High Court of Australia|1994-02-18|Before: Debelle J, Olsson JJ, King CJ, Dawson J

the application for special leave and any subsequent appeal will be

nugatory ((3) Rahme v. Commonwealth Bank [1993] HCA 62; (1993) 68 ALJR 53 at 54-55;

[1993] HCA 62; 117 ALR 618 at 620-621.). Clearly, in the present case, the

examination and from the production of documents concerning the matters

in contention - will have disappeared before the application for

special leave is heard if the application for a stay is refused.

Having regard to the date of the proposed examinations, in the absence

of a stay the questions will have been asked and answered and the

documents produced before the application for special leave is heard.

10. Notwithstanding this circumstance, the jurisdiction to grant a stay is discretionary and other matters are relevant to the exercise

11. Importantly, the applicant must establish a substantial prospect that special leave to appeal will be granted ((4) Jennings

Construction Ltd. v. Burgundy Royale Investments Pty. Ltd. (No.1)

[1986] HCA 84; (1986) 161 CLR 681; Elspan International v. Aerospatiale (1992) 67 ALJR

177 at 178.). It is, I think, the prospect of success in that

application which is significant, although, of course, the prospect of

ultimate success in any appeal (if leave is granted) is an important

element to be taken into account by the Court in deciding whether or

not to grant special leave ((5) See Rahme v. Commonwealth Bank

12. In addition, there are other matters to be taken into consideration in the exercise of the discretion to grant a stay. The

failure, if any, of the applicants to pursue such avenues as are

available in the court below for obtaining a stay is of significance.

Any loss which may be caused to interested parties by the granting of

a stay must be taken into account. And the balance of convenience is

always something to be considered ((6) Jennings Construction Ltd. v.

Burgundy Royale Investments Pty. Ltd. (No.1) (1986) 161 CLR at 685.).

13. In the present case, the application for special leave has been instituted by the applicants and is likely to be heard and determined

within five weeks. Clearly, when one balances that relatively short

delay against the loss of immunity which the applicants seek to

avoid by an appeal, the balance of convenience lies in granting the

application. No financial loss during that time to the respondent

or any other interested party, if a stay is granted, has been

demonstrated. The applicants have fully pursued their opportunity to

obtain a stay in the court below, having been granted a stay at first

instance, which they lost, by a majority, on appeal to the Full Court.

14. That leaves the question of the applicants' prospect of success in their application for special leave to appeal.

15. The section of the Corporations Law which is critical is s.596B. That confers power upon the Court to summon a person for examination

about a corporation's examinable affairs. When regard is had to the

definitions of "examinable affairs", "affairs" and "property"

contained in ss.9 and 53, "examinable affairs" include any legal or

equitable estate or interest (whether present or future and whether

vested or contingent) in real or personal property of any description

16. Clearly the rights of action, if any, of the corporation against the applicants are examinable affairs within the meaning of the

legislation. The Full Court concluded that an examination of those

rights under the relevant provisions was not confined to their

existence but extended to their extent and value. Plainly the latter

are matters of considerable moment to the liquidator of a corporation

in pursuing the assets of the corporation in an economical and

efficient manner. And as was pointed out in Hamilton v. Oades ((7)

[1989] HCA 21; (1989) 166 CLR 486 at 496.), a liquidator performs a public function

in which one of his duties is to protect the interests of the

17. It is not contended before me by the applicants that the examination ordered by the Master is oppressive. What is said is that

it extends beyond the affairs of the corporation to the affairs of

other persons and is merely for the purpose of ascertaining their

potential liability and their capacity to satisfy any judgment against

them. However, as I have said, these are matters of importance to a

liquidator, going in a practical way as they do to the value of the

18. The applicants are unable to point to any authority in their favour. The decision of Drummond J in Re Interchase Corporation

Ltd. ((8) (1993) 12 ACLC 97.) is indeed against them. The

decision of the Court of Appeal of New South Wales in Kelly v. Murphy

((9) (1993) 11 ACLC 1230.) is to be explained upon the basis that

the trustees only sought information for a limited purpose, which did

not extend to discovering the capacity of the partners of the firm of

solicitors in question to satisfy any judgment. In any event, the

question of oppression was raised in relation to the extended

examination eventually sought in that case, a question which is not now

19. In the end, I am not satisfied that the applicants have discharged the onus upon them of demonstrating that the application for special

leave enjoys a substantial prospect of success. The power conferred

by s.596B is wide and I am not persuaded that the conclusion reached

by the Full Court involves any error either in construction of the

Duke Group Ltd v Duke Group Ltd [1994] HCA 3; (1994) 119 ALR 401; (1994) 12 ACSR 600; (1994) 12 ACLC 220; (1994) 68 ALJR 196 (18 February 1994)

Imports Pty. Ltd. v. The Duke Group Ltd. (in liq.) [1993] SASC 4359; (1994) 12 ACLC 116.).

Ltd. (No.1) [1986] HCA 84; (1986) 161 CLR 681 at 683.). It is an extraordinary

Duke Group Ltd v Duke Group Ltd [1994] HCA 3;

At a glance

Court

Decision date

Before

Source

Judgment (70 paragraphs)

Parties

Cases Cited (10)

Duke Group Ltd v Duke Group Ltd [1994] HCA 3; (1994) 119 ALR 401; (1994) 12 ACSR 600; (1994) 12 ACLC 220; (1994) 68 ALJR 196 (18 February 1994)