Re Leisure Developments (Queensland) Pty Ltd (in liq) - [2002] NSWSC 248

Reported Decision:
41 ACSR 276

New South Wales

Supreme Court

CITATION: Leisure Developments (Qld), application of [2002] NSWSC 248

CURRENT JURISDICTION: Equity

FILE NUMBER(S): SC 3946/98

HEARING DATE(S): 25 February, 4, 8, 11, 12, 13 March 2002

JUDGMENT DATE: 19 March 2002

PARTIES :

William Robert Ell, Allan Edward Keast, Colin Graeme Allerdice, John Robert Thomas, Raymond Phillip Fazzolari, Peter Grattan French, Hugh Martin, James Norman Etherington, Peter Lockyer, Douglas Arthur Trood, Leda Commercial Properties Pty Ltd, Leda Finance Pty Ltd, Leda Pty Ltd, Leda Holdings Pty Ltd, Leisure Management Pty Ltd (Applicants)
Christopher John Palmer (Respondent)

JUDGMENT OF: Austin J

COUNSEL : F M Douglas QC with W G Muddle (Applicants)
N Cotman SC with I Young (Respondent)

SOLICITORS: Paul Bard (Applicants)
Australian Government Solicitor (Respondent)

CATCHWORDS: PRACTICE AND PROCEDURE - interlocutory process by examinees to set aside examination summonses and orders for production on grounds, inter alia, of abuse of process - examinees' application for access to liquidator's affidavits supporting issue of examination summonses - examinees' notice to produce to liquidator to support application to set aside examination summonses - relevant principles

LEGISLATION CITED: Corporations Act 2001 (Cth) s 596(C)(2)

CASES CITED: Donnelly v Davison (2000) 105 FCR 1
Freshkept Technology Pty Ltd (in liq) v Goodwin [2000] VSC 500 (28 November 2000)
Purnell Bros Pty Ltd v Transport Engineers Pty Ltd (1984) 73 FLR 160
Re BPTC Ltd (in liq) (1993) 10 ACSR 756
Re Excel Finance Corporation Ltd (1994) 52 FCR 69
Re Hugh J Roberts Pty Limited (in liq) [1970] 2 NSWR 582
Re Moage Ltd (in liq) [1997] 719 FCA (1 August 1997) (Mansfield J)

DECISION: Access to liquidator's affidavit granted; access to produced materials granted, subject to masking of identity of potential examinees

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

AUSTIN J

TUESDAY 19 MARCH 2002

3946/98 IN THE MATTER OF LEISURE DEVELOPMENTS (QLD) PTY LTD (IN LIQ)

JUDGMENT (Revised 21 March 2002)

1 HIS HONOUR: This judgment relates to a dispute about access to documents that have been produced to the Court. The applicants seek access to those documents in aid of their claim for relief against examination summonses and orders for production which are directed to them. The liquidator, as respondent to the application, seeks to deny them access to the documents. The issues presented by the claim for access to the documents depend on an understanding of the applicants' grounds for challenging the examination summonses and orders for production, and consequently some facts relating to companies in the Leda group and their disputes with the Australian Taxation Office ("ATO").

The winding up of LDQ

2 Christopher John Palmer was appointed liquidator of Leisure Developments (Queensland) Pty Ltd (in liquidation) ("LDQ") on 16 October 1998, by order of this Court on the company's own application. At the time when it was placed in liquidation, LDQ was a member of the Leda group of companies. Broadly speaking, the ten individuals who are applicants were directors or secretary of, or…

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.

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Details

Case: [2002] NSWSC 248
Decision Date: 19 March 2002

CaseChat Overview and Summary

The parties involved in this case were Leisure Developments (Queensland) Pty Ltd, a company in liquidation, and various examinees who were subject to examination summonses and orders for production. The examinees sought to set aside the summonses and orders on the basis of alleged abuse of process. They also applied for access to the liquidator's affidavits which supported the issuance of the summonses, and issued a notice to produce to the liquidator to support their application to set aside the summonses. The case was heard in the Federal Court of Australia.

The legal issues before the court included whether the examinees had established a prima facie case for an abuse of process, and whether they were entitled to access the liquidator's affidavits in support of the examination summonses. The court also needed to determine if the examinees' notice to produce to the liquidator was appropriate in the circumstances.

The court found that the examinees had not established a prima facie case for an abuse of process. It held that the liquidator had acted in good faith and that the issuance of the summonses was not an abuse of the court's process. The court also ruled that the examinees were not entitled to access the liquidator's affidavits, as they did not have standing to do so. Finally, the court held that the examinees' notice to produce was not appropriate, as it was not relevant to the issues before the court. The examinees' applications to set aside the examination summonses and orders for production were dismissed.

The court made orders dismissing the examinees' applications and costs orders against them. The examinees were ordered to pay the liquidator's costs of the proceedings, on an indemnity basis. The liquidator was also ordered to pay its own costs of the proceedings, on an indemnity basis.

Orders