Wellness Pty Limited v Hamilton-Bond & Co [2002] NSWSC 1259 at [8].
15 Thus, even outside this special area involving examinations, it is in some circumstances permissible for the Court to release documents which were obtained on compulsory process. The special considerations which arise from the legislative policy of Part 5.9 are an overlay on, and qualification to, the general principle about when a court will permit the use, for purposes other than the proceedings in which they were obtained, of documents obtained by compulsory process.
16 I shall deal first with whether an order of type C should be made.
17 In the present case, none of the people who produced documents to the Court for the purpose of the examinations object to those documents being made available to the police or ASIC. At the risk of saying the obvious, they have important public responsibilities, concerned with the operation of the law. The only people who object are Mr Anthony King and Mr Peter King. Thus, this is a circumstance in which even the general law about making available to third parties documents produced under compulsory process would favour the release of the documents to the police and ASIC.
18 In opposition to the release of the documents Mr Horler QC informed me of a fact, which is common practice in examination like these, that though the Kings have been examined, they have claimed privilege in relation to the answers which they gave their examination, and in consequence the answers which they gave cannot be used by the police, or other authorities, against them. He has pointed out that the King brothers have already been charged, and in consequence the police must have had enough evidence for it not to be an abuse of process for the charges to have been laid.
19 As well as the general law principles favouring the release of the documents, in my view, the purposes identified by Santow J in New Cap are ones which should be applied here. The making available of the documentary information to the police, in circumstances where it appears to be common ground that there is at least enough material for the laying of the charges not to be an abuse of process, is well within the statutory purpose for which information which has been compulsorily acquired under Part 5.9 can be used. Though the answers themselves cannot be used as evidence against the King brothers, the answers, or documents referred to in them, might still be of assistance. There is no question of the limitation on use of answers, where privilege against self-incrimination is claimed, applying to documents which were produced to the Court but not referred to in evidence.
20 Mr Horler submits that if any orders of this kind were made, they should be restricted to the use to the material being used for the conduct of the receivership and not for any other purpose. A restriction of this kind would be one which frustrated the statutory purpose, rather than carrying it out. I will not impose a restriction like that. I therefore will make an order that the applicant be granted leave to use and disclose the documents produced to the Court by each of the people or corporations who produced it in response to an order for production, for the purpose of assisting the New South Wales Police and ASIC in their investigations.
21 The regime of examination established by Part 5.9 dispenses to some extent with the privilege against self-incrimination, by s 597 (12), but does not dispense with the privilege against legal professional privilege. The documents which have been produced might possibly, given the fact they were produced by Mr Wormsley, and also given the fact that he was a solicitor who at one time acted as solicitor for the King brothers' companies, contained privileged material. I would not make any order permitting any release of the material produced by Mr Wormsley until such time as there had been a reasonable opportunity given to the King brothers to ascertain whether they wished to make a claim for legal professional privilege concerning any of that material. I would propose to set a timetable for inspection of documents produced by Mr Wormsley, and the formulation and argument of any claims there might be concerning privilege.
22 The claims which Esanda and the Commonwealth Bank interests make, are ones which require a closer examination of the legislative scheme. Under s 596F(1)(e), the Court may at any time give "a direction about access to records of an examination." Section 597(13) and (14A) provide:
"(13) The Court may order the questions put to a person and the answers given by him or her at an examination to be recorded in writing and may require him or her to sign that written record.
(14A) A written record made under subsection (13):
(a) is to be open for inspection, without fee, by:
(i) the person who applied for the examination; or
(ii) an officer of the corporation; or
(iii) a creditor of the corporation; and
(b) is to be open for inspection by anyone else on paying the prescribed fee."
23 As Santow J pointed out in New Cap, there is a distinction between the "written record" referred to in s 597 (14A), and the "records of the examination" referred to in s 596F(1)(e). The "written record" in s 597 (14A) can be inspected as of right by any creditor of the corporation. That includes, it is common ground, any documents which were marked for identification and shown to a witness in the course of the examination. Thus, there is no basis upon which the receiver could resist, even if he wanted to, a request by a creditor of the corporation to inspect that material.
24 Section 596F(1)(e) confers on the Court a discretionary power, which enables it to give access to, amongst other things, documents which were produced under compulsory process for the purpose of the examination, but were not actually used in the course of the examination. In the New Cap decision, at para [39], Santow J said:
"I am satisfied that there are a number of sources of power available to the liquidator to do that which he does not oppose doing, namely to make available the documents which were utilised in the examination either by directly being marked for identification or as other ways being produced for the examination. I see no sensible distinction between the two categories of documents. The documents not marked for identification were still capable of informing the examination and influencing the questions asked. Indeed the liquidator's submissions appear to favour that access. Thus I would include in any access all documents produced, in the absence of any evidence from those opposing access that a document was produced which was entirely extraneous to any possible purpose of the original examination."
25 It will be observed that His Honour there was dealing with the facts of the particular case before him. He was not purporting to say, and did not say, that in all cases there will never be a distinction between documents which were directly marked for identification, and documents which were otherwise produced for the purpose of the examination.
26 The attitude of Esanda and the Commonwealth Bank parties is that the type B order which is sought by the receiver is indiscriminately wide and indeed so wide that it should not be made. I agree. The starting point of an application like the present one is that documents obtained on compulsory process ought not be used for other purposes, except to the extent that a statute says otherwise (eg s 597(14A)), or there are special circumstances which justify departure from the usual implied understanding. Giving effect to the statutory policy in Part 5.9 can be such a special circumstances. But the statutory purpose of assisting creditors to recover from people who have been involved in the downfall of a corporation is one which the Court needs to be persuaded has a realistic prospect of being carried out by any order which it makes permitting access. The evidence now before me goes no further than the passage I have quoted at para [4] above. It does not identify any creditors who might make applications for recovery against people involved in the downfall of the Kings companies, does not identify any documents or classes of documents which might be shown to those people or to any such people, and does not give any reason to believe that there is a real prospect, rather than an abstract or theoretical possibility, that disclosure of documents would assist a creditor in making a recovery. It is to be observed that in New Cap Reinsurance Santow J had before him a proposal to release documents to a particular creditor, in circumstances where that creditor was proposing to or to bring, or at least contemplating bringing, action against particular identified parties.
27 The Commonwealth Bank submits that the proposed orders have an additional vice. It submits that a receiver is appointed to benefit the secured creditor who appoints him, and, subject to exercising his powers in a way which complies with any general law duties to the company of which he is a receiver, and complying with statutory obligations, he acts in the interests of the secured creditor. It submits that a receiver owes no duty to the general body of creditors, and helping creditors is none of a receiver's business.
28 I would accept that that is so, so far as the general run of receivers goes. However, once a receiver has been appointed as an eligible applicant for the purpose of Part 5.9, an additional range of powers falls upon him. It is only because he has been appointed an eligible applicant that a receiver has the standing to conduct an examination at all. Once the receiver is an eligible applicant, he is put in a situation where he has been entrusted with the carrying through of the purposes which underlie Part 5.9. Thus, I would not accept that it is never possible for a receiver to disclose to a creditor information which has been gained in a compulsory examination.
29 There are, as well, some problems which have been raised by the bank concerning what is to be done about retaining confidentiality of certain documents, which it claims are confidential. If there were to be a regime whereby confidential documents were permitted to be disclosed to a particular party, on terms of undertakings as to confidentiality, and perhaps also, on terms restricting the use which could be made of those documents, those problems may be able to be addressed and overcome. The present form of order type B which is sought does not enable those problems to be addressed.
30 I therefore propose to decline to make an order of type B concerning documents produced by Esanda, and the Commonwealth Bank and its associated persons. This, however, is to be without prejudice to any other application which might be later made for the making of an application for leave to disclose documents which is more focused, so far as the intended disclosees are concerned and the documents to be disclosed are concerned. No order is needed to enable the receivers to perform their statutory duty under s 597(14A).
31 I will not seek to formulate orders now. Rather, I will request parties to bring in short minutes of order to give effect to these reasons for judgment.
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