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You are here: BAILII >> Databases >> High Court of Ireland Decisions >> Barrowland Ltd., Re [2003] IEHC 54 (23 January 2003) URL: http://www.bailii.org/ie/cases/IEHC/2003/54.html Cite as: [2003] IEHC 54

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THE HIGH COURT

Rec. No. 1995/85/COS

IN THE MATTER OF BARROWLAND LTD.

AND

IN THE MATTER OF THE COMPANIES ACTS 1963 TO 2001

JUDGMENT of Mr. Justice T.C. Smyth delivered on Thursday 23rd January 2003.

This is an application brought by the Registrar of Companies concerning an order of the Court dated 3rd April 1995 which was made in relation to an application pursuant to section 12 (6) of the Companies (Amendment) Act, 1982 for the restoration of the name of (Barrowland Ltd. "The Company') to the Register of Companies. The company was incorporated on 30th November 1967. On or about 6th November 1990, the company was dissolved and after its name had been struck off the Register of Companies for failure to file annual returns, the last annual return having been made on 31st December 1978. On 24th March 1995, the company presented a petition to the Court seeking the restoration of the name of the company to the Register of Companies. The Registrar did not object to the application as annual returns for the years 1979-1994 had been delivered to the Companies Registration Office by the company prior to the hearing of the petition.

On 3rd April 1995 the company's application came before the Court and its order was expressed thus -

"IT IS ORDERED that the said company be restored to the Register of Companies and pursuant to the Companies Acts 1963 and 1990 upon an office copy of this order being delivered to the Registrar of Companies for registration the said company is to be deemed to have continued in existence as if its name had not been struck off. And it is ordered that the said Registrar of Companies do advertise in his official name in a form to be settled by him in "Iris Oifigiuil " the making of this order - a

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copy of which has to be delivered to him forthwith by the petitioner by whom the costs of such advertisement is to be paid"

[Emphasis supplied]

Notwithstanding the requirement that the company deliver a copy of the said order to the Registrar forthwith it failed to deliver a copy of the order to him until 3rd November 2000 some five years and seven months after the making of the order. Annual returns were intermittently delivered by the company to the Companies' Registration Offices, date of the order with returns for 1995-1997 being delivered in January 1998 and returns for 1998 and 1999 being delivered in April 2000, returns for the years 2000-2002 were filed during the currency of the present application before the Court.

At the time of the receipt of the order of 1995 by the Registrar of Companies he had become greatly concerned about a practice which had developed of restoration orders being delivered to the Companies Registration Office some considerable time after they had been obtained. He considered that it was appropriate to seek directions from the Court in this case as to whether he was obliged to accept the order without any further order of the Court or whether the order requires to be extended or confirmed by the Court having regard to the significant time period which has elapsed since the making of the order. He was concerned and is concerned at the possibility of creating an undesirable precedent in relation to future cases where the interval might be even larger than in the instant case were the order in the instant case to be accepted for filing was without query. The Registrar was of the view that as registration is an integral part of the restoration process that by necessary implication, the order ought to be delivered to the Companies Registration Office for registration within a reasonable time from the date of its perfection. When a restoration application is made to the Court, it is entitled to have regard to any matters which have occurred since the company was struck off and, since the enactment of the Companies (Amendment) (No. 2) Act of 1999 to include an "alternative order" where appropriate. Where the order is subsequently not

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delivered to the Registrar of Companies for a significant period of time and the company is then restored on its delivery, the Court is not in a position to have regard to any matters which have occurred during that intervening period.

The case therefore concerns the construction to be put on the statutory scheme which is found originally in section 12 of the Companies (Amendment) Act 1982 and in particular subsection 6 thereof which reads as follows:

"(6) If a company or any member or creditor thereof feels aggrieved by the company being struck off the register, the Court, on an application made (on notice to the registrar) by the company or member or creditor before the expiration of 20 years from the publication in Iris Oifigiuil of the notice aforesaid, may if satisfied that the company was at the time of the striking off carrying on business or otherwise that it is just the company be restored to the register, order that the name of the company be restored to the register, and upon an office copy of the order being delivered to the registrar for registration, the company shall be deemed to have continued in existence as if its name had not been struck off and the Court may by the order give such directions and make such provisions as seem just for placing the company and all other persons in the same position as nearly as maybe as if the name of the company had not been struck off. "

[Emphasis supplied]

The section of the 1982 Act was amended by substitution by section 46 of the Companies (Amendment) (No. 2) Act, 1999.

Subsection 12(b)(3) is in identical terms to the original section 12 subsection 6 save that it is subject to the provisions of subsection 4 of the 1999 Act which deals with the alternative order and it is in the following terms:-

"(4) An alternative order may, if the Court considers it appropriate that it should do so, include a provision that, as in respects of debt or liability incurred by or on,

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behalf of, the company during the period when it stood struck off the register, the officers of the company are such one or more of them as is or are specified in the order shall be liable to the whole or apart (as the Court thinks just) of the debt or liability. "

In the case of In re Amantiss Enterprises Ltd [2000] 2 I.L.R.M. 177 it was held by O'Neill J. that "the words the company shall be deemed to have continued in existence as if the name had not been struck off" have the automatic effect of validating retrospectively all acts done in the name or on behalf of the company during the period between its dissolution and the restoration of its name to the register. Section 12 (6) was intended to preserve the validity of transactions entered into during a period of dissolution where frequently that dissolution is unknown to either the company, its officers or third parties dealing with it. The final words of section 12 (6) empowering the Court to make specific orders do not qualify the scope of the preceding general words but enable the Court to achieve to the fullest extent consistent with justice the `as you were' position of the company - Tymans Ltd. -v- Craven [1952] 2 Q.B. 100 followed. In my judgment the interpretation to be placed upon the original subsection 6 and section 12 is quite clear. The conjunctive "and"

"Upon an office copy of the order being delivered to the Registrar for registration " are a clear indication by the Oireachtas that it was not sufficient merely for the Court to make the pronouncement and make its order but that an office copy of the order should be delivered to the Registrar and it is upon the completion of both the making of the Court order and its delivery to the Registrar that the company is deemed to have continued in existence. In the instant case the expression forthwith used in the order of 1995 means with all reasonable celerity or in other words as soon as reasonably possible. Where consequence is `forthwith " to follow on an event (as in the instance case) the word imperatively excludes a time within something else may be done

inconsistent with that consequence.

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The provisions of section 12 do not give rise to an order as of course or as a matter of routine but permit the Court if satisfied as specified to make an Order. The Order of the Court must not merely be pronounced in Court, but perfected in written form and delivered to the Registrar to bring into operation the deemed provision or consequence. The additional discretionary power of the Court to "give such directions and make such provisions as seen

just for placing the company and all other persons in the same position as nearly as may be as if the name of the company had not been struck off ... " was embraced in the second element of the curial part of the Order of 3rd April, 1995 which obligated the company to deliver to the Registrar of Companies a copy of the Order forthwith. This expression complies with both the letter and the spirit of the statutory provisions. The creditors of the company are entitled to know with certainty what its exact status is, as are persons who may have rights to sue the company but the exercise of which rights are or may be affected by the Statute of Limitations (a matter considered by Megarry, J. (as he then was) in In Re Lindsay Bowman Ltd [1996] 1 WLR 1443).

As the effect of an Order which is complied with as to its terms is to validate retrospectively all acts done in the name and on behalf of the company during the period between its dissolution and the restoration of its name to the registrar: it follows that it is imperative that the copy of the Order of the Court be lodged as soon as ever possible with the Registrar of Companies. The Court Order does not act prospectively, the retrospective date of effect is the date not of the making of the Court Order but of compliance with it. However as the Order can only be made if the Court is satisfied with a given state of facts on a given day it is mandatory that the shortest interval possible should exist between the date of the perfected Court Order and a copy of its being lodged with the Registrar of Companies. In my judgment the Registrar ought not to be bound to register restoration orders which are not lodged with him forthwith.

If the Registrar were to have a margin of appreciation in for example, an Order pronounced at the end of a legal term which was not available in perfected form until the

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beginning of the following legal term then at its widest, his discretion could and should not exceed three months from the date of the pronouncement of the Order. Orders not lodged forthwith and at the very outside within three months should and do automatically lapse. In such circumstances a renewed fresh application to the Court is necessary: such must not only comply with this subsection but also aver to the exact state of the business and affairs of the company as from the date of the pronouncement of the lapsed Order and give a full and satisfactory explanation to the Court as to why its original Order was not complied with in the interim.

This construction has due regard to the apparent object of the section and the character of the legislation to which it belongs.

In the instant case the interim without prejudice order of Quirke J. will be discharged, the company may bring a new or fresh application to the Court in accordance with the terms of this judgment.