GREENWOOD J:
1 These proceedings are concerned with separate applications made by Mr Ian Ferguson, Mr Daren Wolfe and Mr Clive Palmer each seeking an order setting aside summonses for their examination issued by Registrar Belcher on 2 August 2016 which are returnable at 9.30am on Tuesday, 30 August 2016.
2 Mr Ferguson and Mr Wolfe also seek an order setting aside a decision of Registrar Belcher of 15 August 2016 for substituted service of each summons. However, that part of the application is no longer pressed by them. Mr Palmer also challenges an order of Registrar Belcher for substituted service. However, the material demonstrates that Mr Palmer has, in fact, received the summons and negotiations are under way between the respondents to the present application and Mr Palmer about aspects of the summons.
3 I will return to these aspects of the matter later in these reasons.
4 The real issues agitated by each of the three applicants are these.
5 First, that part of the summons which requires each addressee to produce documents in his possession, custody or control as detailed in Sch 1 to the summons is said to be an abuse of process or oppressive having regard to the scope of the categories of documents described in Sch 1. Each addressee of the summonses says that it is simply not possible to examine each of the categories of documents, determine whether he has documents falling within any one or more of the categories in his possession, custody or control, determine questions of privilege and respond by the due date.
6 Second, each applicant says that examination summonses have previously issued on the application of the "General Purpose Liquidators" (as described later in these reasons) and thus further summonses issued on the application of the "Special Purpose Liquidators" overlap with the earlier summonses with the result that compliance with both is oppressive.
7 Third, each applicant says that the power conferred upon the Federal Court of Australia by s 596A and s 596B of the Corporations Act 2001 (Cth) (the "Act") does not engage a conferral of the exercise of the judicial power of the Commonwealth nor a power incidental to federal judicial power and is thus not validly conferred on a Chapter III Court under the Constitution. Mr Palmer, who appears on his own behalf, also contends, put simply, that the principles derived from the relevant jurisprudence which might suggest that the conferral of power of the kind contained in ss 596A and 596B of the Act has been historically regarded as an exercise of judicial power, have no application to a conferral of power exercisable on the application of the Special Purpose Liquidators rather than one or more General Purpose Liquidators. That is said to follow by reason of the special purpose or defined nature of the tasks undertaken by such liquidators or the contended limitation upon the focus of their enquiries.
8 Mr Ferguson and Mr Wolfe are represented by Mr Ferrett of counsel. Mr Ferrett contends that the power conferred by Pt 5.9 of the Act and ss 596A and 596B in particular to compel a person to attend before the Federal Court until excused, to be examined about the matters identified in the summons is not judicial in character at least in so far as it is exercised in the context of a voluntary winding up.
9 Thus, on the constitutional question, the point of distinction identified by Mr Ferrett is that the principles derived from authorities to be discussed in these reasons have no application in the context of a voluntary winding up and the point of distinction identified by Mr Palmer adopts that proposition and adds to it the proposition that in the case of an application by special purpose liquidators, the nature of that purpose conditions the character of the power.
10 These matters came before the Court in some urgency on Friday afternoon, 26 August 2016, as the summonses are returnable on Tuesday morning, 30 August 2016, at 9.30am. For present purposes, the question is whether any one of the grounds relied upon by the applicants to set aside the summonses has any arguable merit which would warrant each of the three applicants being afforded further time to develop additional submissions going to any particular ground. This is particularly so in relation to the constitutional question which also engages s 78B of the Judiciary Act 1903 (Cth). The applicants say that they have not had time to prepare and deliver notices under s 78B although they will be able to do so by Monday, 29 August 2016. For present purposes, I propose to consider whether the contentions of each applicant on the constitutional question raise an arguable question. If not, the applications to set aside each summons should be dismissed at least as to that ground. If there is an arguable constitutional question properly raised by the applicants, the summonses should either be stayed or extended pending the determination of the question, subject to any other discretionary questions to be addressed consistent with the settled understanding and operation of s 78B.
11 As to the challenge to that part of each summons concerning the production of documents, the Special Purpose Liquidators by their lawyers have been in negotiations with the lawyers for Mr Ferguson and Mr Wolfe and in direct negotiations with Mr Palmer. The Special Purpose Liquidators have either agreed with the lawyers for Mr Ferguson and Mr Wolfe to extend the date for compliance with the production of documents or, alternatively, are engaged in discussions with them about a mutually satisfactory date. They are also in discussions about the scope of production (Sch 1). Both Mr Ferrett of counsel and Mr Sullivan QC (for the Special Purpose Liquidators) agree that this aspect of the application ought properly be stood over to enable the present caucusing to continue in the expectation that the parties might well be able to agree about this aspect of the matter. If not, the matter can return to the Court for determination.
12 Mr Palmer says that he is also in discussion with the Special Purpose Liquidators about questions of production of documents and, in his view, these discussions ought to continue. There seems to be common ground between Mr Palmer and the Special Purpose Liquidators that those discussions ought to continue. They may resolve. If not, that aspect of the matter can return to the Court for determination.
13 I will return to the remaining grounds after explaining the context within which these issues arise.
14 From about 2009, Queensland Nickel Pty Ltd ("QNI") (now in liquidation) was the manager of a joint venture. The joint venture partners were Queensland Nickel Resources Pty Ltd ("Resources") and Queensland Nickel Metals Pty Ltd ("Metals"). The joint venture operated the Yabulu Refinery near Townsville. The refinery produced nickel and cobalt products by refining nickel ore and other nickel products.
15 On 18 January 2016, Mr John Park, Ms Kellie-Anne Trenfield, Mr Stefan Dopking and Mr Quentin Olde were appointed administrators of QNI pursuant to s 436A of the Act.
16 On 22 April 2016, the second meeting of creditors of QNI was held in Townsville. At that meeting, the creditors of QNI resolved to wind up QNI. The administrators were appointed as the liquidators of QNI. Thus, Mr Park, Ms Trenfield, Mr Dopking and Mr Olde became the liquidators of QNI, otherwise known as the General Purpose Liquidators.
17 The resolution of the creditors at the meeting on 22 April 2016 gave effect to the choice before the creditors at the meeting under s 439C(c) "that the company be wound up". The resolution of the creditors under s 439C(c) to wind up QNI engaged s 446A(1)(a) of the Act with the result that QNI was and is taken to have passed, at the date of the winding up resolution, a special resolution under s 491 of the Act, that QNI be wound up voluntarily and to have done so without a declaration of solvency having been made and lodged under s 494 of the Act.
18 Other background matters may be mentioned briefly. Metals is a 20% shareholder in QNI. Resources is an 80% shareholder in QNI. Mr Palmer was a Director of QNI and Metals and Resources at various dates between 31 July 2009 and February 2015. Mr Ferguson was a Director of QNI at various dated between 30 January 2013 to 23 July 2015 and a Director of Metals and Resources between 30 January 2013 and 24 December 2014. Mr Wolfe was the Company Secretary of QNI, Metals and Resources from 12 February 2010 to 4 January 2013. Mr Wolfe was an employee of QNI for approximately 26 years and was the Chief Financial Officer of QNI, Metals and Resources (among other entities related to those entities) from March 2013 to March 2016.
19 Section 472(1) of the Act provides that on an order being made for the winding up of a company, the Court may appoint an official liquidator to be liquidator of the company. In this case, the liquidators were appointed by resolution of the creditors at a meeting convened by the then administrators. Section 473(8) of the Act provides that if more than one liquidator is appointed by the Court, the Court must declare whether anything that is required or authorised by this Act to be done by the liquidator, is to be done by all or any one or more of the persons appointed. Section 511 of the Act provides that the liquidator or any contributory or creditor may apply to the Court to determine any question arising in the winding up of a company; or to exercise all or any of the powers that the Court might exercise if the company were being wound up by the Court. Section 511(2) provides that if satisfied that the determination of the question arising under s 511(1)(a) or the exercise of the power arising under s 511(1)(b) will be "just and beneficial", the Court may accede wholly or partially to any such application on such terms and conditions as it thinks fit or may make such other order on the application as it thinks just.
20 On 18 May 2016, the Commonwealth of Australia and the Commissioner of Taxation for the Commonwealth together with Mr Stephen Parbery, Mr Marcus Ayres and Mr Michael Owen applied before the Federal Court of Australia for an order pursuant to ss 472(1) and 511 of the Act that Mr Parbery, Mr Ayres and Mr Owen be appointed Special Purpose Liquidators of QNI for particular purposes. On 18 May 2016, Dowsett J made orders appointing the Special Purposes Liquidators for the limited purposes set out at para 4 of the orders made that day. Accordingly, Mr Parbery, Mr Ayres and Mr Owen are Court appointed liquidators of QNI pursuant to the provisions of the Act. There can be no doubt that the provisions of the Act enable multiple liquidators to be appointed. The power to do so is not confined to an appointment of multiple liquidators to a Court ordered winding up. A company in voluntary liquidation with liquidators appointed remains susceptible to an appointment of further or additional liquidators by the Court having regard to the relevant circumstances. Some of the circumstances in which the power to appoint multiple liquidators (now generally described as Special Purpose Liquidators) are illustrated in Onefone Australia Pty Ltd v One.Tel Ltd (in liq) [2003] NSWSC 1228 (2003); 48 ACSR 562 per Windeyer J; Re Obie Pty Ltd (No. 2) (1984) 2 Qd R 155, per Thomas J.
21 The Commonwealth of Australia and the Commissioner of Taxation for the Commonwealth applied to the Court for the appointment of further liquidators on the footing that each applicant was and is a creditor of QNI.
22 The order of Dowsett J appointed the Special Purpose Liquidators for the limited purposes set out in the order. Order 4(a) to (d) is in these terms:
4. Pursuant to sections 511 and 473(8) of the Corporations Act, that:
(a) the appointment of the Special Purpose Liquidator is limited to the matters set out in paragraphs 4(b) to (d) below;
(b) the following things may be done by the Special Purpose Liquidators on behalf of the company:
(i) conducting investigations into any of the matters set out in the Schedule to these orders (the Special Purpose Liquidator's Tasks), including by:
(A) inspecting the books and records of the Company;
(B) conducting examinations pursuant to sections 596A or 596B of the Corporations Act or obtaining orders for production pursuant to section 597(9) of the Corporations Act; and
(C) requiring statements to be provided pursuant to section 475(2) of the Corporations Act;
(ii) pursuing any claim, including by commencing legal proceedings, that may be available to the company or the Special Purpose Liquidators in relation to any of the matters identified in the Special Purpose Liquidators' Tasks, including considering and obtaining legal advice in respect of pursuing any such claims;
(c) in relation to only those matters set out in the Special Purpose Liquidator's Tasks, the Special Purpose Liquidators may take steps, including by commencing legal proceedings, to preserve or protect the assets of the Company, whether or not in the possession of the Company;
(d) in relation to only those matters set out in the Special Purpose Liquidator's Tasks, the Special Purpose Liquidators, as additional liquidators of the Company, are entitled to exercise all powers conferred on a liquidator by section 506 of the Corporations Act, except for the powers contained in section 477(1)(a).
23 I have not corrected the grammatical errors in that part of the order. Attachment A to these reasons is a copy of the schedule setting out the tasks of the Special Purpose Liquidators.
24 Apart from these orders, the Court also ordered that the four General Purpose Liquidators must not do any of the things specified in paras 4(b) to (d) quoted above in relation to the matters set out in the tasks of the Special Purpose Liquidators, other than with the prior written consent of the Special Purpose Liquidators or a further order of the Court. Further, the General Purpose Liquidators were ordered to use their reasonable endeavours to assist the Special Purpose Liquidators by providing documents or information and by providing an image of the relevant server including an extract of the email and drive data which stores and hosts a soft copy of the books and records of QNI. They were also ordered to allow the Special Purpose Liquidators access to the books and records of QNI and to copy them.
25 The orders provide that the Special Purpose Liquidators shall, in accordance with the requirements of the Act, report to creditors of QNI initially on the terms of their appointment and subsequently during the course of their appointment. The Court further ordered that the General Purpose Liquidators "otherwise do all things required or authorised by the Corporations Act as liquidators of the company".
26 Finally, the Court granted leave to the applicants to apply to extend or limit the purposes for which the Special Purpose Liquidators are appointed and apply generally.
27 It can be seen that the exercise of the power by the Court and the scope of the orders made on 18 May 2016 provide for a range of tasks to be specifically undertaken as determined by the Special Purpose Liquidators and the order regulates the division of tasks consistent with the Act. The orders require the Special Purpose Liquidators to report to the creditors about their appointment, the tasks and to keep the creditors informed during the course of their appointment.
28 Accordingly, I do not accept Mr Palmer's proposition that the Special Purpose Liquidators have a single purpose which is inconsistent with protecting the interests of the creditors. Plainly, the Special Purpose Liquidators pursue a task with a view to the interests of those who have sought their appointment. However, those applicants are creditors and the role of the Special Purpose Liquidators is to examine the questions reflected in the scope of the orders and the schedule (attached).
29 One of the grounds relied upon by Mr Palmer to set aside the examination summonses is that the summonses overlap with other examination summonses applied for and obtained by the General Purpose Liquidators. It is clear that the General Purpose Liquidators also applied for and obtained orders for the issue of examination summonses requiring the present applicants (and Mr Mensink) to be examined about the examinable affairs of QNI. However, the public examinations pursuant to the summonses obtained by the General Purpose Liquidators were adjourned by Registrar Belcher on 14 June 2016 to a date to be fixed by the Registrar. A new date has not been set for public examinations pursuant to the orders which were obtained for the issue of the summonses in May. There is no evidence that any of the examination summonses obtained by the General Purpose Liquidators have been served upon any of the present applicants. The orders of the Court of 18 May 2016 expressly provide for the Special Purpose Liquidators to conduct examinations and issue notices of the kind described in the orders.
30 I am not satisfied that there is any basis made out for the proposition that the examination summonses obtained by the Special Purposes Liquidators and compliance with them is rendered oppressive by reason of the earlier summonses obtained by the General Purpose Liquidators which stand generally adjourned.
31 The principal issue in question in these applications is the constitutional question.
32 Mr Ferrett puts the matter in these terms.
33 The Commonwealth Parliament is incapable of conferring on the Federal Court a power which is not judicial "in character" or at least "incidental" to judicial power. Mr Ferrett says that although the authorities demonstrate that there is no comprehensive definition of judicial power comprehended by the Constitution, judicial power normally involves one or more of the following features: determining a justiciable controversy; determining existing rights or liabilities; determining guilt or innocence; or the imposition of punishment for breach of the law. Powers incidental to these powers may properly be conferred on the Federal Court. An examination conducted by virtue of a summons under Pt 5.9 of the Act involves, it is said, none of these "core functions". The power is purely investigative in function and its aim does not involve the resolution of any dispute or the determination of any rights but simply aids the ascertainment of the "true state of the company's affairs". Mr Ferrett says that whilst it might be said that such a power is incidental to the Court's exercise of the power to wind up a company, no order, in this case, of that nature has been made. QNI is in voluntary liquidation by reason of a decision of the creditors at the meeting convened by the administrators, as previously mentioned.
34 Thus, the decisive feature which distinguishes the character of the power is that it is not conferred in the exercise of judicial power comprehended by a winding up order or incidental to such a power.
35 Mr Ferrett concedes that in order to make this argument good, the applicants must demonstrate that the principles derived from an intermediate Court of Appeal decision of the Supreme Court of Western Australia, Saraceni v Jones [2012] WASCA 59; 287 ALR 551 ("Saraceni"), (McLure P, Newnes JA agreeing; Martin CJ also agreeing on different grounds to those adopted by McLure P and Newnes JA), is able to be distinguished on the footing that it has no application to the determination of the character of the power conferred by ss 596A and 596B in the circumstances of the voluntary liquidation. That task is made a little more difficult having regard to the decision of their Honours, Gummow, Hayne and Bell JJ (with reasons for the Court given by Gummow J), rejecting an application for special leave to appeal from the decision of the Court of Appeal in Saraceni: [2012] HCA 38; (2012) 246 CLR 251 [1]-[5].
36 President McLure at [71] identifies the issues before the Court of Appeal as whether ss 596A and 597 conferred on a Court exercising federal jurisdiction non-judicial power in contravention of Ch III of the Constitution where the power is exercised on the application of an eligible applicant (authorised by the Australian Securities and Investments Commission ("ASIC")) being a privately appointed receiver and manager of either the whole or a part of a corporation's assets or a privately appointed agent of a mortgagee in possession of a specified asset of the corporation.
37 The Supreme Court of Western Australia was exercising federal jurisdiction in making the orders which were there under constitutional challenge.
38 It may be accepted that the Parliament of the Commonwealth cannot confer non-judicial power upon the Federal Court except where the power is incidental to an exercise of judicial power: R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254.
39 In Attorney-General (Commonwealth) v Alinta Ltd (2008) 233 CLR 542, Hayne J at [93] observed that "no single combination of necessary or sufficient factors identifies what is judicial power". His Honour also observed that so much is made clear concerning that proposition by the "so-called chameleon doctrine (R v Quinn; Ex parte Consolidated Foods Corporation (1977) 138 CLR 1 at 8) and the cases in which that doctrine has been engaged".
40 The reference to the "chameleon doctrine" recognises that some powers derive or take their character as judicial or non-judicial powers by reason of the body identified as the repository of the power. This derives from the application of a characterisation test for determining the nature of the power taking account of the historical factors informing the characterisation question: R v Davison (1954) 90 CLR 353 at 368-9. It may also properly be accepted that a valid conferral of the judicial power of the Commonwealth arises if the conferral of the power satisfies the functional test reflected in Huddart, Parker & Co Pty Ltd v Moorehead (1909) 8 CLR 330 at 357 per Griffith CJ, or the power is characterised as the same as or analogous to a power historically or traditionally conferred upon Courts.
41 The power might otherwise be incidental or ancillary to the exercise of judicial power.
42 It is not necessary in these reasons to set out the examination powers contained in Ch 5, Pt 5.9 of the Act or ss 596A or 596B. It is enough to note that s 596A provides for a mandatory examination in the sense that the Court is to summons a person for examination about a corporation's examinable affairs on an application by an eligible applicant in circumstances where the Court is satisfied of the relevant statutory matters and that s 596B provides that a Court may summon a person for examination about a corporation's examinable affairs upon an application by an eligible applicant and upon the Court being satisfied of the statutory matters. The statutory framework contained within Pt 5.9, Div 1, was extensively examined by President McLure in Saraceni. I see no reason to depart from the observations made by President McLure about these sections.
43 The important thing to note about their scope and operation is that the power conferred on the Court by ss 596A and 596B in the context of Div 1 of Pt 5.9 makes it clear that the examination power is undertaken in the exercise of the Court's supervision. The examinations are conducted before the Court (not "by" the Court) and questions arising in relation to a range of matters including directions remain under the supervision of the Court: see ss 596D, 596F, 597(5B), 597(7), 597(9), 597(10), 597(12), 597(15), 597(16), 597(17), 597A.
44 The examination power reflected in the conferral of the examination provisions is engaged in a number of circumstances including winding up in insolvency by the Court or by voluntary winding up. The Court nevertheless retains substantive control of the examination process because of its power to give directions and its general supervision of the process. As McLure P observes, the examination power in its terms clearly extends to corporations in liquidation pursuant to a voluntary winding up. The Court, in the exercise of these powers, facilitates an examination conducted by the applicant, and other interested parties with relevant standing and, most importantly, the Court supervises the examination process. The examination of the relevant individuals is not conducted "by" the Court in the sense of the Court adopting an inquisitorial role to elicit information. A party appears and answers questions put to him or her by those who have obtained the order for the issue of the summons. The respondent to the summons engages with those asking the questions. The process, however, falls under the direct supervision of the Court as to its limits, its conduct, the determination of questions arising in the course of the examination and other relevant matters all with a view to ensuring that the process of examination is not abused or conducted oppressively. The scope of the examination, as a whole, will be determined having regard to the interests of all persons entitled or permitted to participate in the examination.
45 In the course of the reasons of McLure P, the President examines the history of companies legislation in England and the history in Australia of companies legislation. In the course of that examination, the President observes that the Companies Act 1862 (UK) (the "1862 Act (UK)") made provision for compulsory examination after a Court had made an order for winding up and by s 138, the 1862 Act (UK) provided that where a company is being wound up voluntarily the liquidators or any contributory of the company may apply to the Court to determine any question in the matter of the winding up or in respect of any other matter concerning all or any of the powers which the Court might exercise as if the company were being wound up by the Court and the Court were to be satisfied that the determination of the question or the exercise of the power would be just and beneficial in all the circumstances. Upon such satisfaction, the Court might accede wholly or partially to the application on the terms and conditions the Court determined appropriate. The obvious comparison with s 511 is clear. One of the powers conferred by s 115 of the 1862 Act (UK) was a compulsory power of examination.
46 It is perfectly clear that historical powers of examination were conferred upon Courts in Court ordered winding up proceedings and in relation to voluntary liquidations. Those powers came to be understood as powers properly conferred upon a Court because they necessarily engaged first, an application to the Court for an appropriate order upon the satisfaction of the judicial officer and second, the continuing supervision of the examination process according to law. That historical understanding is present in Div 1 of Pt 5.9 of the Act. It has deep roots. It is well understood. It engages the federal judiciary in the two ways described above. In the course of her reasons, McLure P identifies the circumstances in which these powers were conferred on Courts in the context of a voluntary winding up. Analogically and historically, these powers, in the context of voluntary liquidations, have been accepted as the proper exercise of judicial power. See, for example, the discussion at [142], [146], [147], [168] to [172]. At [212], President McLure observes:
The court examination powers in relation to the voluntary winding up of a company have been exercised by English and Australian courts since well before federation: Re Gold Co; Re Metropolitan Bank Ltd (1880) LR 15 Ch D 139; Re Broken Hill and Argenton Smelting Co Ltd (1893) 19 VLR 111. Moreover, the applicant for an examination could be a contributory or a creditor: Re Gold Co; Re Excel at FCR 81.
47 The above observation follows an examination of the nature of federal judicial power. In the course of that analysis, the President refers to the observations of Kitto J in R v Davison (1954) 90 CLR 353 at 381. In those observations, Kitto J recognises and explains the relevance of an historical understanding of the nature of the power in characterising the power. At p 382, Kitto J also said this:
Where the action to be taken is of a kind which had come by 1900 to be so consistently regarded as peculiarly appropriate for judicial performance that it then occupied an acknowledged place in the structure of the judicial system, the conclusion, it seems to me, is inevitable that the power to take that action is within the concept of judicial power as the framers of the Constitution must be taken to have understood it.
48 In Saraceni, the Court of Appeal had to determine, ultimately, whether the examination power in relation to the affairs of a company in receivership were relevantly the same as or analogous to the historical power to examine persons in relation to the affairs of a company in liquidation. That question is not the question alive in these proceedings. In these proceedings, the Court has appointed Special Purpose Liquidators and they have sought to engage the processes of Div 1 of Pt 5.9 for the purposes of their appointment and in doing so they make applications for the exercise of the powers under ss 596A and 596B within the scope and context of Div 1 generally. Division 1 contains provisions which reflect the historical evolution of a power which over a long period of time had come to be recognised as an exercise of judicial power. The examinations so ordered under the exercise of the power were and remain under the supervision of the Judges as earlier described.
49 I do not accept that the circumstance that QNI is in voluntary liquidation conditions the character of the power in such a way that the conferral of the power is to be regarded as an unconstitutional conferral of non-judicial power.
50 Mr Ferrett places great emphasis upon the observations of Gaudron J in Gould v Brown (1998) 193 CLR 346 at [67] to [69]. In these paragraphs, Gaudron J observes that the power to examine witnesses conferred by Ch 5, Pt 5.9 of the Act is not a power to be exercised in the "discharge of judicial duties". Her Honour observes that the power is "divorced" from the determination of a justiciable controversy. Her Honour observes that it is not directed to the determination of existing rights or liabilities. Nor is it directed to the determination of guilt or innocence or the imposition of punishment for a breach of the law. Her Honour observes that it is unrelated to the making of any binding decision as to existing powers, duties or status. Her Honour observes that nor is it a power associated with the conferral or adjustment of rights or interests in accordance with legal standards. Her Honour describes it as "simply a power to obtain information".
51 There is no doubt that the power does not directly engage the "quelling of controversies" in the sense described by her Honour. Her Honour goes on to observe at [67] that "[a]s such, it is not judicial power". Her Honour goes on to observe this: "However, that is not to say that the power to examine witnesses in relation to the affairs of a corporation can never be conferred on a federal court".
52 Her Honour observes at [68] that "courts have long exercised jurisdiction with respect to bankruptcies of individuals and the insolvency of companies, their procedures in that regard being essentially judicial in the sense that they usually involve parties - the petitioner and creditor - and invariably require proof of factual matters by application of the rules of evidence in proceedings conducted in accordance with judicial procedures". In that context, her Honour observes that the power to order the winding up of a company or the sequestration of a bankrupt's estate is exercised by the application of legal principles to proven states of fact. At [69], her Honour concludes that the examination of the affairs of persons who have been declared bankrupt and companies that have been wound up is a "familiar feature" of bankruptcy and insolvency law. Her Honour also observes that the power to examine witnesses is readily seen as a power "attendant upon or incidental to the fulfilment of [the powers to make sequestration and winding up orders]" and is thus incidental or ancillary to the exercise of judicial power in that regard.
53 Notwithstanding these observations, two things need to be noted. First, her Honour's observations are not consistent with the observations of other members of the High Court notwithstanding that there was an equal division among the six Judges in Gould v Brown. Second, these observations fail to recognise that the power to examine witnesses had over a long period of time been recognised historically as an aspect of the exercise of judicial power for all the reasons earlier mentioned and not simply rendered a proper exercise of judicial power because the examination power was necessarily connected with an order for winding up by the Court or the sequestration of a person's estate in bankruptcy. For a long time, the examination power had been understood as one exercisable in the context of a voluntary liquidation.
54 The observations of McLure P, with Newnes JA agreeing were the subject of consideration by Gummow, Hayne and Bell JJ in the reasons for dismissing the application for special leave in Saraceni: (2012) 246 CLR 251. The Court there observed that it is not possible to frame a definition of judicial power which is both exclusive and exhaustive. Their Honours adopt and adapt the observations of Kitto J in R v Davison in this way at [2]:
However, to adopt and adapt what Kitto J said in R v Davison, the question which it is sought to agitate in this Court is whether the Constitution requires that the power to take the step necessary to bring about the application of a general law to the particular case is one which cannot be committed to the judiciary. More particularly, on the application of the receiver of a corporation can the Parliament confer upon a court exercising federal jurisdiction the power to make an order under s 596A or s 596B of the Corporations Act 2001 (Cth) for the mandatory examination of a person about the examinable affairs of the corporation?
55 Their Honours then quote the observations of Kitto J in R v Davison at p 382 earlier quoted in these reasons. Their Honours then observe at [2]:
The Companies Act 1862 (UK) (the 1862 Act) which was the model for the companies legislation of the Australian colonies, provided in s 138 that where a company was being wound up voluntarily the liquidator or any contributory might apply to the court having jurisdiction to wind up the company to exercise all or any of the powers which the court might exercise if the company were being wound up by the court.
56 Their Honours recognise that one of those powers conferred by s 115 of the 1862 Act was to order the compulsory examination of an officer or other person whom the Court deemed capable of giving information about the affairs of the company. Their Honours said this at [3]:
The provisions of the Corporations Act which it is sought to impugn are not to any relevantly different effect. The identification in ss 596A and 596B of the circumstances in which an order may be made differs from the more generally expressed reference in s 138 of the 1862 Act to it being "just and beneficial" to make the order, but those differences are not presently significant. The making on application of a receiver of a mandatory examination order is an action of a kind which had come by 1900 to be so consistently regarded as peculiarly appropriate for judicial performance that it then occupied an acknowledged place in the structure of the judicial system.
57 So too had the making of an application by a liquidator, as a result of a compulsory order or a voluntary liquidation, for a mandatory examination or an examination under the equivalent of s 596B become consistently regarded as peculiarly appropriate for judicial performance that it occupied an acknowledged place in the structure of the judicial system.
58 At [4] their Honours observe that the orders of the Court of Appeal in Saraceni are not attended by doubt. The following observation makes plain that their Honours accepted that the reasoning supporting those orders is sound. Their Honours said this:
McLure P set out the text of ss 115 and 138 of the 1862 Act and the passage in the reasons of Kitto J in Davison to which we have referred. Her Honour concluded that the analogy between an examination in respect of companies in receivership and those in voluntary liquidation was "very close" and that the power of a court in this latter respect was of longstanding and predated federation. We need express no further view about the correctness of the reasons given in the Court of Appeal.
59 Special leave was refused.
60 I accept that the power conferred by ss 596A and 596B in the context of Div 1 has long been regarded as peculiarly appropriate for judicial performance such that it has occupied an acknowledged place in the structure of our judicial system for a long time. I can find no error in the reasoning of the Court of Appeal and, plainly enough, three Justices of the High Court were satisfied that there was no error in the principles identified which condition the outcome in these applications.
61 Accordingly, the conferral of the power is not unconstitutional. Both sections reflect valid laws of the Commonwealth.
62 The applications for the orders so far as they relate to the constitutional question and contended oppression due to the earlier issue of examination summonses by the General Purpose Liquidators, are refused. The applications also go to the question of the production of documents and those matters are stood over for further caucusing. Accordingly, the applications will simply be adjourned with costs reserved. To the extent that the applicants, by their applications, seek to vary the examination summonses or seek a stay of the examination summonses, that part of each application is refused and dismissed. I do so because I am not satisfied that there is any arguable basis in relation to the constitutional question or the contended oppression by reason of the fact that the General Purpose Liquidators had previously sought and obtained examination summonses which are not now being pressed. The issues as to the documents are subject to further caucusing between the parties. There is no proper basis upon which the examination of each addressee of the summons ought not to proceed pending the resolution of the question concerning the production of document.
63 I have taken all written and oral submissions into account. To the extent that I have not addressed each and every point in these reasons, it should not be assumed that I have not considered them carefully.
64 On Friday, 26 August 2016, I pointed out to Mr Palmer that many paragraphs of his principal affidavit are problematic for the reasons identified on Friday. I made orders that his two affidavits be, in effect, sealed and not available for examination. I propose to review each of the paragraphs of Mr Palmer's affidavit and give directions about those paragraphs which may properly stand and those which may not. I said to Mr Palmer on Friday that I would give him an opportunity to present written observations about why those paragraphs ought to stand. On Sunday, 28 August 2016, supplementary submissions were received from Mr Palmer. I have considered those submissions. Mr Palmer says that he was not given an opportunity to be heard on the question of whether paragraphs of his affidavit are to be redacted or struck out. Mr Palmer says that no-one has brought an application to complain about the relevant aspects of his affidavits. That is not correct. The Special Purpose Liquidators raised an objection in their written submissions to the paragraphs of Mr Palmer's affidavit which are said to contain scandalous material. An examination of the paragraphs leads the reader to that conclusion. Accordingly, I made interim orders for the non-disclosure of the affidavits on the footing that I would indicate the paragraphs which are objectionable and then give Mr Palmer an opportunity to make written submissions about them. I propose to give Mr Palmer that opportunity as I said I would. I have not yet had an opportunity to decide which of the paragraphs may properly stand and those which may not. I propose to do so by tomorrow, Tuesday, 30 August 2016 and to indicate to Mr Palmer which paragraphs I propose to strike out. Mr Palmer may wish to put on submissions in addition to those filed yesterday. Tomorrow, I will publish from Chambers directions as to the affidavits of Mr Palmer and provide him with an opportunity to say whatever he may wish to say about the parts of his affidavits likely to be the subject of the directions orders.
I certify that the preceding sixty-four (64) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood.