New South Wales Court of Appeal CITATION : BP AUSTRALIA LIMITED & ORS. v. BROWN & ANOR. [2001] NSWCA 33 FILE NUMBER(S) : CA 40074/01 HEARING DATE(S) : 26/02/01 JUDGMENT DATE : 26 February 2001 PARTIES : BP Australia Limited, Damian Johnston, Craig Telford, Melita Caffery (Claimants) Martin Russell Brown, Timothy James Cuming (Opponents) JUDGMENT OF : Powell JA at 1; Fitzgerald JA at 10 LOWER COURT JURISDICTION : Supreme Court - Equity Division LOWER COURT ED 4928/00 FILE NUMBER(S) : LOWER COURT Austin J JUDICIAL OFFICER : COUNSEL : B.A.J. Coles QC/B.J. Skinner (Claimants) C.R.C. Newlinds (Opponents) SOLICITORS : Carneys Lawyers (Claimants) Kemp Strang (Opponents) CATCHWORDS : COMPANIES - Winding up - Conduct and incidents of liquidation - Time for commencing proceedings to recover preferences extended - Application to set aside order extending time - Summonses for examination of witnesses issued - Application to stay examination pending disposition of application to set aside order extending time. ND DECISION : Leave to appeal from order dismissing application for stay refused. IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40074/01 ED 4928/00 POWELL JA FITZGERALD JA 26 February 2001 BP AUSTRALIA LIMITED & ORS. v. BROWN & ANOR. JUDGMENT 1 POWELL JA: In pursuance of a Summons filed on 21 February last, the Claimants, BP Australia Limited ("BP") and three of its employees, seek leave to appeal from a judgment delivered and orders made by Austin J on 9 February last on which day his Honour dismissed with costs an application which had been made by the Claimants, either, to set aside an order for production of documents by BP and Summonses for the examination of the natural Claimants, or, to stay the operation of the order for production and the examination of the three natural Claimants pursuant to those Summonses. 2 The Summonses were issued on 11 December last at the behest of the Opponents, the liquidators of two companies the winding up of one of which commenced in November 1997 and the winding up of the other of which commenced in December 1997, the purpose sought to be achieved by the obtaining of the order for production and the Summonses for examination being the obtaining of information about the examinable affairs of the two companies of which the Opponents were liquidators - in particular, information which might enable the Opponents in their capacities as liquidators to recover for the benefit of the creditors of each of the companies in liquidation what were said to be payments made pursuant to voidable transactions (see s588 FA of the Corporations Law). 3 The time for the bringing of such proceedings, as prescribed in the first instance by s588 FF (3) (a) of the Corporations Law, is three years from "the relation back date" which, in the case of each of the two companies in liquidation, was 24 October 1997. 4 In pursuance of the provision of s588 FF (3) (b) of the Corporations Law, the Opponents had earlier sought to obtain from Austin J an order for the extension of time within which proceedings to recover the proceeds of voidable transactions might be commenced, to which application his Honour, in September last year, responded by ordering that the time for commencing such proceedings be extended to 24 October next. 5 In pursuance of leave reserved by his Honour at the time when he made those orders, BP Australia Holdings Pty Limited ("BPH"), on 4 October last year, filed a Notice of Motion seeking to have the relevant orders set aside. We have been informed today that that Notice of Motion was subsequently amended to include a prayer for an order that BP itself be joined as a party-Applicant, the basis of that application, as we understand it, being that it was BP's interests which were affected by the orders made by Austin J and that, that company not having been given notice of the application, the order ought to be set aside on the basis of the principles discussed by the High Court in Taylor v Taylor ((1978-1979) 143 CLR 1; see also Hoskins v. Van Den-Braak (1998) 43 NSWLR 290). 6 Be that as it may, when the application which has given rise to the present Summons came before Austin J on 9 February last, his Honour, as I have earlier indicated, dismissed the application with costs. 7 The Claimants accept that the judgment delivered by his Honour on the application was a discretionary one and, thus, one which cannot be called in question unless some error in the exercise of that discretion, falling within the principles discussed by Dixon, Evatt and McTiernan JJ in the well known passage in the judgment of the High Court in House v The King ((1938) 55 CLR 499, 504-5), can be shown to have occurred. 8 The Claimants have advanced their argument in a variety of ways including an assertion that his Honour failed to identify the correct issue before him and that be dealt in an impermissible way the questions of prejudice to the conduct of the administration. 9 Having considered all that has been put by Mr B.A.J. Coles QC, who appears today with Mr B.J. Skinner for the Claimants, and by Mr C.R.C. Newlinds, who appears for the Opponents, I am satisfied his Honour did not fall into error in the manner in which he approached the exercise of his discretion and that, on the contrary, his Honour assessed the balance of convenience in an appropriate way. That being so I, do not consider that there is any basis for inference with his Honour's judgment. 10 FITZGERALD JA: I agree. 11 POWELL JA: The orders of the Court thus are that the summons for leave is dismissed with costs. ********* DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. 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