In the Matter of Interchase Corporation Ltd In the Matter of an application by Richard Anthony Barber and Anor

[1996] FCA 950

IN THE FEDERAL COURT OF AUSTRALIA )
QUEENSLAND DISTRICT REGISTRY     )    No. NG 3018 of 1991
GENERAL DIVISION                   )

IN THE MATTER of INTERCHASE CORPORATION LIMITED

and:

IN THE MATTER of an application by RICHARD ANTHONY BARBER and GREGORY PAUL KELLY, Liquidators of INTERCHASE CORPORATION LIMITED

CORAM:    Spender J
PLACE:    Brisbane
DATE:     15 October 1996

MINUTES OF ORDER

THE COURT ORDERS THAT:

1. The Applicants in the notice of motion have leave to appeal against the order made by the Honourable Justice Kiefel on 2 August 1996 that the summons issued against William John Ballhausen be discharged.

1. The applicants' costs of and incidental to this motion be costs in the appeal.

THE COURT DIRECTS THAT:

1. The notice of the appeal is to be filed and served by the applicants by 4 pm on 20 October 1996;

1. An appeal book be prepared as a matter of urgency and parties will be notified as to when the appeal is listed;

1. (i)     there be written submissions in the appeal;

1. written submissions by the appellant/s (of not more than five pages) be filed (5 copies) and served by 4pm three clear working days before the date of the hearing of the appeal;

2. submissions by the respondent/s (of not more than five pages) be filed (5 copies) and served by 4pm one clear working day before the date of hearing of the appeal;

3. all references to the appeal book in the sub- missions should refer to the relevant page and the relevant part of the page [e.g. A.B. 27.5-28.2];

1. similarly, references to authority should give the case, citation, and refer to the relevant page and the relevant part of the page [e.g. A v B 112 CLR 210 from 212.5 to 212.7];

2. Lists of authorities should be supplied in accordance with Practice Note No. 1;

3. Part A authorities contained in the CLRs, FCRs, ALRs, FLRs ALJRs and the Authorised Reports will be supplied by Judges' staff.  All other Part A authorities are to be provided by the party in photocopy form (3 copies) with the relevant sections marked or highlighted, with that party's lists of authorities.

(viii)Part B authorities will not be made available by Judges' staff and any Part B authorities to which reference is made in the course of the appeal should be provided to the Court (3 copies) with the relevant passages marked or highlighted.

1. If appropriate, the appellant should prepare a chronology (3 copies) to be handed to the Court at the commencement of the appeal.

Note:       Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA )
QUEENSLAND DISTRICT REGISTRY     )    No. NG 3018 of 1991
GENERAL DIVISION                   )

IN THE MATTER of INTERCHASE CORPORATION LIMITED

and:

IN THE MATTER of an application by RICHARD ANTHONY BARBER and GREGORY PAUL KELLY, Liquidators of INTERCHASE CORPORATION LIMITED

CORAM:    Spender J
PLACE:    Brisbane
DATE:     15 October 1996

REASONS FOR JUDGMENT

By a notice of motion filed on 13 August 1996, Richard Anthony Barber and Gregory Paul Kelly sought orders that they have leave to appeal against the order made by Kiefel J on 2 August 1996 that the summons issued to William John Ballhausen be discharged.  The motion further sought that the applicant's costs of and incidental to this motion be costs in the appeal.

In a sense, the question of the summons issued to William John Ballhausen who is a claims officer for the excess insurer of defendants in Supreme Court proceedings brought by the liquidators of Interchase Corporation Ltd, is a subsidiary one to the position of a Ronald John Shorter who is an officer of FAI General Insurance Company Limited ("FAI") which is the primary insurer of one of the defendants in the Supreme Court proceedings.

The summons to Mr Shorter was upheld by her Honour in giving judgment on 2 August 1996 but in relation to the summons to Mr Ballhausen, her Honour discharged the summons directed to him.  Her Honour said:

"The utility of the examination of Mr Ballhausen, for the excess insurer, is put on a rather different basis.  The evidence adduced by Mr Ballhausen discloses that that insurer has made no investigations of its own at all.  Indeed it has not been asked to confirm the availability of excess cover.  It will not make a decision or carry out any investigation until after FAI decides.

It seems to me that good ground has been shown why an examination is likely to be pointless and that the true focus of any enquiry at present is FAI.  In terms of the section I am unable to hold that Mr Ballhausen may be able to provide the information sought.  It may be that there are communications between FAI and the excess insurer which are relevant to the liquidators' enquiries, but these may be ascertained from FAI.  That leaves the possibility that the excess insurer may have received oral advices from FAI, but one is now in the realm of speculation. "

On the question of the grant of leave, the court has an unfettered discretion pursuant to section 24(1A) of the Federal Court of Australia Act 1976. It is, of course, useful to have reference to the tests referred to in Niemann v Electronic Industries Ltd [1978] VR 431 where the questions were expressed to be whether the decision at first instance is attended with sufficient doubt to warrant it being reconsidered and whether substantial injustice would result if leave were refused.

In this particular case, Mr McKenna of counsel for the liquidators submitted that it was at least arguable that the conclusion by her Honour: "I am unable to hold that Mr Ballhausen may be able to provide the information sought.", is wrong.  At least in terms of the test, there was sufficient doubt to warrant that conclusion being reconsidered.  He focussed essentially on the primary contractual documents leading to the issue of the making of the contract of insurance between the excess insurer, HIH Casual & General Insurance Ltd ("HIH") and the insured and says that Mr Ballhausen can provide information as to the proposal, the terms of the policy insurance, when the claim was notified and other primary facts concerning any decision which might be made by HIH to decline to provide the indemnity to the insured.

It seems to me that there is substance in this submission.  Her Honour's orders effectively determine whether the liquidator should have an opportunity to make the inquiries which it wishes to make on this aspect of the matter.  It seems to me that I ought to grant leave to appeal. 
          The point is a very short point. It may be that there is an excess of care behind the present application, rather than the more substantial one directed at the primary insurer, FAI.  Whether, of course, the appeal enjoys any success is quite a different matter and can be left to a Full Court. 

I order that:

1. The Applicants in the notice of motion have leave to appeal against the order made by the Honourable Justice Kiefel on 2 August 1996 that the summons issued against William John Ballhausen be discharged;

2. The applicants' costs of and incidental to this motion be costs in the appeal.

I direct that:

1. The notice of the appeal is to be filed and served by the applicants by 4 pm on 20 October 1996;

2. An appeal book be prepared as a matter of urgency and parties will be notified as to when the appeal is listed;

3. (i)     there be written submissions in the appeal;

1. written submissions by the appellant/s (of not more than five pages) be filed (5 copies) and served by 4pm three clear working days before the date of the hearing of the appeal;

2. submissions by the respondent/s (of not more than five pages) be filed (5 copies) and served by 4pm one clear working day before the date of hearing of the appeal;

3. all references to the appeal book in the sub- missions should refer to the relevant page and the relevant part of the page [e.g. A.B. 27.5-28.2];

4. similarly, references to authority should give the case, citation, and refer to the relevant
   page and the relevant part of the page [e.g. A v B 112 CLR 210 from 212.5 to 212.7];

5. Lists of authorities should be supplied in accordance with Practice Note No. 1;

6. Part A authorities contained in the CLRs, FCRs, ALRs, FLRs ALJRs and the Authorised Reports will be supplied by Judges' staff.  All other Part A authorities are to be provided by the party in photocopy form (3 copies) with the relevant sections marked or highlighted, with that party's lists of authorities.

(viii)Part B authorities will not be made available by Judges' staff and any Part B authorities to which reference is made in the course of the appeal should be provided to the Court (3 copies) with the relevant passages marked or highlighted.

1. If appropriate, the appellant should prepare a chronology (3 copies) to be handed to the Court at the commencement of the appeal.

I certify that this and the  preceding four (4) pages are a true copy of the reasons for judgment herein of the Honourable Justice Spender.

Associate
  Date: 15 October 1996

Counsel for the liquidators of

Interchase Corporation Ltd       :   Mr J D McKenna

instructed by  :   Allens Allens & Hemsley

Counsel for William John Ballhausen    :   Mr S Couper QC

instructed by  :   Gadens Ridgeway

Date of Hearing  :   15 October 1996