Aquila Resources Ltd v Pasminco Ltd (Administrators Appointed)

Aquila Resources Ltd and Aquila EHM Pty Ltd sought pre-action discovery orders against Pasminco Ltd and MIM Holdings Ltd. The applicants sought documents from the respondents for the period 23 February to 31 March 2001 relating to a transfer notice, a proposed extension of the pre-emption period, and the obligation to make payment of a termination fee. The applicants argued that they may have a cause of action against the respondents based on allegations of misleading and deceptive conduct by Pasminco, and knowing involvement by MIM. The respondents argued that the applicants had not made reasonable enquiries and that there were no reasonable grounds for believing that the respondents had relevant documents. Master Sanderson held that the applicants had established that they wanted to commence proceedings against the respondents, that they had made reasonable enquiries, and that they had not obtained sufficient information to enable a decision to be made whether to commence proceedings. The Master was satisfied that there were reasonable grounds for believing that the respondents had documents that may assist in the applicants making their decision. Discovery orders were made in favour of the applicants against the respondents. The respondents were ordered to provide verified discovery of documents in the period 23 February to 31 March 2001 relating to a transfer notice, an extension, proposed extension and any communications, understanding, arrangement or agreement in relation to an extension, or any proposed extension, of the period for MIM to exercise rights of pre-emption in 2001 in relation to shares in Ernest Henry Mining, and the obligation to make payment to the applicants of a termination fee by Pasminco pursuant to a deed of commitment. The respondents were to provide evidence as to the costs of providing discovery and indicate the basis upon which the costs are calculated. The applicants should have the chance to respond. The costs of the application itself were to be reserved.