Insolvent firm and related company’s manager in the Kenoss case frame
In a rare occurrence for the region, the Australian Capital Territory is hosting a case that will form the basis for future legal approaches in the trucking industry.
Known as the Kenoss Contractors case, one that is early in the history of harmonised work health and safety (WHS) laws, especially as they related to directors and managers, it hinges on the death by electric shock of a construction company worker who was also a truck driver.
Local media reports say Michael Booth died two years ago when his truck’s tipper hit powerlines.
Norton Rose Fulbright lawyers Alena Titterton and Alice Winter-Irving say the case will have particular resonance for companies with related firms as both the company, which is now in liquidation, and an officeholder of a related firm are in prosecutors’ sights.
The officer has pleaded not guilty and his case is to be heard on December 17-19.
The lawyers also note that legal ground may be broken on the position of defunct companies and their creditors in such cases.
“Another legal issue that arises is whether or not Kenoss Contractors can be criminally prosecuted whilst insolvent,” they state in an advisory.
“Section 471B of the Corporations Act provides that a person cannot begin or proceed with a proceeding against a company that is being wound up in insolvency, except with the leave of the Federal Court of Australia or the ACT Supreme Court. The Office of ACT Director of Public prosecutions (DPP) however, submitted that section 471B does not apply to criminal proceedings.
“Section 500(2) of the Corporations Act provides that after the passing of a resolution for voluntary winding up, no action or other civil proceeding is to be proceeded with or commenced against the company except with leave of the Federal Court of Australia or the ACT Supreme Court.
“The DPP also submitted that that does not apply in criminal proceedings this being supported by the plain and ordinary meaning of the language of the section and the purpose of the legislation.
“The DPP submitted that sections 471B and 500(2) did not apply to Kenoss Contractors in the event respectively, of either a court-ordered winding up or a voluntary winding-up and that therefore it could proceed with the prosecution of the company.”
Chief Industrial Magistrate Lorraine Walker has listed the matter for a further hearing on Tuesday to tackle the insolvency issue with the company’s liquidators, RMS Bird Cameron, expected to appear representing the company.