COVID-19 – BE READY FOR COURT SUMMONSES DURING WORK SHUTDOWNS – CHECK YOUR MAIL REGULARLY
Many Victorian businesses have already ceased operations from offices, factories, warehouses, hotels and restaurants.Many accountancy offices are also closing down with staff electing to work from home.Those offices may be left unattended for days or even weeks.
It is possible that Victoria will move to Stage 3 or 4 level shutdowns in the immediate future, which will compel all businesses to cease operation and to work from home where that is possible.
Businesses should be aware that companies may still be served with legal process at their registered office by mail during any shutdown.Normally, a company’s registered office may be a place where that company does not carry on business.The most common example would be an accountant’s office.Equally, where the company’s registered office is the place where it does carry on business, that may be closed due to Government COVID-19 restrictions.
Although Victoria’s courts are operating on a restricted basis, court processes such as the issuing of summons and writs and the processing of default judgements will continue online.Judicial Form processing will continue remotely.Staff are continuing to process those documents.This means that a summons, writ or originating motion that is served by post on a registered office which is not functioning may go unnoticed until well after the time for appearance or for notice of defence required under court rules.This means that default judgments may be entered by the issuing plaintiff.
Such judgments may be able to be set aside in the future as a result of the COVID-19 emergency.However, being able to avoid the affect of clear court rules is never easy, even in these exceptional times.Also, default judgments will still be registered by ASIC and by credit reporting agencies.A business’s crediting rating may be adversely affected at a time of great economic uncertainty.
Another relevant issue is the service of statutory demands.Normally, statutory demands can be issued against a company at its registered office for debts for as little as $2,000.00.The Federal Government has enacted amending legislation to operate between 24 March 2020 and ending on 25 September 2020, which means that a statutory demand will not be able to be issued for amounts less than $20,000.00.A company’s time to respond to the notice will increase from 21 days to 6 months.These are important relaxations of the statutory demand rules, which will assist debtors considerably.
Nevertheless, De Marco Lawyers’ message to businesses is that one of the important components of a business’s emergency response plan will be to ensure protocols for the regular collection and supervised checking of all mail addressed to its business addresses as well as to their registered office address.If this is with an accountant, businesses must contact their accountants and make arrangements for mail to be collected by that firm and sent by email to the directors and senior managers for on-forwarding.
Businesses will need to determine whether or not they should request their accountants to organize mail redirections so that all mail is sent to their own post offices or to the home address of a responsible director or senior manager.In the same way, electronic communication to the company’s email addresses will also need to be checked.One can imagine the chaos that could occur if emails were being sent to absent workers advising of important and legally significant events, which, due to an office close-down, went ignored and unanswered.Businesses will need to ensure that such emails are, at the very least, re-directed or that employees are set up safely at home to be able to receive such emails directly.
De Marco Lawyers have expertise in the formulation and implementation of emergency response protocols and remain operational to assist clients prepare for and undergo transition working arrangements should progressive shutdowns require remote working solutions.
If any of our clients require further information in relation to this article, they are requested to contact the following:
Michael Pickering – Managing Principal (firstname.lastname@example.org)
Michael Tourkakes – Dispute Resolution Principal (email@example.com)
Max Van de Garde – Lawyer (Max.Vandegarde@demarco.com.au)
This article is intended only to provide a summary of the subject matter covered. It does not purport to be comprehensive or to render legal advice. No reader should act on the basis of any matter contained in this article without first obtaining specific professional advice.
DISCLAIMER: We accept no responsibility for any action taken after reading this article. It is intended as a guide only and is not a substitute for the expert legal advice you can get from De Marco Lawyers and other relevant experts.