PARTIES:	TIMOR TRANSPORT PTY LTD (In
liquidation) v
MURLROAM PTY LTD

TITLE OF COURT:	SUPREME COURT

JURISDICTION:	SUPREME COURT

FILE NO:	No 525 of 1990 (9018213)

DELIVERED:	Darwin 20 August 1992

HEARING DATES:	21 May, 20 August 1992

JUDGMENT OF:	Martin J.

CATCHWORDS:

Practice - Northern Territory - Amendment of writ - Plaintiff not to amend name of defendant on writ without application to Court - Court may set aside proceedings or step taken in them

Williams Civil Procedure Victoria, Volume 1
Principles of Practice and Procedure, O'Leary and Hogan

Practice - Northern Territory - Service of writ - Application for extension of time - No express precondition to granting of extension - To show good reason - Regard to be had to all the circumstances

Supreme Court Rules (NT), r5.12

Foxe v Brown (1985) 59 ALJR 186, applied
Vanleer Australia Pty Ltd v Palace Shipping (1981) 34 ALR 3, applied
Victa Ltd v Johnson (1975) 10 SASR 496, applied

Practice - Northern Territory - Addition of parties - Company in liquidation - Proceedings for recovery of preferences - Application to join liquidator as a plaintiff - Liquidator and company having separate causes of action - Not to be consolidated -

Johnston v Port Darwin Petroleum Pty Ltd, unreported, 15 October 1986, applied.

Jones v Davies Franklin Cycle Co Ltd (1902) 27 VLR 649, considered.
Kent v La Communauté des soeurs de Charité de la Providence [1903] AC 220, considered.
Re Evers Motor Company Ltd (1962) QWN 6, applied
Re Reid Murray Holdings Ltd (1969) VR 315, considered

Practice - Northern Territory - Addition of parties - Company in liquidation - Proceedings for recovery of preferences - Application to join liquidator as a plaintiff - No order to be made joining a plaintiff if a limitations defence would be affected -

Supreme Court Rules (NT), r36.01

Liff v Peasley (1980) 1 All ER 623, applied
Mabro v Eagle, Star and British Dominions Insurance Co Ltd (1932) 1 KB 485, applied

Corporations - Companies - Winding up - Company in liquidation - Proceedings for recovery of preferences void as against liquidator - Action to be brought by liquidator - Companies Code (NT), s451 and s368 - Where liquidator and company have separate causes of action not to be consolidated

Bolwell Fibreglass Pty Ltd v Foley (1984) VR 97, applied
Johnston v Port Darwin Petroleum Pty Ltd, unreported 15 October 1986, applied
Re Evers Motor Company Ltd (1962) QWN 6, applied

Costs - Interlocutory proceedings - Costs liability of legal practitioners - Costs incurred as a result of solicitor's default - Costs disallowed between solicitor and client

Supreme Court Rules (NT), r63.21

Limitation of Actions - Procedure, pleading and evidence - Mistake as to name of defendant on writ - Application to substitute name of the defendant - Supreme Court Rules (NT) r36.01 - Rule is remedial and should be given beneficial interpretation -

Limitation Act (NT), s12(1), 48A Supreme Court Act (NT), s80, 81 Supreme Court Rules (NT), r36.01 Halsbury 3rd Ed, Vol.24, p194

Bridge Shipping Pty Ltd v Grand Shipping SA (1991) 173 CLR 231, applied
Smart & Ors v Stuart, unreported 2 April 1992, applied

REPRESENTATION:

Counsel:

Plaintiff:	D W E Trigg
Defendant:	J E Reeves

Solicitors:

Plaintiff:	Cridlands
Defendant:	Buckley & Stone

Judgment category classification:	B Court Computer Code:
Judgment ID Number:	mar920021
Number of pages:	27
DISTRIBUTION: LOCAL

mar920021

IN THE SUPREME COURT
OF THE NORTHERN TERRITORY OF AUSTRALIA

No. 525 of 1990
(9018213)

BETWEEN:

TIMOR TRANSPORT PTY LTD
(In liquidation)
Plaintiff

AND:

MURLROAM PTY LTD
Defendant

CORAM:	MARTIN J.

REASONS FOR JUDGMENT

(Delivered 20 August 1992)

ORDER SOUGHT

The relief sought by each of the plaintiff and the defendant is indicative of the most unsatisfactory state of these proceedings, which has arisen entirely as a result of avoidable problems occasioned by the solicitors for the plaintiff.

The plaintiff seeks orders that:

the writ be renewed for a further twelve months (presumably from the date upon which the time for service expired);

Allen Charles Garraway be added as second plaintiff (Mr Garraway is the liquidator of the named defendant);

the writ be amended to include an endorsement pursuant to s. 44 of the
Limitation Act.

As to the defendant, it seeks orders that:

the ex parte order of acting Master Godtschalk made 16 January 1992 (by which the defendant was substituted for another defendant) be set aside;

the amended writ amended 16 January 1992 be set aside;

further, or in the alternative, the amended writ amended 16 August 1991 be set aside (the date upon which the plaintiff previously purported to substitute a person as defendant);

service of the amended writ on the defendant on or about 3 February 1992 be set aside. (It was served outside the period allowed for service).

BACKGROUND

On 22 May 1986 Murlroam Pty Ltd registered the business name "Eastside Petroleum" ("Eastside"), pursuant to the provisions of the Business Names Act. In September, October and December of that year it is alleged to have received payments from the plaintiff amounting to $14,430. According to a letter from the solicitors for Eastside the payments were received in return for fuel, lubricants and other petroleum products provided to the plaintiff on credit in accordance with established trading practice of the two companies ("the s. 451 claim"). On 7 January 1987, a summons for the winding up of the plaintiff was presented, and on 3 September 1987 an order for winding up of the company was made and Allen Charles Garraway was appointed liquidator.  Between those two dates there had been numerous payments made by the plaintiff to Eastside, amounting to $65,763 which its solicitors assert were made in return for fuel provided by Eastside on credit, in good faith and in the ordinary course of the defendant's business ("the s. 368 claim"). During the whole of the period prior to the appointment of the liquidator Murlroam Pty Ltd remained as the person in relation to whom the business name was registered, but a search of the public records comprising the register kept under the Business Names Act shows that the company ceased to use that name, and Graham Dean Puddick and Moira Florence Geoghegan commenced to use it from 18 October 1989.

By letter of 21 June 1990 addressed to "Eastside Petroleum" the liquidator claimed payment of the amounts referred to above. Solicitors, who asserted that they acted for "Eastside Petroleum", replied to that letter saying they were obtaining detailed instructions. On 28 August 1990 they wrote to the liquidator denying liability

and putting forward arguments based on the relevant statutory provisions, referred to above, in support of that denial. In that letter the solicitors said that their client would be making an application to the Court for appropriate orders shortly (s. 368), and referred to their client as "Eastside Petroleum". The liquidator then instructed his solicitors and on 31 August 1990 they issued the writ herein naming "Eastside Petroleum Pty Ltd" as defendant. Why the defendant was so described is not explained and it does not appear that there is any entity by that name which had any connection with the matter. The writ was not served in that form. Instead, on 17 December 1990 the solicitors instructed by the liquidator wrote to the solicitors who had previously communicated with the liquidator and, referring to "East Side Petroleum Pty Ltd", made a demand for the s. 368 claim only.  The reply perpetuated the error by referring to "East Side Petroleum Pty Ltd" and advised that counsel had been instructed to draw the necessary application to the Court. There the matter rested until 15 August 1991.
There is no evidence as to what happened in the meantime. On that date a further search of the business name "Eastside Petroleum" disclosed that it had been registered on 22 May 1986 and that its business was that of a service station carried on at Lot 582 Stuart Highway, Katherine. The search also disclosed the change of ownership on
18 October 1989. There was no information on that search disclosing who it was that carried on business under that name at the relevant period, that is, between August 1986 and the date of the winding up order. Nevertheless, the solicitors for the liquidator purported to amend the writ, previously naming "Eastside Petroleum Pty Ltd" as defendant, by substituting "Graham Dean Puddick and Moira Florence Geoghean trading as "Eastside Petroleum" as defendants.  (It is not necessary to clarify whether the correct name of the second person then named as defendant was Geoghegan as shown on the search or Geoghean as shown on the Court record).

The solicitor having the conduct of the proceedings on behalf of the liquidator, in an affidavit in support of the plaintiff's applications, deposed that on
22 August 1991 she arranged for service of the writ as amended upon the persons then named as defendants. There is no evidence as to when, if at all, and upon whom, if anyone, the writ was purportedly served. It was valid for service for one year only after the day it was filed, 31 August 1990 (r. 5.12). There being no evidence to the contrary that period must be taken to have expired before service (if service was affected at all).
All that is deposed to is that on 22 October 1991 the solicitor was informed by a "Ms Geoghan that she did not at any time own the business of Eastside Petroleum
although her name was on the records". That caused the solicitor to carry out a further search of the business name which confirmed that it was registered on 22 May 1986 and went on to incorporate the following: "Registered proprietor between 26.6.87 to 9.1.87 is Murlroam P/L" and to finish off with a note that "No company of the name Eastside Petroleum P/L is registered". The searches of the business name were carried out by someone other than the solicitors. The dates shown as being those between which Murlroam Pty Ltd was the registered proprietor of the business name do not seem to provide an answer to any question which is relevant to the causes of action under consideration. Be that as it may, the solicitors for the plaintiff, on 8 January 1992, filed a summons seeking leave to amend the name of the defendant, and on 16 January 1992, leave was granted ex parte to amend the writ by changing the defendant's name to "Murlroam Pty Ltd trading as Eastside Petroleum".

At some stage prior to all that it seems that the solicitors for the liquidator had sought from him his consent to be joined in the proceedings (0. 9.07(1)), and on 5 December 1991 he signed a document which referred to correspondence and advised: "I consent to be added as a second plaintiff in all of those actions commenced

by Timor Transport Pty Ltd (in liquidation) against the creditors pursuant to section 451 of the Corporations Laws". He enclosed that consent, "as requested", with his letter of 20 February 1992 to his solicitors. The amended writ was served upon Murlroam Pty Ltd on 3 February 1992; it promptly entered a conditional appearance and took out its summons for the relief now sought (r. 2.03). The plaintiff took out its summons on
10 March.

THE AMENDMENT TO THE WRIT OF 16 AUGUST 1991

The defendant seeks to set this amendment aside.

I can find no provision in the Rules or elsewhere which enables a plaintiff simply to change the name of a defendant on a writ at any time otherwise than by application to the Court. Rule 36.01(1) provides that the Court may at any stage order that a document in the proceedings be amended or that a party have leave to amend a document in the proceedings, and by subrule (4) a mistake in the name of a party may be corrected under subrule (1) whether or not the effect is to substitute another person as a party.  (See also r. 9.06).  The only exception to the rule that an order of the Court is required is to be found in r. 36.03 providing that a party may amend a pleading served by him once before the close of pleadings. A "pleading" includes an endorsement of claim on a writ which constitutes a statement of claim, and includes particulars of a pleading, (r. 1.09), but nowhere is it suggested that a pleading includes the name of the parties to a proceeding. "The pleadings are the written statements of the claim and defence of the plaintiff and defendant respectively which are served in turn by each party on the other. Pleadings are filed in court and form part of the record of the proceeding. Pleadings serve the two fold purpose of giving notice and

defining issues.   They inform each party of the claim or defences of the other side	"
Williams Civil Procedure Victoria Volume 1, para 13.01.5, p. 2863, see also O'Leary and Hogan Principles of Practice and Procedure, para 1.401 "Pleading defined". The failure to comply with the rules in relation to the name of the defendant does not render the step taken a nullity, and the Court may set aside the proceedings, set aside the step taken in the proceedings or exercise its powers under Chapter 1 of the Rules to allow amendments and make orders dealing with the proceedings generally (r. 2.01).

THE ORDER SUBSTITUTING THE DEFENDANT - 16 January 1992

The defendant seeks to set the order and the writ aside.

The then acting Master did not notice the irregularity described above when making the order changing the defendant's name, on the second occasion, on 16 January 1992. Nor did she notice that the time for service of the writ had expired. To make such an order at that time was futile unless accompanied by an order extending time for service. The order by which Murlroam Pty Ltd came to be described as the defendant in the proceedings was not made on notice to it and r. 46.08 provides that the Court may set aside or vary an order in those circumstances. That remedy is not limited to orders made against a party, although such applications usually concern a party.  If the irregularities in the proceedings had been brought to the attention of or noted by the acting Master at the time she made the order in respect of Murlroam Pty Ltd it would have been appropriate to order that notice of that application be given to Murlroam Pty Ltd.

The plaintiff, by its application, seeks to have orders made which would

have the effect of regularising all that happened. Faced with the orders sought by the defendant, it applied orally, upon the hearing, for orders that if the previous order concerning Murlroam Pty Ltd being made a defendant, and the service upon it, be set aside, it be substituted as a defendant and for extension of the time for service upon it. It has also sought leave to file evidence of the date of service of the writ upon Puddick and Geoghean (or Geoghegan) if a decision contrary to the interests of the plaintiff is to be made dependant upon lack of proof of just when that service took place. Before deciding what ought to be done, it is first necessary to consider the effect of the Limitation Act and other Rules of Court modifying its application.

LIMITATION ACT - SUBSTITUTING THE DEFENDANT

The monies which are sought to be recovered (upon grounds which are detailed later) comprise payments made by the plaintiff between 19 September 1986 and 26 June 1987. The right to such recovery could only arise upon the date of the winding up order and appointment of the liquidator, being the date "when all the facts have happened which are material to be proven to entitle the plaintiff to succeed" (Halsbury 3rd Ed, Vol 24, p. 194), that is, 3 September 1987. The action, being for monies recoverable by virtue of the companies legislation, was not maintainable after the expiry of three years from that date (s. 12(1)(d) Limitations Act). The issue of the writ on
31 August 1990 was thus barely within the limitation period. The effect of the order substituting Murlroam Pty Ltd as a defendant, and, if it is set aside, the effect which substituting that company as the defendant anew might have, as prejudicing the rights of Murlroam existing at the date of any such order, must be considered. The well known rule in Weldon v Neal gave rise to refusal by the Courts to allow an amendment of parties or of a pleading where it appeared a defendant would be unfairly prejudiced by

the loss of a defence based upon a statute of limitation. That rule must now be read in the light of s. 48A of the Limitation Act which came into operation on 1 November 1987. It provides:

"(1)If a court would, but for the expiry of a relevant period of limitation after the day a proceeding in the court has commenced, allow a party to amend a document in the proceeding, the court shall allow the amendment to be made if it is satisfied that no other party to the proceeding would by reason of the amendment be prejudiced in the conduct of that party's claim or defence in a way that could not be met by an adjournment, an award of costs or otherwise.

(2)This section does not apply to an amendment in a proceeding commenced before the commencement of this section.".

This provision looks to prejudice which might be suffered by an existing party to proceedings. It does not apply so as to permit the addition of a party (per Dawson J. at pp. 609 and 612, Bridge Shipping, infra).   In addition there are sections 80 and 81 of the Supreme Court Act giving the Court a wide discretion to amend or remedy defects, errors or omissions in proceedings and remedying formal defects. Rule 36.01, which forms part of the current rules of Court ratified, validated and approved by the Parliament, is as follows:

"(1)For the purpose of determining the real question in controversy between the parties to a proceeding or of correcting a defect or error in a proceeding or of avoiding multiplicity of proceedings, the Court may at any stage order that a document in the proceeding be amended or that a party have leave to amend a document in the proceeding.

In this Order "document" includes originating process, an endorsement of claim on originating process and a pleading.

An endorsement of claim or pleading may be amended under subrule (1) notwithstanding that the effect is to add or substitute a cause of action

arising after the commencement of the proceeding.

A mistake in the name of a party may be corrected under subrule (1) whether or not the effect is to substitute another person as a party.

Where an order to correct a mistake in the name of a party has the effect of substituting another person as a party, the proceeding shall be taken to have commenced with respect to that person on the day the proceeding commenced.

The Court may, notwithstanding the expiration of a relevant limitation period after the day a proceeding is commenced, make an order under subrule
where it is satisfied that any other party to the proceeding would not by reason of the order be prejudiced in the conduct of his claim or defence in a way that could not be fairly met by an adjournment, an award of costs or otherwise.

For the purpose of subrule (6) "any other party to the proceeding" includes a person who is substituted as a party by virtue of an order made to correct a mistake in the name of a party.

Subrule (6), with the necessary changes, also applies to an application under rule 14.03(2).

Subrule (1) does not apply to the amendment of a judgment or order.".

Subrules (1), (4), (5), (6) and (7) have particular effect on the outcome of the applications concerning Murlroam Pty Ltd as defendant. The Victorian provisions identical to s. 48A of the Limitation Act and r. 36.01 were considered by the High Court in Bridge Shipping Pty Ltd v Grand Shipping S.A. (1991) 173 CLR 231.  It was held that r. 36.01(4) covers not only cases of misnomer, clerical error and misdescription, but also those where the plaintiff, intending to sue a person identified by a particular description, was mistaken as to the name of the person who answered that description. McHugh J., with whom Brennan and Dean JJ. agreed, said at the foot of p. 260 and over to p. 261 that the rule is remedial and should be given a beneficial interpretation: "It is proper to give it the widest interpretation which its language will permit". Here, the

plaintiff made a mistake "in the name of a party" because, although intending to sue a person whom the plaintiff knew by a particular description, that is, the person to whom the payments sought to be recovered were made, the plaintiff was mistaken as to the name of the person who answered that description (see McHugh J. at p. 260).
Reference might also be made to the decision of the Court of Appeal in Smart & Ors v Stuart, unreported, 2 April 1992, especially the reasons of Mildren J.

It was not suggested that, apart from the limitations defence, any prejudice has been or would be suffered by Murlroam Pty Ltd by any of the orders concerning it previously made or now proposed. The history of the matter prior to the issue of the writ shows that whoever lay behind Eastside was aware from the letter of demand sent by the liquidator of the nature of the claims made, and, with reference to the considered reply to that demand by solicitors, the nature of the defences which might be raised to such claims, and of the rights it had to make application to the Court with a view to protecting its position in respect of s. 368. Such prejudice as may have been or may be suffered by Murlroam Pty Ltd, in relation to its being substituted as a defendant, is compensable in costs.

EXTENSION OF TIME FOR SERVICE OF WRIT

The writ in which Murlroam Pty Ltd was named as defendant was purportedly served upon it on 3 February 1992, five months after the time for service had expired (r. 5.12).  The plaintiff seeks an order extending the time for service to cover that event nunc pro tunc, or, if it becomes necessary to serve the company again to give it the opportunity to do so. If service again was required and the time not extended

the commencement of a fresh action would be well outside the limitation period which expired on 3 September 1990. This is a case in which the failure to serve the writ on the proper defendant in time was due to the default of the solicitors for the plaintiff, and where, for reasons already given, the defendant has been well aware of the claims to be made and of the courses of action available to it to protect its position since long before the time for service expired. There is no prejudice alleged by the defendant, other than the potential loss of the limitation defence, which is not compensable in costs.

The writ was purportedly served on the defendant about five months after the time for service had expired and the plaintiff's application to extend time for service was made about one month thereafter, but as a reaction to the defendant's applications to have the service set aside.

In exercising discretion in relation to the renewal of a writ, an approach should be adopted which looks to the general justice of the case, paying regard to all the circumstances, including not only any limitation statute but also the relative hardships which the grant or refusal of renewal would impose upon the parties (Vanleer Australia Pty Ltd v Palace Shipping (1981) 34 ALR 3). In that case his Honour Justice Stephen undertook an extensive review of authorities in England, Canada and Australia including observations in cases where the relevant circumstances include the operation of a statute of limitations. His Honour adopted what was said by Bray CJ. in Victa Limited v Johnson (1975) 10 SASR 496:

"It is not correct to say that the defendant has acquired an absolute right to immunity when a writ issued within the limitation period is not served within 12 months of its issue and the limitation period has in the meantime expired. What has expired is in reality not the limitation period but the period

which would have been a limitation period if no writ had ever been issued. What the failure to serve a writ within 12 months gives the defendant is no more than a right to contend that the court in the exercise of its discretion should not renew the writ. The efficacy of the writ does not expire absolutely at the end of the 12 months, it only expires if and in so far as the court sees fit not to renew it".

His Honour also referred to a Canadian case to similar effect. That approach was also adopted by Mason J. in Foxe v Brown (1985) 59 ALJR 186.   There is no longer any express precondition to the exercise of the court's discretion to extend the period of validity for a service of a writ. Previously it was necessary to show that reasonable efforts had been made to serve the defendant or other good reason.  No doubt the plaintiff must still show good reason. Here, there are two good reasons. The first is that the default arose through the failure of the plaintiff's solicitors to properly search and identify the name of the person carrying on the business at the relevant time. The second is the operation of statutory limitations in these circumstances, bringing about the possibility at least of recovery against the defendant not being able to be pursued, and consequent hardship to the creditors of the company.   No relevant hardship or prejudice has been shown on the part of the defendant if the extension was allowed. The plaintiff's default has not been intentional or contumelious nor has the delay been such as to give rise to a substantial risk that a fair trial is not possible.
(These and other matters which may impinge upon the exercise of the discretion are referred to in greater detail by Mildren J. in The Commonwealth of Australia v DKB Investments Pty Ltd, unreported, 12 September 1991).

APPLICATION TO JOIN THE LIQUIDATOR AS A PLAINTIFF

The plaintiff sues as a company in liquidation and there is an application

by it that the liquidator be joined as an additional plaintiff. The claim against the defendant is in two parts. The first arises from the operation of s. 451 of the Code. It provides that a payment made by a company that, if it had been made by a natural person, would, in the event of his becoming bankrupt, be void as against the trustee in bankruptcy, is in the event of the company being wound up, void as against the liquidator. This incorporates s. 122(1) of the Bankruptcy Act which provides that a payment made by a person who is unable to pay debts as they become due from his own money, in favour of a creditor, having the effect of giving that creditor a preference ....
over other creditors, being a payment made	within six months before the
presentation of a petition is void against the trustee in bankruptcy. The relevant date in the case of the liquidation of a company is the date of the filing of the application for winding up (s. 451(2)), that is, 7 January 1987. There are provisions in the Bankruptcy Act which may be applied to the circumstances of a particular payment to a creditor which may overcome the effect of this law.

There appears to have been a fairly well settled practice as to who should be plaintiff in relation to proceedings for recovery of a preference. For example, in Freeway Mutual Pty Ltd v Taylor (1978) 22 ALR 281, which came before the Full Court of the Supreme Court of Queensland, the proceedings were initiated by the official liquidator, similarly, in Court v Hewett, in the Full Court of the Supreme Court of Western Australia exercising federal jurisdiction (1981) 39 ALR 627. In the later Western Australian case Kyra Nominees Pty Ltd (In liquidation) v National Australia Bank Ltd (1986) 4 ACLC 400 the action was commenced in the name of the company in liquidation, but it seems that the company was being wound up voluntarily and there may be a distinction based upon that fact.   Reference might also be made to Rees v Bank of New South Wales (1964) 38 ALJR 133 where the High Court was considering a

claim by a liquidator of a company in relation to monies said to have constituted a preference within the meaning of the equivalent provisions of the then Companies Act and Bankruptcy Act.

Whether or not it was a practice that proceedings of that type be taken in the name of the liquidator or the name of the company in liquidation was not the subject of any comment in any of those cases, but was taken up by Adam J., in Re Reid Murray Holdings Ltd (1969) VR 315 at 318. That again was a case concerning preferences which had been commenced in the name of the liquidator. The major issue was the procedure adopted, but at page 318 his Honour held that the action should properly be brought in the name of the liquidator.  In so doing he referred to Jones v Davies Franklin Cycle Co. Ltd (1902) 27 VLR 649 and Kent v La Communauté des soeurs de Charité de la Providence, [1903] AC 220. In the former case the claim, which was brought in the name of the liquidator, was to set aside a transaction made between the company in liquidation, Diamond Cycle Pty Ltd and the defendant on the ground that the transaction amounted to a fraudulent preference. The brief report indicates that the argument went only to the question of whether a proceeding on behalf of a company in liquidation could only be brought in the name of the company. Relying upon the provisions of the then legislation, a'Beckett J. held that the action, not being brought in the name and on behalf of the company, the writ should be set aside. A recent equivalent statutory provision is to be found in s. 377(2) of the Code which enables a liquidator to bring or defend legal proceedings in the name and on behalf of the company.   It is also noted that in that case the company was in voluntary liquidation and that the writ was subsequently amended by leave of the Court. In the latter case the Privy Council considered an appeal from the Court of King's Bench for the Province of Quebec. The action out of which the appeal arose was commenced by the appellants in

their character as liquidators of a bank against the defendants to recover a sum alleged to be owing by them to the bank on a promissory note. Although the case originated in Canada there does not appear to be any material difference in the law to be applied to that relating to this matter. At p. 226 Lord Davey, on behalf of their Lordships, said:

"The office of the liquidator has in fact a double aspect. On the one hand he wields the powers of the company, and on the other hand he is the representative for some purposes of the creditors and contributories. There are therefore many cases in which he may sue in his own name, as, eg, to impeach some act or deed of the company before winding up which is made voidable in the interests of the creditors and contributories. But their Lordships think that wherever the object of the action is to recover a debt, or to recover or protect property the title to which is in the company, the action should be brought in the name of the company".

At p. 227 it was noted that although the liquidators had the right to sue they had sued in the wrong form; they ought to have joined with themselves the company. Adam J. followed the latter case and he, in turn, by Asche J., as he then was, in this Court, in Johnston v Port Darwin Petroleum Pty Ltd Action No. 232 of 1986, which was bound up with a number of other matters (unreported 15 October 1986 - see at p. 15 of the judgment). In Re Evers Motor Company Ltd (1962) Q.W.N. 6, Gibb J. remarked that the reported cases in which applications had been made for a declaration that a payment made by a company, was void as a preference, show: "That it is by no means unusual for the liquidator to represent the general body of creditors on such an application".

It is clear by authority and practice that actions brought under s. 45 of the Code and its equivalents ought to be taken in the name of the liquidator. After all, it is against him that the preferential payment is declared void.

Pursuant to r. 9.06, the Court may, at any stage of proceedings, order that a person who ought to have been joined as a party or whose presence before the Court is necessary to ensure that all questions in the proceedings are effectually and completely determined, be added as a party.	Here, the present plaintiff seeks to have
Mr Garraway added as a party. His written consent, as required by r. 9.07(1), has been given. The plaintiff and proposed additional plaintiff do not have the same cause of action against the defendant. On the material available there does not seem to be any dispute by the defendant as to its having been paid the amounts in respect of which repayment is sought. There may be some common questions of law and fact arising upon the two claims, but, the rights of relief sought are not in respect of, or arise out of the same series of transactions. There are two such series, one prior to and the other after the commencement of the winding up (r. 9.02(1)(a)). Further, although the Court has a discretion to join an additional plaintiff under r. 9.02(1)(b), it shall not do so unless it is satisfied that the joinder will not prejudice a party (r. 9.02(2)(b)). Although there are no pleadings showing the defence or defences sought to be raised by the defendant, its solicitors have indicated they will rely upon its having provided the company now in liquidation with goods on credit, in good faith and in the ordinary course of business. One of the effects of adding the liquidator in person as a plaintiff (if permissible under r. 9.02), would be akin to making an order that an action by him against the defendant be consolidated with an action by the company in liquidation against the defendant (r. 9.12). In Bolwell Fibreglass Pty Ltd v Foley (1984) VR 97 at 104, Brooking J. opined that a consolidation order should rarely be made and the order of the Court at p. 119 was that the actions consolidated be deconsolidated. Young CJ. at p. 100 agreeing with Brooking J., speaking generally, thought that it was better to confine cases of consolidation to cases where several actions had been brought which

might have been joined in one writ. His Honour then mentioned the distinction between a consolidation order and one where an order is made that actions be heard together and by the making of various enabling orders. Kaye J. agreed with the Chief Justice and Brooking J.

On the information available, there are separate causes of actions arising from a number of transactions falling into two separate periods of time and there is only a bare indication of the defence which the defendant may seek to raise. A separate application by the defendant to the Court, presumably under s. 368 was contemplated, although not yet commenced. The requirements of r. 9.02(1)(a) are not met.

LIMITATION ACT - ADDING A PLAINTIFF

But the problem goes deeper than that. There is no equivalent in the rules concerning the addition of a party to that which provides that where an order to correct a mistake in the name of a party has the effect of substituting another person as a party, the proceedings shall be taken to have commenced with respect to that person on the day that proceedings commenced (r. 36.01(5)). If the addition of Mr Garraway as plaintiff would only take effect from the date of the order, the time for commencing his separate claim against the defendant has long expired. In Mabro v Eagle, Star and British Dominions Insurance Co Limited (1932) 1 KB 485 and 487 Scrutton LJ. speaking of a similar rule said that in his experience the Court had always refused to allow a party to be added where, if it were allowed, a limitations defence would be defeated. The defendant should not be placed in a position in an existing action where, by reason of the joinder of an additional plaintiff, he would be deprived of a limitation defence which would be available if the person sought to be added as a plaintiff had

brought a fresh action at that time. In Liff v Peasley (1980) 1 All ER 623 at 632 Stephenson LJ. said that there was a formidable line of authority that the addition of a new plaintiff into an existing action relates back to the date when that action first began. Whether the addition of a fresh plaintiff relates back to the issue of the writ, or only takes effect upon the order being made, no such order should be made where the limitation period for the cause of action the fresh plaintiff seeks to pursue has expired. If the order relates back, the accrued defence of the defendant is effected, and if it does not then the defence remains available and the addition of the plaintiff serves no useful purpose. (See the discussion of Brandon LJ. commencing at p. 639).

THE SECTION 368 CLAIM

The other basis upon which a claim is made against the defendant is under s. 368(1) of the Code. It provides that "any disposition of property of the company .... made after the commencement of the winding up is	unless the court
otherwise orders, void". In National Acceptance Corporation Pty Ltd v Benson (1988) 13 ACLR 1 the distinction between the provisions found in ss. 368 and 451 of the Code was discussed, and attention drawn to the law that under s. 451 the transactions were void as against the liquidator whereas under s. 368 the transactions were simply void, that is, void for all purposes related or incidental to the administration of the winding up of the company, and as between the company and a person dealing with the company. (Neither the liquidator nor the company in liquidation was a party to those proceedings). However, in Tellsa Furniture Pty Ltd (in liquidation) v Glendave Nominees Pty Ltd (1987) 9 NSWLR 254 the Court of Appeal of New South Wales was concerned with an appeal brought by a company in liquidation, in that name, against orders relating to dispositions of property made by it to one of its suppliers after the commencement of its

winding up. No question was raised as to the validity of the proceedings brought in that name.

Where a payment is rendered void by operation of s. 368 of the Code or its equivalent, any action to recover the monies paid is in the nature of an action for the recovery of the property of the company, and, consistent with Kent, ought to be brought in its name.

All of the above is, of course, subject to a statutory provision to the contrary, for example, the power of a liquidator to recover property of a company vested in him (s. 374(2)).

ORDERS

On the plaintiff's application

The time for service of the writ is extended nunc pro tunc up to and including the date of service on Murlroam Pty Ltd.

The application that Allen Charles Garraway be added as a second plaintiff is refused.

The application that the writ be amended to include an endorsement under s.
44 of the Limitation Act is refused as unnecessary.

On the defendant's application

The application that the ex parte order of acting Master Godtschalk made 16 January 1992, be set aside is refused.

The application that the amended writ amended 16 January 1992 be set aside is refused.

The application that the amended writ amended 16 August 1991 be set aside is granted.

The application that service of the amended writ on the defendant on or about 3 February 1993 be set aside is refused.

COSTS

During the hearing of these applications the attention of counsel for the plaintiff was directed to r. 63.21, costs liability of legal practitioner. The solicitor for the plaintiff was present. It was indicated that the Court was considering making appropriate orders against the solicitor under the rule and submissions were	invited on that question. Time was allowed so as to provide an opportunity for the solicitor to be heard.  Counsel indicated later that instructions had been taken from the solicitor and she had no submissions to make.

For reasons which appear clearly from the reasons for decision on the substantive applications, it is plain that the costs of these proceedings have been incurred as a consequence of the solicitors default in failing to conduct or have

conducted a proper search of the Business Names register so as to identify the owner of the name at the relevant times, failing to abide by the rules relating to the original change of name of the defendant, failing to obtain an extension of time for service of the writ when required, failing to serve Murlroam Pty Ltd with the application that it be substituted as defendant, failing to take the appropriate proceedings on behalf of Mr Garraway. Had the identity of the true defendant been ascertained in the first place, and appropriate proceedings been taken and service effected within time, none of these applications would have been necessary.

Order that all of the costs of the plaintiff and Mr Garraway as between them and their solicitors in relation to the amendment of the writ on 16 August 1991, the substitution of the defendant as defendant on 16 January 1992, and these applications of the plaintiff and the defendant be disallowed as between solicitor and client, and that the solicitors for the plaintiff pay the costs of the defendant in relation to the plaintiff's and defendant's applications.

Certified fit for counsel.