Caboche v England No. Scgrg-93-92516 Judgment No. S6784

RE: SOUTHERN EQUITIES CORPORATION LIMITED
(IN LIQUIDATION)
DELORES JEAN CABOCHE v RICHARD ANTHONY
FOUNTAYNE ENGLAND (No.2)
[1998] SASC S6784

Civil

Debelle J

On 10 July 1998 Judge Bowen Pain, a Master of this Court, ordered:

1...... That the examination of Ms D J Caboche pursuant to s596B of the Corporations Law resume on 4 August 1998.

That on or before 27 July 1998 Ms Caboche produce to his chambers

2.1 the accounts of Carindale Land Corporation Pty Ltd for the
financial years ending 30 June 1996 and 30 June 1997; and

2.2 all documents which Ms Caboche has which disclose the terms of
insurance policies which comprise the assets of her superannuation
fund.

Ms Caboche resists these orders. She has made three applications and one appeal relating to them. They are:

An application dated 17 July 1998 to set aside the order of Judge Bowen Pain made on 10 July 1998.

An application dated 24 July 1998 for a stay of the said order or, in the alternative, for an extension of time within which to comply with para 2.2 of the order made on 10 July 1998.

An application dated 29 July 1998 for an extension of time within which to appeal against the order of 10 July 1998.

An appeal against the order of 10 July 1998.

All of these matters were heard together. In a moment, I will state the facts leading to this hearing and explain why all four matters are being heard together.

This is the second occasion on which Ms Caboche has resisted orders that she be examined pursuant to s596B of the Corporations Law. On 1 August 1997 I dismissed her appeal from an order of Judge Bowen Pain requiring her to attend before this Court for examination. Ms Caboche appealed to the Full Court, which, on 23 October 1997, dismissed her appeal. Ms Caboche applied for leave to appeal to the High Court. Pending the hearing and determination of her application for leave to appeal, Ms Caboche applied for a stay of the order requiring her to attend for examination. On 19 November 1997, Lander J refused her application.
The facts leading to the appeal which I dismissed on 1 August 1997 are set out in the reasons for judgment delivered on that date. I incorporate them in these reasons. I repeat the main steps.

1...... The liquidator of Southern Equities Corporation Limited (“SECL”) has been conducting a series of examinations of former officers of SECL and other persons who have taken part or been concerned in the examinable affairs of SECL. SECL was formerly called “Bond Corporation Holdings Limited”. Mr Alan Bond was chairman of directors and executive director of Bond Corporation Holdings Limited before the financial crash of that company and other companies in the Bond Group.

Between 1989 and 1990 Ms Caboche was employed as a financial controller and company secretary of Dallhold Investments Pty Ltd, which was a private company owned and controlled by Mr Alan Bond. Dallhold Investments Pty Ltd was the holding company of SECL, holding slightly more than half of the issued shares in SECL. Ms Caboche is at present an employee of companies controlled by members of the family of Mr Alan Bond. She resides in Perth, Western Australia.
On 7 December 1995 the liquidator of SECL applied for orders pursuant to s596B of the Corporations Law that Ms Caboche and others attend before this Court for examination.
On 8 December 1995 Judge Bowen Pain made a series of orders summoning Ms Caboche and others for examination. Ms Caboche was summoned for examination on 19 February 1996 but the order was not served. The examination of other persons proceeded at different times in 1996.
On 18 March 1996 Judge Bowen Pain ordered that Ms Caboche attend for examination on 1 April 1996.
On 1 April 1996 Ms Caboche attended for examination. Mr Fraser, who appeared for her, applied for an adjournment of the examination on the ground that it was being conducted for an improper purpose. The application was refused. The examination proceeded but was not completed. The examination was adjourned sine die.
The liquidator did not seek to resume the examination of Ms Caboche for some 12 months. The reason lies in the fact that the examination of a person alleged to have a central role in the matters the subject of the examination failed to attend for examination on three separate occasions. In the second half of 1996, that person was overseas and instituted applications in this Court and in another jurisdiction to set aside the orders for examination and appealed against orders dismissing his applications. Ultimately, the examination of that person proceeded in this Court on 7 to 11 April and on 18 April 1997.
On 24 April 1997 the liquidator applied for an order that the examination of Ms Caboche resume. Judge Bowen Pain ordered that Ms Caboche attend for examination on 16 May 1997 and 2 June 1997. The order required her to produce certain documents listed in the schedule attached to the order. That list of documents did not include the accounts of Carindale Land Corporation Pty Ltd for the financial years ending 30 June 1996 and 30 June 1997 or the insurance policies which comprise the assets of the superannuation fund of Ms Caboche.
Ms Caboche asked the solicitors for the liquidator to be excused from attending the examination on 16 May 1997 as she intended travelling overseas. The solicitors for the liquidator informed her that the liquidator would agree to her being excused from attending on 16 May provided that she produce the documents requested before that date and attended for examination on 2 June 1997. Ms Caboche agreed to that proposal.
Ms Caboche did not produce the documents on 16 May. Some of the documents were, however, produced at the examination of another witness and by that witness.
On 2 June 1997 Ms Caboche attended for examination before Judge Bowen Pain. Before the examination resumed, Mr Harris, counsel for Ms Caboche, applied to set aside the order made on 24 April 1997 on the ground that the liquidator had obtained the order for a proper purpose. Judge Bowen Pain dismissed the application and ordered that the examination proceed. Mr Harris then made an application to have the examination stayed pending the hearing and determination of an appeal from the order that the examination proceed. Judge Bowen Pain refused the application. However, when ordering that the examination should proceed, Judge Bowen Pain ordered that the evidence should be taken de bene esse. In the course of the examination, Ms Caboche produced the balance of the documents which she had agreed to produce on 16 May.
On the afternoon of 2 June 1997 counsel for Ms Caboche made an oral application to a judge of this Court seeking a stay of the examination. The examination was then continuing before Judge Bowen Pain. The application was refused. Ms Caboche has not appealed from that order.
On 4 June 1997 Ms Caboche instituted an appeal from the order of Judge Bowen Pain made on 2 June 1997 dismissing her application to set aside the order made on 24 April 1997 requiring her to attend for examination.
I heard the appeal on 4 July 1997. On 11 July 1997, when the preparation of the reasons for judgment of the appeal was well advanced, Ms Caboche applied for leave to amend her application to set aside other orders requiring her to attend for examination. I allowed the application to amend. That application was heard on 14 July. Because of the commitments of counsel, it could not resume until 29 July. The resumed hearing was heard on 29 and 30 July 1997.
On 1 August 1997 I published my reasons for judgment and dismissed the appeal. I also dismissed the application dated 11 July 1997 and other applications made in the course of hearing that application.
Ms Caboche appealed to the Full Court against my decision. On 23 October 1997 the Full Court dismissed her appeal.
Ms Caboche applied for leave to appeal to the High Court. She also applied for an order staying the order that she attend for examination. On 19 November 1997, Lander J dismissed her application.
The application for leave to appeal to the High Court has not yet been heard.
On 24 November 1997 the examination of Ms Caboche resumed. Mr Whitington QC then appeared for the liquidator and Mr Cudmore for Ms Caboche. Included in the questions asked during the examination were questions relating to the Carindale Land Corporation Pty Ltd and Ms Caboche’s superannuation arrangements. It is those questions which lead to the issues which I must now decide.
I will, in a moment, describe in more detail the events of 24 November 1997. For the present, it is sufficient to note that, during examination, Ms Caboche undertook to provide two classes of documents, namely:
(1) The accounts of Carindale Land Corporation Pty Ltd for the year ended 30 June 1996 and 30 June 1997. I will refer to those documents as “the Carindale documents”.
(2) Documents disclosing the assets of Ms Caboche’s superannuation fund including insurance policies. I will refer to these documents as “the superannuation documents”.
Ms Caboche undertook to provide the Carindale documents “within the next day or two”. In the case of the superannuation documents, she undertook to make them available to her solicitor who might then make further representations as to their availability. She said that the superannuation documents were not immediately to hand and that it might take as long as one month to locate them.
The topic of her superannuation arrangements and the superannuation documents was the last topic on which Mr Whitington QC questioned Ms Caboche on 24 November 1997. When Ms Caboche gave the undertaking to produce the documents to her solicitors in about one month’s time, Mr Whitington QC asked that the examination be adjourned. He said:
......... “We’ve got nothing further. In view of the undertaking, we ask that the examination be adjourned.”
When asked if he wished to re-examine Ms Caboche, Mr Cudmore said that he did not. Judge Bowen Pain asked Mr Whitington QC to undertake on behalf of the liquidator to write to Ms Caboche at her solicitors seeking the documents she had undertaken to produce during the examination that day. There were four classes of documents. They included the Carindale documents and the superannuation documents. Mr Whitington QC gave the undertaking and the examination of Ms Caboche was adjourned to a date to be fixed.
On 28 November 1997 Ward & Partners, solicitors for Ms Caboche, sent a letter to Fisher Jeffries, the solicitors for the liquidator, enclosing one of the documents which Ms Caboche had undertaken to produce and stating that, despite a search, she had not been able to find another of the class of documents which she had undertaken to produce. The letter said nothing as to the production of either the Carindale documents or the superannuation documents.

On 30 November 1997, before they had received the letter dated 28 November 1997, Fisher Jeffries wrote to Ward & Partners listing the documents Ms Caboche had undertaken to produce. That letter was plainly written in order to honour the undertaking given on behalf of the liquidator by Mr Whitington QC. In that letter Fisher Jeffries asked for the Carindale documents to be produced forthwith and for the superannuation documents to be produced within one month.

On 3 December 1997 Fisher Jeffries wrote a letter to Ward & Partners in response to the letter from Ward & Partners dated 28 November which had obviously crossed their letter of 30 November. The material part of the letter reads:

......... “We note that your letter does not address Ms Caboche’s superannuation and insurance documents referred to in our letter dated 30 November 1997. Please confirm that the retrieval of these documents is under way.”

On 4 December 1997 Ward & Partners wrote a letter to Fisher Jeffries concerning two of the classes of documents Ms Caboche had undertaken to produce. The letter did not refer to either the Carindale documents or the superannuation documents or in any other way respond to the request in the letter of 3 December.

On 6 April 1998 Fisher Jeffries sent another letter to Ward & Partners reminding them of the undertakings given by Ms Caboche to produce both the Carindale documents and the superannuation documents. The letter asked that Ms Caboche immediately produce the documents.

Fisher Jeffries did not receive any response from either Ms Caboche or Ward & Partners to their letter of 6 April 1998.

On 25 May 1998 Fisher Jeffries wrote again to Ward & Partners referring to the letter of 6 April 1998. The letter sought an immediate reply and added that, if Ms Caboche failed to comply with her undertakings, “we will have no alternative but to seek to call the matter on again before the Master.”

Fisher Jeffries have not received any response to their letter of 25 May 1998 from either Ms Caboche or Ward & Partners.

It will have been noticed that by the time Fisher Jeffries wrote on 25 May 1998, six months had elapsed since Ms Caboche had given her undertaking to produce the Carindale documents and the superannuation documents. The documents had not been produced notwithstanding several requests that she do so. In that period of six months, Ms Caboche had neither objected to the production of the documents nor applied to be released from her undertaking. I resume the narrative.

On 30 June 1998 Fisher Jeffries issued an application seeking orders that the examination of Ms Caboche resume and that she forthwith comply with her undertakings to produce the Carindale documents and the superannuation. It is important to note the terms in which the application was couched. For present purposes, it is sufficient to refer to paragraphs 1, 2 and 3 of the application.
“1..... That the examination of Delores Jean Caboche pursuant to Section 596B of the Corporations Law adjourned on 24 November 1997 to a date to be fixed be resumed on the earliest available date convenient to this Honourable Court.
2...... That Delores Jean Caboche forthwith comply with the Undertaking given by her on 24 November 1997 by producing to this Honourable Court the financial accounts of Carindale Land Corporation Pty Ltd for the years ended 30 June 1996 and 30 June 1997.
3...... That Delores Jean Caboche forthwith comply with the Undertaking given by her on 24 November 1997 by producing to her solicitor documents disclosing the assets of her superannuation fund including insurance policies.”
Paragraphs 4 to 7 of the application sought ancillary orders.

The application was heard by Judge Bowen Pain on 10 July 1998. Both the liquidator and Ms Caboche were represented. After hearing argument, Judge Bowen Pain made the following orders:
1. That the examination of Delores Jean Caboche resume on Tuesday
the 4th day of August 1998 at 2pm.

2. That on or before Monday the 27 July 1998 Delores Jean Caboche
produce to my chambers:

(a) The accounts of Carindale Land Corporation Pty Ltd
for the financial years ended 30 June 1996 and 30 June 1997.

..................         (b)     all the documents which Delores Jean Caboche has which
..................                   disclose the terms of the insurance policies which comprise
..................                   the assets of the superannuation fund of Delores Jean Caboche.

......... It will have been noticed that paragraph 1 of the order does no more than order the resumption of the examination, that is to say, the resumption of the examination which had been adjourned on 24 November 1997.

On 17 July 1998 Ward & Partners issued an application on behalf of Ms Caboche to set aside the orders made on 10 July 1998. The application was listed for hearing before Judge Bowen Pain on 30 July 1998.

On 24 July 1998 Ward & Partners issued an application on behalf of Ms Caboche seeking a stay of the orders made on 10 July 1998 pending the disposal of the application to set aside those orders. In the alternative, Ms Caboche applied for an extension of time within which to comply with para 2.2 of the order.

On 28 July 1998 I heard the application for a stay and extension of time in which to produce the documents. In the course of the application, I questioned whether Ms Caboche could apply to set aside the order made on 10 July since that order had been made at an inter partes hearing and after both parties had been heard. I suggested that the proper remedy was an appeal. After hearing the parties, I made the following orders:

1. Vacating the hearing before Master Bowen Pain at 12.30pm on
30 July 1998.

2. Appointing 2.15pm on 31 July 1998 for the hearing by me on the
applications to set aside the order dated 10 July 1998, the application
for extension of time in which to appeal from the said order and the
appeal if the extension be granted.

3. Question of costs reserved.

On 29 July 1998 Ward & Partners made an application on behalf of Ms Caboche seeking an extension of time within which to appeal against the order of Judge Bowen Pain dated 10 July 1998. The intended Notice of Appeal was exhibited to an affidavit of Mr P A Govey sworn in support of the application.

On 31 July 1998 I heard all of the applications made by Ms Caboche, namely,

(1) the application to set aside the orders of Judge Bowen Pain made
on 10 July 1998;

(2) the application for a stay of the order of 10 July 1998, or
alternatively, the application for an extension of time within
which to comply with the order;

(3) the application for an extension of time within which to appeal
against the order made on 10 July 1998;

(4) the appeal against the order made on 10 July 1998.

It is convenient to deal first with the substance of the matter. I will return to the procedural issues.

The Carindale documents and some of the documents relating to Ms Caboche’s superannuation fund have been produced to this Court. They have been placed in a sealed envelope exhibited to an affidavit of Mr Cudmore sworn on 27 July 1998. In the course of the hearing, Mr White QC expressly abandoned any opposition to production of the superannuation documents.
The submission of Mr White QC, who appeared for Ms Caboche, did not rely on all of the grounds listed in the Notice of Appeal. His submission was founded on the premise that the liquidator was seeking a fresh examination of Ms Caboche. He contended that it was necessary for a fresh affidavit to be sworn pursuant to s596C to justify the order and that, as such an affidavit had not been sworn, Judge Bowen Pain should not have made his order on 10 July 1998. He sought to reinforce that submission by stating that the affidavit of Mr J D Karas sworn on 30 June 1998, the only affidavit in support of the application, did not address the liquidator’s purpose but merely recited the events on 24 November 1997 and the subsequent correspondence between the parties. Events have occurred since 24 November 1997, he said, which required a contemporaneous exhibit to justify the examination. He added that the liquidator’s purpose could only be gleaned from the transcript of proceedings on 10 July 1998 and that was contrary to the liquidator’s obligation to disclose his purpose in an affidavit, an obligation to which the attention of this liquidator had been drawn by Lander J in Bond and Caboche v England (1997) 194 LSJS 401 at 440-441. According to Mr White QC, the liquidator had an ulterior purpose which had been mentioned on 24 November by Mr Whitington QC, who had then appeared as counsel for the liquidator. I will return to this final aspect of Mr White’s submission. It is convenient to deal first with his primary submission that this was an order for a fresh examination and no affidavit had been filed in compliance with s596C.
There are, in effect, two separate issues. The first concerns the propriety of the order that this examination resume. The second concerns the order that the Carindale documents be produced.
It is convenient to be reminded of the essential features of the events which lead to this application.

1...... On the application of the liquidator supported by affidavit, the Master ordered Ms Caboche to attend for examination.

After attending for examination on 1 April 1996 and before examination on 2 June 1997, Ms Caboche sought to set aside the order. The application was refused.

Ms Caboche appealed to every court available to her against the decision refusing to set aside the order for examination. Her appeals to this Court have been dismissed.

Her appeals having been dismissed, Ms Caboche was ordered to attend for examination on 24 November 1997.

In the course of examination on 24 November 1997, Ms Caboche undertook to produce, among other things, the Carindale documents and the superannuation documents. On her undertaking to produce the superannuation documents, the examination was adjourned to a date to be fixed.

Ms Caboche has not produced the Carindale documents and has, therefore, failed to honour her undertaking. Her consent to produce the superannuation documents was not given until during the course of this hearing on 31 July 1998.

On 30 June 1998 the liquidator applied for resumption of the examination for production of both the Carindale documents and the superannuation documents.

On 10 July 1998 Judge Bowen Pain did no more than order the resumption of the hearing and the production of the Carindale documents and the superannuation documents.

Thus, this is not a fresh examination of Ms Caboche but a continuation of an existing examination ordered by this Court. Ms Caboche has failed in all her attempts to have the order that she attend for examination set aside. It is those essential features of the events so far which demonstrate the flaw in Mr White’s submission that this is a fresh examination. It plainly is not. The examination is a resumption of the examination which, on 24 November 1997, had been adjourned to a date to be fixed. This is sufficient to dispose of the submission that this is a fresh examination. But there are other grounds on which it fails and I turn to them.

Mr White’s submission also betrays a misunderstanding as to the effect of both s596B and of the initial order that Ms Caboche be examined and later orders that the examination be resumed. All of those orders were examined by me and the Full Court in the course of the appeals by Ms Caboche. Section 596B(1) authorises the Court to summon a person for examination upon being satisfied as to the matters recited in s596B(1)(b). Judge Bowen Pain held that he was satisfied of those matters and ordered that Ms Caboche attend for examination. His decision has been upheld on appeal. No direction as to the matters to be enquired into at the examination has been given pursuant to s596F(1)(a). Given that the order for examination has been made and upheld on appeal, the liquidator is at liberty to examine those ordered to attend for examination about any matter which is an examinable affair of SECL. The liquidator is, therefore, entitled to examine Ms Caboche about the examinable affairs of SECL.
The definition of “examinable affairs” is wide: ss9 and 53 of the Corporations Law. It is well settled that information with respect to the probability or otherwise of success in litigation contemplated by a corporation which is in liquidation is information with respect to the examinable affairs of the corporation, and that an enquiry as to the existence and value of any property that the corporation may possess is a relevant enquiry for the purpose of s597(9). There is a substantial body of authority to that effect. It is sufficient to refer to Grosvenor Hill (Qld) Pty Ltd v Barber (1994) 48 FCR 301, 305-306. It is also well settled that the liquidator may enquire as to the worth of a potential defendant so as to be able to make a practicable assessment as to the likelihood of a return to the corporation of the fruits of any favourable judgment and the costs expended in obtaining it: see Grosvenor Hill (Qld) Pty Ltd v Barber (supra) at 307-312 for the statement of the principle and the circumstances in which the power to order the examination will be exercised, and see also Gerah Imports Pty Ltd v Duke Group Ltd(in liq) (1993) 61 SASR 557. The power to obtain information from a defendant or potential defendant as to the ability of that person to satisfy any judgment which may be obtained in litigation instituted by the liquidator is to facilitate the realisation of the chose in action to the best advantage of the company and its creditors and, as such, is an examinable affair: Grosvenor Hill (Qld) Pty Ltd v Barber (supra) at 311. The liquidator is, therefore, entitled to examine Ms Caboche on the capacity of potential defendants to satisfy any judgment the liquidator might obtain against them.
In his affidavit sworn in support of the order to examine Ms Caboche and others, the liquidator asserted his belief that SECL may be entitled to institute proceedings to recover any loss occasioned by dealings in paintings which he alleged were owned by SECL. He said that he sought the examinations to assess the prospects of success. Even if the examination by the liquidator is limited to that issue, it does not prevent him from examining Ms Caboche as to the capacity of defendants or potential defendants to satisfy any judgment. The liquidator also instituted the action No 113 of 1996 in which he seeks damages in relation to what he alleges were wrongful dealings in the paintings. It is legitimate in the course of an examination pursuant to s596B to ask questions of a defendant in the action No 113 of 1996 as to the defendant’s ability to satisfy any judgment which the liquidator might secure against that defendant. Ms Caboche is a defendant in action No 113 of 1996. The liquidator is, therefore, entitled to question Ms Caboche on that topic. In this context, it is relevant to note that Mr Cudmore, who appeared for Ms Caboche at the examination on 24 November 1997 and at the hearing before Judge Bowen Pain on 10 July 1998, recognised on both occasions the entitlement of the liquidator to ask questions of Ms Caboche concerning her capacity to satisfy any judgment which might be obtained against her. I refer to pages 200-202 in the transcript of proceedings of the examination on 24 November 1997 and to page 8 of the transcript of the hearing before Judge Bowen Pain on 10 July 1998 when Mr Cudmore said that “the only purpose for which Ms Caboche was ordered to be examined is.... as to say investigations into the artworks and the prospects of recovery.” (Emphasis added)
The next question is whether the liquidator, when seeking information as to Carindale Land Corporation Pty Ltd, is seeking to extend the examination beyond an enquiry into dealings with the paintings and the prospects of recovering any judgment which he might obtain. The answer to that question lies in an examination of the transcript of 24 November 1997.
After some questions concerning other topics, questions to which no objection was taken, Mr Whitington QC asked Ms Caboche about her knowledge of the affairs of Carindale Land Corporation Pty Ltd (“Carindale”). His examination on this topic is contained in pages 185 to 196 of the transcript of the examination. The topics on which she was asked questions were:
her knowledge of the affairs of Carindale
her appointment as secretary of Carindale in July 1994 and as a director of Carindale in December 1996
the appointment and retirement of other directors of Carindale
that she and Mr John Bond are the current directors of Carindale
the extent of her involvement in the affairs of Carindale
her knowledge as to who signs cheques on behalf of Carindale
the nature of the business of Carindale and its present trading
whether she had the accounts of Carindale for the years ending 30 June 1996 and 30 June 1997 in her possession and her undertaking to produce those accounts
whether the present shareholders of Carindale are Mr Craig Bond and Mr William Redmond and whether those shareholders are the beneficial owners of Carindale

(10)her knowledge of the income tax returns prepared on behalf of Carindale
(11)her knowledge of the involvement of the company called Hastings Finance Pty Ltd in the affairs of Carindale.

The questions concerning the identity of the beneficial ownership of Carindale prompted an objection from Mr Cudmore. While acknowledging that the questions were “directed to the liquidator informing himself as to the prospects of making recovery”, he protested that Ms Caboche had already answered the questions to the best of her ability. Mr Whitington QC acknowledged that the reason for the question was to ascertain the prospects of making recovery of any judgment in favour of the liquidator. Thus, Mr Cudmore did not object to questions going to the prospects of recovery. His objection was limited to the repetition of questions which, he said, had already been answered. In effect, he was submitting only that the questions were oppressive. It is, therefore, apparent from a reading of the transcript that the examination did not proceed beyond its proper bounds.

Mr White QC relied on submissions made by Mr Whitington QC at the examination on 24 November when dealing with one other objection by Mr Cudmore as to the course of questions concerning Carindale. After a question seeking to identify the shareholders in Carindale, the nature of the business of Carindale and those responsible for its day to day management, Mr Whitington QC asked who was an organisation called Deller Walter. Mr Cudmore objected. The following exchange occurred.
“MR CUDMORE: I object to this line of questioning. In my submission, the question is now being asked beyond what comes within the definition of ‘examinable affairs’ for the purposes of ss.9 and 53 of the Corporations Law. Companies about which questions are now being asked do not relate to the affairs or the examinable affairs of the company in liquidation, but I have nothing more, having not seen the affidavit sworn in support of the orders for examination, as to why that might be or might not be the case.
MR WHITINGTON: The authorities are clear that the liquidator is entitled to examine to obtain information going to the prospects of recovery in any particular matter. Other examinees have been asked about this company and in one particular case we didn’t get very far. I hope to get a bit further here, but this is a matter that goes directly to the prospects of recovery against certain people in respect of courses of action which the liquidator is presently exploring. (Emphasis added)
QUESTION ALLOWED”

Further questions showed that Deller Walter is a firm of engineers involved in assisting Carindale in developing land.

Mr White QC submitted that the words I have emphasised in Mr Whitington’s submission disclose that the liquidator has an ulterior purpose. The expression “other courses of action which the liquidator is presently exploring” may indicate an intention to take other steps or institute other proceedings in addition to the action No 113 of 1996. It is difficult to determine whether Mr Whitington QC intended to go so far. But even if he did, I do not think the line of questioning becomes inadmissible. The answers given by Ms Caboche show that Mr Craig Bond is one of the shareholders of Carindale and Mr John Bond is a director of that company. Both are defendants in action No 113 of 1996. Questions on such topics as the control of Carindale, its shareholdings, the holders of the beneficial interests, the nature of its activities, its profits and its profitability are very material to the question of Mr Craig Bond’s ability to satisfy any judgment the liquidator might obtain in action No 113 of 1996. In my view, the principles expressed in Grosvenor Hill (Qld) v Barber (supra) extend to permit questions concerning assets of other defendants available to satisfy a judgment. The fact that the answers to the questions might also assist the liquidator in other ways does not, I think, in the particular circumstances of this case, preclude the liquidator from pressing this line of questioning. It is, of course, important that the Master conducting the examination is alert to ensure that the questions do not go beyond the purpose of Craig Bond’s ability to satisfy a judgment in action 113 of 1996. In this respect, it is relevant to note that the Master has the benefit of assistance from counsel for Ms Caboche, so it is likely, therefore, that the liquidator’s enquiry will be confined within proper limits.
To summarise, Judge Bowen Pain has done no more than order the resumption of an examination which he had earlier ordered, an order which this Court has twice held to be an order which was properly made. The arguments advanced by Ms Caboche that the order is invalidated by the absence of a further affidavit from the liquidator are misconceived and have no foundation. There is no reason why the order that the examination resume should be set aside.
Mr White QC was driven to submit that if this was no more than the resumption of an examination which had been adjourned to a date to be fixed, it would have been sufficient for the liquidator to have made a simple request to the Master, who would then have fixed a date for resumption. He added that the fact that the liquidator made the written application on 30 June 1998 supported by an affidavit by Mr Karas indicated that this was a new examination. That conclusion was, he said, reinforced by the fact that Judge Bowen Pain made the order on 10 July 1998 for resumption of the hearing and the production of the documents. I mean no discourtesy, but I am bound to say for the reasons which follow, that this is a bootstrap argument.
Ms Caboche is in breach of undertakings she gave to the Court to produce both the Carindale documents and the superannuation documents. Despite being reminded on several occasions of the terms of her undertaking, Ms Caboche has failed to honour them. The liquidator not only wanted his examination to resume but it is reasonable to infer that he also wanted Ms Caboche to produce the documents before the resumption so that he could ask any questions those documents might prompt concerning the prospects of recovery of a judgment. That is an obvious and reasonable inference to draw, particularly given that the examination on 24 November 1997 was adjourned once Ms Caboche had given her undertaking to produce the superannuation documents and other documents. The fact that the liquidator sought an order from the Court compelling Ms Caboche to produce the very documents which she had failed to produce in breach of her undertaking should not be used as a ground to defeat the liquidator pursuing his legitimate enquiries. In any event, as already noted, the liquidator has been careful to seek an order to resume the examination. He has not sought a fresh examination. The fact that the liquidator adopted this course instead of merely asking for a resumption does not justify the conclusion that he is seeking a fresh examination. Ms Caboche seeks to make altogether too much of the fact that one procedure was adopted instead of another.
I come to the orders for production of the documents. The effect of the submissions made on behalf of Ms Caboche is to seek to canvass the ruling made by Judge Bowen Pain on 24 November 1997 that questions concerning Carindale were a legitimate enquiry. Ms Caboche did not appeal from that ruling. Despite several requests for the documents, she did not make any objection to the ruling until the liquidator made his application dated 30 June 1998. For over six months, she has sat on her hands and done nothing. Only when the liquidator took steps to seek orders requiring her to comply with her undertaking does she object. Ms Caboche does not proffer any explanation for the delay. Neither does she proffer any explanation for failing to respond to the letters from Fisher Jeffries seeking production of the documents. This may be yet another instance of an eleventh hour attempt by her to delay the liquidator in making his proper enquiries. Although the conduct of Ms Caboche is open to the most severe criticism, I do not decide the matter on that basis. It is sufficient to observe that it is now too late for her to seek to canvass Judge Bowen Pain’s ruling on 24 November 1997. I add also that, for the reasons already given, the production of the Carindale documents can be required as part of a legitimate enquiry as to the prospects of the liquidator to recover should he obtain judgment.
Moreover, Ms Caboche gave an undertaking to the Court. She is an accountant with many years experience. She has acted as the accountant or secretary of substantial companies. It is reasonable to infer from her background and experience, as I do, that she would have been well aware of the significance of the undertaking and that it imposed upon her a clear obligation to produce documents in order to honour her undertaking given under oath to a judicial officer. It was submitted on behalf of the liquidator that this was a solemn undertaking similar in kind to, say, the undertaking as to damages given in support of an application for an interlocutory injunction and other like undertakings. It is unnecessary to determine that question. It is sufficient to note that the undertaking imposed a clear obligation upon Ms Caboche to produce the documents. There is no reason why she should be released from her undertaking. She must produce the Carindale documents to Judge Bowen Pain.

The Procedural Questions

Given the order made by Judge Bowen Pain made on 10 July 1998 was made at an inter partes hearing and after both parties had been heard, it was inappropriate to seek to set aside that order. Rule 84.12 does not authorise such an application in the circumstances of this case. I adopt the reasoning of Judge Burley in Monte Paschi Aust Ltd v Manno (unreported 15 October 1996 Jdt S5837). The proper course was to institute an appeal against the order. The application for an extension of time within which to appeal was made on 29 July 1998. The appeal should have been instituted by no later than 25 July 1998. The application for extension of time within which to appeal was made four days late. However, the application to set aside the order had been made on 17 July 1998. Thus, before the time in which to appeal had expired, Ms Caboche had given the liquidator notice of her intention to challenge Judge Bowen Pain’s order of 10 July. The fact that for more than six months Ms Caboche has not sought to challenge the ruling tells against the exercise of a discretion in the favour of this application. Ms Caboche should not be prejudiced by failure to adopt the correct procedure in circumstances where she has given the liquidator unequivocal notice of a challenge to an order he has obtained against her and that notice has been given within the time in which to institute an appeal. It has not been suggested that the liquidator has been prejudiced by the delay of four days and, in all the circumstances, it is difficult to identify any prejudice to him.
For these reasons, I extend the time within which Ms Caboche can appeal to 29 July 1998. The Notice of Appeal exhibited to the affidavit in support of the application will be deemed to have been issued on 29 July 1998. For the reasons I have given, the appeal will be dismissed.
As Ms Caboche has already produced the Carindale documents to the Court, there is no occasion to extend the time within which the documents should be produced. As I have dismissed the appeal, there is no ground for a stay of the order of 10 July 1998 requiring production of the documents to the liquidator. For all of these reasons, there will be orders as follows:

1...... That the application of Ms Caboche dated 17 July 1998 to set aside the orders dated 10 July 1998 be dismissed.

That the application of Ms Caboche dated 24 July 1998 for a stay of the orders made on 10 July 1998 and, in the alternative, for an extension of time within which to comply with the said orders be dismissed.

That the time within which Ms Caboche might appeal against the order made on 10 July 1998 be extended to 29 July 1998.

That the Notice of Appeal which is exhibit “PAG1” to the affidavit of Mr P A Govey sworn on 29 July 1998 be deemed to be the Notice of Appeal.

The appeal against the orders made on 10 July 1998 be dismissed.

I will hear the parties on the question of the costs of these applications and of the appeal.

After these reasons had been published, Fisher Jeffries drew my attention to a fact not stated in the course of the hearing that the application to set aside the order had not been served until 27 July 1998. Thus, notice was not given to the liquidator of any challenge to his order made on 10 July. The notice was two days after the time for appeal had expired. The fact that it is two days late does not cause me to alter the above conclusions as that is but a short period out of time and there is no prejudice.

[1998] SASC 6784

3 August 1998