Is appointing court leave required to sue a liquidator?

02/03/2021

The Commercial Law Association will host a lunchtime seminar on 12 March at NSW State Library.

Speaker: Dr John Azzi, Western Sydney University. Chair: Dr Robert Austin, Level 22 Chambers. Register at www.cla.org.au

In November 2020, the NSW Court of Appeal dismissed an appeal seeking to overturn a decision prohibiting the applicants from commencing proceedings against a Court-appointed liquidator personally (Aardwolf Industries LLC v Tayeh [2020] NSWCA 301 (‘Aardwolf’)). Despite that it was commonly agreed leave of the appointing Court was necessary, Leeming JA questioned whether this was in fact correct, making in obiter remarks ‘lest they be overlooked in later cases’.

Having published a paper in 2011 suggesting the requirement of appointing Court leave is both outdated and outmoded, in this seminar Dr John Azzi re-examines the origin and rationale for the procedural requirement of leave. He finds it is neither necessary nor maintainable given the Corporations Act 2001 (Cth), which is designed to promote efficiency and cover the field by ensuring any person aggrieved can commence proceedings against a liquidator personally without first obtaining leave from either the appointing Court or any other Court.