Re Csidei; ex parte Andrew

Re CSIDEI; Ex parte ANDREW (1979) 39 FLR 387
Bankruptcy

COURT

FEDERAL COURT OF AUSTRALIA

GENERAL DIVISION
Lockhart J.(1)

CATCHWORDS

Bankruptcy - Registrar's summons to attend to give evidence - Trustee seeking to examine liquidator - Liquidator having no personal knowledge of bankrupt or bankrupt's affairs save through his liquidation - Liquidator not unwilling to assist trustee - Whether compulsory process required - Bankruptcy Act 1966 (Cth.), s. 81.

Bankruptcy - Summons issued pursuant to s. 81 of Bankruptcy Act 1966 (Cth.) - Review - Locus standi of liquidator - Bankruptcy Act 1966 (Cth.), s. 14(5).

HEADNOTE

On the application of a trustee in bankruptcy the Registrar issued two summonses pursuant to s. 81 of the Bankruptcy Act 1966 (Cth.) addressed to the applicant (A.) a liquidator of a company duly appointed by a State Supreme Court. Each summons required A. to attend and give evidence and produce certain documents alleged to be in his custody or power. A. had no personal knowledge of the bankrupt or his affairs except such knowledge as had been derived in the course of his duties as a liquidator. A. applied to set aside the summonses pursuant to s. 14(5) of the Act.

Held: (1) The power prescribed by s. 81 of the Act is an extraordinary power which must be carefully exercised.

Ex parte Willey; Re Wright (1883), 23 ChD 118, approved.

Rees v. Kratzmann (1965), 114 CLR 63, referred to.

(2) The order requiring the attendance of a person pursuant to s. 81 is not made as of course nor as of right.

Heiron's case (1880), 15 ChD 139, followed.

Re Rolls Razor Ltd. (No. 2), (1979) 1 Ch 576; Ex parte Willey; Re Wright (1883), 23 ChD 118, referred to.

(3) The power given to the court by s. 81 is a discretionary one.

Re Maurice and Shepherd; Ex parte Official Receiver Unreported (Supreme Court of Queensland, Matthews J., 17th December, 1976) not followed.

(4) No rigid rules should be laid down for the proper exercise of the discretion of the court.

Re Rolls Razor Ltd. (No. 2), (1970) 1 Ch 576, approved.

(5) The applicant had locus standi to apply to the court pursuant to s. 14(5).

Heiron's case (1880), 15 ChD 139; Re North Australian Territory Company (1890), 45 ChD 87; Re Rolls Razor Ltd. (No. 2), (1970) 1 Ch 576, approved.

Re Gold Company (1879), 12 ChD 77, not followed.

Discussion concerning the nature of the overlapping jurisdictions in matters of insolvency and the meaning of "may" in s. 81.

HEARING

Sydney, 1979, October 30; November 1; December 14. #DATE 14:12:1979

APPLICATION.

John William O'Brien, the liquidator of Dollar Fund of Australia Ltd., applied to the court pursuant to s. 14(5) for orders setting aside two summonses issued by the Registrar on the application of the trustee in bankruptcy of Bela Csidei, a bankrupt, which summonses were issued pursuant to s. 81 of the Bankruptcy Act 1966 (Cth.) requiring Mr. O'Brien to attend before the Registrar and give evidence in connexion with the estate of the bankrupt and produce certain documents.

B.W. Rayment, for the applicant.

P.D. Urquhart, for the respondent.

Cur. adv. vult.

Order accordingly.

Solicitors for the applicant: Wronker & Partners.

Solicitors for the respondent: Lobban McNally & Harney.

D. LEVIN.

JUDGE1

December 14

The following judgment was delivered.

LOCKHART J. This case raises a question of general importance in bankruptcy. It concerns the construction of s. 81 of the Bankruptcy Act 1966 ("the Act") and the circumstances in which the power thereby conferred, of summoning persons to attend to give evidence, should be exercised in the case of the liquidator of a company appointed by a State Supreme Court whom the trustee seeks to examine as to his knowledge of matters relating to the bankruptcy that have come to his attention solely in his capacity as liquidator of the company. (at p388)

What gave rise to the question was the issue by the Registrar of two summonses under s. 81 directed to John William O'Brien, requiring him to attend to give evidence in connexion with the bankrupt estate of Bela Csidei and to produce certain documents in his custody or power. (at p388)
Mr. O'Brien (to whom I shall refer as "the liquidator") was appointed provisional liquidator of a company, Dollar Fund of Australia Ltd. ("the company"), by the Supreme Court of New South Wales in its Equity Division on 1st September, 1977. He was appointed liquidator on 7th November, 1977. He is an "A" list official liquidator of New South Wales. (at p388)
The first summons was issued on 17th July, 1979, following the filing by the trustee of the bankrupt's estate of an application for issue of summonses directed to six people. So far as relevant, the application specified the grounds for the issue of the summons against the liquidator as being that inquiries of the trustee disclosed that the bankrupt was the registered proprietor of certain land near Cairns in Queensland and that the owner of a parcel of adjoining land was a company, Half Moon Bay Pty. Ltd., which the bankrupt had stated at his public examination had been under his control. There was a series of complex negotiations involving the lands owned by the bankrupt and the lands owned by Half Moon Bay Pty. Ltd. culminating in a deed of 5th August, 1976, which provided, inter alia, that the bankrupt grant an option to the company for the consideration of $100,000. The trustee said he believed the option was exercised and that subsequently the company was wound up. He said it appeared that the company had not paid the whole of the money and he wished to examine the liquidator as to that matter. (at p389)
A further application was made on 10th October, 1979, by the trustee for the examination of the liquidator in which he said much the same as he had said in his earlier application but added: "From information which I have received, it would appear that the liability of Dollar Fund of Australia Ltd. to pay the said $100,000 may have been the subject of an arrangement or agreement subsequent to 5th August, 1976, whereby the said liability was reduced from $100,000 to $60,000. I desire to examine Mr. J. O'Brien for the purpose of ascertaining: (a) what arrangements, agreements or deeds were entered into by Dollar Fund of Australia Ltd. and the bankrupt subsequent to 5th August, 1976, relating to the said liability; (b) what part, if any, of the said liability has been discharged and in what manner." (at p389)
Pursuant to this last-mentioned application the Registrar issued a summons on 11th October, 1979, requiring the liquidator to attend before him on 23rd October, 1979, to give evidence in connexion with the bankrupt's estate and to produce certain specified documents. (at p389)
The examinations have been stood over pending the outcome of these proceedings. (at p389)
Mr. Rayment who appears for the liquidator, both before the Registrar and this Court, informed the Registrar that an informal arrangement has been made between the trustee and the liquidator for the documents referred to in the summonses to be made available for inspection by the trustee, not requiring an order by the Registrar. (at p389)
The liquidator has given evidence in this Court that, prior to his appointment as provisional liquidator, he had no dealings whatever with the bankrupt and that his only knowledge of the bankrupt's affairs is as to matters that have come to his attention solely in his capacity as liquidator of the company, and that he has never met the bankrupt or had any communication with him. (at p389)
The liquidator says that, in these circumstances, it is not a proper exercise of the power under s. 81 for this Court or the Registrar to issue summonses requiring the attendance under compulsory process of the liquidator of a company appointed by a State Supreme Court, unless it is first established that the liquidator has refused to assist the trustee. Such refusal is not suggested by the trustee in this case. (at p389)
The liquidator seeks orders that the acts or decisions of the Registrar to summon him to attend before the Registar to give evidence relating to the bankrupt or his trade dealings, property or affairs be set aside and that the two summonses likewise be set aside. (at p390)
The application is made by the liquidator under s. 14(5) of the Act which provides that an order or direction made or given or an act done by the Registrar under the Act is subject to review on summary application to the court. (at p390)
Section 81(1) of the Act provides as follows:

"81.(1) The Court or the Registrar may, on the application of
the trustee or of a creditor who has proved his debt, and on such
terms as to costs as the Court or the Registrar thinks fit to
impose, at any time summon-
(a) the bankrupt or the spouse of the bankrupt; or
(b) a person known or suspected to have in his possession any
property of the bankrupt, or who is supposed to be indebted to the
bankrupt or to be able to give information respecting the
bankrupt or his trade dealings, property or affairs,
to attend before the Court or before the Registrar or, if the Court
or the Registrar thinks fit, before a magistrate, to give evidence
and produce any documents in his custody or power relating to
the bankrupt or his trade dealings, property or affairs." (at p390)
The corresponding section in the Bankruptcy Act 1924 was s. 80 which was substantially taken from s. 25 of the Bankruptcy Act, 1914 (Imp.). It was in turn taken, except for sub-s. (5) which was added later, from the Bankruptcy Act, 1869 (Imp.). The power to summon persons for examination in bankruptcy was originally conferred by 34 & 35 Henry 8 c. 4, s. 2, and was continued by 13 Eliz. 1 c. 7, s. 5; 1 Jac. 1 c. 15, s. 10; 6 Geo. 4 c. 16, s. 33, and the Act of 1849 (Imp.), s. 120. (at p390)
The purpose of the section is to elicit information that may be relevant for the proper conduct of the bankruptcy and that may aid the process of finding and recovering assets available for distribution. (at p390)
There are analagous provisions in the law relating to the winding up of companies. I shall mention these provisions and some of the authorities that relate to them as the process of examining persons in the winding up of companies has been borrowed from the law of bankruptcy and the purpose of the inquisitional powers conferred by bankruptcy and company legislation is much the same. (at p390)
Section 249 of the Uniform Companies Act 1962 provides for an examination which is held in chambers and the purpose of which is to enable the liquidator to obtain information from those connected with the company that can be used for the beneficial winding up of the company. The origins of s. 249 are to be found in s. 15 of the Joint Stock Companies Winding Up Act, 1884 (Imp.), which empowered the court to summon and examine persons who were thought to be capable of giving information about the property and previous dealings of the company. Section 268 is the equivalent section in the Companies Act, 1949 (Imp.). (at p391)
Provision is made by the Uniform Companies Act for the public examination of persons under s. 250 which serves substantially the same purpose; but the fact that it is held in open court and that it is concerned principally with obtaining evidence of the commission of fraud by officers of the company tends to characterize the examination as quasi-criminal in character. (at p391)
Section 250 is equivalent to s. 270 of the Companies Act, 1948 (Imp.). It was not until 1890 that provision was made under English law for the public examination of persons connected with the company by s. 8 of the Companies (Winding Up) Act, 1890 (Imp.). (at p391)
The analogy between bankruptcy and the winding up of companies in this respect, and the nature of the inquisitional power conferred by s. 96 of the Bankruptcy Act, 1869 (Imp.), a predecessor of s. 81 of the Act, was expressed by Jessell M.R. in Ex parte Willey; Re Wright in these terms: "Now that is a very grave power to entrust to any Court or any man, viz., power to summon any other man whom you suspect (for mere suspicion will do) to be capable of giving information, and to get any information from him, although that information may be extremely hostile to the interests of the man himself. It is a power which, so far as I know, is found nowhere except in bankruptcy and the winding-up of companies (which is a kind of bankruptcy); it is a very extraordinary power indeed, and it ought to be very carefully exercised" (1883) 23 ChD 118, at p 128 . See also Rees v. Kratzmann per Windeyer J. (1965) 114 CLR 63, at p 79 . (at p391)
The power conferred by s. 81 to summon persons to attend to give evidence or produce documents is, like the power conferred by s. 249 of the Uniform Companies Act, "an extraordinary power of an inquisitorial nature": see Re North Australian Territory Company per Bowen L.J. (1890) 45 Ch D 87, at p 93 . The examinee is not a witness in the ordinary sense and the ordinary rules of procedure do not govern the examination. (at p391)
The application to examine is made ex parte and the person whom it is sought to examine is not heard on the application for the issue of the summons. (at p391)
The order is not made as of course or as of right; see Re Metropolitan Bank (Heiron's case) (1880) 15 Ch D 139 ; Re Rolls Razor Ltd. (No. 2) (1970) 1 Ch 576 and Ex parte Willey; Re Wright (1883) 23 Ch D 118 . (at p391)
In Re Rolls Razor Ltd. (No. 2) Megarry J. said in relation to s. 268 of the Companies Act, 1948 (Imp.): "In such a process, it seems to me that the court must give great weight to the views of the liquidator, with his detailed knowledge of the problems that exist in relation to the affairs of the company and the information that is required. At the same time, the court must be astute to prevent any oppressive, vexatious or unfair use of this extraordinary process, especially as the liquidator's report is kept hidden from the examinees. Indeed, in Re Greys Brewery Company (1883) 25 Ch D 400, at p 408 , Chitty J. said that the section had been called the Star Chamber clause. These circumstances seem to me to point at least to the desirability of the examinees having the right to have the unfettered discretion of the judge brought to bear upon any exercise of this extraordinary jurisdiction. I may add that in this case there is no question of any attempt to use the section in any improper way as a means of aiding the liquidator in other litigation, such as arose in Re Metropolitan Bank, (Heiron's case) (1880) 15 Ch D 139 , Re Imperial Continental Water Corporation (1886) 33 Ch D 314 and Re North Australian Territory Company (1890) 45 Ch D 87 " (1970) 1 Ch, at p 592 . (at p392)
Although his Lordship was speaking of s. 268 of the Companies Act, 1948 (U.K.), much of what he said applies by analogy to the power of the court or the Registrar to issue a summons under s. 81 of the Act. (at p392)
Considerable weight must be given to the views of the trustee as it is he who is most conversant with the problems that exist in relation to the affairs of the bankrupt and the information that is necessary. The very fact that the order for examination is made ex parte; that the examination is a compulsory process with penal consequences for failing to attend, or to properly answer questions or to produce documents; and that the transcript of evidence or notes of examination may be used against the witness in proceedings under the Act, all point to the conclusion that the court or the Registrar has a discretion to issue the summons (I shall deal with this question more fully later) and that in the exercise of that discretion the court or the Registrar must "be astute to prevent any oppressive, vexatious or unfair use of this extraordinary process". See Re North Australian Territory Company (1890) 45 Ch D 87 ; Re Joseph Hargreaves Ltd. (1900) 1 Ch 347, at p 352 ; Re London & Northern Bank; Ex parte Archer (1901) 85 LT 698 ; Re British Building Stone Company Ltd. (1908) 2 Ch 450 ; Re South Essex Estuary & Reclamation Company; Ex parte Paine and Layton (1869) 4 Ch App 215, at p 217 ; Ex parte Nicholson; Re Wilson (1880) 14 Ch D 243 and Williams on Bankruptcy (18th ed.), pp. 127-128. (at p392)
It is going too far to say that a trustee should not apply for the issue of a summons under s. 81 unless he has previously applied to the proposed examinees themselves who have declined or refused to give the information sought or otherwise acted unsatisfactorily, although this was said by Connolly J. of the Supreme Court of New Zeland in Re Ngunguru Coal Co. (Ltd.) (1899) 18 NZLR 256 in relation to the section in the New Zealand Companies Act (s. 177) equivalent to s. 249 of the Uniform Companies Act. (at p393)
In Re Rolls Razor Ltd. (No. 2) (1970) 1 Ch 576 it was argued in relation to s. 268 of the Companies Act, 1948 (U.K.), that in order to avoid oppression "and to focus the view of the examinee on the matter in issue, this is the course which ought usually to be adopted", i.e. the course of first submitting written questions to the proposed examinee for answer. Megarry J. rejected the submission and said: "In my judgment the exercise of the court's discretion ought not to be fettered in any such way. There may well be some cases in which it would plainly be oppressive or unreasonable not to submit written questions first. There will also be other cases in which there plainly ought to be an oral examination without the prior submission of any written questions. Between these two categories there may be many cases in which the court must determine which course is best suited to discover the relevant facts without being oppressive, vexatious or unfair. In order to do this, the court must, I think, look at the facts of the case as a whole, without yielding to preconceptions; and in doing this, the court should give all proper weight to the views of the liquidator without, of course, abandoning the proper exercise of its discretion, or treating the liquidator's views as being in any way decisive of the matter. The prior submission of written questions will sometimes aid and speed the ascertainment of the relevant facts; but sometimes it may hamper or delay the process. There may be a marked difference between the information obtained from unsworn written answers which may have been drafted by lawyers and that obtained from viva voce answers on oath. In all the circumstances of this case, in the exercise of my discretion, I hold that there ought to be an oral examination without any prior submission of written questions being made requisite. I would have reached the same conclusion even if (contrary to my opinion) there were any rule, whether of law or of practice, that prima facie there should be no oral examination unless written questions had first been submitted" (1970) 1 Ch, at pp 595-596 . (at p393)
In my opinion these observations of his Lordship are applicable generally to the exercise by the court or the Registrar of the power conferred by s. 81 of summoning persons to attend for examination. (at p393)
No rigid or inflexible rules can be laid down as to the exercise of this power. Proper material must be adduced to enable the court or the Registrar to decide whether it is an appropriate case for the exercise of the power. The court and the Registrar are not mere rubber stamps for the trustee, although proper weight should be given to his views. (at p393)
There should be no pre-conception that because the application is made by the trustee, as it generally is, this in itself is a good reason for exercising the power. The power belongs to the court or the Registrar, not the trustee. (at p394)
I do not suggest that the court necessarily should require voluminous material or elaborate statements or reasons to be placed before it by the trustee before issuing a summons. The path of a trustee in performing his duties under the Act is difficult enough and must not be impeded; but the very nature and breadth of the inquisitorial power conferred by s. 81 requires the exercise by the court or Registrar of considerable care before it is invoked. Each case must be determined on its merits. Sometimes written or oral questions ought to be submitted to the proposed examinee before application is made under s. 81, and the court or Registrar informed why such procedure has proved inadequate or unsuccessful. At other times not. (at p394)

I agree generally with what was said by Megarry J. in Re Rolls Razor Ltd. (No. 2) (1970) 1 Ch, at pp 595-596 . (at p394)
One case where, as a general rule, written or oral questions should first be submitted by the trustee is where the person from whom the information is sought is the liquidator of a company in the course of being wound up. (at p394)
Australia's federal system of government has produced in practice, thus far, a dichotomy of jurisdiction in relation to insolvencies, the States having jurisdiction over the winding up of companies and the Commonwealth as to bankruptcy and the winding up of companies in Territories. Liquidators of companies being wound up are officers of the court in compulsory windings up and are registered as liquidators under State Acts or Ordinances of the Territories in the case of voluntary windings up. Trustees in bankruptcy are creatures of Commonwealth law. Many trustees are also liquidators of companies. (at p394)
The winding up of companies is, according to Jessell M.R. in Willey's case (1883) 23 Ch D, at p 128 , " a kind of bankruptcy"; the inquisitorial powers of ss. 249 and 250 of the Uniform Companies Acts are "borrowed from the law of bankruptcy" per Megarry J. in Re Rolls Razor Ltd. (No. 2) (1970) 1 Ch, at p 392 . Many of the laws of winding up and bankruptcy are the same. This is not to suggest that ss. 249 and 250 of the Uniform Companies Acts owe their origin to the Bankruptcy Act 1924 (Cth.). On the contrary, the fundamental rules of insolvency, including those developed as to the inquisitorial power now embodied in s. 81 of the Act, owe their origins to English legislation, adopted and applied in Australia, and to decisions of the courts both here and in the United Kingdom. (at p394)
Bankruptcy jurisdiction is exercised in Australia not only by federal courts. The Federal Court of Australia is invested with bankruptcy jurisdiction under the Act: s. 27. The Federal Court of Bankruptcy continues in existence, but has been left with jurisdiction in respect of matters pending before the court and part heard on 1st February, 1977. The Supreme Courts of States and of the Northern Territory and the Courts of Insolvency of some States continue, as before, to have jurisdiction in bankruptcy: s. 27. (at p395)
There has been an increasing tendency in Australia for uniformity of laws as to companies and for the homogeneity of laws, procedures and practices relating to the administration of insolvencies, be they State or federal, companies or natural persons. (at p395)
Trustees in bankruptcy and liquidators of companies are all charged with the due administration of the laws of insolvency, whether State or federal or both. The need for each to assist the other is obvious. In my opinion, the furtherance of comity between persons whose task it is to administer insolvencies, whether State or federal, requires co-operation between them. Each may then properly perform his duty and thus aid the administration of justice in Australia. (at p395)
Generally, when a liquidator of a company has information about the company's affairs that may assist the trustee of a bankrupt's estate the trustee should obtain all the information he reasonably can by oral or written communication from the liquidator before seeking to invoke the inquisitorial powers of s. 81. Liquidators should do the same when the assistance of trustees in bankruptcy is sought, before resorting to s. 249 of the Uniform Companies Act. There may be cases in which clearly it would be desirable or necessary to apply to the court for the issue of a summons under s. 81 to examine the liquidator. Instances that come to mind are where a liquidator has a personal pecuniary interest in the winding up or where he has unreasonably refused or declined to co-operate with the trustee. (at p395)
In the present case, the summonses ought not to have issued. There was nothing before the Registrar to suggest that the liquidator was personally interested in the winding up of the company or had failed to assist the trustee. Indeed the liquidator in the proceedings before me has expressly disavowed any disentitling conduct on his part. (at p395)
I should add that the researches of counsel have not revealed any case that decided the precise question that has arisen here. Although the summonses were issued by the Registrar at the instance of the trustee, they have been adjourned so that the very question may be determined by the court. (at p395)
It was argued by Mr. Urquhart, who appeared for the trustee, that the power conferred by s. 81 is mandatory in the sense that, once the court is satisfied that the proposed examinee is within one of the categories specified in s. 81, the court or the Registrar is required to issue a summons under the section for the attendance of the person to give evidence or produce documents or both. This argument requires reading the word "may" as having a compulsory meaning. (at p396)
Whether the word "may" is used in a facultative or compulsory sense depends on the context in which it appears. (at p396)
In Ward v. Williams (1955) 92 CLR 496, at pp 505-506 Dixon C.J., Webb, Fullagar, Kitto and Taylor JJ. said: "In considering the correctness of this interpretation it is necessary to bear steadily in mind that it is the real intention of the legislature that must be ascertained and that in ascertaining it you begin with the prima facie presumption that permissive or facultative expressions operate according to their ordinary natural meaning. 'The authorities clearly indicate that it lies on those who assert that the word "may" has a compulsory meaning to show, as a matter of construction of the Act, taken as a whole, that the word was intended to have such a meaning' - per Cussen J.: Re Gleeson (1907) VLR 368, at p 373 . 'The meaning of such words is the same, whether there is or is not a duty or obligation to use the power which they confer. They are potential, and never (in themselves) significant of any obligation. The question whether a Judge, or a public officer, to whom a power is given by such words, is bound to use it upon any particular occasion, or in any particular manner, must be solved aliunde, and, in general, it is to be solved from the context, from the particular provisions, or from the general scope and objects, of the enactment conferring the power' - per Lord Selborne: Julius v. Bishop of Oxford (1880) LR 5 AC 214, at p 235 . One situation in which the conclusion is justified that a duty to exercise the power or authority falls upon the officer on whom it is conferred is described by Lord Cairns in his speech in the same case. His Lordship spoke of certain cases and said of them '(they) appear to decide nothing more than this: that where a power is deposited with a public officer for the purpose of being used for the benefit of persons who are specifically pointed out, and with regard to whom a definition is supplied by the Legislature of the conditions upon which they are entitled to call for its exercise, that power ought to be exercised, and the Court will require it to be exercised' (1880) LR 5 AC, at p 225 " (1955) 92 CLR, at pp 505-506 . (at p396)
Some support for the argument that "may" is used in s. 81 in a compulsory sense may be found in the language used by the section to define the persons to be examined. The words "a person known or suspected to have in his possession any property of the bankrupt or who is supposed to be indebted to the bankrupt or to be able to give information respecting the bankruptcy or his trade dealings, property or affairs" (see s. 81 (1)(b)) assume that some process of evaluation has been carried out to arrive at the conclusion that the person answers the given description. Hence, so the argument goes, once he answers that description, the summons must issue. Likewise, the summons must issue if the person is either the bankrupt or the spouse of the bankrupt. (at p397)
In my opinion, the argument is fallacious. The history of s. 81, and of the equivalent sections of the Uniform Companies Acts, both here and in the United Kingdom; the many authorities which either expressly assert or assume the existence of a discretion in the court to issue the summons (in addition to the authorities already cited see Ex parte Tatton; Re Thorp (1881) 17 Ch D 512 and Re H.J. Price (No. 4) (1948) 14 ABC 142 the very purpose of the section itself and its subject matter; the context in which the word "may" appears in s. 81 itself; and the construction of the Act as a whole (see for instance s. 69 and the strange consequence that would follow if the argument is correct), lead me to conclude that the word "may" is used in its prima facie facultative sense. (at p397)
It was not sought on behalf of the trustee to argue that the word "may" is used in a facultative sense where the person to be examined is the bankrupt or the spouse of the bankrupt (s. 81(1) (a)), but in a compulsory sense where the person falls within the description of s. 81 (1)(b). Nor do I think such an argument would be tenable. (at p397)
Some reliance was placed by the trustee on an unreported decision of Matthews J. in Re Maurice and Shepherd; Ex parte Official Receiver Unreported (Supreme Court of Queensland, Matthews J., 17th December, 1976). judgment delivered 17th December, 1976, where his Honour held that a summons must issue under s. 81 of the attendance of the spouse of the bankrupt once it had been established that she answered that description. His Honour does not appear to have been referred to the history of the section and the decisions on the equivalent sections in other Bankruptcy Acts and Acts relating to companies. I respectfully reach a different conclusion. (at p397)
There was some argument as to the nature and extent of an application to the court under s. 14(5). It was submitted on behalf of the trustee that the court is limited to the evidence before the Registrar. I need not determine this question as I am satisfied that on the material before the Registrar alone, the summons should not have issued. (at p397)
Although the locus standi of the liquidator to apply to the court for the orders sought was not disputed, I shall say something about it as there has been some conflict of judicial opinion on this question. (at p397)
In Re Gold Company (1879) 12 Ch D 77 Jessell M.R. and Baggallay L.J. held that the examinee under the relevant section of the then English Companies Act had no right of appeal against the order directing him to attend for examination. Thesiger L.J. preferred to express no opinion on the point. In Re North Australian Territory Company (1890) 45 Ch D 87 Bowen L.J. said: "Having regard to those characteristics of this section which I have touched upon, I certainly should be loth to conclude that the witness - if I may call him a witness - the examinee, the person who is to be examined and against whom or upon whom the order has been served - has not a locus standi to complain that that order is oppressive or hard upon him; . . . it seems to me that the point ought to be left open; because, as at present advised, there are some expressions of the late Master of the Rolls and Baggallay L.J. in the case of Re Gold Company which seem to me at the first blush to go too far, and which seem to me indeed to be contrary to the decision in Heiron's case (1880) 15 Ch D 139 " (1890) 45 Ch D, at p 93 . (at p398)
In my opinion, the decision of the English Court of Appeal in Heiron's case is contrary to Re Gold Company. (at p398)
In Re a debtor (No. 3 of 1909); Ex parte Goldstein (1917) 1 KB 558 Horridge J. sought to distinguish Re Gold Company on the ground that the language of Jessell M.R. and Baggallay L.J. "must be taken as referring to a right of appeal strictly so called, and not to an application to set aside an order" (1917) 1 KB, at p 562 . Horridge J. and Shearman J., comprising the divisional court, allowed an appeal by the witness from the refusal of his application to have an order for his examination discharged: see also Re Macdonald (1914) 58 SJ 798 and Re Stirling Henry Ltd. (1972) 1 NSWLR 497 . (at p398)
In Re Rolls Razor Ltd. (No. 2) Megarry J. described the decision of Re Gold Company (1879) 12 Ch D 77 as "a case which on some points has not passed unscathed" (1970) 1 Ch, at p 592 . (at p398)
In my opinion, the examinee has locus standi to apply to the court for an order rescinding the order for examination and to complain that the order is harsh or oppressive or otherwise ought to be set aside. (at p398)
For these reasons, the summonses should be set aside. (at p398)
As to costs, the case has been treated by both parties as a test case so that some light may be thrown on the important question of practice involved, in the absence of authority directly in point. In my opinion, each party should bear his own costs. (at p398)
I order that the acts of the Registrar in summoning John William O'Brien to attend before the Registrar to give evidence relating to the bankrupt or his trade dealings, property or affairs be set aside. (at p398)

ORDER

I order that the summonses dated 17th July, 1979, and 11th October, 1979, addressed to John William O'Brien so far as the same require him to give evidence before the Registrar, be set aside.

I make no order as to costs.

[1979] FCA 160

14 December 1979