Oswal, in the matter of Burrup Fertilisers Pty Ltd (Receivers and Managers Appointed) v Carson, McEvoy and Theobald

IN THE FEDERAL COURT OF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY GENERAL DIVISION WAD 370 of 2011

IN THE MATTER OF BURRUP FERTILISERS PTY LTD (RECEIVERS AND MANAGERS APPOINTED) (ACN 095 441 151) PANKAJ OSWAL

IAN MENZIES CARSON, DAVID LAWRENCE MCEVOY AND SIMON GUY THEOBALD (IN THEIR CAPACITIES AS RECEIVERS AND MANAGERS OF BURRUP FERTILISERS PTY LTD (RECEIVERS AND MANAGERS APPOINTED) (ACN 095 441 151))

JUDGE: SIOPIS J DATE: 26 APRIL 2013 PLACE: PERTH

REASONS FOR JUDGMENT 1 On 19 April 2013, I published reasons for judgment in this matter and asked the parties to make submissions as to the form of the orders and costs. The following issues were raised by the parties. 2 The first issue is the formulation of the terms of the inquiry. I am minded to accept the minute which has been put forward by Mr Oswal. However, I understand the criticism which has been made by Mr De Kerloy that Order 1(a) is formulated simply by reference to a time period of six weeks and does not refer to the capacity in which the defendants charged the fees and expenses. However, I am mindful that the inquiry will be concerned, as the reasons for judgment show, with the fees and expenses rendered by the defendants as receivers and managers of Burrup Fertilisers Pty Ltd, and invoiced as such. 3 The second issue between the parties was whether there should be discovery given before the filing of evidence; or whether the defendants should have a further opportunity to put on evidence in relation to the matters the subject of the inquiry. The authorities say that the inquiry is to be conducted on an adversarial basis. The usual adversarial process is for discovery to be given before the filing of evidence. I do not see any good reason why one should depart from the usual process. 4 I will, therefore, order that the defendants give discovery in respect of the matters which are the subject of the inquiry. Because the inquiry is limited in scope, I do not anticipate that the giving of that discovery would be particularly burdensome. I will hear from the parties as to the appropriate timeframe for the giving of discovery. 5 As to the question of costs, my view is that Mr Oswal's application for an order for an inquiry under s 423 of the Corporations Act 2001 (Cth) should be treated as a separate application in respect of the question of costs and that orders for costs in respect of that application should be made now. As is evident from my judgment, the defendants were substantially successful. In general, I found that Mr Oswal's application was an inappropriate means by which to deal with the complexity of the matters which were raised in his application, and that many of these same matters are the subject of parallel proceedings. I also found that the Court did not have jurisdiction in relation to one of the matters. In my view, Mr Oswal should pay 80% of the defendants' costs to be taxed or agreed. However, the payment of those costs be stayed until after the conclusion of the inquiry, or further order. 6 I will also hear from the parties in relation to a further directions hearing. I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Siopis.