Expile v Jabb's Excavations - [2003] NSWSC 786

CITATION: Expile v Jabb's Excavations [2003] NSWSC 786

HEARING DATE(S): 15 August 2003

JUDGMENT DATE:
15 August 2003

JURISDICTION:
Equity

JUDGMENT OF: Austin J

DECISION: Notice to Produce set aside

CATCHWORDS: PRACTICE & PROCEDURE - plaintiff's Notice to Produce issued to company in administration, partly complied with by administrator - Court decides it would be oppressive to require further answer - creditors resolve to execute deed of company arrangement - Plaintiff then serves Notice to Produce in identical terms, in anticipation of challenging creditors' decision and deed - whether second Notice to Produce should be set aside

LEGISLATION CITED: Corporations Act 2001 (Cth) ss 286, 440A, 444E, 445D 459R, 467, 1321
Corporations Regulations, reg 5.3A

CASES CITED: Bovis Lend Lease v Wily [2003] NSWSC 467

PARTIES :
Expile Pty Ltd (P)
Jabb's Excavations Pty Ltd (D)

FILE NUMBER(S): SC 1887/02

COUNSEL: S Epstein SC (P)
D Allen (D)

SOLICITORS: Baron and Associates (P)
Middletons (D)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

AUSTIN J

FRIDAY 15 AUGUST 2003

1887/02 EXPILE PTY LTD V JABB’S EXCAVATIONS PTY LTD

JUDGMENT (Ex tempore; revised 19 August 2003)

1 HIS HONOUR: The plaintiff brought this proceeding for an order for the winding up of the defendant. The proceeding was heard by Barrett J, who dismissed the application to wind the defendant up, but there was an appeal by the plaintiff to the Court of Appeal, which delivered its reasons for judgment on 24 June 2003. The Court of Appeal allowed the appeal against Barrett J’s decision, set aside his Honour's orders, and ordered that the plaintiff's costs as appellant and at the trial be paid out of the assets of the respondent company.

2 Between argument concluding in the Court of appeal and judgment being handed down on 24 June, an administrator was appointed to the company. Consequently, the orders that would have been made by the Court of Appeal for the winding up of the company in insolvency were deferred in order to allow an opportunity for an application to be made for the company to continue in administration, rather than to be wound up. The application that the Court of Appeal had in mind was an application under s 440A(2) of the Corporations Act.

3 Eventually, orders were made for that application to be heard in the Equity Division, and it was heard by Campbell J on 18 July 2003. The hearing of the matter was not concluded on 18 July, although by the end of that day counsel had commenced their final addresses.

4 On the next working day, Monday 21 July, a Notice to Produce was served on the administrator of the company seeking various documents that would, in broad terms, give details about the creditors of the company and the basis for believing that particular people were creditors in particular amounts. Some photocopy documentation was produced in response to that Notice to Produce, but when the matter returned before his Honour on 24 July 2003, there…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2003] NSWSC 786
Decision Date: 15 August 2003

CaseChat Overview and Summary

In this case, the plaintiff, Expile, issued a Notice to Produce to Jabb's Excavations, a company in administration. The Notice sought the production of various documents, and the administrator of the company provided a partial response. The Court found that requiring the company to provide further information would be oppressive, given its administration status. Subsequently, the creditors of Jabb's Excavations agreed to a deed of company arrangement, and the plaintiff issued a second Notice to Produce, identical to the first, anticipating the possibility of challenging the creditors' decision and the deed. The court was required to decide whether the second Notice to Produce should be set aside.

The primary legal issue was whether the second Notice to Produce should be set aside, given that the first Notice had already been partly complied with and the Court had determined that it would be oppressive to require further information from the company. The court also considered whether the plaintiff's intention in issuing the second Notice to Produce was an abuse of process, given that the company was now in the process of being restructured under the deed of company arrangement. The court found that the second Notice to Produce should be set aside, as it would be oppressive to require the company to provide further information, and the plaintiff's intention in issuing the second Notice appeared to be an abuse of process.

The court determined that setting aside the second Notice to Produce was necessary to prevent an abuse of process and to avoid placing an undue burden on the company in administration. The Court found that the plaintiff's actions in issuing the second Notice to Produce were an abuse of process, given that the company was in the process of being restructured under the deed of company arrangement. The court emphasised the importance of ensuring that the administration process was not interfered with unnecessarily, and that the rights of all parties involved were protected. The court ordered that the second Notice to Produce be set aside, and that no further steps be taken to enforce it.

Orders