Bond, A. & Ors v Tuohy, A.P. & Ors [1995] FCA 37

IN THE FEDERAL COURT OF AUSTRALIA ) ) VICTORIA DISTRICT REGISTRY ) No. VG 427 of 1994 ) GENERAL DIVISION ) B E T W E E N: ALAN BOND & ORS - and - Applicants ANDREW PATRICK TUOHY & ORS Respondents JUDGE: Heerey J DATE:6 February 1995 PLACE: Melbourne EX TEMPORE REASONS FOR JUDGMENT This proceeding challenges the lawfulness of notices under s 77C of the Bankruptcy Act (1906) (Cth) given to police who have seized documents from persons other than Mr Bond under Crimes Act warrants. I am satisfied it should be heard urgently. The urgency largely arises from the action of Mr Bond himself in putting forward a composition which would end his bankruptcy and with it the exercise of the trustee's power of investigation. The creditors have to vote on this composition on the 27th of this month. It is true that the trustee does not say that without the documents the subject of the present proceeding he cannot express a view to creditors on the acceptance of the compromise, but he clearly believes the documents may provide important information relevant to the view he has already expressed. On the material before me such documents are likely to be relevant - one way or the other. Mr Burnside QC has deprecated the significance in fact of the documents seized from Mr Bond himself and which have now been inspected by the trustee as a consequence of Mr Bond's consent directed by this Court. It is not necessary to deal with the merits of this criticism. Suffice it to say that if the present proceeding fails and the further documents are made available to the trustee it will be open to Mr Bond's representatives to urge creditors that the further documents also prove nothing as to the allegation that Mr Bond has concealed substantial wealth from his trustee. If those arguments are persuasive, the fact that documents which Mr Bond did not expect to be disclosed show no evidence of concealment would itself suggest there was no concealment. I think the present opposition by Mr Bond to an urgent hearing of an application which he himself has brought also has to be considered against a history of lack of co-operation with his trustee. A notable example of this was his refusal to answer questions about telephone calls made from his hotel in Sydney to Switzerland at the time of his public examination in May last year. As a result, the trustee was forced to obtain an order from this Court which thus far has only resulted in what seem to be evasive and unsatisfactory responses. As to the time for a hearing of this proceeding, it seems to me that two days should be adequate provided written submissions are lodged in advance. The essential point is a short legal one, namely, can s 77C of the Bankruptcy Act be used to obtain documents which the holder has obtained under coercive process? I am not persuaded at the moment that there is a reasonable likelihood of any substantial evidentiary dispute or lengthy cross-examination, or indeed any cross-examination at all. All the necessary interlocutory steps have been completed and the evidence filed. In my opinion the material does not make out an arguable prima facie case of subjective bad faith on the part of the trustee. I say this of course for the purpose of dealing with the present application for the fixing of a trial date. I cannot bind the trial judge, and do not attempt to do so. I am conscious that counsel presently appearing for Mr Bond will be preparing for a resumed committal proceeding in Perth on 22 February and that shortly thereafter further very substantial criminal charges will be laid against him. The short answer is that Mr Bond may have to retain other counsel for the present proceeding. One of the benefits of a separate Bar such as we have in Victoria and other States is that appropriately qualified counsel are available at short notice to enable litigation to be disposed of efficiently. I propose to fix the hearing of this application for 13 and 14 February before Ryan J. I will direct that both parties file and serve written submissions by 4 pm on Thursday the 9th. I will reserve the costs of today.