In the matter of FSM Development Pty Ltd (in liq)

[2025] NSWSC 988

Supreme Court

New South Wales

Medium Neutral Citation:

In the matter of FSM Development Pty Ltd (in liq) [2025] NSWSC 988

Hearing dates:

25 August 2025

Date of orders:

25 August 2025

Decision date:

28 August 2025

Jurisdiction:

Equity - Corporations List

Before:

Black J

Decision:

Stay orders for examinations with liberty to apply to lift stay and orders as to document production varied.

Catchwords:

CORPORATIONS — examinations — whether time for application to set aside examination summons should be extended in respect of one applicant — whether orders for examination should be set aside.

Legislation Cited:

- Corporations Act 2001 (Cth), ss 596A, 596B

- Supreme Court Act 1970 (NSW), s 121(3)

- Supreme Court (Corporations) Rules 1999 (NSW), r 11.5(2)

- Uniform Civil Procedure Rules 2005 (NSW), r 49.19

Cases Cited:

- Bridgeport – Advisers and Asset Managers Pty Ltd (2005) 221 ALR 146; [2005] NSWSC 757

- Re ACN 004 410 833 Ltd (formerly Arrium) (subject to a Deed of Company Arrangement) [2019] NSWSC 1606

- Re Global Medical Imaging Management Ltd (in liq) [2001] NSWSC 481

- Re Ji Woo International Education Centre Pty Ltd (2019) 134 ACSR 448; [2019] NSWSC 93

- Re Kurmond Industries Pty Ltd (in liq) [2021] NSWSC 147

- Re LED (South Coast) Pty Ltd (2009) 76 NSWLR 428; [2009] NSWSC 946

- Re Mustang Marine Australia Services Pty Ltd (2014) 292 FLR 228; [2014] NSWSC 136

- Re Newheadspace Pty Ltd (in liq) (2020) 144 ACSR 224; [2020] NSWSC 173

- Re New Tel Ltd (in liq); Evans v Wainter Pty Ltd (2005) 145 FCR 176; 54 ACSR 284; [2005] FCAFC 114

- Re Stewart Free as Liquidator of Future Power Developments Pty Ltd (in liq) [2025] NSWSC 619

- Re Westgate Wool Co Pty Ltd (in liq) (2006) 206 FLR 190

- UBS AG v Tyne (2018) 265 CLR 77; [2018] HCA 45

- Walton v ACN 004 410 833 Ltd (formerly Arrium Ltd) (in liq) (2022) 275 CLR 508; (2022) 158 ACSR 391; [2022] HCA 3

Category:

Procedural rulings

Parties:

Stingray Management Pty Ltd (Plaintiff)
David Mao, Steven Bougoukas, George Ajaka, Daniel White and Ray White Capital Pty Ltd (Applicants to Interlocutory Process filed 1 August 2025)
Miki Cvijetic, Alex Hone, Kevin Hua, Justin Lal and Keyview Investment Management Pty Ltd (Applicants to Interlocutory Process filed 5 August 2025)
Fu Ming Guo (Applicant to Interlocutory Process filed 15 August 2025)

Representation:

Counsel:
DL Cook SC / JJ Nolan (Plaintiff)
D Thomas SC / B Michael (Ray White Parties)
S Scott (Keyview Parties)
B Haines (Fu Ming Guo)

Solicitors:
Ashurst (Plaintiff)
King & Wood Mallesons (Ray White Parties)
William James (Keyview Parties)
Longton Blackwell (Fu Ming Guo)

File Number(s):

2025/147136 (003, 004, 005)

JUDGMENT

Nature of the applications

1. Each of Ray White Capital Pty Ltd (“RWC”) and several of its employees (“RW Employees”); Keyview Investment Management Pty Ltd (“Keyview”) and several of its employees (“Keyview Employees”); and Mr Guo sought orders setting aside examination orders and orders for production made by the Court on the application of Stingray Management Pty Ltd (“Stingray”). The position as to orders for production was resolved in the course of the hearing before me on 25 August 2025 and I stayed, but did not set aside, the examinations of the RW Employees, the Keyview Employees, and Mr Guo, with liberty to resume them when further steps had been taken by Stingray to manage the risk of duplications between these examinations and ongoing examinations conducted by the liquidators (“Liquidators”) appointed to FSM Development Pty Ltd (“FSM”) concerning the same transactions in the Federal Court of Australia (“FCA”). These are my reasons for taking that course.

Application by RW Employees and RWC

2. By Interlocutory Process filed on 1 August 2025, the RW Employees and RWC sought orders setting aside a Summons for Examination issued under s 596B of the Corporations Act 2001 (Cth) (“Act”) addressed to the RW Employees and setting aside orders for production also addressed to RWC and the RW Employees and setting aside an order for production issued to RWC.

3. Some aspects of the application were narrowed in submissions, because the applicant for the examinations, Stingray, did not press for production of documents by RWC, where it has had access to documents produced in the Liquidators’ examinations in the FCA; Stingray accepted that orders for production directed to the RW Employees should be limited to documents not already produced by their employer; and, on that basis, the RW Employees had no further documents to produce. Mr Thomas, with whom Mr Michael appeared for the RW Employees and RWC, sought to expand the scope of the application in one respect, to raise an additional issue that I address below. It is ultimately possible and appropriate to determine the issues in this application on a narrow basis, and I only reach findings as to matters necessary to that narrow determination.

Background facts and affidavit evidence

4. By way of background, a third party lender had made a loan to FSM secured by a property at Ashfield. FSM and guarantor companies under that loan were owned by Mr Guo, who also brings an application which I will address below. Subsequently, another company associated with Mr Guo entered a loan facility with Zagga Investments Pty Ltd (“Zagga”) in respect of a property at Lindfield, secured by a second ranking mortgage over the Ashfield property. On 7 September 2023, the first lender and Zagga entered into a deed of priority, which was subsequently amended in May 2024.

5. On 7 August 2024, a trust managed by RWC acquired the first of those loans by assignment from the first of the lenders and the loan facility was also amended in a manner that is now challenged by FSM, the Liquidators and Stingray. At the time, that facility was amended by a Deed of Amendment and Restatement to increase the interest rate from 7.79% to 32.4% per annum, specify a minimum interest payable of $11.99 million and provide for an establishment fee of $1.22 million inclusive of GST. On 20 August 2024, under a Substitution Agreement, the trusts associated with RWC sold down over 50% of the loan to FSM to a trust which was a nominee of Keyview. Stingray also seeks to examine representatives of Keyview and Keyview also brings an application to set aside those examinations which I address below.

6. Zagga subsequently contended that the first lender’s securities under the deed of priority did not extend to FSM’s increased indebtedness arising under the amended facility and commenced proceedings in this Court in respect of that dispute. Zagga subsequently paid out the first mortgage, assigned its debt to Stingray and discontinued those proceedings; and Stingray then appointed voluntary administrators to FSM who have now become the Liquidators.

7. On 24 December 2024, the Liquidators commenced proceedings in the FCA seeking orders that various persons attend for examination, including the RW Employees. RWC has also produced documents and mobile phone messages in response to orders for production in the FCA, although it appears that a large number of documents have been withheld or redacted for legal professional privilege, some other documents are the subject of claims for commercial confidentiality and there are existing or anticipated disputes as to those matters in the FCA. On 2 July 2025, after examination orders and orders for production were made in the FCA, Stingray served orders for production by this Court on RWC, in substantially the same terms as the orders for production issued at the Liquidators’ request by the FCA. On 29 July 2025, Stingray served the RW Employees with summonses and orders for production.

8. The RW Employees and RWC then filed this application promptly, on 1 August 2025. Subsequently, Stingray raised a proposal to transfer the examinations to the FCA under s 1337H of the Act, but did not proceed with that proposal, where it appears that doubts had arisen as to whether this Court had power to make such an order, to which I refer below. At some time after 15 August 2025, the FCA made orders by consent allowing Stingray access to documents produced by RWC in the Liquidators’ examinations in the FCA, other than documents over which RWC has claimed confidentiality or legal professional privilege.

9. Turning now to the affidavit evidence, the RW Employees and RWC relied on an affidavit dated 1 August 2025 of their solicitor, Ms Tatasciore and a voluminous exhibit to that affidavit. Ms Tatasciore there addresses the relationship between the parties and the subsequent appointment of administrators to FSM by Stingray, who, as I noted above, later became the Liquidators. Ms Tatasciore also refers to Stingray’s entry into a funding agreement with the voluntary administrators and a subsequent funding agreement with the Liquidators and to the Liquidators’ commencement of liquidator’s examinations in the FCA in which orders for production were issued to RWC and orders for examination were issued to the RW Employees. Ms Tatasciore refers to disputes in the FCA concerning the scope of the orders for production and confidentiality claims made by RWC and to documents which had been produced in response to the orders for production in the FCA and the then pending examinations of the RW Employees in the FCA. Ms Tatasciore also refers to the subsequent issue, on Stingray’s application, of an order for production addressed to RWC in this Court and to the summonses for examination and orders for production issued to the RW Employees in this Court.

10. By a second affidavit dated 21 August 2025, Ms Tatasciore responds to the affidavit dated 14 August 2025 of Mr Greenstein, on which Stingray relies to resist the applications brought by the RW Employees and RWC. She refers to subsequent correspondence between the parties, to a successful application by Stingray for access to documents produced in the FCA, and to developments in respect of the examinations in the FCA including examinations of the RW Employees that took place in early August 2025. Ms Tatasciore also refers to other aspects of Mr Greenstein’s evidence which it is not necessary for me to address.

11. Stingray in turn reads the affidavit dated 14 August 2025 of Mr Greenstein in response to the application by RW Employees and RWC and by other applicants. Mr Greenstein also refers to the financing arrangements involving FSM and Mr Guo and to the examinations conducted and documents required for production on the application of the Liquidators in the FCA. Mr Greenstein acknowledges that Stingray has similarly sought to issue summons for examination and orders for production to the majority of the same entities and persons in this Court, dealing with similar issues tom those addressed in the Liquidators’ examinations in the FCA. Mr Greenstein’s evidence (Greenstein 14.8.25 [40]) is that:

“Whilst Stingray and the Liquidators are both applicants permitted to conduct public examinations, Stingray’s examinations are investigating its own claims which it may bring in its own name. On the other hand, the liquidators are investigating their claims which they may bring either in their own capacities as Liquidators or in the names of the Companies. While I consider there is foreseeable overlap between the two examinations, Stingray intends to ask questions relevant to its own interests and has ordered and is obtaining copies of the transcript of the Liquidators’ Federal Court proceeding with a view to avoiding asking any duplicative questions.”

12. Mr Greenstein denies any suggestion that Stingray commenced the further examinations with any intention to prejudice RWC or Keyview. Mr Greenstein also refers to the availability of dates for examinations in this Court and the limited availability of dates for examination in the FCA and notes his concern that delay in seeking examinations in that Court would be contrary to Stingray’s interests. Mr Greenstein also responded to other matters raised in Ms Tatasciore’s first affidavit and Mr Forrest’s affidavit which it is not necessary for me to address.

Applicable principles

13. Mr Thomas submits, and I accept, that the Court has power to set aside or vary an order made by a Registrar, including for an examination, under s 121(3) of the Supreme Court Act 1970 (NSW) or under r 49.19 of the Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”). Mr Thomas also submits, and I accept, that, although an examination summons is issued for a proper purpose, it may be set aside if it is unjustifiably oppressive: Re LED (South Coast) Pty Ltd (2009) 76 NSWLR 428 at 430; [2009] NSWSC 946.

14. I also have regard to the purpose and scope of liquidators’ examinations, and the circumstances in which they may be at aside, as summarised in Re New Tel Ltd (in liq); Evans v Wainter Pty Ltd (2005) 145 FCR 176; (2005) 54 ACSR 284; [2005] FCAFC 114 (“New Tel”), although I bear in mind that the scope of a proper purpose of an examination has likely been expanded by the High Court’s decision in Walton v ACN 004 410 833 Ltd (formerly Arrium Ltd) (in liq) (2022) 275 CLR 508; (2022) 158 ACSR 391; [2022] HCA 3 (“Arrium”) to which I refer below. In New Tel at [252], Lander J (Ryan and Crennan JJ concurring) observed that:

“1.   The power given to the court to summon a person for examination is a coercive power.

2.   The purpose of the power is to be gleaned from the legislation.

3.The following legitimate purposes emerge:

3.1    First, an examination is designed to serve the purpose of enabling an eligible applicant to gather information to assist the eligible applicant in the administration of the corporation.

3.2    Second, it assists the corporation’s administrators to identify the corporation’s assets, both tangible and intangible. It also allows the corporations liabilities to be identified.

3.3    Third, the purpose is to protect the interests of the corporation’s creditors.

3.4    Fourth, it serves the purpose of enabling evidence and information to be obtained to support the bringing of proceedings against examinable officers and other persons in connection with the examinable affairs of the corporation.

3.5    Fifth, it assists in the regulation of corporations by providing a public forum for the examination of examinable officers of corporations.

4.   If an eligible applicant applies for an order for the examination of a person for a purpose unconnected with the purposes authorised by the legislation that will be an abuse of process and the order, if obtained, will be set aside.

5.   The procedure may not be used to allow a party to obtain a forensic advantage and, if it is, any order obtained will be set aside.

6.   The procedure may not be used as a dress rehearsal for the cross-examination of a person in a pending or subsequent action. However, it is not improper to seek an order of the Court to summon a person for examination whilst litigation is pending against that person or entities connected with that person.

7.   The question whether in any particular case the applicant has used the procedure abusively will depend upon the applicant’s purpose in seeking the order and all of the surrounding circumstances. It will not be an abuse unless an offensive purpose is at least the predominant purpose.

8.   It will be an offensive purpose if the application cannot be characterised as being for the benefit of the corporation, its contributories or creditors.

9.   A creditor may, if first authorised by ASIC, apply to the Court for an order to summon for examination a person for the purpose of obtaining information in relation to a debt owed to the creditor if such an examination would be in the interests of the corporation or its creditors as a whole.

10.   A creditor may not use the procedure for the purpose of obtaining a forensic advantage which would not have been available to the creditor if the corporation had not gone into administration.”

15. Mr Thomas also rightly draws attention to the possibility that duplicative examinations may give rise to abuse of process, which I had noted at first instance in Re ACN 004 410 833 Ltd (formerly Arrium) (subject to a Deed of Company Arrangement) [2019] NSWSC 1606 at [51] as follows:

“I note, for completeness, that it does not follow from this finding that the Court would or should order, on the Plaintiffs’ application, an examination under s 596A of the Act of any person who was in fact previously examined by the liquidators, where the evidence is that the Plaintiffs had the opportunity to participate in that examination and did not do so. It may well constitute an abuse of process for the Plaintiffs to seek to put such a person to a second examination, not supported by the liquidators, in that situation. It also does not follow that the Court would or should order, on the Plaintiffs’ application, any future examination under s 596B of the Act of any person who is not an officer of Arrium, since the case for such an examination may well be weakened if Arrium, its liquidators and its creditors in fact derive no useful further information from Mr Galbraith’s examination, and such an examination may well likely constitute an abuse of process if the Plaintiffs could have participated, but chose not to participate, in any early examination by the liquidators of that person. I have formed, and express, no concluded views as to those questions, which will initially be a matter for a Registrar in dealing with any application for such an examination, and possibly a matter for a further hearing if an application is then brought to set aside any decision of a Registrar in that respect. I assume that the Plaintiffs will bring this judgment to the attention of any Registrar or judge dealing with such an application.”

16. When that matter reached the High Court on appeal in Arrium, Gageler J also observed (at [92]–[93] and [125]–[126]) that:

“There is also an important commonality between ss 596A and 596B. The commonality is that the s 596A duty is imposed and the s 596B discretion is conferred conformably with the ordinary incidents of the exercise of jurisdiction by the Court. Indispensable to the ordinary incidents of the jurisdiction of the Court is the capacity of the Court to prevent abuse of its process. The Court can accordingly refuse to make an order under either section if it is satisfied in advance that summoning a person on the application of an eligible applicant would amount to an abuse of the process of compulsory examination for which the Part provides. The Court can also stay an order it has made under either section if it is later satisfied that subjecting or continuing to subject the person to the process of compulsory examination amounts to an abuse of that process.

The possible varieties of abuse of process are only limited by human ingenuity and the categories are not closed.” That said, abuses of process “usually fall into one of three categories: (1) the court’s procedures are invoked for an illegitimate purpose; (2) the use of the court’s procedures is unjustifiably oppressive to one of the parties; or (3) the use of the court’s procedures would bring the administration of justice into disrepute”.133 Those categories can overlap in practice. A pertinent example is where one party invokes a procedure of the court for a purpose unjustifiably oppressive to another. The illegitimacy of the purpose then lies in the unjustifiable oppression. But an invocation of a procedure can be unjustifiably oppressive even if invoked for a legitimate purpose. …

The legitimacy of any purpose to which the process of compulsory examination under Pt 5.9 of the Corporations Act might ultimately be put may well lie in the nature and quality of the connection between the purpose and the examinable affairs of the corporation that is in external administration. That said, I do not think it necessary or prudent to attempt to map out the metes and bounds of the legitimate purposes to which the process might ultimately be put in order to resolve the present appeal. Indeed, borrowing from another field of discourse, I doubt whether any court considering whether an application is or was an invocation of the process of compulsory examination for an illegitimate purpose can be expected to do more than to pronounce in a particular case that a specifically identified purpose is “definitely extraneous to any objects the legislature could have had in view”.

Suffice it for the purpose of the present case to conclude that the appellants did not seek to examine the third respondent for a purpose foreign to the nature of the process of compulsory examination for which Pt 5.9 of the Corporations Act provides by reason only that the result which the appellants intended to achieve would bring no commercial or demonstrable benefit to the [company] or its creditors. The appellants’ ultimate purpose of enabling evidence and information to be obtained to support the bringing of proceedings against officers and other persons in connection with the examinable affairs of the [company] was not illegitimate.” [footnotes omitted]

17. Edelman and Steward JJ also there observed (at [130], [169]–[170] and [175]) that:

“Although the categories are not closed, the doctrine of abuse of process has conveniently, but loosely, been divided into three overlapping categories. These are: (i) the use of the court’s processes for an illegitimate purpose; (ii) the use of the court’s processes in a manner that is unjustifiably oppressive to one of the parties; and (iii) a category which might better be described as concerned with the integrity of the court and not merely its processes, and which is sometimes described as concerned with bringing the administration of justice into disrepute. …

The statutory history, context, and terms of s 596A, set out above, demonstrate that a characterisation of the purpose of s 596A at a higher level of generality than its terms should not be curtailed by “muffled echoes of old arguments” concerning its predecessors. In particular, the purpose of s 596A cannot be confined by reference to benefit to the company, its creditors, or its contributories. As the scope of application of s 596A expanded, so did its underlying purpose and concern. That expanded concern is with the administration or enforcement of the law concerning the public dealings of the corporation in external administration and its officers. The only vestige that remains of the old approaches to purpose that might have confined the predecessors to s 596A is the public aspect of the purpose of the power.

The purpose of s 596A, at a higher level of generality than its terms, and reflecting the underlying mischief to which the provision is directed, is therefore to address, by examinations of present or former corporate officers or provisional liquidators, the administration or enforcement of the law concerning the corporation and its officers in public dealings. A summons for examination will not be an abuse of process unless the predominant purpose of the examination would contradict or stultify — in some way — this public interest in the external administration of a company. …

Legitimate purposes under s 596A therefore include the enforcement of the Corporations Act, the promotion of compliance with that Act, and the protection of shareholders or creditors from corporate misconduct. An examination conducted for a purpose that included investigating the possible existence of misconduct on the part of a company’s officers might be expected to serve the public interest in ways such as these. Hence, regardless of whatever ultimate purpose a litigant might have, a summons that is sought for a substantial purpose that includes the public purpose of enforcement of the Corporations Act, whether by ASIC or another eligible applicant, is not a summons sought for a purpose foreign to s 596A in the sense that it is inconsistent with the purposes of s 596A. And the purpose of enforcement of the Corporations Act includes examination for the purpose of determining whether relief might be obtained in respect of potential corporate misconduct.” [footnotes omitted]

18. I also bear in mind that, in UBS AG v Tyne (2018) 265 CLR 77; [2018] HCA 45 (at [1], [59]), the plurality observed that:

“The varied circumstances in which the use of the court’s processes will amount to an abuse, notwithstanding that the use is consistent with the literal application of its rules, do not lend themselves to exhaustive statement. Either of two conditions enlivens the power: where the use of the court’s procedures occasions unjustifiable oppression to a party, or where the use serves to bring the administration of justice into disrepute. The issue in this appeal is whether one or both of those conditions is met in circumstances in which the factual merits of the underlying claim have not been determined and any delay in prosecuting the claim has not made its fair trial impossible …

For the Federal Court to lend its procedures to the staged conduct of what is factually the one dispute prosecuted by related parties under common control with the attendant duplication of court resources, delay, expense and vexation, as Dowsett J found, is likely to give rise to the perception that the administration of justice is inefficient, careless of costs and profligate in its application of public moneys. The primary judge was right to permanently stay the proceedings as an abuse of the processes of the Federal Court.” [footnotes omitted]

Oppression

19. Mr Thomas refers to Stingray’s acquisition of the loan and securities assigned to it by Zagga as a second-ranking lender to FSM, refers to the conduct of the Liquidators’ examinations in the FCA and points out that Stingray has been funding, and Stingray’s solicitors have been attending, those examinations. Mr Thomas also provides a detailed outline of the background facts, to which I have referred above.

20. Mr Thomas submits that the duplication of examination proceedings in different jurisdictions is oppressive to the RW Employees and will expose them to the prospect of examinations that duplicate those conducted in the FCA and require additional costs and additional time and Court resources. Mr Thomas also points out that Stingray did not apply to participate in the Liquidators’ examinations in the FCA and has not sought to transfer the examinations in this Court to the FCA. He submits that:

“The RWC Examinees would be exposed to a risk of duplicate examination over the same ground once by the liquidators, funded by Stingray, then again by Stingray itself. While Stingray may wish to investigate what it perceives to be potential claims unique to it, the reality is that the factual matters underlying such claims being investigated by [it] overlap heavily, if not entirely, with those of the liquidators’ examinations. They arise out of the same transaction and involve the same persons, events and documents.”

21. Mr Thomas also submits that the risk of duplication is exacerbated by the fact that the Liquidators have indicated that they will be recalling examinees at a future time in the FCA, with the risk that the RW Employees will therefore be examined in the FCA, then in this Court, then again in the FCA. Mr Thomas accepts that, in the ordinary course, the risk of duplicative questions could be addressed by the Court’s supervision of the conduct of the examination. He submits that that is more difficult where the examinations are in two different Courts. I do not accept that submission, but I do accept that a Registrar, even in the same Court, would face difficulties in addressing issues of duplication, where a second examination or a third examination is conducted sometime after an earlier examination. Mr Thomas also points to practical difficulties arising from different examination bundles, although it seems to me that those could be readily addressed to identify overlapping documents by a process of comparison. Mr Thomas also submits that Stingray’s examination proceedings carry the risks associated with multiplicity of proceedings generally. Mr Thomas submits that the examinations should be set aside for that reason.

22. Mr Cook, with whom Mr Nolan appears for Stingray, accepts that:

“It is possible, perhaps even likely, that [Stingray’s] examination could traverse the same events as the liquidator’s examination has traversed where [Stingray’s] potential claims arise out of the same events that give rise to the potential claims that the liquidator is investigating.”

23. Mr Cook responds, and I accept, that that is legitimate where the investigation of the same matters is necessary in order to advance potentially different claims; but that is not an answer to the need to manage the risk duplication in order to avoid oppression.

24. Mr Cook also relies on the observations of Brereton J in Re Mustang Marine Australia Services Pty Ltd (2014) 292 FLR 228; [2014] NSWSC 136 at [47], where his Honour observed, in a somewhat different context, that:

“The cases to which I have referred illustrate that if the examination is used for the predominant purpose of undermining the credit of the examinee or by way of rehearsal for cross-examination, it will then constitute an abuse of process. There may be exceptional circumstances in which a judgment that an examination is to be used for that purpose can be made in advance, on an application to set aside the examination summons. However … those issues will usually better be addressed and controlled by the judicial officer presiding at the examination, who can judge, question by question, whether the procedure is being inappropriately used for one of those purposes.”

25. I do not disagree with that observation. However, in the context of a potential substantial overlap between the questions asked at the Liquidators’ examination in the FCA and Stingray’s examinations in this Court, it seems to me that more is required to manage the risk of overlaps, so as to avoid oppression, than for Stingray’s Counsel to say that he will seek to avoid overlap or that a Registrar will be able to avoid overlap, to the extent that it is apparent to the Registrar where he or she did not preside over the examinations in the other Court. That matter can and should be addressed, in a more structured and transparent way, by Stingray identifying those matters as to which it needs to examine, having regard to the information that is already available to it from the Liquidators’ examinations and production of documents in the FCA. Mr Cook also submits that, in any event, having now obtained transcripts of examinations in the FCA, Stingray now considers it would not be efficient to proceed with examinations of the RW Employees or the Keyview Employees, or possibly Mr Guo, in the days presently allocated for examinations in this Court commencing in early September, with a qualification referable to the production of further documents does not now arise.

26. I do not accept the wider version of the RW Employees’ and RWC’s submission. It is common ground that Stingray has standing to seek the examination orders and it is plain that its potential claims are different to the claims that are available to the Liquidators and that it has separate interests to pursue in respect of those claims. In principle, it is no more an abuse of process and no more oppressive for Stingray to conduct separate examinations to the Liquidators’ examinations, than it would be for Stingray to conduct separate proceedings to any proceedings which may subsequently be taken by the Liquidators, whether in the same Court or in a different Court. I do not accept that, as a practical matter, it is more difficult for a Registrar of this Court to monitor the question of duplication between examinations than it would be for a Registrar of the FCA to do so.

27. Having said that, it seems to me that there is here a real practical connection between the two sets of examinations, where Stingray was funding the Liquidators’ examinations in the FCA and its solicitors were present and observing those examinations, and where Stingray knew of the FCA examinations and the scope of the document production sought in those examinations. At least in those circumstances, it was at least oppressive for Stingray to conduct examinations in this Court (or likely in the FCA) without taking active steps to avoid unnecessary duplication between the Liquidators’ examinations and document production in them and its examinations are requests for document production, where that would expose the examinees and the community to the wasted time and costs of conducting duplicative examinations.

28. Stingray has now, albeit belatedly, taken those steps to avoid duplication in respect of document production. It could have taken steps to avoid or minimise duplication in respect of the examinations of the RW Employees. First, as the RW Employees and RWC point out, it could have sought to conduct its examinations of the RW Employees in the FCA at the same time as the Liquidators’ examinations, which would have allowed a Registrar of the FCA readily to address the risk of duplication between the two examinations of a single examinee. I accept that it was not inevitable that the FCA would permit that course, but here Stingray did not seek to adopt that course. Second, and alternatively, it would have been possible for Stingray to access the transcripts of examinations in the FCA, as it has now done, and identify those matters which were not covered or in its view were not adequately covered, in the Liquidators’ examinations in the FCA, and identify matters for examination which fell within that more limited category so as to minimise the risk of duplication. It has not taken that course, in any structured way, and instead contends that its Counsel will seek to avoid duplication of questions at the examination in this Court without any transparency as to the areas that he will or will not examine about.

29. It seems to me that the absence of structured steps taken by Stingray to reduce the extent of duplication between the Liquidators’ examinations in the FCA and Stingray’s examination in this Court is a sufficient basis to stay the examinations of the RW Employees, unless and until Stingray completes its review of transcripts in the FCA and identifies the matters as to which it can properly proceed with an examination in this Court, without duplicating matters that have already been addressed in the Liquidators’ examinations in the FCA to which it has had access.

30. For these reasons, I stayed the examinations of the RW Employees reserving liberty for Stingray to apply for leave to undertake those examinations, once it has taken the course of identifying matters which can properly be addressed without duplication.

Illegitimate purpose and abuse of process

31. Second, the RW Employees and RWC submit that the purpose of examinations falls outside the ambit of s 596B of the Act because the examinations and orders for production do not involve upholding the requirements of the Act or investigating misconduct on the part of FSM’s officers; that the examinations have a predominant purpose which is foreign to that permitted under s 596B of the Act; and that they constitute an abuse of process. Mr Thomas further submits that:

“The evident predominant purpose of the examinations is to investigate what Stingray perceives potential claims it may have against RWC, Keyview, or persons associated with those businesses, arising out of the transactions involving the Amended facility. Unlike in Arrium, the purpose here is not to explore potential claims against the Company, its officers, or those intimately involved with its management. …”

32. I do not accept that submission, which seems to me to turn upon a false dichotomy. It appears that Stingray’s potential claims against RWC or Keyview or their associates turn, at least in part, upon claims for breach of director’s duties against Mr Guo and the potential for accessorial liability against RWC or Keyview, and the exploration of those matters serves the purposes of enforcement of the Act, the promotion of compliance with the Act and the protection of FSM’s creditors from corporate misconduct, all of which are proper purposes of an examination under ss 596A–596B of the Act.

33. Mr Cook responds, and I accept, that an allegation of abuse of process is not easily established: Re Global Medical Imaging Management Ltd (in liq) [2001] NSWSC 481 at [13]; Re Newheadspace Pty Ltd (in liq) (2020) 144 ACSR 224 at [105]; [2020] NSWSC 173. He also submits that there is a plainly arguable case that Mr Guo may have breached his duties as a director of FSM in causing FSM to enter into the amended loan arrangements, given their arguably onerous terms and in the circumstances to which I referred above. Mr Cook also contends that:

“At a time when the development was almost complete, the entry into [that arrangement] on its onerous terms had the consequence that any equity in the development [that] would otherwise have been available to FSM’s creditors, including [Stingray], was lost to RWC and Keyview (and Mr Guo).”

34. Mr Cook submits, and I accept that, so far as claims that are available to Stingray arise from Mr Guo’s conduct as a director of FSM, in entering that arrangement on behalf of FSM, that is within the scope of the examinable affairs of FSM; the investigation of an arguably uncommercial transaction between FSM and Guo on the one hand and RWC and Keyview on the other, is within the proper scope of s 596A-596B of the Act; and the High Court’s decision in Arrium establishes that it is not necessary that FSM obtain a direct benefit from any claim that may be made by its creditors against its officers in that respect.

35. It seems to me that neither an illegitimate purpose on Stingray’s part nor abuse of process is established here for the reasons noted in paragraphs [27] and [32]–[33] above.

Transfer of examination proceedings under s 1337H of the Act

36. Alternatively, Mr Thomas submits that the examination proceedings should be transferred to the FCA under s 1337 of the Act, by the Court of its own motion.

37. As I have noted above, there is a dispute between the parties as to whether the Court has power to transfer an examination to another Court under s 1337 of the Act, which turns upon the correctness of the decision in Re Westgate Wool Co Pty Ltd (in liq) (2006) 206 FLR 190 at [27]–[29]; [2006] SASC 372 (“Westgate Wool”), which held that the Court has no such power. Mr Thomas contends that decision was wrongly decided. Mr Cook responds that there is at least doubt as to whether the Court has power to transfer the examinations to the FCA under that section, by reason of that decision, and points to the disadvantage of such a transfer to Stingray arising from the limited availability of examination dates in the FCA in any event. I do not consider that it is necessary to determine the dispute as to the correctness of Westgate Wool in this application, both because I have stayed the examinations for the reasons set out above, and because there are several reasons why the Court should not exercise its power to transfer the examinations to the FCA of its own motion.

38. The first is that the RW Employees and RWC did not themselves bring an application for transfer of the examinations to the FCA, apparently because they consider they are not parties to the proceedings and do not have standing to bring such an application. It seems to me that it would be inconsistent with that proposition for the RW Employees and RWC, on the premise that they do not have standing to seek a transfer, then to urge the Court to make that transfer of its own motion so as to avoid their lack of standing. Second, it seems to me that there would be no, or no significant advantage, in transferring the examinations to the FCA, since substantially the same issues as to duplication would arise in the FCA, where it is now too late for the examinations of the RW Employees by Stingray to take place together with the examinations undertaken by the Liquidators, which have already occurred. Third, it seems to me that a transfer of examinations would generally not be appropriate under s 1337H of the Act, particularly where it is sought immediately before examinations are due to take place before the transferring Court. The transferring Court would often limited knowledge as to when the transferee Court could list those examinations and there is every likelihood that a transfer of examinations to another Court would delay them by a significant period. The evidence here suggests that it would likely be some time before the FCA could list such examinations and that a transfer to the FCA would result in significant delay, although I recognise that the effect of that delay would be mitigated, at least to some extent, by the fact that, as I noted above, Stingray does not now seek to proceed with the examinations of the RW Employees commencing next week in this Court. For all these reasons, even if I had power to transfer the examinations, which it is not necessary to decide, I would not have done so.

Application by Keyview Applicants

39. The Keyview Employees similarly seek an order that summonses for examination under s 596B of the Act issued to them be discharged or set aside, and orders are also sought by them and Keyview setting aside orders for production made in this Court. The issue as to orders for production has been displaced for the reasons noted above.

40. Keyview reads the affidavits dated 4 August and 21 August 2025 of its solicitor, Mr Forrest and also tenders a substantial exhibit. By his first affidavit, Mr Forrest also outlines the sequence of events to which I referred above, by which a trust associated with Keyview became a substituted lender to FSM on the amended terms arising from the restatement of the loan facility to which I referred above. Mr Forrest also refers to the Liquidators’ examinations in the FCA, which included the issue of an order for production to Keyview and summonses for examination to the Keyview Employees; the production of documents by Keyview in the FCA; and to orders for production subsequently issued on the application of Stingray brought in this Court to Keyview, seeking similar categories of documents to those which had been sought by the Liquidators in the FCA and summons for examinations issued to the Keyview Employees in this Court. Mr Forrest also asserted the existence of confidentiality issues on the basis that Zagga and Keyview are competitors in the private credit market, but it is not necessary to address any question as to that matter to determine this application.

41. By his second affidavit, Mr Forrest addressed the further conduct of the examinations in the FCA, including the Liquidator’s examinations of the Keyview Employees in the FCA and the topics as to which they were examined. Mr Forrest also addressed the production of documents by Keyview in the FCA and discussions as to the possibility of the transfer of the examinations in this Court to the FCA, of a similar kind to those which had arisen in respect of the RW Employees.

42. By her submission on behalf of the Keyview Employees and Keyview, Ms Scott advances much the same submissions as Mr Thomas for the RW Employees and RWC and similarly submits that the summonses for examination addressed to the Keyview Employees and the orders for production addressed to the Keyview Employees and Keyview should be set aside. As I noted above, issues concerning the orders for production were substantially resolved in the course of the hearing. Ms Scott also submits that parallel proceedings in the FCA and this Court, in respect of the Liquidators’ examinations and Stingray’s proposed examinations would cause “obvious prejudice” to the Keyview Employees who had already been examined in the FCA where the Liquidators had also foreshadowed their further examinations in the FCA.

43. Ms Scott submits that, having regard to a suggested “paucity of evidence” about Stingray’s purpose in seeking to conduct the examinations, the Court would not consider it an appropriate and efficient use of public money and Court resources to allow “duplicative” proceedings to be maintained. I do not accept that submission, once the risk of duplication has been properly managed, where it is plain enough that the examinations in this Court would be directed to Stingray’s investigation of matters including potential breaches of director’s duties by Mr Guo and any involvement by Keyview and the Keyview Employees in those breaches.

44. Ms Scott also points to a potential risk of inconsistent findings in respect of claims for legal professional privilege and confidentiality in respect of the production of documents in FCA and in this Court. That risk would arise in any case where the same documents were produced in more than one Court and such disputes arose, but that question no longer arises here given the approach which has been adopted in respect of the production of documents. She also refers to potential inconvenience and cost to the Keyview Employees who had already been examined in the FCA. I do not accept that the Keyview employees have any proper expectation that, because they have been examined by the Liquidators in respect of proceedings which may be brought by the Liquidators against Keyview or against them, they will not in future be examined by other persons who have standing to conduct such examinations in respect of separate proceedings which may be brought by those persons against Keyview or against them, provided that proper steps are taken to manage the risk of duplication between those examinations.

45. Ms Scott also submits that there is prima facie duplication, where Stingray is funding the examinations in the FCA and conducting its own examinations in this Court. I also do not accept that submission, where the fact that Stingray has funded the Liquidators’ examinations, directed to advancing the interests of FSM and its creditors generally, does not provide reason to disregard the difference in interests between FSM or the Liquidators as plaintiffs and Stingray as a plaintiff, where they likely have different claims, albeit arising from common factual circumstances.

46. I have addressed Mr Cook’s submissions in response in dealing with the application by the RW Employees and RWC above.

47. I do not consider that a basis to set aside the examinations of the Keyview Employees in this Court has been established, for the same reasons that a basis for that order was not established in respect of the examinations of the RW Employees. I am satisfied that I should stay those examinations on the same basis as the examination summonses issued to the RW Employees was stayed, until Stingray takes appropriate steps to manage the risk of duplication between the Liquidators’ examinations of the Keyview Employees in the FCA and its proposed examinations of those persons in this Court.

Application by Mr Guo

48. By an Interlocutory Process belatedly filed on 15 August 2025, Mr Guo sought an order extending the time allowed by r 11.5(2) of the Supreme Court (Corporations) Rules 1999 (NSW) (“Corporations Rules”) to bring an application to discharge the examination summons issued to him under s 596A of the Act, and an order that that summons be set aside.

49. Mr Guo relied on his affidavits dated 15 and 22 August 2025 and the affidavit dated 25 August 2025 of his solicitor, Mr Chong. By his first affidavit, Mr Guo refers to the summons for examination issued at the request of Stingray in these proceedings and to the fact that he was previously examined by the legal representatives of Stingray in this Court on 3 June 2025; and to a subsequent summons for examination issued by the Liquidators in the FCA and the fact that he has also been examined by the legal representatives of the Liquidators in the FCA on 12 August 2025, and that is now required for examination by Stingray in this Court in the period from 1 September 2025 and potentially for further examination by the Liquidators in the FCA.

50. By his second affidavit, Mr Guo refers to orders for production made in this Court and his production of documents in this Court; and to orders for production made in the FCA, with a significant number of overlapping categories, and his production of documents in the FCA. He also elaborates in that affidavit on the topics on which he was examined on 3 June 2025 in this Court and on 12 August 2025 in the FCA and expresses the view that he was then being asked the same questions again. He also refers to his concern about duplication of legal costs if he is to be further examined by Stingray and then by the Liquidators and his evidence is that that concern has prompted him now to seek to set aside Stingray’s examination summons in this Court.

51. By his affidavit dated 25 August 2025, Mr Chong refers to his service of this application on the Australian Securities and Investments Commission, which has not sought to appear in these proceedings.

52. I summarised the purpose of the time limit under r 11.5 of the Corporations Rules in Re Ji Woo International Education Centre Pty Ltd (2019) 134 ACSR 448; [2019] NSWSC 93 at [24] as follows:

“[Counsel] submitted, and I accept, that the relevance of an application for any delay by the Applicants is to whether it is just and fair to grant the extension of time that is sought, in respect of the examination summonses: Iovanescu v McDermott [2004] NSWCA 106 at [16]. [Counsel] also submitted that a satisfactory explanation of delay is not a pre-condition to the exercise of the power to extend time. I accept that submission, at least in the sense that time may more readily be extended for a meritorious application, even if there is a less satisfactory explanation for delay. [Counsel] also referred to the observation of Emmett J in Commonwealth v Sheahan [2004] FCA 1301 at [28] that an extension of time “should only be granted where there is a satisfactory explanation provided for delay and the delay has not caused prejudice of an irreparable nature”, and to his Honour’s recognition of the absence of prejudice to the liquidator as a significant factor in that case. [Counsel] also rightly drew attention to the treatment of the relevant issues by Barrett J in Bridgeport — Advisers and Asset Managers [(2005) 221 ALR 146; [2005] NSWSC 757], where his Honour recognised that r 11.5 of the Corporations Rules exhibits “an expectation of prompt action”, and also noted that compliance with that rule was not a pre-condition to invoking the jurisdiction, by contrast with the time limit under s 459G of the Corporations Act for the filing of applications to set aside a creditor’s statutory demand. [Counsel] also rightly recognised that extensions of time were refused in Re 82–84 Belmore Street Pty Ltd (in liq) [2014] NSWSC 1701 and in Re Cardinal Group [[2018] NSWSC 748], in each case in circumstances where the Court was satisfied of the lack of merit of the underlying application.”

53. I also accept that the Court has power to extend the time to bring such an application under r 1.12 of the UCPR, and there are cases where that has occurred, including Bridgeport – Advisers and Asset Managers Pty Ltd (2005) 221 ALR 146; [2005] NSWSC 757. Mr Haines, who appears for Mr Guo in this application, also refers to my identification of the relevant factors in extending the time for such an application Re Kurmond Industries Pty Ltd (in liq) [2021] NSWSC 147 and in Re Stewart Free as Liquidator of Future Power Developments Pty Ltd (in liq) [2025] NSWSC 619 at [7].

54. Mr Haines sets out the history of service of examination summonses on Mr Guo, which differs from the position in respect of the RW Employees and the Keyview Employees because Mr Guo was previously examined in this Court on 3 June 2025, before he was examined by the Liquidators in the FCA on 12 August 2025 and was again to be examined in this Court in early September 2025. Mr Haines also refers, with some force, to the fact that Mr Guo has now participated in examinations by both Stingray and the Liquidators in this Court and the FCA, respectively, and that his decision to bring this application, albeit it late, is explicable by the fact that it has now emerged that both Stingray and the Liquidators are contemplating further examinations of him. Mr Haines also points to the fact that hearing his application, where the Court will already be hearing corresponding applications by the RW Employees and RWC and by the Keyview Employees and Keyview, will cause no real disadvantage to Stingray or to the community.

55. Mr Haines otherwise refers to submissions made by Mr Thomas and Ms Scott in respect of oppression and submits that the duplication caused by having the two examinations continue will be oppressive to Mr Guo where, he submits, there is no apparent need for parallel proceedings. Mr Haines also submits that, while Stingray may be investigating its own claims, that is not a reason why an examination by the Liquidators will not satisfy Stingray’s needs. He also submits that the examinations sought by Stingray expose Mr Guo to financial prejudice and consequently oppression arising from his costs of attending those examinations and will deplete or delay the use of Court resources by other parties. I have addressed Mr Cook’s submissions in response in dealing with the application by the RW Employees and RWC above.

56. I have borne in mind the lateness of Mr Guo’s application to set aside the examination summons in this Court. However, on balance, it seemed to me that there is sufficient basis to grant an extension of time for him to bring his application to set aside the examination summons in this Court, where he appeared in the FCA for examination by the liquidators on 12 August 2025, and his evidence is that the alleged duplication as between the earlier examination in this Court and the Liquidators examination in FCA has prompted his application to set aside the further examination in this Court, which was to take place less than a month after the Liquidators’ examination in the FCA. I am not persuaded that I should set aside the examination summons issued to Mr Guo, but I am satisfied that I should stay it on the same basis as the examination summonses issued to the RW Employees and the Keyview Employees, until Stingray takes appropriate steps to manage the risk of duplication between the Liquidators examinations in the FCA and its proposed examinations in this Court.

Orders

57. For these reasons, I made the following orders at the conclusion of the hearing on 25 August 2025:

1. Order that the summonses for examination under s 596B of the Corporations Act 2001 (Cth) (“Act”) dated 27 June 2025 addressed to Messrs Mao, Bougoukas, Ajaka and White be stayed until further order of the Court.

2. Order that the summonses for examination under s 596B of the Act addressed to Messrs Cvijetic, Hone, Hua and Lal be stayed until further order of the Court.

3. Order extending the time for Mr Guo to bring an application to discharge the examination summons issued to him, or seek alternative relief, up to and including 15 August 2025.

4. Order that the summons for examination dated 6 May 2025 addressed to Mr Guo be stayed until further order of the Court.

5. Order that Messrs Mao, Bougoukas, Ajaka and White need not produce, in response to orders for production issued to them, documents already produced by their employer or any associating company in examinations in the Federal Court of Australia.

6. Order that Messrs Cvijetic, Hone, Hua, Lal need not produce, in response to orders for production issued to them, documents already produced by their employer or any associated company in examinations in the Federal Court of Australia.

7. Liberty to apply for this stay to be lifted, in respect of the examinations, on two business days' notice specifying, in the case of that application, the topics which are to be the subject of the proposed examination of the particular employees and the basis on which it is contended that those topics were not addressed, or were not adequately addressed, in examinations previously conducted in the Federal Court of Australia.

8. Reserve the question of costs.

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Decision last updated: 29 August 2025