CATCHWORDS JURISDICTION, PRACTICE AND PROCEDURE - stay of proceedings for examination of a director under s. 596B of the Corporations Law pending special leave application to High Court - factors relevant to exercise of discretion to stay - "substantial prospect that special leave to appeal will be granted" - application in respect of order for substituted service of process upon solicitor having no instructions to accept service from client outside of Australia - prospect of obtaining special leave "not insubstantial" whether grant of stay will cause loss to respondent - loss to respondent from grant of stay should be minimal - where "balance of convenience" lies - operation of examination summons suspended Corporations Law s. 596B Ex parte Bucknell (1936) 56 CLR 221 - applied Marsden v Amalgamated Television Services Pty. Ltd., unreported, High Court, 6 May 1996, Gummow J - considered Jennings Construction Limited v Burgundy Royale Investments Proprietary Limited (No. 1) (1986) 161 CLR 681 - applied De L v Director-General, NSW Department of Community Services (1996) 136 ALR 201 - considered Gerah Imports Pty. Ltd. v The Duke Group Ltd. (in liq.) (1994) 119 ALR 401 - considered Aboriginal Development Commission v Ralkon Agricultural Co. Pty. Ltd. (1987) 15 FCR 159 - considered Sharp v Deputy Commissioner of Taxation (1988) 18 FCR 475 - considered IAN EDWARD JOYE v JOHN SHEAHAN No. SG 3137 of 1994 BEAUMONT, SPENDER & LEHANE JJ SYDNEY (Heard in Adelaide) 14 JUNE 1996 IN THE FEDERAL COURT OF AUSTRALIA ) ) SOUTH AUSTRALIA DISTRICT REGISTRY) No.SG3137 of 1994 ) GENERAL DIVISION ) APPLICATION FOR LEAVE TO APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA BETWEEN: IAN EDWARD JOYE Applicant AND: JOHN SHEAHAN Respondent CORAM: BEAUMONT, SPENDER AND LEHANE JJ. PLACE: SYDNEY (Heard in Adelaide) DATE: 14 JUNE 1996 MINUTES OF ORDER THE COURT ORDERS THAT: 1. The time for filing the applicant's notice of motion dated 2 May 1996 be extended up to and including that date. 2. Leave to appeal be granted. 3. The appeal be allowed, with costs. Set aside the orders made at first instance on 15 April 1996; in lieu thereof, order that, upon the applicant, by his solicitors, filing in the Registry within seven days of this date a written undertaking (a) to pay damages on the usual terms; and (b) to prosecute with due diligence the special leave application in the High Court sittings in Adelaide in August 1996, any further proceedings upon the summons for the examination of the applicant issued pursuant to s.596B(1) of the Corporations Law be stayed until the High Court has determined the special leave application; further order that the respondent pay the applicant's costs at first instance. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA ) ) SOUTH AUSTRALIA DISTRICT REGISTRY) No.SG3137 of 1994 ) GENERAL DIVISION ) APPLICATION FOR LEAVE TO APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA BETWEEN: IAN EDWARD JOYE Applicant AND: JOHN SHEAHAN Respondent CORAM: BEAUMONT, SPENDER AND LEHANE JJ. DATE: REASONS FOR JUDGMENT BEAUMONT J. INTRODUCTION This is an application for an extension of time to make, and application for leave to appeal from, an order of a Judge of the Court (Branson J.), dismissing an application by the present applicant, Ian Edward Joye, for an order adjourning an examination of Mr. Joye under s.596B of the Corporations Law ("the Law"). The applicant seeks an adjournment until the hearing of his application to the High Court for special leave to appeal from an order of another Full Court of this Court (Sheppard, Spender and Hill JJ.) in this matter. That Full Court dismissed an appeal from an earlier order made by Branson J. dismissing an application by Mr. Joye to set aside an order made by Registrar Fisher for substituted service of the summons issued pursuant to s.596B of the Law. In the examination ordered by the summons, which was issued at the request of Mr. Sheahan, the present respondent, as the liquidator of Cortaus Limited (in liquidation), Mr. Sheahan sought to examine Mr. Joye, a former director of Cortaus, about its "examinable affairs". In order to understand the issues that arise on the present application, it will be necessary to describe the history of the litigation in some further detail. THE HISTORY OF THE LITIGATION (a) The Registrar's order for substituted service On 1 November 1994, Mr. Sheahan applied to this Court for the issue of the examination summons. An order to that effect was made on 25 November and on 6 December 1994 the summons, directed to Mr. Joye, was issued. Attempts to serve the summons on Mr. Joye not being successful and since Mr. Joye was overseas, in February 1995 Mr. Sheahan applied to the Court for an order for its substituted service on Mr. Joye's solicitors (Messrs Speed and Stracey) and his accountants, both in Sydney. That order was made by Registrar Fisher on 7 February 1995 and substituted service was effected on 14 February. (b) The application to set aside the order for substituted service and the dismissal of that application by Branson J. on 1 June 1995 In March 1995, Mr. Joye applied to the Court for (1) an order setting aside the Registrar's order for substituted service; and (2) a declaratory order that the summons and the Registrar's order had not been validly served. On 1 June 1995, Branson J. dismissed that application (see: Sheahan v Joye (1995) 57 FCR 389). Her Honour held (at 396) that, by virtue of s.18 of the Federal Court of Australia Act 1976, the jurisdiction was "Australia-wide". The question whether the Registrar's order for substituted service was competent was one of jurisdiction, and being an action in personam, as Lockhart J. has held in Re Deposit Investment Company Limited (Receiver appointed) (1991) 30 FCR 463 (at 464) the Court's jurisdiction depended upon Mr. Joye's presence within Australia. Branson J. said (at 397): "The common law position is plain that a court has jurisdiction to entertain an action in personam against any person who is within the jurisdiction of the Court at the time that its authority is exercised over that person. What is less plain is whether such authority is exercised at the time for service of the process by which jurisdiction is asserted or the time of issue of such process. In this case Mr Joye was within the jurisdiction at the date of the issue of the summons but not at the date of the purported substituted service." After reviewing the authorities, in particular Laurie v Carroll (1958) 98 CLR 310, her Honour concluded (at 399): "... the better view is that this Court exercised authority over Mr Joye at the time of the issue of the summons to him of 6 December 1994. That is, that the issue of the summons was itself an act of jurisdiction and not merely an inchoate command which would be perfected upon service of the summons on Mr Joye. Mr Joye was in Australia on 6 December 1994. Consequently I consider that substituted service on him thereafter may validly be ordered." Earlier in her reasons, Branson J. had made findings of fact, which, although not "of significance" on her Honour's view of the law (at 394-5), became important on the appeal from her decision. They included findings (at 396) that: "(a)Messrs Speed & Stracey contacted Mr Joye following their receipt of the facsimile transmission dated 9 December 1994 from the solicitors for the applicant; (b) Mr Joye learned from Messrs Speed & Stracey earlier than his departure from Australia on 13 December 1994 of the institution of these proceedings by the applicant, and of the desire of the applicant's solicitors to effect service of process upon him." In drawing these inferences, her Honour relied, inter alia, on the absence of evidence from the firm of Speed & Stracey as to the action, if any, taken by the firm after 9 December 1994 when they received a letter from Mr. Sheahan's solicitors enquiring whether they had been instructed to accept service. Branson J. said (at 395): "It has not been suggested that any difficulties have stood in the way of the obtaining of such evidence on behalf of Mr Joye, or that such evidence would be privileged. I assume that such evidence, if obtained, would not assist Mr Joye: Jones v Dunkel (1959) 101 CLR 298." (c) The appeal to the Full Court and the dismissal of that appeal on 28 March 1996 As has been noted, Sheppard, Spender and Hill JJ. dismissed the appeal from her Honour's judgment. Their Honours said that the disposition of the appeal "depends in large measure on the way the proceedings were conducted before the primary Judge". Having referred to findings (a) and (b) quoted above made by Branson J., their Honours said: "It was conceded on behalf of Mr Joye that if her Honour's factual findings stood, ie, that Mr Joye knew before he departed from Australia that a summons for his examination had been issued and that an attempt was being made to serve it upon him, then there was jurisdiction to make an order for substituted service. The appellant submitted that the factual finding by her Honour as to knowledge was wrongly made, and it was in consequence submitted that the court lacked jurisdiction, relying on Laurie v Carroll ... . That decision was much debated both below and on the appeal. What Laurie v Carroll actually decided is of no present application. Unlike the present case, at the time of the issue of the process of which substituted service was subsequently ordered, Laurie was not within the jurisdiction." The Full Court went on to say: "What Laurie v Carroll decided was that substituted service could not be ordered where a person was not in the jurisdiction at the time of issue of suit, but had accelerated his departure because of the threat of suit. In this sense, the Court decided that where a person is outside the jurisdiction, presence in the jurisdiction at the time of issue of the writ was a necessary (but not necessarily sufficient) element before substituted service could properly be ordered. The primary judge concluded (57 FCR at 399) that mere presence at the time of issue of the order and summons was sufficient to confer jurisdiction to make an order for substituted service. In Laurie v Carroll (at 332) the Court agreed with the observation of Lord Sumner in Johnstone v Pedlar [1921] 2 AC 262 at 292 that local allegiance owed by an alien temporarily present in England `begins no earlier than and continues no longer than the presence of the alien...within the realm,...' [emphasis added] In the light of the High Court's observations (at 328) that: `If a defendant knowing of the issue of the writ goes abroad before personal service or, although he does not positively know of the fact of the issue of the writ, goes abroad to evade service, doubtless he may be treated as under notice of the obligation of its command.' earlier referred to, it seems likely that mere presence, without more, at the time of issue is insufficient." However, their Honours found it unnecessary to resolve this legal question "in the light of the concession on behalf of Mr Joye that his presence within the jurisdiction at the time of issue, and knowledge of the issue of a summons for his examination prior to leaving Australia would confer jurisdiction to make an order for substituted service". The Full Court then addressed a challenge by Mr. Joye to the inferences of fact (a) and (b), above, made by Branson J. Their Honours said: "The only question on this aspect of the matter is whether on the evidence before the primary judge it was open to her to draw the inference which she did. It should be recalled that the term of the letter of 16 December from Speed and Stracey was: `We refer to your letter of 9 December 1994 and advise that we have no instructions to accept service.' One would be permitted to infer that a well known and reputable firm such as Speed and Stracey, on receipt of the letter from the respondent's solicitor of 9 December would at least have sought instructions. The client was not in Australia after Tuesday, 13 December. The careful reticence of the reply, `We have no instructions to accept service' is the evidence which brings the principle of Jones v Dunkel into application. Mr Joye's solicitors did not say either `We have sought instructions and our instructions do not permit us to say that we will accept service', nor did they say `We have not been able to get instructions as to whether to accept service and therefore we advise that we cannot accept service'. The nature of the reply by the solicitors, and in particular, as her Honour noted, the absence of any reference to an inability to contact Mr Joye, permitted the inference that they had contacted him and that he gave them instructions and those instructions were the basis of their communication of Friday 16 December, an inference which the considerations of Jones v Dunkel would fortify. If that was what occurred, the probability is that it occurred before Tuesday, 13 December, when Mr Joye departed Australia, a conclusion which again the considerations of Jones v Dunkel would fortify. Those considerations lead to the conclusion that, after the issue of the Order and Summons, and with knowledge of those proceedings, Mr Joye departed the jurisdiction. The appellant argued the matter below and on the appeal on the basis that if those were the facts, then there was jurisdiction to order substituted service. The appeal should therefore be dismissed with costs." (d) Mr. Joye's application to the High Court for special leave to appeal from the judgment of the Full Court On 17 April 1996, Mr. Joye filed in the High Court an application seeking leave to appeal and, if granted, seeking orders (1) setting aside the orders made respectively by the Full Court, by Branson J. and by Registrar Fisher; and (2) declaring that the summons to attend an examination under s.596B of the Law was not duly served on Mr. Joye. The questions of law said, on behalf of Mr Joye, to be raised by the special leave application are: "14.Whether mere presence at the time of issue of the summons is sufficient to render a person amenable to a court's jurisdiction. 15. Whether the principle of Jones v Dunkel can be applied to the letter of 16 December to support the inference drawn by the courts below that the applicant had knowledge of the summons." It appears that the special leave application will be fixed for hearing at the Adelaide sittings of the High Court scheduled to commence on 12 August 1996. (e) Mr. Joye's further application to Branson J. in April 1996 for orders adjourning his examination and its dismissal on 23 April. By notice of motion dated 12 April 1996, Mr. Joye sought orders adjourning the examination until after the High Court has dealt with the special leave application. In her reasons for refusing Mr. Joye's motion, Branson J. noted that his application was more in the nature of a claim for an interlocutory injunction, rather than a stay of proceedings under the Full Court's order. Her Honour further noted that it appeared that the source of her authority was the original jurisdiction conferred by s.20(1) of the Federal Court of Australia Act, rather than the limited appellate jurisdiction vested in a single Judge by s.25(2) of that Act. Branson J. accepted that if Mr. Joye's examination were to take place before the hearing of the special leave application, then the result of any appeal which might follow, if successful, would be nugatory. On the other hand, her Honour also accepted, citing Jennings Construction Limited v Burgundy Royale Investments Proprietary Limited (No. 1) (1986) 161 CLR 681 and Smith Kline & French Laboratories (Aust.) Ltd. v Secretary, Department of Community Services and Health (1991) 65 ALJR 360, that her jurisdiction to grant injunctive relief (to further adjourn the examination) pending a special leave application was an "extraordinary one" and would only be granted in "exceptional circumstances". Her Honour said: "I accept the submission made on behalf of the liquidator that the following factors are to be considered on an application of this kind. First, whether there is a substantial prospect that special leave to appeal to the High Court will be granted; secondly, whether the grant of the application will cause loss to the liquidator; and thirdly, where the balance of convenience lies." Having noted that before the Full Court (although not at first instance), senior counsel for Mr Joye had conceded that if, as her Honour had concluded, Mr. Joye knew before he departed from Australia that a summons for his examination had been issued and that an attempt was being made to serve it upon him, then there was jurisdiction to order substituted service, Branson J. said: "I do not regard Mr Joye's prospects of obtaining special leave to appeal to the High Court as substantial. Indeed, I consider such prospects to be slim. I regard this assessment as a factor of considerable significance on the application before me... ." On the other hand, although her Honour concluded that further delay in the examination of Mr. Joye "may result" in loss to the liquidator in his official capacity, Branson J. was "unable to conclude that it will cause such loss". Her Honour also took into account the length of time since the issue of the order and summons for examination, and the public interest sought to be advanced by the examination. Branson J. concluded that the case was not one which attracted the exceptional relief sought. CONCLUSIONS ON THE SEVERAL APPLICATIONS BEFORE THIS FULL COURT As has been mentioned, there are several applications before us, namely (a) an application to extend time for seeking leave to appeal from the orders made by Branson J. in April 1996; (b) leave to appeal; (c) an order, pending the special leave application to the Full Court, staying the orders of the Full Federal Court made on 28 March 1996; and (d) an order staying the order for the examination of Mr. Joye. In the complicated circumstances which have arisen, it will be convenient to deal with (a) first and then consider (b), (c) and (d) together. (a) The extension of time sought By O.52 r.10(2)(b) a notice of motion for leave to appeal from an interlocutory judgment shall be filed and served within seven days from the pronouncement of the judgment, or within such further time as the Court or a Judge may allow. In order to understand the context in which this application is made, it will be necessary to provide some more details of the history of the litigation. The notice of motion before Branson J. was heard by her Honour on 15 April 1996. At the conclusion of the argument, the Judge indicated, for reasons she would give in writing at a later date, that she was not prepared to make an order to the effect that the examination be adjourned until a date after the High Court had heard Mr. Joye's special leave application, but that she was prepared to restrain Mr. Sheahan, as liquidator, from requesting that a date be fixed for Mr. Joye's examination for a period sufficient to permit an application to be made to the High Court or to the Full Federal Court for orders of the kind sought in the notice of motion before Branson J. On that indication being given, and upon her Honour ordering the dismissal of the notice of motion, Mr. Sheahan offered, and her Honour accepted, his undertaking that he - "will not approach this Court for a new date to be set for the examination of the respondent pursuant to the Examination Summons within 21 days of the date of this order or such earlier date upon which [Mr. Joye] shall have made and been refused an application restraining or otherwise preventing [Mr. Sheahan] from so obtaining a date for the examination of [Mr. Joye] pursuant to the Examination Summons." Her Honour also reserved liberty to Mr. Joye to apply on short notice. On 23 April 1996, Branson J. published her reasons. The notice of motion before us was filed on 2 May 1996, that is, more than seven days after the making of orders on 15 April, but only nine days after the date of publication of reasons. Given the shortness of time, the procedural complexities of the litigation and the absence of any specific suggestion of prejudice to the liquidator if an extension of time until 2 May were granted, that extension ought, in my opinion, now be granted. (b) Leave to appeal In my opinion, this leave ought to be granted. It should be noted at the outset that, in my view, no question arises here of prior exercise of the election considered in, for instance, Thomas Borthwick & Sons (Pacific Holdings) Limited v Trade Practices Commission (1988) 18 FCR 424 (at 433). That election would have been exercised if Mr. Joye had earlier asked Branson J. to grant leave to appeal from her orders made on 15 April. Instead, Mr. Joye chose to apply to this Court for leave to appeal from those orders. In my opinion, he was entitled to do this. It will be recalled that her Honour said that she was exercising original (s.20) rather than appellate (s.25) jurisdiction. In form, as well as in substance, her Honour's orders were interlocutory, thus requiring the grant of leave to appeal pursuant to s.24(1A). On the other hand, the practical effect of her Honour's dismissal of Mr. Joye's application was, as has been seen, final. Although that consideration does not bear upon the character of the order, it is relevant, in a positive sense, to the discretionary question whether leave ought to be granted. In Ex parte Bucknell (1936) 56 CLR 221, Latham C.J., Rich, Dixon, Evatt and McTiernan JJ. said (at 225-6): "There is one class of case which raises little difficulty. If the interlocutory order, being an order of the character specified in sub-paras.1, 2, or 3 of sec.35(a), has the practical effect of finally determining the rights of the parties, though it is interlocutory in form, a prima facie case exists for granting leave to appeal. For example, a judgment for either party on a demurrer might, in effect, be decisive of the whole litigation. Although such a judgment would often be interlocutory, it might be final in determining the issue between the parties, and, in such a case, leave would be granted almost as of course." It is true that one aspect of the proposed appeal bears upon a matter of practice and procedure, and that this is an area where traditionally it is difficult to obtain leave to appeal. On the other hand, the point of practice and procedure, that is, the scope of the power of a Judge of this Court to grant a stay, or an interlocutory injunction, pending a special leave application to the High Court, is one of general importance and a jurisprudence is beginning to develop after the adoption of the approach laid down in Jennings, above (cf. the practice now adopted by the Court of Appeal of the Supreme Court of New South Wales, which was mentioned by Branson J. (without necessarily adopting it): see, e.g., Sibuse Pty. Ltd. v Shaw (No.2) (1988) 13 NSWLR 125). On balance, then, I favour the grant of leave to appeal. (c) The appeal itself In the present context, a distinction has been drawn between an application to a single Judge for a stay of the operation of final orders already made, on the one hand, and an application for fresh, albeit temporary, orders which are injunctive in nature, on the other. For instance, in Marsden v Amalgamated Television Services Pty. Ltd., High Court, 6 May 1996, Gummow J. said (at 3-4): "... the present motion in this Court seeks not a stay of orders already made but the making of fresh orders, injunctive in nature. In that regard, I refer to the following passage, with which I respectfully agree, in the judgment of Guadron J in Elliott v Seymour... . Her Honour said: `It was argued for the applicants that, given the nature of the case, the only question relevant to the grant of interlocutory relief is whether there is a prospect that special leave will be granted. That can be taken as correct, particularly in so far as the relief claimed is essential to the preservation of the subject matter of the proposed appeal. However, something should be said as to the prospect that special leave will be granted. It was put for the applicants that the case involves the liberty of the subject and that, in accordance with Narain v Director of Public Prosecutions (1987) 61 ALJR 317, all that is required is that that prospect should not be insubstantial, rather than that there should be a `substantial prospect` as required in Jennings Construction Ltd v Burgundy Royale Investment Pty Ltd (No 1)... . It is to be remembered that this is an application for an interlocutory injunction, not for the stay of a final judgment. Interlocutory relief always depends on there being a probability that final relief will be obtained. Inevitably, the question whether there is a prospect of special leave being granted in a case involving the refusal of interlocutory relief depends on whether there is a probability of ultimate success. Thus, whether the matter is approached on the basis of a not insubstantial prospect or a substantial prospect (assuming there is a shade of difference between the two), the present applications must pass the threshold point which involves some consideration of the prospects of final success. That is only to give more particular content to the rubric that it is only in exceptional cases that there will be a grant of special leave from a decision involving the refusal of interlocutory relief.'" In the present case, the claim for interim relief has a dual aspect. From one perspective, what is sought is a stay of the Court's order summoning Mr. Joye to attend to be examined. From another point of view, what is sought to be temporarily restrained is the apprehended action of Mr. Sheahan in requesting that the examination be set down for hearing before the High Court entertains the special leave application. But, in my view, as a matter of substance, and perhaps also of form, Mr. Joye's motion was for a temporary stay of the Court's order that he attend for examination. This, I think, follows from the form and structure of the relevant legislative scheme of the Law which is as follows. By s.596B(1) of the Law, it is provided that, in certain circumstances, the Court may, as a matter of discretion, summon a person for examination about a corporation's examinable affairs. By s.596D(1)(a), a summons under s.596B is to require the person to attend before the Court at a specified place, and time and day that are reasonable. By s.597(6), a person summoned under s.596B to attend before the Court shall not, without reasonable excuse, fail to attend as required by the summons. By O.71 r.81(5), at least eight days before the date set for the examination, the summons must be personally served or served in such other manner as the Court or a Judge may direct. Since the Full Court has dismissed the appeal from the refusal of Branson J. to set aside the Registrar's substituted service order, it must follow that, unless its operation is now stayed, the summons for the examination of Mr. Joye is at this stage in full force and effect. Assuming for the moment an entitlement to some appropriate form of interim relief, it may be possible to consider, as a possible form of relief, the grant of an injunction restraining Mr. Sheahan applying to have a fresh date fixed for the examination. However, it is, I think, rather more in accordance with the statutory scheme outlined above to consider Mr. Joye's present claim as one for a stay of proceedings, not of the Full Court's orders, but of proceedings under the examination summons itself. The factors identified by Brennan J. in Jennings as material to the exercise of the discretion to stay were described thus (at 685): "In each case when the Court is satisfied a stay is required to preserve the subject-matter of the litigation, it is relevant to consider: first, whether there is a substantial prospect that special leave to appeal will be granted; secondly, whether the applicant has failed to take whatever steps are necessary to seek a stay from the court in which the matter is pending; thirdly, whether the grant of a stay will cause loss to the respondent; and fourthly, where the balance of convenience lies." As to the prospect of the grant of leave, as Gaudron J. noted in Elliott in the passage cited by Gummow J. in Marsden, it may be that there is a shade of difference between a prospect that is "substantial" and one that is "not insubstantial". But it could not be right that verbal distinctions should govern the outcome here. Clearly, there must be a range of possibilities. A few illustrations will suffice. In granting a stay in De L v Director-General, NSW Department of Community Services (1996) 136 ALR 201, Gummow J. said (at 204): "The question then becomes whether there is a substantial prospect that special leave will be granted. Supplementary documents were filed in court this morning. The amended draft notice of appeal contains five paragraphs dealing with grounds of appeal, the first two of which focus upon the construction of para(c) of reg 16(3). They highlight the difference of opinion in the Full Court as to the construction of the provision. In particular, there are differing views as to the significance to be attached in the courts of this country to the construction placed upon the relevant provisions of the Hague Convention by the English Court of Appeal. The Court of Appeal's decision is that in S v S... . There is a question of public importance involved here. There is, in my view, at least a significant prospect of success as regards those grounds. There is, in my view, less prospect of success in grounds set out in paras 4, 5 and 6 of the amended draft notice of appeal." In Elliott, above, in refusing a stay, Gaudron J. concluded that there was no prospect of obtaining special leave. A stay was also refused in Gerah Imports Pty. Ltd. v The Duke Group Ltd. (in liq.) (1994) 119 ALR 401, where Dawson J. said (at 404): "In the end, I am not satisfied that the applicants have discharged the onus upon them of demonstrating that the application for special leave enjoys a substantial prospect of success. The power conferred by s.596B is wide and I am not persuaded that the conclusion reached by the Full Court involves any error either in construction of the provision or otherwise." The claim for interim injunctive relief was refused by Gummow J. in Marsden on the ground that there was neither "a substantial prospect" nor a "not insubstantial prospect" that special leave would be granted. In the present case, as has been noted, Branson J. said, in this connection, that she did "not regard Mr. Joye's prospects ... as substantial. Indeed, I consider [them] to be slim". With respect, one can readily appreciate the force of these remarks, especially if, as appears to be the case, Mr. Sheahan may argue that any High Court appeal should fail because of concurrent findings of fact by a primary Judge and an intermediate appellate court. If those findings were to be the decisive issues in any appeal, then I would agree with her Honour that, ordinarily, leave would be refused. But it does appear that those findings were in a rather special context, that is, an order for substituted service of process upon a solicitor when the solicitor has previously indicated that he had no instructions to accept service. It might be thought that to direct service upon the solicitor in those circumstances was not appropriate, as it could place the solicitor in an invidious position of, in effect, being compelled to obtain instructions from the client to waive the client's professional privilege. That being so, a further question, arguably at least, would arise as to the scope of the rule in Jones v Dunkel in that connection. In my opinion, if the matter is viewed on this broader basis, it may be said that Mr. Joye has a prospect of obtaining special leave which is "not insubstantial". I would not, in any event, regard his special leave application as frivolous or vexatious or an abuse of process, and I would hesitate so to hold except in the clearest case, acknowledging, of course, that a Justice of the High Court must be in a stronger position than a member of another court to assess the prospects of the grant of special leave in any case. It should be noted that in this Court a flexible approach has been taken in a similar area which may provide a useful analogy in the special situation here. In Aboriginal Development Commission v Ralkon Agricultural Co. Pty. Ltd. (1987) 15 FCR 159, Forster, Woodward and Wilcox JJ. said (at 163-4): "...it is clear that the inquiry whether there is a serious question to be tried must be answered with reference to the circumstances of the case. There may be cases in which the facts are so clearly and comprehensively established at the time of the application for the interim order that the court would conclude that the applicant had no arguable case. At the opposite extreme there may be cases in which the applicant has had little opportunity to ascertain the facts and to adduce evidence but there is some material to suggest an entitlement to relief. Upon further investigation that material may turn out to be capable of ready refutation or explanation but, in the meantime, it may be appropriate for the court to intervene. Everything must depend upon the circumstances of the case, including the extent to which the applicant has had an opportunity to present the facts to the court and the consequences of granting or of refusing relief. This is what was meant by Woodward J when, in Bullock (at 472) and in Jungpradit v Hurford... he spoke of considering together the two tests of `serious question' and `balance of convenience'. The overriding principle is that referred to by Dawson J in Hayden (at 5) "that a court ought not to be misled by an overstrict application of verbal formulae to depart from its primary duty to do complete justice in the cause." In Sharp v Deputy Commissioner of Taxation (1988) 18 FCR 475, Bowen C.J., Sheppard and Burchett JJ. said (at 484): "We do not suggest that there is anything intrinsically unjust in his Honour's conclusion that the first matter relied upon by counsel for the appellants did not raise a substantial question to be tried. But that conclusion must be looked at in context. If the Commissioner is given access to the documents in advance of the final hearing and it is ultimately found that he was not entitled to have that access, he will have been given something to which he was not in law entitled. More importantly, he will have achieved his object, and the matter so far as the appellants are concerned, will have become academic. In those circumstances, there was much to be said for the view that weak though the appellants' case as put to his Honour was, there were countervailing considerations which militated in favour of the grant of interlocutory relief; see Aboriginal Development Commission v Ralkon Agricultural Co. Pty Ltd... ." Turning then to the other discretionary factors identified in Jennings, it appears that if a limited stay were to be granted, and if appropriate undertakings, or conditions, of the kind directed in Jennings were in place, then any loss suffered as a result by Mr. Sheahan should be minimal; moreover, the balance of convenience favours Mr. Joye. In summary, I am of the view that the apparent weakness of Mr. Joye's case is outweighed by the other discretionary considerations. With some reluctance, given the extraordinary delay that has already occurred, I am of the view that this Court should now intervene by suspending the operation of its examination summons for a further period. That period is expected to be no more than two months. Since writing the above, I have noted that, in a related matter, Branson J. dealt with an application to adjourn the examination of members of Mr. Joye's family and others (see SG 3037 of 1996, In the matter of Cortaus Limited (In liq.), John Sheahan as Liquidator of Cortaus Limited (In liq.) v Judith Olga Joye & ors.). This application was heard by Branson J. on 29 May, shortly after argument on this appeal. The background to that application was a jurisdictional challenge heard by another Full Court of this Court in November 1995 in Southern Steel Supplies Pty Ltd v Favelle Favco Holdings Limited and Amann Aviation Pty Limited (In liq.) v The Appliction of Martin Russell Brown. An adjournment of the examination was sought on the grounds, as described by her Honour in her reasons dated 30 May, that the challenge might result in a determination that this Court lacks jurisdiction to issue summonses pursuant to s.596B. It might also result in the termination of the appointment of Mr. Sheahan as liquidator of Cortaus; and if Mr. Sheahan's appointment as liquidator of Cortaus were to be terminated, he would lose his qualification as an "eligible applicant" for the issue of a summons within the meaning of s.596B. In her reasons for ordering that the examination be adjourned until the Full Court's determination, Branson J. said: "If the respondents are required to attend for examination relating to Cortaus, and are so examined, and it is subsequently determined that this Court has no jurisdiction to issue the summonses respectively served upon them, their civil liberty to attend to their ordinary affairs without interference, and to keep to themselves information unless and until they choose to disclose it, will have been seriously interfered with." In my opinion, the outcome of that application, and the reasons given, provide further support for the conclusion I had reached in the present appeal. ORDERS PROPOSED I propose that a conditional stay of the proceedings under the examination summons be granted pending the determination of the special leave application in the terms of the following orders: 1. Extend the time for filing the applicant's notice of motion dated 2 May 1996 up to and including that date. 2. Grant leave to appeal. 3. Allow the appeal, with costs. Set aside the orders made at first instance on 15 April 1996; in lieu thereof, order that, upon the applicant, by his solicitors, filing in the Registry within seven days of this date a written undertaking (a) to pay damages on the usual terms; and (b) to prosecute with due diligence the special leave application in the High Court sittings in Adelaide in August 1996, any further proceedings upon the summons for the examintion of the applicant issued pursuant to s.596B(1) of the Corporations Law be stayed until the High Court has determined the special leave application; further order that the respondent pay the applicant's costs at first instance. I certify that this and the preceding twenty-three (23) pages are a true copy of the Reasons for Judgment herein of his Honour Justice Beaumont. Associate Dated: 14 June 1996 IN THE FEDERAL COURT OF AUSTRALIA) ) SOUTH AUSTRALIA DISTRICT REGISTRY) No. SG 3137 of 1994 ) GENERAL DIVISION ) APPLICATION FOR LEAVE TO APPEAL FROM THE JUDGMENT OF A JUDGE OF THE FEDERAL COURT OF AUSTRALIA BETWEEN : IAN EDWARD JOYE Applicant AND : JOHN SHEAHAN Respondent CORAM: BEAUMONT, SPENDER AND LEHANE JJ PLACE: SYDNEY (heard in Adelaide) DATE: 14 JUNE 1996 REASONS FOR JUDGMENT SPENDER J I have had the opportunity of reading in draft form the reasons for judgment of Beaumont J. I agree to the granting of an extension of time within which to seek leave to appeal from the judgment of Branson J, for the reasons which his Honour gives. However, I would not grant leave to appeal and, if leave to appeal were to be given, I would dismiss the appeal. The nature of the application before Branson J was in substance a claim that the proceedings under the examination summons ought to be stayed pending the determination of the application for special leave to the High Court. The matter is essentially a point of practice and procedure. As Gummow J recently said in Marsden v Amalgamated Television Services Pty Ltd (High Court, 6 May 1996) at p 4: " It is to be remembered that this is an application for an interlocutory injunction not for the stay of a final judgment. Interlocutory relief always depends on there being a probability that final relief will be obtained. " In this case, Branson J did not regard as substantial Mr Joye's prospects of obtaining special leave . Her Honour said: " Indeed, I consider [them] to be slim. " In my respectful opinion, there was no error of principle demonstrated in her Honour's reasons nor any compelling reason why the usual reticence in relation to applications for leave to appeal from interlocutory judgments, particularly in relation to points of practice and procedure, ought not obtain in the circumstances of this case. I would refuse leave to appeal, with costs, and if leave were to be granted, I would dismiss the appeal, also with costs. I certify that this and the preceding page are a true copy of the reasons for judgment herein of the Honourable Justice Spender. Associate Date: 14 June 1996 IN THE FEDERAL COURT OF AUSTRALIA ) SOUTH AUSTRALIA DISTRICT REGISTRY ) GENERAL DIVISION ) )No. SG 3137 of 1994 APPLICATION FOR LEAVE TO APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA BETWEEN: IAN EDWARD JOYE Applicant AND: JOHN SHEAHAN Respondent CORAM: Beaumont, Spender, and Lehane JJ PLACE: Sydney (Heard in Adelaide) DATE: 14 June 1996 REASONS FOR JUDGMENT LEHANE J: I have had the advantage of reading the judgment of Beaumont J. I agree that the orders proposed by his Honour should be made and I agree also with his reasons. I certify that this page is a true copy of the Reasons for Judgment of the Honourable Justice Lehane. Associate: Dated: 14 June 1996 Heard: 10 May 1996 Place: Adelaide Decision: 14 June 1996 Appearances: Messrs D M J Bennett QC and E M Jackson of counsel instructed by Cowell Clark appeared for the applicant. Messrs A J Besanko QC and G S Davis of counsel instructed by Piper Alderman appeared for the respondent.