Rathner (Liquidator), in the matter of Reliance Franchise Partners Pty Ltd (in liq) (No 2) [2019] FCA 1930

COLVIN J: 1 A dispute arose between the liquidators of Reliance Franchise Partners Pty Ltd (RFP) and three parties as to the scope of the terms of orders for production and for the issue of examination summonses made by a Registrar of this Court, particularly whether the scope of documents to be produced could be supported as being within the examinable affairs of RFP. The three parties are Fopar Nominees Pty Ltd (Fopar), Mr Jonathon Fogarty and Mr Jonathon Asquith. 2 Fopar sought orders amending the order made by the Registrar to produce documents, alternatively an order setting aside the orders. Mr Fogarty and Mr Asquith sought orders amending the categories of documents that they were required to produce under the terms of examination summonses, alternatively orders setting aside the summonses. The applications were originally listed by the Registrar but were referred to a judge of the Court to determine. 3 On 6 November 2019, I gave reasons upholding a number of the objections raised by the three parties. In doing so, I expressed the view that the Court was exercising a jurisdiction to review de novo on a limited basis the decision by the Registrar to make the orders in respect of Fopar and issue the summonses to each of Mr Fogarty and Mr Asquith: Rathner (Liquidator), in the matter of Reliance Franchise Partners Pty Ltd (in liq) [2019] FCA 1816. I indicated that, in the circumstances, it would be appropriate for fresh orders in the same terms as those made by the Registrar to be made by the Court, but varied so as to give effect to the reasons: at [36]. I then directed the liquidators to submit orders to give effect to those reasons. 4 A further dispute has arisen as to the making of those orders. The parties have advanced competing minutes. I directed that submissions be filed as to the competing positions and indicated that I would deal with the matter on the papers. My reasons as to each of the issues raised are as follows.

Nature of the orders to be made 5 First, the liquidators propose orders by way of variation of the orders made by the Registrar. For reasons I have already given, as the jurisdiction invoked is a de novo review, to the extent that the application has succeeded the appropriate order is for the issue of new summonses. To the extent that the limited review was upheld, the orders of the Registrar should be set aside and fresh orders should be made to reflect the terms of my earlier decision. 6 The liquidators say that course should not be adopted because it will be productive of delay and additional cost. I note that the application was listed urgently and determined promptly. The need for fresh orders arises because of the nature of the jurisdiction being exercised. 7 The liquidators then say that fresh orders should not be made because there would then be an opportunity for a fresh application to be made to set aside the summons. To the extent that an application of that kind might be advanced on the basis that the orders now to be made would be interlocutory then it would need to be demonstrated that there has been some change in circumstances that was not apprehended at the time of the earlier hearing. Otherwise, any complaint about the orders would need to be raised by way of appeal. The availability of such steps are inherent in the procedures of the Court. They are not a reason for orders to be made by way of variation of the orders of the Registrar. I note that no submissions have been advanced to the effect that a judge of this Court has some jurisdiction other than a de novo review jurisdiction on review by which the orders of the present kind as made by a Registrar may be altered. 8 Therefore, I will make orders in the exercise of a review jurisdiction but only to the extent that the limited review application has been upheld.

Fopar 'internal' documents 9 The orders issued by the Registrar required production of a category of documents that were 'circulated internally within Fopar'. The words were said to be vague and uncertain. I expressed the view that the position could be made clear by requiring the production of documents 'internal to Fopar'. The liquidators propose that the order use that form of words. Fopar proposes instead that the words 'communicated between directors, officers and/or employees of Fopar or communicated between directors, officers and/or employees of Vantage' be used. I apprehend that the words proposed by Fopar would narrow the category. They would do so in a respect not contemplated by my reasons. The form proposed by the liquidators should be used.

Fopar documents for the financial year ending 30 June 2017 10 The matter was argued before me by the liquidators on the basis that the matter said to be relevant to the examinable affairs that supports the notices and order to produce documents was the payment of proceeds of the sale of the business of RFP to Vantage Holding Group Pty Ltd (Vantage). Those proceeds were said to have been paid, at least as to $4,537,375.55, to Fopar. My earlier reasons do not refer expressly to the date of those payments. The evidence before me for the liquidators identified the payments as having been made in the period 29 February 2016 to 28 June 2017. The sale itself occurred on about 15 January 2016. 11 Documents outside of the period the subject of those payments were sought to be justified by the liquidators on the basis of general submissions about possible tracing claims against Mr Fogarty and Mr Asquith. The general submission of the liquidators in that regard was not accepted as a basis for supporting the extent of orders as to production: at [30]. 12 Therefore, the reasons accepted that categories of documents should be upheld to the extent that they related to the period for which payments of the proceeds of the sale of the business of RFP to Vantage and then to Fopar were said to have occurred and rejected to the extent that they were sought to be supported only by general submissions as to potential tracing claims. 13 In those circumstances, the period of time advanced by the liquidators to justify production of financial records of Fopar was up to 30 June 2017. In error, the reasons record that date as being 30 June 2016 at [22], [23] and [26]. The error is an obvious slip that ought to be corrected. I do not accept the submission advanced for Fopar that it is a matter that could only be corrected on appeal. I will arrange for a corrigendum to be issued in respect of my earlier reasons. 14 Orders should be made to reflect my earlier reasons as corrected.

Orders as to Mr Fogarty 15 The same error extended into the categories for Mr Fogarty: at [30] and [32]. They too should be corrected. Orders should be made on that basis.

Orders as to Mr Asquith 16 In my earlier reasons I found that there was no reason to adopt a different approach for Mr Asquith to that adopted for Mr Fogarty: at [33]. Orders should be made on that basis.

Costs 17 In my earlier reasons I indicated that my preliminary view was that there should be no order as to costs. I made an order in those terms, but I gave leave to apply to vary that order. No party has sought to vary the terms of that order. I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Colvin.