FEDERAL COURT OF AUSTRALIA Edge Technology v Wang [2001] FCA 247 PRACTICE AND PROCEDURE – documents subpoenaed by petitioning creditor in bankruptcy proceedings – tendered by petitioning creditor as evidence to support sequestration order – whether trustee in bankruptcy may use such documents in pursuing bankrupts for recovery of property. Bankruptcy Act 1966 (Cth) Crest Homes Plc v Marks [1987] AC 829 cited Edge Technology Pty Ltd (In Liquidation) & Ors v Wang & Anor [2000] FCA 1586 cited Holpitt Pty Ltd v Varimm Pty Ltd & Ors (1991) 29 FCR 576 referred to Springfield Nominees Pty Ltd v Bridgelands Securities Ltd (1992) 38 FCR 217 referred to Sweetman v Australian Thoroughbred Finance Pty Ltd (Lockhart J, 23 July 1992, unreported) referred to EDGE TECHNOLOGY PTY LIMITED (IN LIQUIDATION) & ANOR v WANG & ANOR N 7671 OF 2000 MICROSOFT LICENSING INC v WANG & ORS N 1347 OF 1999 CONTI J 26 FEBRUARY 2001 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 7671 OF 2000 BETWEEN: EDGE TECHNOLOGY PTY LIMITED (IN LIQUIDATION) (RECEIVER APPOINTED) ACN 003 761 144 FIRST APPLICANT EDGE HOLDINGS PTY LIMITED (IN LIQUIDATION) (RECEIVER APPOINTED) ACN 061 986 221 SECOND APPLICANT AND: JEN-TSE WANG (also known as Johnson Wang) FIRST RESPONDENT SIU CHUI LAI WANG (also known as Phynia Wang) SECOND RESPONDENT IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 1347 OF 1999 BETWEEN: MICROSOFT LICENSING INC AND: APPLICANT/CROSS RESPONDENT JEN-TSE WANG (also known as JOHNSON WANG) FIRST RESPONDENT SIU CHUI LAI WANG (also known as PHYNIA WANG, SIU CHUI LAI and SIU CHUI WANG) SECOND RESPONDENT EDGE TECHNOLOGY PTY LIMITED (IN LIQUIDATION) (RECEIVER APPOINTED) (ACN 003 761 144) THIRD RESPONDENT KTX TECHNOLOGY PTY LIMITED (ACN 052 845 557) FOURTH RESPONDENT JEN-TSE WANG (also known as JOHNSON WANG), SIU CHUI LAI WANG (also known as PHYNIA WANG, SIU CHUI LAI and SIU CHUI WANG), EDGE TECHNOLOGY PTY LIMITED (ACN 003 761 144), and KTX TECHNOLOGY PTY LIMITED (ACN 052 845 557) CROSS CLAIMANTS JUDGE: CONTI J DATE OF ORDER: 26 FEBRUARY 2001 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. EDGE TECHNOLOGY PTY LIMITED (In Liquidation) EDGE HOLDINGS PTY LIMITED (In Liquidation) and MICROSOFT LICENSING INC have leave to give to ANDREW HUGH JENNER WILY (by this Order referring also to his employees and agents), in his capacity as trustee of the respective bankrupt estates of Jen-Tse Wang (also known as Johnson Wang ("Mr Wang") and Siu Chui Lai Wang (also known as Phynia Wang, Siu Chui Lai and Siu Chui Wang) (Mrs Wang), and for ANDREW HUGH JENNER WILY have leave to use, copies of any documents (without limitations including copies of the documents annexed to the affidavit of Maria Jose Campos filed on 19 February 2001 in proceedings N 7671 of 2000) containing passport numbers or identity card numbers of Mr Wang and/or Mrs Wang produced in response to subpoenas addressed to the Proper Officer, the Department of Immigration and Multicultural Affairs in these proceedings, for the purposes of enabling him (or his servants or agents) to investigate whether Mr Wang and/or Mrs Wang own any property (of any kind) in Hong Kong or elsewhere, and to use for the purposes of seeking to recover any property which he considers may have belonged or may belong to Mr Wang or Mrs Wang or for any other purpose related to the administration of their bankrupt estates. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 7671 OF 2000 BETWEEN: EDGE TECHNOLOGY PTY LIMITED (IN LIQUIDATION) (RECEIVER APPOINTED) ACN 003 761 144 FIRST APPLICANT EDGE HOLDINGS PTY LIMITED (IN LIQUIDATION) (RECEIVER APPOINTED) ACN 061 986 221 SECOND APPLICANT AND: JEN-TSE WANG (also known as Johnson Wang) FIRST RESPONDENT SIU CHUI LAI WANG (also known as Phynia Wang) SECOND RESPONDENT IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 1347 OF 1999 BETWEEN: MICROSOFT LICENSING INC AND: APPLICANT/CROSS RESPONDENT JEN-TSE WANG (also known as JOHNSON WANG) FIRST RESPODNENT SIU CHUI LAI WANG (also known as PHYNIA WANG, SIU CHUI LAI and SIU CHUI WANG) SECOND RESPONDENT EDGE TECHNOLOGY PTY LIMITED (IN LIQUIDATION) (RECEIVER APPOINTED) (ACN 003 761 144) THIRD RESPONDENT KTX TECHNOLOGY PTY LIMITED (ACN 052 845 557) FOURTH RESPONDENT JEN-TSE WANG (also known as JOHNSON WANG), SIU CHUI LAI WANG (also known as PHYNIA WANG, SIU CHUI LAI and SIU CHUI WANG), EDGE TECHNOLOGY PTY LIMITED (ACN 003 761 144), and KTX TECHNOLOGY PTY LIMITED (ACN 052 845 557) CROSS CLAIMANTS JUDGE: CONTI J DATE: 26 FEBRUARY 2001 PLACE: SYDNEY REASONS FOR JUDGMENT 1 On 24 October 2000 in proceedings N7671 of 2000, upon the application of Edge Technology Pty Limited (In Liquidation) (Receiver Appointed) ("Technology") and Edge Holdings Pty Limited (In Liquidation) (Receiver Appointed) ("Holdings"), sequestration orders were made against the respective estates of the abovenamed Respondents Jen-Tse Wang (also known as Johnson Wang) and Sui Chui Lai Wang (also known as Phynia Wang, Siu Chui Lai and Siu Chui Wang), and Andrew Hugh Jenner Wily was appointed trustee in bankruptcy of each insolvent estate. The sums then owed to Technology and Holdings by the bankrupts were $1,368,653 and $1,717,751 respectively. Mr Wang had departed Australia for Hong Kong on 7 June 2000, and Mrs Wang departed for Hong Kong on 10 June 2000, and both of them have apparently never since returned. 2 Mr Wily had earlier been appointed voluntary administrator of Technology and Holdings on 7 June 2000. 3 As I recounted in Edge Technology Pty Limited (In Liquidation) & Ors v Wang & Anor [2000] FCA 1586, Microsoft Licensing Inc ("Microsoft") as well as many other persons and entities, claimed to be creditors of Mr and/or Mrs Wang, and Microsoft was granted leave to join in the application for such sequestration orders in the context of proceedings N1347 of 1999. 4 For the purpose of obtaining such sequestration orders, Mr Wily had caused to be issued and served upon the Department of Immigration and Multicultural Affairs a subpoena to produce copies of documents containing passport numbers and Hong Kong identity card numbers relating to Mr and Mrs Wang. Such subpoena to produce was duly answered and such documents were tendered as exhibits in the said proceedings N7671 of 2000 and N1347 of 1999. 5 Mr Wily in his capacity as trustee in bankruptcy of the said bankrupt estates has since, through one of his partners in professional practice Mr Alan Topp, been endeavouring to locate and identify property of the bankrupts. To that end, he has instructed a Hong Kong resident firm of lawyers, CMS Cameron McKenna, to make enquiries with certain Hong Kong banks with a view to determining whether either or both of the Wangs has or have any assets in Hong Kong which could be made available for the benefit of their respective creditors, including of course the petitioning creditors abovementioned. Mr Topp has been informed that the Banks which he has approached for such information have responded to the effect that it would be necessary for them to be provided with passport numbers or identity card numbers relating to Mr and Mrs Wang in order to correctly identify the existence of any such bank accounts. That is because of the existence of many residents in Hong Kong who have similar names. Plainly, access to such information would be an efficient and effective means of establishing whether the Wangs or either of them operate at least any bank accounts in Hong Kong, and of otherwise initiating a reasonable chain of enquiries. 6 Application has therefore been made by Notices of Motion in both proceedings by Mr Wily, in his capacity as trustee of the bankrupt estates of both Mr and Mrs Wang, for access to and making copies of the documents earlier produced by the Department of Immigration and Multicultural Affairs to the Court in answer to the subpoenas issued, as above stated, in each of proceedings N7671 of 2000 and N1347 of 1999, for the purpose of investigating whether Mr and/or Mrs Wang own any property of any kind in Hong Kong or elsewhere, and of using any information so obtained for the recovery of any property which he considers may belong or may have belonged to Mr and /or Mrs Wang, and for any other purpose related to the administration of their respective bankrupt estates. 7 I was referred on behalf of Mr Wily to Holpitt Pty Ltd v Varimn Pty Ltd & Ors (1991) 29 FCR 576, where the Court's leave was sought to use in proceedings before this Court documents in the possession of the applicants for such leave, being documents which had been produced to them on discovery in certain other proceedings in the Court. After referring to Crest Homes Plc v Marks [1987] AC 829 at 860, Burchett J discussed the need to establish special circumstances, if leave to use such documents was to be granted. His Honour observed at 578-9 as follows: "… As far as the expression "special circumstances" is concerned, it is an expression which is liable to be misunderstood unless care is taken to ask and answer the question, special in relation to what? "Special" is one of those words which derive almost all their meaning from the context. … If all that is required is that, among the great number of cases in the court in which documents have been discovered, this one must evince some special feature which affords a reason for releasing or modifying the undertaking, there will be no difficulty. Circumstances in which there is a legitimate reason why documents discovered in one proceeding should be made available in another will, viewed in this way, be rare. In the ordinary course, the ordinary rule should apply, there being no special circumstances to suggest otherwise. Cf Jess v Scott (1986) 12 FCR 187, where the Full Court was concerned with the construction of O 52, r 15(2), by which leave to file an appear out of time could be granted "for special reasons"… In my opinion, the court's duty, in an application of this kind, is to consider whether the applicant has shown some circumstance which takes the matter out of the ordinary course, according to which production of documents pursuant to an obligation to make discovery involves the implied undertaking to the court; and, if so, whether an exercise of the court's discretion in favour of the application would be in the interests of justice." This approach has been followed in principle by Lockhart J in Sweetman v Australian Thoroughbred Finance Pty Ltd (Lockhart J, 23 July 1992, unreported) and by Wilcox J in Springfield Nominees Pty Ltd v Bridgelands Securities Ltd (1992) 38 FCR 217. 8 In the present case, the documents in respect of which access has been sought remain in one sense within the ambit of the same proceedings, though the use for which the documents were originally required for production has been technically spent. In any event, the present circumstances of the Applications fall comfortably within the principles above discussed. The interests of justice and the broader public would plainly be served by grant of orders for the access and use sought. I make orders sought in favour of the Applicant Mr Wily accordingly. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Conti. Associate: Dated: 13 March 2001 Solicitor for Edge Technology Pty Limited (In Liquidation): Mr T Ryan (Blake Dawson Waldron) Solicitor for Microsoft Licensing Inc: Ms W Braithwaite (Mallesons Stephen Jaques) Date of Hearing: 26 February 2001 Date of Judgment: 26 February 2001