The Superior Court decision in Caning Construction Limited v. Dhillon finds that a bankruptcy proceeding was not an alternative process that could impact on the appropriateness of a civil action. The bankruptcy proceeding could have determined damages in the civil action, but not its merits. Further, in the circumstances the case, there was no reasonable prospect of the bankruptcy proceeding making the plaintiff whole and so a civil action was always going to be necessary for full recovery:
[56] As in both Gravelle and Lilydale, the Westport bankruptcy proceedings could not resolve the legal dispute involving Mr. Dhillon. Here, Canning knew it had a claim in negligence against the Defendants before the bankruptcy proceedings against Westport were concluded. Although the bankruptcy could have determined the amount of damages to be sought in the civil action, the proceedings could not determine the legal issues between the parties and were therefore not an alternative means of resolving the negligence allegations. I conclude that the Westport bankruptcy proceedings are not an alternative process which delays the start of the limitation period in the action against the Defendants.
[57] Even if a bankruptcy proceeding is an alternative remedy which could have the effect of delaying the start of the limitation period, it is my view that it does not do so in the circumstances of this case. Section 5(1)(a)(iv) of the Act is subject to the modified objective test. The determination of when a plaintiff “discovered” that the legal action against the defendant was legally appropriate takes into account what a reasonable person with the abilities and in the circumstances of the plaintiff ought to have known. Here, Canning had an unsecured claim in the amount of $1,638,018.89. Based on the secured claims and assets of Westport as set out in the Statement of Affairs, there was no reasonable expectation that unsecured creditors would be fully compensated for their claims. I conclude that a plaintiff with the abilities and in the circumstances of Canning would have known that it would not fully recover its claim in the Westport bankruptcy and therefore would have known that a tort action against the Defendants was legally appropriate before the bankruptcy proceedings were completed.