Where a company is deregistered pursuant to chapter 5A of the Corporations Act 2001 the company ceases to exist (s 601AD(1)). The corporate entity is dissolved on deregistration and therefore ceases to be a legal person. In the absence of a corporate identity, a deregistered company cannot commence any proceedings, be joined to any proceedings and any proceedings against it instituted before the dissolution of the company cannot be continued.[1] Furthermore, a non-entity is unable to carry on proceedings (including defending proceedings) under the Uniform Civil Procedure Rules.[2]
Sackville J of the Federal Court in Re Morton; Ex parte Mitchell Products Pty Ltd (1996) 21 ACSR 497 stated:
A company registered under the Corporations Law is, inter alia, capable of suing and being sued and of holding property: s 123(2)(c), (e). But upon dissolution the company ceases to be a legal person: it becomes a “non existent person”: United Service Insurance Co Ltd (in liq) v Lang (1935) 35 SR (NSW) 487 (FC), at 495, per Jordan CJ. Under the Corporations Law, the property (including choses in action) of the dissolved corporation vests in the Australian Securities Commission: s 9 (definition of “property”), s 576(1). Upon the court becoming aware that the plaintiff or applicant is a non existent person, it will not allow the action to proceed: United Service, at 497.
If a party has a cause of action against a deregistered company, in order to pursue it the party will first need to apply for the reinstatement of the company. A party may apply to ASIC for reinstatement or a party with standing may make an application to the court for reinstatement.
[1] Sciacca at 6
[2] UCPR Part 7.1; Civil Procedure Act s 19(2).
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Ari Katsoulas | Barrister 