Re Bond, A; Ex Parte Caboche, D. v Ramsay, R

[1992] FCA 364

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JUDGMENT No. ........ ........ .. ........ -

IN THE FEDERAL COURT OF AUSTRALIA	1
GENERAL DIVISION	1
BANKRUPTCY DISTRICT OF THE	) No. NB1072 of 1992
STATE OF NEW SOUTH WALES	1

RE:	ALAN BOND
EX PARTE:	DELORES CABOCHE
AND :	ROBERT RAMSAY Respondent

C O W :	HILL J
PLACE :	SYDNEY
DATED :	3 JUNE 1992

EX TEMPORE REASONS FOR JUDGMENT

The applicant, MS Caboche, moves the court to set
aside a summons issued by a registrar of this court on 2 June

L992 for her to attend on Thursday at 10 am to be examined

under s.81(1) of the Bankru~tcv Act 1966.

Miss Caboche is a resident of Perth and relevantly for present purposes is trustee of a superannuation fund known as the Investors Retirement Fund. That is a fund, as both parties accept, in which Mr Bond the "relevant person" referred to in s.81(1) was at some time a member.

member of the fund.

Correspondence has been going on since at least 14 May 1992 between the trustee and MS Caboche concerning the question of whether the trustee is entitled to the moneys and assets of that fund. It seems that Mr Bond was the sole

The trustee threatened proceedings but discussions took place over the next few weeks during which time MS Caboche advised that unless the trustees took action by a certain date, she would not be prepared to give an undertaking not to deal with the assets. Those discussions culminated in a conversation on 1 June 1992 when the trustee was advised that MS Caboche would be in a position to have a hearing on 5 June to deal with the question of an interlocutory injunction restraining her from dealing with the fund's assets.

In the meantime the trustee sought details of certain matters from MS Caboche and ultimately issued to her notices under S. 77A of the Bankru~tcv Act requiring information which the trustee alleged was relevant to the administration of the estate.

Quite properly MS Caboche sought advice and although

it was put to me by counsel for the trustee that she had been

actions should be characterised as being unco-operative merely	in essence unco-operative, it did not seem to me that her
because of the delay in responding to those questions from 20 May to date.
There were conversations on 1 June 1992 in which MS Caboche's solicitor agreed to extend the terms of the undertaking not to deal with the assets until 5 pm on 5 June 1992 and no longer. Thus by the time the summons was issued on 2 June 1992 the situation was that there were questions that had been put by the trustee which remained unanswered and there was an undertaking on the part of MS Caboche as trustee not to deal with the superannuation fund assets pending the possibility of the trustee commencing proceedings on or before 5 pm on 5 June.
The trustee says in an affidavit read to the court that he has not completed his investigations in relation to the fund and in particular Mr Bond's interest therein and is anxious to obtain additional information from MS Caboche as a matter of the greatest urgency. It was for that reason that he sought the examination summons with an appointment to be flxed having regard to the deadline which he faced. He said that the purpose of the examination was to obtain information from MS Caboche about the Investors Retirement Fund so that he could progress his investigation of Mr Bond's interest in the funds and obtain details about the assets of the fund which he
may be able to claim from the estate and the liabilities of the fund.
It seems that conversations took place between MS Caboche and an accountant, with Bird Cameron in Perth acting on behalf of the trustee, concerning the attendance of MS Caboche at the examination tomorrow.
An affidavit read in the proceedings indicated that when Mr Cribb spoke to MS Caboche, MS Caboche said that she had been expecting a call and was anxious to know details about the flight and her accommodation. In her affidavit MS Caboche indicates she was served at 4 pm on 2 June 1992 by Mr Cribb who told her that he would send an air ticket to her and asked her where she would like to stay in Sydney. She says that by saying that she did not intend to suggest that it was convenient for her to travel. She indicates that she had arranged an afternoon off on 3 June 1992 and that she had plans to do various things on 3 and 4 June 1992, including vlsiting a physiotherapist and assisting in the preparation of Mr Bond's tax returns. She says she desires to consult her solicitors and prepare properly for a public examination and given limited time would be unable to attend to this prior to 10 am on 4 June 1992.

Counsel for the applicant submitted:

(1) that a reasonable time had not been allowed to MS

Caboche to arrange to attend;

(2) that MS Caboche would undertake to answer by tomorrow the questions which had been put to her by the trustee;

(3) that it was improper for the trustee to use an examination under s.81 to satisfy himself as to what his exposure might be should he be called upon to give an undertaking as to damages in proceedings seeking an interlocutory injunction restraining MS Caboche from dealing with the fund's assets;

(4) that in any event, the real issue between the parties so far as the ownership of the funds in the superannuation fund was concerned arose not from matters of fact but from a question of construction of the trust deed. I was taken to the provisions of the trust deed, in particular, cl. 16 as amended and also to the relevant provision in the rules.

What is reasonable, of course, depends upon all the circumstances. Prima facie two days is not reasonable when it requires the attendance of a person in Perth in Sydney. I say prima facie because circumstances may obviously arise, as in the present case, which renders such a short period

reasonable.

Two matters were urged upon me by counsel for the trustee; the first was that an attempt had been made to secure the public examination in Perth but his client was told by the registry that no one was available to conduct it. In those circumstances the fact that the examination was to be held in Sydney is more understandable. The second was that it is the applicant who has imposed the deadline of 5 June 1992 in respect of dealings with the fund.

I have not had before me evidence of what the assets in the fund are or indeed, what the reason for a deadline of 5 June is. I was told from the bar table that MS Caboche intends to carry out some unspecified transaction at that time but that counsel did not have instructions as to the nature of that transaction.

I gave counsel the opportunity to obtain instructions from MS Caboche as to whether or not she was prepared to undertake not to deal with the assets until a later time which would provide her with the time to consult solicitors prior to the public examination and would enable a perfectly reasonable time to be set for the examination when the heat of the possible controversy on Friday would not interrupt it. The undertaking was not proffered on instructions.

Although there is some substance in the submissions put by counsel for the applicant that the central issue between the parties is one of law I am not convinced that it is the only issue that is likely to arise between the parties. To this extent I take into account the assurance given to me by counsel for the trustee that there are factual matters of relevance to the relationship between the estate of the bankrupt and the assets in the fund which he wishes to ask and he wishes not at this stage to give MS Caboche advance notice of those matters.

There is no substance in my view in the submission put by counsel for the applicant that it is not appropriate to issue a summons under s.81(1) until questions are put and it is clear that they will not be answered.

Although MS Caboche has undertaken to answer the written questions by tomorrow it is quite possible that those questions will themselves prompt other questions. It is also possible that the trustee may wish to examine in greater detail the responses which he receives from MS Caboche in the written replies.

Further, I do not think that it is correct to say
that the trustee on the material before me proposes or seeks

to use the provisions of s.81(1) improperly so as to satisfy

damages.

himself as to what his exposure may be on an undertaking for

It seems to me that the trustee is entitled provided that he does not seek to use s.81 to obtain some unfair tactical advantage or for a forensic purpose extrinsic to the purpose behind the section to put questions that would be relevant to the issue whether the assets of the fund are assets to which the estate is entitled, being part of the property of the bankrupt. Further, the trustee is entitled so to do prior to commencing litigation against MS Caboche should he be so advised. Put in another way, the trustee is not obliged to put himself in a position where the estate could be liable in costs in proceedings taken against MS Caboche in circumstances where the asking of questions and the obtaining of information might make it clear either that there is a case or that there is no case at all.

In these circumstances I do not think that the applicant here made out a case that the trustee is seeking to use the provisions of S . 81(1) to obtain some unfair advantage or for some improper purpose. In these circumstances I would not adjourn the public examination, as I was requested to do, to a later date or set aside the summons requiring MS Caboche's attendance at it.

Accordingly I have indicated that the public examination should continue tomorrow as scheduled before the registrar at 10 am. In those circumstances I would dismiss

the application. I will order the applicant to pay the

trustee's costs.

I certify that this and the
preceding seven (7) pages
are a true copy of the Reasons
for Judgment herein of his Honour

M r Justice Hill.

Associate:

Date: 3 June 1992

Counsel and Solicitors	C.R.C. Newlinds instructed by
for Applicant:	Neil Lawson & CO
Counsel and Solicitors	S. Reeves instructed by
for Respondent:	Malleson Stephen Jaques
Date of Hearing:	3 June 1992
Date Judgment Delivered:	3 June 1992