on 26 June 2017 are set aside. 3. In place of those orders, the proceedings HB 14/495581 in the Tribunal are dismissed with no order as to costs. 4. There is no order as to costs of these proceedings. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 24 May 2018