In the matter of Vista Capital Pty Limited (in liquidation)

[2013] NSWSC 121

Supreme Court

New South Wales

Medium Neutral Citation:	In the matter of Vista Capital Pty Limited (in liquidation) [2013] NSWSC 121
Hearing dates:	31 January 2013
Decision date:	31 January 2013
Jurisdiction:	Equity Division - Corporations List
Before:	Black J
Decision:	Application dismissed.
Catchwords:	EVIDENCE - Witnesses - Examination in chief - Order sought under s 75(10) Supreme Court Act 1970 (NSW) that evidence given in liquidator's examination not admissible in evidence - Whether misdirection on examinee's entitlement to claim a privilege against self-incrimination under s 597(12A) Corporations Act 2001 (Cth)
Legislation Cited:	Australian Securities and Investments Commission Act 2001 (Cth) s 68 Corporations Act 2001 (Cth) ss 597, 597(12A) Supreme Court Act 1970 (NSW) ss 75A, 75(1) Uniform Civil Procedure Rules 2005 (NSW) r 49.8
Cases Cited:	- Smith v R [2007] WASCA 163; (2007) 63 ACSR 445
Category:	Interlocutory applications
Parties:	Vista Capital Pty Limited (in liquidation) (First Plaintiff) Dimitri Amargianitakis (Applicant)
Representation:	Counsel: G.D. McDonald (direct brief) (Applicant)
File Number(s):	2012/172094

Judgment - EX TEMPORE

1. Mr Dimitri Amagianitakis (to whom I will refer as the "examinee") is a director of Vista Capital Pty Limited (in liquidation) and several other companies. He brings an appeal under s 75A of the Supreme Court Act and Uniform Civil Procedure Rules 2005 (NSW) r 49.8, from a decision of an Associate Justice in respect of a matter arising in the conduct of a liquidator's examination conducted under s 597 of the Corporations Act 2001 (Cth). The examinee seeks an order under s 75(10) of the Supreme Court Act 1970 (NSW), consequential on the appeal:

"That all of the evidence given by the [examinee] in this Court on 10 September 2012 is not admissible in evidence against the [examinee] in the circumstances set out in section 597(12A) of the Corporations Act."

The appeal is said to be brought from:

"The whole of the decision of the Associate Judge in which he ruled that the [examinee] was, in effect, not entitled to claim the benefit of section 597(12A) of the Corporations Act by stating the word "privilege" and to direct that the [examinee] was required to state, on each occasion that he wanted to claim the benefit, the words to the effect 'I claim that the answer to this question may tend to incriminate me or make me liable to a penalty and I claim privilege'."

1. The first question that arises in respect of the application before me is whether the Associate Justice in fact made a direction or ruling of the nature appealed from. The transcript of the examinee's examination refers to an explanation given by the Associate Justice of the process to be adopted to claim the statutory privilege against self-incrimination or incrimination to a penalty in a liquidator's examination, which included a statement that the examinee should, in order to do so, say the words "I claim the answer may incriminate me or make me liable to a penalty before answering the question".

1. The transcript does not record any discussion with the examinee's Counsel as to the content of that explanation, although it refers to the Associate Justice asking the examinee whether he understood what the Associate Justice had said, and the examinee acknowledging that he did. The transcript also records the examinee requesting a piece of paper and pencil, presumably to use to write down the language of the direction, and the Associate Justice suggesting that was a sensible course; noting that the suggested procedure was slightly different to that followed by the registrars, and again explaining that procedure.

1. The examinee, in a second affidavit sworn in support of the application dated 23 January 2013 has provided a somewhat more expansive account of events than the transcript, which is not inconsistent with the transcript but refers to a short exchange between the Associate Justice and Counsel that is not recorded in the transcript. The examinee's evidence is that Counsel pointed to the different practice of the Registrars in examinations and the Associate Justice expressed a view that the practice of the Registrars was not correct. I infer that the reference to a different practice is to a practice which permits a claim for the privilege under s 597(12A) of the Corporations Act by simply stating the word "privilege" prior to answering every question for which such a claim is to be made. The examinee has not been cross-examined as to that account of events, since no other party appeared to oppose this application. It seems to me to be plausible that a brief exchange of this kind, of a legal character, might not have been recorded in the transcript of the examination and I will proceed on the basis that it occurred.

1. Having had that, I am not satisfied that the Associate Justice in fact made a decision or ruling of the kind that is appealed from. Plainly, the Associate Justice expressed a view as to the proper manner for the examinee to advance a claim to the statutory privilege against self incrimination under s 597(12A) of the Corporations Act. Counsel raised with the Associate Justice, on the examinee's evidence, a difference between the approach suggested by the Associate Justice and the approach adopted by Registrars, but did not submit to the Associate Justice that that approach was incorrect as a matter of law. The Associate Justice was ultimately not called upon, in my view, to either make a decision as to the matter or to give a formal direction. What he was instead doing was, helpfully, drawing the examinee's attention to a right that is available to the examinee under s 597(12A) of the Corporations Act.

1. In the event, the examinee largely did not use either the fuller or the shorter form of words to claim that privilege, in the course of the examination, although there are at least two occasions on which he used a form of words indicating an intent to claim the privilege. In the absence of any substantial use of either form of words, the Associate Justice was not called upon to rule upon the efficacy of a claim for privilege in either of those forms.

1. I will, however, address the substance of the issue raised by the application, although it may not strictly be necessary for me to do so in this application. I do so because it does seem to me that a substantive point is raised, and it is at least possible that the examinee's conduct in the course of the examination was effected by the procedure adopted, although that is not a matter which it is necessary for me finally to determine in the course of this application for reasons that I will indicate below.

1. The ability to claim a privilege against self incrimination or incrimination to a penalty in a liquidator's examination arises from s 597(12A) of the Corporations Act which provides that:

"Where:

(a) before answering a question put to a person (other than a body corporate) at an examination, the person claims that the answer might tend to incriminate the person or make the person liable to a penalty; and

(b) the answer might in fact tend to incriminate the person or make the person so liable;

the answer is not admissible in evidence against the person in:

(c) a criminal proceeding; or

(d) a proceedings for the imposition of a penalty; other than a proceeding under this section, or any other proceeding in respect of the falsity of the answer."

1. This subsection has two elements, requiring first an indication that the person makes the relevant claim and second that the answer might in fact tend to incriminate the person or make the person liable to a penalty. Mr McDonald, who has made able submissions for the examinee, points to the recognition of the privilege against self incrimination at general law. It seems to me that s 597(12A) of the Corporations Act is better understood as displacing that privilege but substituting a statutory exclusion of evidence in the specified circumstances: compare Smith v R [2007] WASCA 163; (2007) 63 ACSR 445. Mr McDonald also submits that a construction that would promote the object or underlying purpose of the Act should be preferred to one that would not and that submission is plainly correct.

1. The form of s 597(12A) of the Corporations Act is similar to that of s 68 of Australian Securities and Investments Commission Ac 2001 (Cth), which provides a similar statutory privilege in examinations conducted under that Act. The practice by which a person being examined can claim the statutory privilege by saying the word "privilege" before commencing to answer a question or making a statement giving information was recognised, in the similar context of s 68 of the Australian Securities and Investments Commission Act in Smith v R above at [66]. The Associate Justice's attention was not drawn to that decision in the course of the discussion before him to which I have referred above.

1. Although the language to which the Associate Justice referred in the course of his indication to the examinee of the steps which should be taken to claim the privilege reflected the terms of s 597(12A)(a), I do not consider that, as a matter of the proper construction of the section or its policy, the statutory privilege cannot also be invoked by the use of the shorter term form of claim such as "privilege", which in my view sufficiently indicates that the examinee makes the claim contemplated by the language of that section. To that extent, I will differ from the approach which was implicit in the comment made by the Associate Justice, and consider that the approach commonly adopted by Registrars in this Court is properly open.

1. It does not, however, follow that the examinee is entitled to the relief sought. First, as I noted above, I do not consider that the Associate Justice ultimately made a decision or ruling as to the matter. Whether this matter had an impact on the manner in which the examination proceeded raises a difficult question of fact, which it is ultimately not necessary for me to determine, given the view which I have reached as to relief. The examinee did not, as I have noted, generally invoke the statutory privilege under s 597(12A) of the Corporations Act, even by using the shorter form "privilege". His evidence is that he expected to be able to claim the statutory privilege by saying the word "privilege" before every answer and intended to do so; and that he did not do so "as a result" of the Associate Justice's observation, in circumstances that he was suffering from the flu and also needed to take tablets on the day of examination. This evidence is given in somewhat conclusory form, and the examinee has not been cross-examined about it, where no party has appeared to oppose the application. There is a question whether a person who intended to claim the privilege by using a shorter formulation and was advised to use a longer formulation would, in the ordinary course, not use either formulation and not claim the privilege at all. On the other hand, Mr McDonald has drawn my attention to two occasions in the transcript, to which the examinee refers in his evidence, where he in fact attempts to use the longer formulation to which the Associate Justice had referred. These tend against any conclusion that the examinee had, for whatever reason, decided not to claim the privilege at all in the course of the examination. I think it is best, given the view that I will shortly express, that this matter be left for determination by any other judge who may ultimately have to deal with this question in other circumstances.

1. In the presence case, I do not consider that I could grant relief of the kind sought, first, because I have not found that the Associate Justice made the direction or decision appealed from. Second, I do not consider that I could grant relief of that kind, since the admissibility of any answer would ultimately depend on whether the other conditions in s 597(12A), and specifically s 597(12A)(b) are satisfied in respect of any particular answer. I note, however, that the matters raised before me may be relevant to any application for the exclusion of particular evidence on discretionary or other grounds in any criminal proceedings or proceedings for imposition of a penalty which may ultimately be commenced against the examinee. It seems to be that the determination of the questions of fact to which I have referred, and the ultimate relevance of those questions to any discretionary exclusion of evidence, are a matter for determination in those proceedings and not in this application.

1. I should add that, after I raised the question whether any relief was available in oral submissions, the examinee accepted in supplementary submissions that, if the evidence he gives is sought to be used in future proceedings, the Court in those proceedings would be the correct tribunal to determine whether or not the evidence should be admitted. He submitted that the Court's ruling on the appeal against the Associate Judge's "decision" would be relevant to such an application and the appeal was pursued for that reason, even if the Court was not able to grant any other relief.

1. In these circumstances, the only order that I should make is that the application is dismissed.

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Decision last updated: 05 March 2013