Re Bill Express Limited (No.3) - [2010] VSC 640

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

COMMERCIAL COURT LIST E

No. S CI 2009 10799

RE BILL EXPRESS LIMITED (IN LIQUIDATION) (ACN 090 059 564)

BETWEEN:

SANDRO DI DONATO

TELE CARDS ASIA PTY LTD (ACN 101 775 900)

- and –

CRAIG DAVID CROSBIE and IAN MENZIES CARSON
as joint and several liquidators of BILL EXPRESS LIMITED (In liquidation) (ACN 090 059 564)

AND BETWEEN:

PETER JOHN COUPER

AUSTRALIAN PRIVATE NETWORKS PTY LTD
(ACN 103 009 552)

- and –

CRAIG DAVID CROSBIE
IAN MENZIES CARSON as joint and several liquidators of BILL EXPRESS LIMITED (In liquidation)
(ACN 090 059 564)

First Applicant

Second Applicant

Respondents

First Applicant

Second Applicant

Respondents

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JUDGE:	GARDINER AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	23 July 2010
DATE OF JUDGMENT:	17 December 2010
CASE MAY BE CITED AS:	Re Bill Express Limited (No.3)
MEDIUM NEUTRAL CITATION:	[2010] VSC 640

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CORPORATIONS - EXTERNAL ADMINISTRATION – Examination of directors and other persons pursuant to s 596A and s 596B of the Corporations Act2001 (Cth) – Application pursuant to r 42.04(1) of the Supreme Court (General Civil Procedure) Rules 2005 to set aside subpoenas directed to examinees during the course of the examination – Whether liquidators should have sought production under examination provisions of the Corporations Act2001 (Cth) rather than causing the issue of subpoenas – Whether the employment of subpoenas in such circumstances was an abuse of process – Whether documents sought in subpoenas relate to examinable affairs of the company – Whether the subpoenas are “fishing” – Documents ordered to be produced - Application dismissed.

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APPEARANCES:	Counsel	Solicitors
For the Applicants	Mr Bigmore QC	Mills Oakley Lawyers
For the Respondents	Mr P Bick QC with Mr K Tsiakis	Freehills

HIS HONOUR:

On 7 June 2010, Mr Di Donato and Tele Cards Asia Pty Ltd (“TCA”) made application by interlocutory process pursuant to rule 42.04(1) Supreme Court (General Civil Procedure) Rules 2005 to set aside subpoenas respectively addressed to them and dated 24 May 2010.

On 8 June 2010, Mr Peter Couper and Australian Private Networks Pty Ltd (“APN”) made a similar application that the subpoena addressed to Mr Couper and dated 24 May 2010 be set aside.

The subpoena had been issued on the application of the respondents Craig David Crosbie and Ian Menzies Carson, who are the liquidators of Bill Express Ltd (in liq) (“Bill Express”).

The respondents rely on the affidavits of Warren Ingerson and David Webb, both sworn 15 July 2010.

The application by TCA and Mr Di Donato is supported by an affidavit of Ariel Currie Borland sworn 7 June 2010 and Mr Couper’s application is supported by an affidavit of Lisa Filippin sworn 7 June 2010.

By orders made on 19 December 2009 on the application of the respondents, Messrs Di Donato and Couper were summonsed to be examined pursuant to s 596B of the Corporations Act 2001 (Cth) (“the Act”) in respect of the examinable affairs…

Grounds of appeal

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

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

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

Consideration

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

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

Continue reading Re Bill Express Limited (No.3)

Details

AGLC: Re Bill Express Limited (No.3) [2010] VSC 640
Case: [2010] VSC 640
Decision Date: 17 December 2010

CaseChat Overview and Summary

The case of Re Bill Express Limited (No. 3) was an application to set aside subpoenas issued by liquidators during the examination of directors and other persons under the Corporations Act 2001 (Cth). The application was brought in the Supreme Court of Victoria, and it challenged the validity and propriety of the subpoenas issued in the course of the examination. The primary dispute centred around whether the liquidators should have sought the production of documents under the examination provisions of the Corporations Act 2001 (Cth) instead of resorting to subpoenas, and whether the use of subpoenas in these circumstances constituted an abuse of process. Furthermore, the court had to determine if the documents sought by the subpoenas pertained to the examinable affairs of the company and if the subpoenas were being used in a manner that could be considered "fishing" expeditions.

The legal issues before the court included the interpretation and application of sections 596A and 596B of the Corporations Act 2001 (Cth), which pertain to examinations of directors and other persons. The court had to consider whether the liquidators had correctly followed the statutory provisions or if they had exceeded their authority by issuing subpoenas. The court also had to assess the scope of the documents sought by the subpoenas to ensure they were relevant to the examinable affairs of the company and not a general search for information. The application raised questions about the balance between the powers of liquidators in examinations and the rights of the examinees, as well as the potential for abuse of process in the context of corporate examinations.

The court found that the liquidators had not abused their process by issuing subpoenas and that the documents sought were relevant to the examinable affairs of the company. The court held that the liquidators had acted within their authority and that the issuance of subpoenas was not an improper use of process. The documents in question were ordered to be produced, and the application to set aside the subpoenas was dismissed. The court emphasised that the liquidators' actions were aimed at ensuring a thorough examination and that the subpoenas were not a fishing expedition but were justified under the circumstances.

Orders