Lamb, K.W. v Fixler, R

JUDGMENT No. ..z.!&6k .... l .. .?d....

IN THE FEDERAL.COUR3-OF AUSTRALIA )

VICTORIA DISFR@i!a R=S.T.@Y ) No. VG3310 of 1993

GENERRL DXVIS~~N= v--

.. )
IN THE MATTER of TEXEL PTY LTD ( IN LIQUIDATION) (A.C.N. 006 835 918)

BETWEEN: KENNETH WAY N E LAMB
Applicant

AND : ROBERT FIXLER
First Respondent

m: JOSEPH FRANCK
Second Respondent

m: DAVID WELLESLEY MARRINER

17 MAY 1994
Third Respondent

AUSTRALIA
PRINCIPAL

REGISTRY AND : JOSEPH HELLEN
Fourth Respondent

-: Jemkinson J.

m: Melrbourne

m: 13 May, 1994

filed1 216 april 1994 be set aside.
MINUTES OF ORDER

THE COURT ORDERS 7

1.

Each ob the directions and rulings specified in para@ra'phs 1, 2, 3 and 4 of the application by the

4

rl

respondent Joseph Hellen filed 19 April 1994 be
conf &#ed.

Each of the applications specified in paragraph 5 of the said a~plication filed 19 April 1994 be refused.

3. The ruling specified in paragraph 1 of the appl~c&iGn by the applicant Kenneth Wayne Lamb
The j applicant have on and after 27 May 1994 access to t.$e'do&@nents produced to the Court by the second and ithcrd respondents in response to a direction by the gourt $0 those respondents that they produce the foll4wing ciocuments:

(a) loan and security documentation (including amendLng documentation) with the ANZ Banking Group Ltd;
(b) correspondence with the ANZ Banking Group Ltd. ;
relating to a property known as the Wendouree Shopying Gentre held by the ANZ Banking Group Ltd. prio~ to December 1993 as security for indebtedness owed by @eenethorpe Properties Pty. Ltd. and/or related pemons ("the Wendouree property").
The applicant's costs of each of the applications for review filed respectively on 2 December 1993, 19 April 1994 and 26 April 1994 (including costs reserved) be paid by the respondent Joseph Hellen.

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

I N THE FEDERAL .COUR!LOF AUS,TRALIA )

VICTORIA DIS%RhIxg RETWSTR@ ) No. VG3310 of 1993

-7

GENE= D I V I S I ~ N 1

I N THE MATTER of TEXEL PTY
LTD ( I N LIQUIDATION)

(A.C.N. 006 835 918)

BETWEEN: K E N N E T H W A Y N E LAMB
Applicant

AND : ROBERT FIXLER

F i r s t Respondent

AND : JOSEPH FRANCK
Second Respondent

m: DAVID WELLESLEY MARRINER
Third Respondent

m: JOSEPH HELLEN
Fourth Respondent

CORAM: Jenkinson J.
m: Melrbourne
DATE :

13 May, 1994

REASONS FOR JUDGMENT

Reviews of s eve ra l d i r ec t i ons given by a Deputy

Regis t rar concerning t h e mat ters i n t o which inquiry may be

made a t an exayi.nat$on, under Division 1 of Pa r t 5.9 of t h e
Corporations Law, ambout t h e examinable a£ f a i r s of Texel Pty.

Ltd. ( i n l iqu ida t ion) ("Texel") .

Texel i s a l l eged t o have been a t r u s t e e of a u n i t

trust called "The 387 Bourke Street Unit Trust" ("the Bourke Street Trust"). The directors of Texel were three persons each of whom controlled one of the three companies which as trustees of family trusts held all the units in the Bourke Street Trust. The person under examination at the times when the directions were given by the Deputy Registrar, Joseph Hellen, controls Mideb Pty. Ltd. ("Mideb") , which is the trustee of the Hellen Family Trust and hold 45 per centum of the units in the Bourke Street Trust. Similar directions are likely to be gkven in respect of the other two directors and the companies holding the rest of the units.

It is alleged by the liquidator that each of Mideb and the other two companies is apparently indebted to Texel in a large sum, in each case a sum proportioned to the company's interest in the units. In Mideb's case that is 45 per centum of nearly $12 million advanced by Texel to the three companies and by them in turn advanced in the same proportions to Deenethorpe Properties Pty. Ltd. ("Deenethorpe"), which is

also controlled by m. Hellen and the other two persons.

The liqui&aItor desires to elicit, from Mr. Hellen and from financial amnd other records of Mideb, information which would enable him to assess Mideb's capacity to satisfy a judgment for the a1le.ged debt in favour of Texel, in order to determine whether to commit resources to instituting and prosecuting such an action. Mr. Archibald Q.C., who appeared with Mr.Sifris for Mr. Hellen, submitted that in balancing the interest of the liquidator in obtaining information of that kind and the interest of Mideb and of its shareholders and of beneficiaries of the Hellen Family Trust in privacy concerning Mideb's affairs the Court should weigh in favour of the latter interest the evidence which suggested that the existence of the alleged indebtedness, of Mideb to Texel, was doubtful. One source of doubt suggested was the circumstance that Texel was constituted "an additional Trustee of the Trust Deed to hold [certain land of which it was the registered proprietor and which was part only of the land subject to the trust] upon the trusts contained in the Trust Deed". Mr. Archibald disavowed an intention to present a detailed argument, based upon that circumstance, that only the original trustee and not Texel was a creditor of the three trustee companies, if debt there was, or a detailed argument that there was no debt at all, which other circumstances of which there was evidence suggested. His submission was that the doubts raised concerning the existence of the debt strengthened the case which was othe:mise raised on Mr. Hellen's behalf concerning

the Deputy Reghstrar's directions.

Mr. Goldbeeg Q.C., who appeared with Mr. Collinson for the liquidator, presented a more detailed argument to demonstrate inclebtedness of Mideb to Texel, both in respect of the advance to which I have referred and in respect of other advances which the evidence suggested had been made by Texel to the three companies and by them in turn to Deenethorpe.

The principal argument by Mr. Archibald was that the
Deputy Registrar's directions for production by Mr. Hellen of

documents of Mideb comprehended documents unnecessary to be

: .

examined in quest of information enabling assessment to be 1 .
made of Mideb's capacity to satisfy a judgment for any debt
Mideb may owe to Texel. For that purpose documents evidencing
Mideb's present and future capacity to pay such a debt would
be relevant, and Mr. Archibald declared his client's
willingness to produce Mideb's current financial statements -
a balance sheet and profit and loss account. But those
directions of the Deputy Registrar which required production
by Mr. Hellen of such statements in respect of the financial
years ended 30 June 1992 and 1993, and production of "general
ledger and supporting journals and any trust of which Mideb is
trustee" for those years, and production of the asset register
and of "valuations of properties in which Mideb holds an
interest", and production of "documents recording details of i
!._
securities over properties in which Mideb holds an interest i
I
(including doc~ments showing the extent of the indebtedness

secured by the p~operty such as mortgages and facility ! I
i
agreements with fina~ncial institutions)", and production of
I
"contracts or other documentation relating to dispositions or
acquisitions of assets of Mideb in the period since 30 June
1993", went far beyand what was required for assessment of , -
Mideb's present or hture capacity to satisfy such a judgment, !
according to Mr. Archibald's submission.

Mr. Archibald stressed, and Mr. Goldberg did not deny, the important distinction between the ambit of the power to examine and to compel production of documents and discretionary determination of the circumstances in which, and of the extent to which, exercise of the power is appropriate, a distinction to which the Full Court of this Court drew attention in Grosvenar Hill (Old) Ptv. Ltd. v. Barber (1994) 12 A.C.J.R. 646 at 651, 656-657.

It is at least arguable that more has been required to be produced than could be justified by reference to the liquidator's need to assess Mideb's capacity to satisfy a judgment against it in favour of Texel, or by reference to the liquidator's need to determine whether Texel is a creditor in respect of Mideb's share of the first advance of nearly $12 million. But there is evidence which raises the possibility that Mideb's fimanclal position, at the several times when advances were made to Mideb by Texel, or were made to Mideb in circumstances which otherwise created a liability of Mideb to Texel, was such that a person who was a director of both Texel
and Mideb at those times may have contravened s.232(2) or s.232(4) of the Cormrations Law in sanctioning, as a director

of Texel, those advances, or one or more of them, on the terms, hereafter to be stated, which it is suggested on behalf of Mr. Hellen were agreed. Further, Mr. Hellen and the other two persons whose examinations are in train knew that the advances to the three trustee companies they controlled were to be passed on to Deenethorpe, which they also controlled and which they caused to borrow $22 million from Australia and New Zealand Banking Group Ltd. ("the AN2 Bank"), so that with the first advance of nearly $12 million and that $22 million a shopping centre in Ballarat could be purchased. In 1993, after further advances aggregating $1,564,000 had been made to the three trustee companies and passed on to Deenethorpe as further loans by those three companies, the mortgage over the shopping centre securing the loan of $22 million by the AN2 Bank was modified to secure additional liabilities, with the result that when in December 1993 the shopping centre was sold the whole of the consideration (about $26.5 million) was paid to the ANZ Bank in reduction, or perhaps extinction, of the debts secured by the mortgage. Those circumstances also raise the possibility that a person who was a director of Texel and Mideb and one of the three controllers of Deenethorpe may have contravened s.232(2) or s.232(4) of the Corporations Law in sanctioning, as a director of Texel, the further advances, and in abstaining, if abstention there was, as a director of Texel, from seeking to have security provided, by Deenethorpe to the trustee companies and by the trustee companies to
Texel, for the advances which flowed from the Bourke Street Trust through the family trusts to the trust of which

Deenethorpe was trustee, and in abstaining, if abstention there was, as a director of Texel, from seeking to prevent or to limit the modification of the mortgage to the AN2 Bank. The evidence suggests that none of the advances was secured or documented, nor did any of them bear interest. It appears that Deenethorpe lacks the financial capacity to repay the trustee companies the moneys advanced. It is suggested that the arrangement between the parties was that repayment should be made only if, and to the extent that, the proceeds of the sale of the shopping centre included a profit on the sale. Compensation may be ordered to be paid to Texel in respect of loss or damage suffered by Texel as a result of the act or omission constituting such a contravention : see s.l317HA(l) of the Corporations Law. And damages may be claimed under the general law in respect of breach of a director's duty : see s.232(11) of that Law.

In order to determine whether there is evidence to justify an action for damages, or a request by the liquidator that the Austxalian Securities Commission apply for a civil penalty order, pursuant to s .1317EA of the Corporations Law, in respect of Mr. Hellen's conduct as a director of Texel, the documents specified in the Deputy Registrar's requirement would be appropriate subjects of examination, in my opinion. In the circumstances I have specified I consider that the requirement should stand. The same circumstances make it
that the liquidator of Texel be allowed to ask "questions appropriate in my opinion that the Deputy Registrar's ruling

relating to the creditworthiness and financial capacity of Mideb and any %rust of which Mideb was a trustee" should also stand, without limitation to the present creditworthiness and financial capaclty of that company.

The generality of the language of the ruling was criticised by Mr. Archibald, as justifying a supposition that the Court's duty to consider the appropriateness of each question put during the examination was being disregarded. I would understand the ruling as indicating a permitted subject of examination, but without any prejudgment of the appropriateness of a question merely because the question fell within the subject. As the examination proceeds the exercise of the discretionary power conferred by s.597(5B) must be made on the material then available to the Court, and may be made, on that material, in such a way as to contract or expand the subject described in the ruling now under consideration.

Mr. Archibald submitted that, because there is lacking in s.596A of the Cor~orations Law, and in particular in the statutory exposition of the expression "examinable affairs" which is provided by s.53 of that Law, any reference to misconduct, whereas such a reference is found in s.596B1 an
examination upon a summons under s.596A does not extend to

questioning merely for the purpose of discovering whether misconduct has occurred in relation to a corporation. I do
person summoned under s.596B should have been concerned in not accept the submission. The requirement in s.596B that the

examinable affalirs of the corporation and may have been guilty of misconduct in relation to the corporation is part of a limitation on the d,iscretionary power conferred by s.596B to summon persons for eeamination. The power does not extend to a person who neither is nor during the period specified in s.596A(b) was an examinable officer of the company and who is not shown to be one who is able to give information about examinable affairs of the company. The terms of s.596B do not justify a restrictive reading of s.53 in my opinion. Further, even if the potential entitlement to compensation, coupled with the right of the corporation to be heard on the question whether the Court should order payment of compensation, which s.1317JB contemplates, does not constitute a chose in action and so property of the corporation, the chose in action under the general law for breach of a director's duty is in my opinion "property" of a corporation and so part of the

corporation's "examinable affairs".

The liquidator seeks review of the Deputy Registrar's decision on 11 April 1994 to deny the liquidator access to certain documents which had been previously produced to the Court and which were on that date in the custody of the Court. The liquidator seeks an order that the decision be set aside and that an order be made that the liquidator have access to the documents. The description of the documents in the originating application is unsatisfactory. They are

described thus:

"documents in the possession of the first and second res~pondents and produced to the Court by
the first and second respondents ........ .... :

(a) loan and security documentation (including amending documentation) with the RNZ Banking Group Ltd;
(b) correspondence with the ANZ Banking Group Ltd;
relating to a property known as the Wendouree Shopping Centre held by the ANZ Banking Group Ltd. prior to December 1993 as security for indebtedness owed by Deenethorpe Properties Pty. Ltd. and/or related persons ('the Wendouree property')."

The documents were produced to the Court in response to a direction by the Court which described the documents required in the terms I have quoted, but omitting the words "produced to the Court by the first and second respondents". In those circumstances a direction that the liquidator have access to them may appropriately describe them thus:

"documents produced to the Court by the first and second respondents in response to a direction by the Court to those respondents that they produce the following documents:

(a) loan and security documentation (including amending documentation) with the ANZ Banking Group Ltd;
(b) correspondence with the ANZ Banking Group Ltd;
relating to a property known as the Wendouree Shopping Centre held by the ANZ Banking Group Ltd. prior to December 1993 as security for indebtedness owed by Deenethorpe Properties Pty. Ltd. and/or related persons ( 'the Wendouree property')."

The documents to which access is sought may be expected to a£ ford information as to the knowledge Mr. Hellen had, or could have had if as a director of Deenethorpe he had sought it, concerning Deenethorpe's financial and legal relations with the ANZ Bank during the period, or part of the period, when as a director of Texel he was participating in the making of advances by Texel to the three trustee companies to enable those companies to make advances to Deenethorpe, and during the period when modification of the AN2 Bank's mortgage over the shopping centre was under consideration by mortgagor and mortgagee. For the reasons given earlier it is in my opinion appropriate that the liquidator be given the means of ascertaining what that knowledge was. I will set aside the Deputy Registrar's decision and order that the liquidator have access to the documents.

Application was made, in the event that Mideb's financial affalrs and those of trusts of which it has been trustee were made the subject of examination, that that part of the examination be held in private. The interest of shareholders of Mideb and beneficiaries under the Hellen Family Trust in the privacy of those affairs was said to

constitute "special circumstances", within the meaning of that

expression in s.597(4). The shareholders, other than directors, and beneficiaries are not subject to examination about Texel's affairs and should not have their own affairs or the affairs of the trustee company exposed in public, it was

the Commonwealth Bank information of use to it in the conduct submitted. It was said that public examination would afford

of pending litigation in the Supreme Court of Victoria by it against Mideb, which is alleged to have guaranteed debt owed to the Commonwealth Bank. That information the Commonwealth Bank could not obtain by any procedure available to it in that litigation and the information could not be obtained if the examination were held in private and appropriate directions were given in exercise of powers conferred by s.596F, it was submitted.

The submission last stated was contradicted by Mr. Goldberg, who pointed to the provisions of s.597(13) and s.597(14A)(b). I need not attempt by construction to reconcile what may be thought to be conflicting provisions on the subject of publication of information disclosed during examination under Division 1 of Part 5.9. As a creditor in a large sum of Texel the Commonwealth Bank has an interest in the discovery of any conduct which may be productive of funds, whether by compensation or damages, to Texel. (Cf. Re Laurie Cotter Productions Ptv. Ltd. (in liq.) (1992) 9 A.C.S.R. 913.) The financial affairs of Mideb, as distinct from the conduct of those who controlled Mideb and its financial affairs during the period under consideration, are unlikely to be the subject of general public interest. There is no evidence of any particular embarrassment which a shareholder or beneficiary, other than one who was also a controller, would be caused by public disclosure of Mideb's financial affairs. I am not

decline at this stage to order that any part of the persuaded that exceptional circumstances have been shown. I
examination of Mr. Hellen be in private.

Submissions were advanced by Mr. Goldberg that Mr. Hellen was estopped from advancing in support of his present application several of the contentions with which I have dealt, because of the course taken on his behalf on the hearing of a previous application by him to review a ruling by the Deputy Registrar. Mr. Goldberg's submissions were vigorously contradicted by Mr. Archibald. Having been exhorted by Mr. Goldberg to give judgment in this matter "sooner rather than later", I have abstained from consideration of the question of estoppels.

An earlier application by Mr. Hellen, filed 2 December 1993, for review of a ruling during Mr. Hellen's examination resulted in confirmation of the ruling by me on 10 March 1994. The parties were requested to make written submissions on the question of costs. The written submissions were very helpful. Upon consideration I have reached the conclusion that exercise of the rlght to review a Registrar's decision is regarded in this Court as initiating an adversarial proceeding whenever there is a party seeking to uphold the decision, and that the discretionary jurisdiction to award costs, conferred by s.43 of the Federal Court of Australia Act 1976, in such a case is ordinarily exercised on that footing. I do not find that the Court has departed from

that course because the person seeking review has been involuntarily involved in an examination under Division 1 of

Part 5.9 of the Cozporations Law as an examinee and that the application for review is occasioned by dissatisfaction with a Registrar's ruling or direction in the course of his examination. That being the Court's practice, I am not free to depart from it unless convinced that it is wrong. My uneasiness concerning the practice has not grown to such a conviction. The unsuccessful applicant for review will

theref ore be ordered to pay the respondent 'S costs, there being no other circumstance which would justify another course.

I certify that this and the 13
preceding pages are a true copy of the Reasons for Judgment of the Honourable Mr. Justice Jenkinson.
Dated: 13 May, 1994

Mr. A.H. Goldberg Q.C. and Mr. P.W. Collinson instructed by
Phillips Fox for the Applicant

Mr. H.S. Obst Solicitor of Tress Cocks & Maddox for the Second and Third Respondents

Mr. A.C. Archibald Q.C. and Mr. M.L. Sifris instructed by
Clayton Utz for the Fourth Respondent

Dates of Hearing: 29 April 1994 and 2 May 1994

I N THE FEDERAL .COUR!LOF	AUS,TRALIA	)
VICTORIA	DIS%RhIxg RETWSTR@	) No. VG3310 of 1993

made a t an exayi.nat$on,	under Division 1 of Pa r t 5.9 of t h e
*Corporations Law,* ambout	t h e examinable a£ f a i r s of Texel Pty.

examined in quest of information enabling assessment to be	1 .
made of Mideb's capacity to satisfy a judgment for any debt
Mideb may owe to Texel. For that purpose documents evidencing
Mideb's present and future capacity to pay such a debt would
be relevant, and Mr. Archibald declared his client's
willingness to produce Mideb's current financial statements -
a balance sheet and profit and loss account. But those
directions of the Deputy Registrar which required production
by Mr. Hellen of such statements in respect of the financial
years ended 30 June 1992 and 1993, and production of "general
ledger and supporting journals and any trust of which Mideb is
trustee" for those years, and production of the asset register
and of "valuations of properties in which Mideb holds an
interest", and production of "documents recording details of	i
!._
securities over properties in which Mideb holds an interest	i
I
(including doc~ments showing the extent of the indebtedness

secured by the p~operty such as mortgages and facility	! I
i
agreements with fina~ncial institutions)", and production of
I
"contracts or other documentation relating to dispositions or
acquisitions of assets of Mideb in the period since 30 June
1993", went far beyand what was required for assessment of	, -
Mideb's present or hture capacity to satisfy such a judgment,	!
according to Mr. Archibald's submission.
Mr. Archibald stressed, and Mr. Goldberg did not deny, the important distinction between the ambit of the power to examine and to compel production of documents and discretionary determination of the circumstances in which, and of the extent to which, exercise of the power is appropriate, a distinction to which the Full Court of this Court drew attention in Grosvenar Hill *(Old)* Ptv. Ltd. v. Barber (1994) 12 A.C.J.R. 646 at 651, 656-657.
It is at least arguable that more has been required to be produced than could be justified by reference to the liquidator's need to assess Mideb's capacity to satisfy a judgment against it in favour of Texel, or by reference to the liquidator's need to determine whether Texel is a creditor in respect of Mideb's share of the first advance of nearly $12 million. But there is evidence which raises the possibility that Mideb's fimanclal position, at the several times when advances were made to Mideb by Texel, or were made to Mideb in circumstances which otherwise created a liability of Mideb to Texel, was such that a person who was a director of both Texel
and Mideb at those times may have contravened s.232(2) or	s.232(4) of the Cormrations Law in sanctioning, as a director
of Texel, those advances, or one or more of them, on the terms, hereafter to be stated, which it is suggested on behalf of Mr. Hellen were agreed. Further, Mr. Hellen and the other two persons whose examinations are in train knew that the advances to the three trustee companies they controlled were to be passed on to Deenethorpe, which they also controlled and which they caused to borrow $22 million from Australia and New Zealand Banking Group Ltd. ("the *AN2* Bank"), so that with the first advance of nearly $12 million and that $22 million a shopping centre in Ballarat could be purchased. In 1993, after further advances aggregating $1,564,000 had been made to the three trustee companies and passed on to Deenethorpe as further loans by those three companies, the mortgage over the shopping centre securing the loan of $22 million by the *AN2* Bank was modified to secure additional liabilities, with the result that when in December 1993 the shopping centre was sold the whole of the consideration (about $26.5 million) was paid to the ANZ Bank in reduction, or perhaps extinction, of the debts secured by the mortgage. Those circumstances also raise the possibility that a person who was a director of Texel and Mideb and one of the three controllers of Deenethorpe may have contravened s.232(2) or s.232(4) of the Corporations *Law* in sanctioning, as a director of Texel, the further advances, and in abstaining, if abstention there was, as a director of Texel, from seeking to have security provided, by Deenethorpe to the trustee companies and by the trustee companies to
Texel, for the advances which flowed from the Bourke Street	Trust through the family trusts to the trust of which
Deenethorpe was trustee, and in abstaining, if abstention there was, as a director of Texel, from seeking to prevent or to limit the modification of the mortgage to the *AN2* Bank. The evidence suggests that none of the advances was secured or documented, nor did any of them bear interest. It appears that Deenethorpe lacks the financial capacity to repay the trustee companies the moneys advanced. It is suggested that the arrangement between the parties was that repayment should be made only if, and to the extent that, the proceeds of the sale of the shopping centre included a profit on the sale. Compensation may be ordered to be paid to Texel in respect of loss or damage suffered by Texel as a result of the act or omission constituting such a contravention : see s.l317HA(l) of the *Corporations Law.* And damages may be claimed under the general law in respect of breach of a director's duty : see s.232(11) of that Law.
In order to determine whether there is evidence to justify an action for damages, or a request by the liquidator that the Austxalian Securities Commission apply for a civil penalty order, pursuant to s .1317EA of the *Corporations* Law, in respect of Mr. Hellen's conduct as a director of Texel, the documents specified in the Deputy Registrar's requirement would be appropriate subjects of examination, in my opinion. In the circumstances I have specified I consider that the requirement should stand. The same circumstances make it
that the liquidator of Texel be allowed to ask "questions	appropriate in my opinion that the Deputy Registrar's ruling
relating to the creditworthiness and financial capacity of Mideb and any %rust of which Mideb was a trustee" should also stand, without limitation to the present creditworthiness and financial capaclty of that company.
The generality of the language of the ruling was criticised by Mr. Archibald, as justifying a supposition that the Court's duty to consider the appropriateness of each question put during the examination was being disregarded. I would understand the ruling as indicating a permitted subject of examination, but without any prejudgment of the appropriateness of a question merely because the question fell within the subject. As the examination proceeds the exercise of the discretionary power conferred by s.597(5B) must be made on the material then available to the Court, and may be made, on that material, in such a way as to contract or expand the subject described in the ruling now under consideration.
Mr. Archibald submitted that, because there is lacking in s.596A of the *Cor~orations* Law, and in particular in the statutory exposition of the expression "examinable affairs" which is provided by s.53 of that Law, any reference to misconduct, whereas such a reference is found in s.596B1 an
examination upon a summons under s.596A does not extend to
questioning merely for the purpose of discovering whether misconduct has occurred in relation to a corporation. I do
person summoned under s.596B should have been concerned in	not accept the submission. The requirement in s.596B that the
examinable affalirs of the corporation and may have been guilty of misconduct in relation to the corporation is part of a limitation on the d,iscretionary power conferred by s.596B to summon persons for eeamination. The power does not extend to a person who neither is nor during the period specified in s.596A(b) was an examinable officer of the company and who is not shown to be one who is able to give information about examinable affairs of the company. The terms of s.596B do not justify a restrictive reading of s.53 in my opinion. Further, even if the potential entitlement to compensation, coupled with the right of the corporation to be heard on the question whether the Court should order payment of compensation, which s.1317JB contemplates, does not constitute a chose in action and so property of the corporation, the chose in action under the general law for breach of a director's duty is in my opinion "property" of a corporation and so part of the
corporation's	"examinable affairs".

(a)	loan and security documentation (including amending documentation) with the *RNZ* Banking Group Ltd;
(b)	correspondence with the ANZ Banking Group Ltd;

(a)	loan and security documentation (including amending documentation) with the ANZ Banking Group Ltd;
(b)	correspondence with the ANZ Banking Group Ltd;

[1994] FCA 284

13 May 1994