New South Wales Supreme Court CITATION : Re NSW Grains Board [2002] NSWSC 913 CURRENT JURISDICTION: Equity Division Corporations List FILE NUMBER(S) : SC 4319/02 HEARING DATE(S) : 16/09/02 JUDGMENT DATE : 3 October 2002 Murray Campbell Smith as Administrator of New South Wales Grains Board - Plaintiff Graham Lawrence - First Defendant John Francis Joseph Fitzgerald - Second Defendant PARTIES : Dr Kevin P Sheridan - Third Defendant Scott Davenport - Fourth Defendant Jack Kheir - Fifth Defendant Lee White - Sixth Defendant JUDGMENT OF : Barrett J Mr T F Bathurst QC/Mr T D Castle - Plaintiff COUNSEL : Mr J T Johnson - First and Second Defendants Mr I Mescher - Third and Fourth Defendants Mr D P Robinson - Fifth and Sixth Defendants Atanaskovic Hartnell - Plaintiff SOLICITORS : Carroll & O'Dea - First and Second Defendants Crown Solicitor's Office - Third and Fourth Defendants Holding Redlich - Fifth and Sixth Defendants CATCHWORDS : CORPORATIONS - interpretation of Corporations Law of NSW - meaning of "corporation" - meaning of "public authority" - scope of definition of "public authority of the Commonwealth or a State" - STATUTES - interpretation - Corporations Law continued by grain marketing legislation - interaction with secrecy provisions of audit legislation Corporate Law Economic Reform Program Act 1999 (Cth) Corporations Act 1989 (Cth) Corporations Act 2001 (Cth) Corporations (Ancillary Provisions) Act 2001 Corporations (Ancillary Provisions) Regulation 2001 Corporations (Consequential Amendments) Act 2001 Corporations Law LEGISLATION CITED : Corporations (New South Wales) Act 1990 Corporations (Repeals, Consequentials and Transitionals) Act 2001 (Cth) Government Guarantees Act 1934 Grain Marketing Act 1991 Grain Marketing Amendment Act 2001 Grain Marketing Regulation 2001 Interpretation Act 1987 Public Finance and Audit Act 1983 Search Warrants Act 1985 Adler v Qintex Group Management Services Pty Ltd (1996) 22 ACSR 446 Attorney-General v Breckler (1999) 197 CLR 83 Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 Bank of Valletta plc v National Crime Authority & Anor (1999) 90 FCR 565 Coal Mining Industry (Long Service Leave Funding) Corporation v Commissioner of Taxation (1999) 85 FCR 416 Commissioner of Taxation v Bank of Western Australia Ltd (1995) 61 FCR 407 Commissioner of Taxation v Silverton Tramway Co Ltd (1953) 88 CLR 558 Committee on Direction of Fruit Marketing v Australian Postal Commission (1980) 144 CLR 577 Corporation of the City of Unley v South Australia (1997) 68 SASR 511 Edith Cowan University v Edith Cowan University Student Guild [1999] WASC 35 General Steel Industries Inc v Commissioner for Railways (1964) 112 CLR 125 Government Insurance Office of New South Wales v Commissioner of Taxation (1992) 35 FCR 247 Grosvenor Hill (Qld) Pty Ltd v Barber (1994) 12 ACSR 646 Hong Kong Bank of Australia v Murphy (1992) 28 NSWLR 512 Hubbard Association of Scientologists International v Attorney-General for the State of Victoria [1976] VR 119 CASES CITED : Incorporated Council of Law Reporting (Q.) v Federal Commissioner of Taxation (1924) 34 CLR 580 Marshall v Scottish Milk Marketing Board [1956] SLT 162 New South Wales Grains Board v Davis (unreported, NSWCCA, 17 July 1997) R v Credit Tribunal; Ex parte General Motors Acceptance Corporation (1977) 137 CLR 545 Ray Brown Pty Ltd v New South Wales Grains Board (2002) 41 ACSR 631 Re Anti-Cancer Council (Vic); Ex parte State Public Services Federation (1992) 175 CLR 442 Re Doran Constructions Pty Ltd (2002) 20 ACLC 909 Re Honey Pool of Western Australia (1987) 6 ACLC 208 Re Interchase Corporation Ltd (1996) 68 FCR 481 Re Woorabinda Aboriginal Council (1995) 18 ACSR 191 Renmark Hotel Inc v Commissioner of Taxation (1949) 79 CLR 10 RESI Corporation v Sinclair [2002] NSWCA 123 Taikato v The Queen (1996) 186 CLR 454 Trustees of Dartmouth College v Woodward (1819) 4 Wheaton 518 Victoria v The Commonwealth (1937) 58 CLR 618 Western Australian Turf Club v Commissioner of Taxation (1978) 139 CLR 288 DECISION : Originating process dismissed - 33 - IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST BARRETT J THURSDAY, 3 OCTOBER 2002 4319/02 – MURRAY CAMPBELL SMITH (AS ADMINISTRATOR OF NEW SOUTH WALES GRAINS BOARD) v GRAHAM LAWRENCE & 5 ORS JUDGMENT Introduction 1 The plaintiff claims standing to apply for the exercise by the court of jurisdiction to summon persons for examination about the affairs of the New South Wales Grains Board ("the Grains Board"). In doing so, he maintains that relevant powers are conferred on the court by Part 5.9 (and, in particular, ss.596A and 596B) of the Corporations Law of New South Wales, even though that legislation has been superseded for most purposes by the Corporations Act 2001 (Cth) with effect from 15 July 2001. 2 By originating process filed on 30 August 2002, the plaintiff seeks leave to issue summonses in the form attached thereto to four persons who were, at relevant times, officers of the Grains Board or of the New South Wales public service, as well as the Assistant Auditor-General and the Director of Audit at the Audit Office of New South Wales. 3 These six persons are named as defendants in the originating process. The first four appeared by counsel upon the hearing of the originating process and submitted to such order as the court may make, save as to costs. The other two (to whom I refer, for convenience, as "the Audit Office parties") were also represented by counsel and opposed the making of the orders sought by the plaintiff. 4 There arise, in relation to all six defendants, questions about the functions of the Grains Board, the legislative regime applying to it, the effect of certain documents signed by the Minister for Agriculture and Fisheries ("the Minister") and the status of the Grains Board for the purposes of the Corporations Law of New South Wales. In relation to the Audit Office parties, secrecy provisions in the Public Finance and Audit Act 1983 also arise for consideration. Background 5 The Grains Board was established by the Grain Marketing Act 1991. It succeeded to the assets, liabilities, rights and obligations of four other bodies, being the Barley Marketing Board for the State of New South Wales, the Grain Sorghum Marketing Board for the State of New South Wales, the Oats Marketing Board for the State of New South Wales and the Oilseeds Marketing Board for the State of New South Wales, each of which was dissolved by that Act. It will be necessary to review the functions and activities of the Grains Board in due course. 6 The recent history of the Grains Board is conveniently summarised in the following introductory paragraphs of the judgment of Austin J in Ray Brown Pty Ltd v New South Wales Grains Board (2002) 41 ACSR 631: "The Grain Marketing Act 1991 (NSW) established an authority to improve the marketing of coarse grains and oilseeds in New South Wales, called the New South Wales Grains Board ('the Grains Board'). By the year 2000 the Grains Board's financial position had substantially deteriorated. Its day-to-day grain marketing and related functions were sold to Grainco Australia Ltd, in a transaction effectuated by a deed dated 30 October 2000, which provided for contractual obligations of the Grains Board to be performed by Grainco, subject to a contract review process. On 10 November 2000 Mr Murray Smith, a chartered accountant, was appointed administrator of the Grains Board under s 31 of the Act. Subsequently Grainco did not accept some of the Grains Board's obligations under sales contracts, leading to possible liability of the Grains Board for damages for non-performance of those contracts. Additionally the Grains Board's funding arrangements proved to be insufficient to meet its continuing liabilities. After making an assessment that there was a deficiency of assets to meet liabilities in excess of $150 million, Mr Smith filed an application with the Court for the winding up of the Grains Board on 9 February 2001. As an alternative to liquidation, he also developed a compromise scheme ('the Grains Board Scheme') that would be likely, in his opinion, to result in a more attractive return to creditors than would be available in liquidation. It is unnecessary for the purposes of this judgment to set out the terms of the Grains Board Scheme in detail. Creditors were divided into three classes. 801 creditors were in the class of Unsecured Creditors (including 621 Interstate Farmers), 2295 were Farmer Creditors (essentially growers who supplied grain that was grown and harvested in New South Wales to the Grains Board as grain pool participants in 1999/2000), and there were three secured creditors in the class of Lenders. The scheme involved the Lenders making a loan, the Farmer Creditors being paid in full and the Unsecured Creditors receiving a dividend expected to be 50 to 55 cents in the dollar. The rights of creditors were to be extinguished. The scheme was propounded under s 80 of the Grain Marketing Act . Part 7 of the Act, which includes s 80, makes provisions for the winding up of the Board and arrangements with creditors. It sets up a procedure for a compromise or arrangement between the Board and its creditors . Section 80 provides in part as follows: '(1) If a compromise or arrangement is proposed between the Board and its creditors or any class of them, the Court may, on the application in a summary way of the Board or any creditor of the Board, or, in the case of the Board being wound up, of the liquidator, order a meeting or meetings of the creditors or class of creditors to be convened in such manner, and to be held in such place or places within the State, as the Court directs . If the Court makes such an order, the Court may approve the explanatory statement required by section 81 (1) (a) to accompany notices of the meeting or meetings. (2) A compromise or arrangement is binding on the creditors, or on a class of creditors of the Board and, if the Board is being wound up, on the liquidator, if, and only if: (a) at a meeting convened in accordance with an order of the Court under subsection (1), the compromise or arrangement is agreed to by a majority in number of the creditors, or of the creditors included in that class of creditors, present and voting, either in person or by proxy, being a majority whose debts or claims against the Board amount in aggregate to not less than 75 per cent of the total amount of the debts and claims of the creditors present and voting in person or by proxy, or of the creditors included in that class present and voting in person or by proxy, as the case may be, and (b) it is approved by order of the Court.' Section 80 is closely modelled on the provision that is now s 411 of the Corporations Act 2001 (Cth), so far as s 411 relates to creditor schemes of arrangement. Creditor schemes of arrangement for companies are no longer common, because of the introduction in 1992 of the voluntary administration regime found in Part 5.3A of the Corporations Act. Consequently the Grains Board Scheme was akin to an "old-fashioned" creditor scheme of arrangement. Mr Smith and the Grains Board took proceedings in this Court for approval of the Grains Board Scheme under s 80. At a hearing on 20 August 2001, Santow J made orders for the convening of meetings of the Unsecured Creditors and the Farmer Creditors, respectively … . The evidence before me does not indicate that the meetings were held and that the Grains Board Scheme was approved by the various classes of creditors, but there is nothing to suggest that these events did not occur. At a hearing on 24 October 2001 Santow J made an order dismissing the application to wind up the Grains Board, and an order under s 80 (2) (b) of the Grain Marketing Act approving the Grains Board Scheme. An office copy of the order was lodged with the Minister on the same day, and so by virtue of s 80 (8) of the Grain Marketing Act the order took effect on that day. No appeal has been filed in respect of Santow J's orders." 7 It will be seen from this narration that the Grains Board has a deficiency of assets and that the plaintiff occupies two positions in relation to it. First, he holds an appointment as administrator of the Grains Board under s.31 of the Grain Marketing Act and therefore has, by virtue of s.31(2), all the powers of the Grains Board. Second, he is, quite separately, the administrator named as such in the s.80 arrangement. In the latter capacity, his main function is to administer the arrangement in accordance with its terms and to exercise his powers and perform his functions and duties as agent of the Grains Board. Section 83 of the Act underwrites that role by providing that a person appointed as administrator of a s.80 arrangement may, as provided in the arrangement, exercise functions conferred on the Grains Board by the Act. 8 One of the functions of the administrator envisaged by the s. 80 arrangement is stated in its clause 4.7: "4.7 Examinations by Administrator The Administrator will, if he sees fit and if he is authorised by ASIC or the Minister to do so, conduct public examinations pursuant to Part 5.9 of the Law as an 'eligible applicant' as defined by the Law in order to 4.7.1 ascertain the reasons for the present financial position of the Grains Board; 4.7.2 investigate the 'examinable affairs' of the Grains Board; and 4.7.3 determine the availability and feasibility of taking action against persons who have or may have a legal responsibility to compensate or otherwise pay money to the Grains Board." 9 For the purposes of the arrangement, the plaintiff is empowered by clause 4.6 and Schedule 2: "To conduct public examinations pursuant to Part 5.9 of the Law as an 'eligible applicant' defined by the Law, where authorised by the Minister and/or ASIC if required." Applicability of the Corporations Law 10 Section 4B of the Grain Marketing Act is as follows: " 4B. Application of Corporations Law after commencement of Corporations legislation (1) The provisions of the Corporations Law and ASIC Law continue on and after the commencement to apply of their own force to a matter dealt with by this Act if they applied to that matter of their own force immediately before that commencement despite anything in section 6 of the Corporations (Ancillary Provisions) Act 2001. (2) Any provision of this Act or the regulations that refers to, or applies to a matter, any provision of the Corporations Law or ASIC Law (whether with or without modification) continues to have effect according to its tenor despite the provisions of sections 11 and 12 of the Corporations (Ancillary Provisions) Act 2001. (3) Subsections (1) and (2) have effect subject to any modifications to the Corporations Law or ASIC Law that may be prescribed by the regulations. (4) Any matter dealt with by this Act to which a provision of the Corporations Law or ASIC Law applies of its own force (or that is applied to the matter by a provision of this Act or the regulations) is declared to be an excluded matter for the purposes of section 5F of the Corporations Act 2001 of the Commonwealth in relation to the whole of the Corporations legislation. Note. Section 5F of the Corporations Act 2001 of the Commonwealth provides that if a State law declares a matter to be an excluded matter for the purposes of that section in relation to all or part of the Corporations legislation of the Commonwealth, then the provisions that are the subject of the declaration will not apply in relation to that matter in the State concerned. (5) Subsection (4) does not apply to any matter excluded from the operation of that subsection by the regulations. (6) In this section: ' commencement ' means the commencement of the Corporations Act 2001 of the Commonwealth. ' matter ' includes act, omission, body, person or thing. ' modification ' includes addition, exception, omission or substitution." 11 Modifications have been made by regulation as contemplated by s.4B(3). Clause 4(1) of the Grain Marketing Regulation 2001 is as follows: "For the purposes of section 4B (3) of the Act, the following modifications to the Corporations Law and ASIC Law are prescribed: (a) any reference in the Corporations Law or the ASIC Law to the Commission or ASIC is to be read as a reference to the Minister, (b) a liquidator or provisional liquidator of the Board cannot be appointed under the Corporations Law unless the Minister consents in writing to that appointment, (c) the provisions of Division 2 of Part 5.7B of the Corporations Law are to be read as if they do not to apply in relation to the Grainco deed, (d) the provisions of section 568 of the Corporations Law are to be read as if they do not apply in relation to the Grainco deed. Note. Section 4B of the Act provides for the continued application of the Corporations Law and ASIC Law of this State to matters dealt with by the Act to which those Laws applied of their own force immediately before the commencement of the Corporations Act 2001 of the Commonwealth. Section 4B (3) provides that the Laws continue to so apply subject to any modifications prescribed by the regulations. " 12 The references to the Corporations Law in s.4B of the Grain Marketing Act and in clause 4(1)(a) of the Grain Marketing Regulation are, by force of the Interpretation Act 1987, as amended by the Corporations (Consequential Amendments) Act 2001, references to the Corporations Law within the meaning provided for by Part 3 of the Corporations (New South Wales) Act 1990, that is, the Corporations Law of New South Wales, being the Corporations Law set out in s.82 of the Corporations Act 1989 (Cth) as it applies as a law of New South Wales by operation of s.7 of the Corporations (New South Wales) Act 1990. The last-mentioned provision, as amended by the Corporations (Ancillary Provisions) Act 2001, causes to apply as a law of New South Wales the Corporations Law set out in s. 82 of the Corporations Act 1989 (Cth) "as in force immediately before the repeal of that section". That repeal was effected by s. 3 of the Corporations (Repeals, Consequentials and Transitionals) Act 2001 (Cth) with effect from the commencement of the Corporations Act 2001 (Cth) on 15 July 2001. 13 Under s.11(1) of the Corporations (Ancillary Provisions) Act 2001, a reference in a New South Wales Act to the Corporations Law is, after the commencement of the Corporations Act 2001 (Cth), taken to be a reference to the Corporations Act 2001 (Cth). But this rule applies subject to s.11(2) which says that the regulations may make contrary provision in relation to particular references to the Corporations Law. Clause 4(1) of the Corporations (Ancillary Provisions) Regulation 2001 says that s.11(1) does not apply in relation to references to the Corporations Law in the Grain Marketing Act 1991. 14 The effect of this web of provisions is that, to the extent specified in s.4B of the Grain Marketing Act, the Corporations Law of New South Wales, in the form in which it existed immediately before commencement of the Corporations Act 2001 (Cth) on 15 July 2001, continues to apply, subject to the modifications made by clause 4(1) of the Grain Marketing Regulation. References below to the Corporations Law are to be understood accordingly. The availability of ss.596A and 596B of the Corporations Law 15 The plaintiff does not contend that ss.596A and 596B of the Corporations Act 2001 (Cth) are available as a source of jurisdiction for the summoning of persons to be examined in relation to the affairs of the Grains Board. Nor is it said that the provisions of the arrangement set out above confer jurisdiction: in light of the limited effect that an arrangement is afforded by s.80(2) of the Grain Marketing Act ("… is binding on the creditors, or on a class of creditors of the Board"), they could not conceivably do so. The plaintiff relies entirely on the provisions of the Corporations Law and their continued application by force of s.4B of the Grain Marketing Act in the manner just described. Those Corporation Law provisions are as follows: "596A. Mandatory examination The Court is to summon a person for examination about a corporation's examinable affairs if: (a) an eligible applicant applies for the summons; and (b) the Court is satisfied that the person is an examinable officer of the corporation or was such an officer during or after the 2 years ending: (i) if the corporation is under administration---on the section 513C day in relation to the administration; or (ii) if the corporation has executed a deed of company arrangement that has not yet terminated---on the section 513C day in relation to the administration that ended when the deed was executed; or (iii) if the corporation is being, or has been, wound up---when the winding up began; or (iv) otherwise---when the application is made. 596B. Discretionary examination (1) The Court may summon a person for examination about a corporation's examinable affairs if: (a) an eligible applicant applies for the summons; and (b) the Court is satisfied that the person: (i) has taken part or been concerned in examinable affairs of the corporation and has been, or may have been, guilty of misconduct in relation to the corporation; or (ii) may be able to give information about examinable affairs of the corporation. (2) This section has effect subject to section 596A." 16 If ss.596A and 596B of the Corporations Law are to be the source of jurisdiction to summon persons for examination about the Grains Board's affairs, it must be found that such examination is a matter to which those provisions of the Corporations Law applied of their own force before 15 July 2001. Only if that is established is the application of ss.596A and 596B to such examination on and after 15 July 2001 continued by s.4B(1) of the Grain Marketing Act. 17 It therefore becomes necessary to determine whether, immediately before 15 July 2001, it would have been open to the court under ss.596A and 596B of the Corporations Law to summon persons for examination about the Grains Board's affairs. Leaving aside the matters those sections identify as matters about the persons to be examined on which the court must be satisfied (see s.596A(1)(b) and s.596B(1)(b)), two conclusions are essential to a positive answer to that question: first, that the Grains Board is a "corporation"; and, second, that the plaintiff is an "eligible applicant". The intervention of the Corporations Act 18 Before dealing with those issues, I should refer in passing to the fact that ss.596A and 596B of the Corporations Act 2002 (Cth) have been in force generally since 15 July 2001. They are in the same terms as the Corporations Law provisions and turn upon the same two matters, namely, status as a "corporation" (under an identical definition) and status as an "eligible person". The plaintiff could be an "eligible applicant", for the purposes of the Corporations Act, only if he had been authorised by ASIC in the manner stated in paragraph (e) of the definition of that term. There is nothing to suggest that he has been so authorised. That may give rise to a question whether the existence of the Commonwealth law provisions causes the State law provisions to be inconsistent in the sense relevant to s.109 of the Constitution and therefore inoperative to the extent of the inconsistency. 19 Any inconsistency of this kind that might otherwise have arisen seems to me to be forestalled by s.5F of the Corporations Act, read in conjunction with s.4B(4) of the Grain Marketing Act. By s.5F, the Corporations Act curtails its own scope by excluding certain matters from its operation in certain States. The classes of such matters are defined in two ways. The first class is relevant here. It covers matters declared by State law to be, in effect, excepted from the operation of otherwise applicable provisions of the Commonwealth Act. By force of s.5F(2), the provisions of the Commonwealth Act identified in the relevant State law do not apply in that State in relation to a relevant matter. Section 4B(4) of the Grain Marketing Act is a State law provision of this kind. 20 Section 5F of the Corporations Act represents an explicit Commonwealth legislative statement that the Commonwealth law is not intended to be an exhaustive and exclusive law or "a complete statement of the law governing a particular matter or set of rights and duties": Victoria v The Commonwealth (1937) 58 CLR 618 per Dixon J. As a result (and for reasons expressed in R v Credit Tribunal; Ex parte General Motors Acceptance Corporation (1977) 137 CLR 545), State law will be inconsistent with such a Commonwealth law only if, as Dixon J put it in Victoria v The Commonwealth, it "would alter, impair or detract from the operation of a law of the Commonwealth Parliament" – that is, if there would be some form of direct collision. The effect of s.5F(2) of the Corporations Act appears to be that that Act, of its own force, has such contracted operation as will accommodate the full operation of the relevant State law, so that direct collision is avoided. 21 I am conscious of the fact that these matters were not argued before me and therefore do not arise in these proceedings. This is because no party sought to contend that the Grain Marketing Act failed to make the Corporations Law provisions applicable in an effective and binding way. I therefore express no views on the inconsistency issue, beyond saying that there does not appear to me to be any need to question the basis on which the parties were apparently content to proceed. "Corporation" 22 Under s.9 of the Corporations Law, "corporation" has the meaning given by s.57A: " 57A. Meaning of corporation (1) Subject to this section, in this Act, "corporation" includes: (a) a company; and (b) any body corporate (whether incorporated in this jurisdiction or elsewhere); and (c) an unincorporated body that under the law of its place of origin, may sue or be sued, or may hold property in the name of its secretary or of an officer of the body duly appointed for that purpose. (2) Neither of the following is a "corporation": (a) an exempt public authority; (b) a corporation sole." 23 The term "corporation" thus includes, among other things, "any body corporate, whether incorporated in this jurisdiction or elsewhere", provided that it is neither "a corporation sole" nor "an exempt public authority". 24 The Grains Board is unquestionably a "body corporate". It is constituted by the Grain Marketing Act, s.5 of which is as follows: 5. Constitution of the Board (1) There is constituted by this Act a body corporate with the corporate name of the New South Wales Grains Board. (2) The Board does not, for any purpose, represent the Crown." 25 Section 6(1) then provides: "(1) The Board is to consist of: (a) the Managing Director of the Board, and (b) 6 part-time members appointed by the Governor." 26 Section 79 provides: "If at any time the Board consists of less than the number of members necessary for it to be a Part 5.7 body within the meaning of the Corporations Law, Part 5.7 of that Law continues to apply to the Board." (This refers, clearly enough, to paragraph (b) of the definition of "Part 5.7 body" in s.9 of the Corporations Law , since the number of members is the matter with which that paragraph is concerned.) 27 It is recognised in both s.6(1) and s.79 that the Grains Board "consists of" members, thus suggesting that it may be a product of the kind of incorporation "by which a perpetual succession of many persons are considered as the same, and may act as a single individual": Trustees of Dartmouth College v Woodward (1819) 4 Wheaton 518 at 636 per Marshall CJ. An alternative view of the corporate existence of the Grains Board is that outlined by Dixon J in Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 361 in relation to the Commonwealth Bank as then constituted: "Although the Commonwealth Bank is declared to be a body corporate there are no corporators. I see no reason to doubt the constitutional power of the Federal parliament, for a purpose within its competence, to create a juristic person without identifying an individual or a group of natural persons with it, as the living constituent or constituents of the corporation. In other legal systems an abstraction or even an inanimate physical thing has been made an artificial person as the object of rights and duties. The legislative powers of the Commonwealth, while limited in point of subject matter, do not confine the legislature to the use of existing or customary legal concepts or devices, that is, except in so far as a given subject matter may be defined in terms of existing legal conceptions, as perhaps in some respects may be the case in, for example, pars. (ii.), (xii.), (xiv.), (xvii.), (xviii.), (xxiv.) and (xxv.) of s. 51. The matter was considered to some extent in Heiner v. Scott [(1914) 19 CLR 381], at p. 393 where Griffith C.J. said: 'I pass by the question whether in the nature of things it is competent for the Commonwealth Parliament to declare that such an abstraction dissociated from any material persons shall be regarded as a corporation, and will assume that it is, and that the Bank is a real entity cognizable by law. Probably the true effect of the Act is a declaration that the Commonwealth may itself carry on the business of banking under the name of the "Commonwealth Bank of Australia"'. Isaacs J., speaking for himself and Gavan Duffy and Rich JJ., said [(1914) 19 CLR, at p.400] : 'We do not think the Act constitutes the Bank universally the agent of the Commonwealth in the sense necessary to make all its acts the acts of the Commonwealth itself--in other words Sovereign Acts. In respect of sub-s. (c) of s. 7 (cf. s. 17 (2) and s. 13 (b) of the present Act), its personality is kept distinct from that of the Commonwealth. In respect of some of its functions and obligations, it may or may not be identified with the Commonwealth--a matter for possible future consideration.' " 28 It has not been argued that the Grains Board is a "corporation sole". Even if Dixon J's formulation is apt in this case and there cannot be said to be corporators, it does not follow that the Grains Board is a "corporation sole". This is, I think, made sufficiently clear by the discussion of the meaning of "corporation sole" in Hubbard Association of Scientologists International v Attorney-General for the State of Victoria [1976] VR 119 and I shall not dwell on the issue here. 29 It is, however, necessary to examine the question whether the Grains Board is an "exempt public authority". "Exempt public authority" 30 Section 9 of the Corporations Law defines "exempt public authority" as follows: " 'exempt public authority' means a body corporate that is incorporated within Australia or an external Territory and is: (a) a public authority; or (b) an instrumentality or agency of the Crown in right of the Commonwealth, in right of a State or in right of a Territory. " 31 The Grains Board is constituted a body corporate by New South Wales law. It is therefore "incorporated within Australia". Because s.5(2) of the Grain Marketing Act says that the Grains Board does not, for any purpose, represent the Crown, it cannot be within paragraph (b) of the definition of "exempt public authority". This makes it unnecessary to consider the numerous cases involving that and analogous expressions reviewed by the Court of Appeal in RESI Corporation v Sinclair [2002] NSWCA 123 and by the Full Court of the Supreme Court of South Australia in Corporation of the City of Unley v South Australia (1997) 68 SASR 511. The question to be determined is whether the Grains Board is a "public authority" as mentioned in paragraph (a) of the definition. 32 The Corporations Law contains no definition of "public authority", but s.9 does include a definition of "public authority of the Commonwealth or a State" which I was invited by counsel for the plaintiff to regard as the equivalent of "public authority". That definition was inserted by the Corporate Law Economic Reform Program Act 1999 (Cth). 33 There is only one reference in the Corporations Law to the composite expression "public authority of the Commonwealth or a State". It appears in s.659B(1)(b). There are three references to "public authority" in unqualified form (in the s.9 definition of "exempt public authority" presently relevant, s.147(4) and s.601DC(4)), as well as references to "public authority" with territorial qualifiers not corresponding with those in the composite expression (see the s.111AE references to "public authority of the Commonwealth" and "public authority of a State or Territory") and, of course, references to the defined expression "exempt public authority" (either in unqualified form or with a territorial qualifier: see the reference in s.708(21) to "an exempt public authority of a State or Territory"). Section 659B(1)(b), being the only provision in which the composite defined term "public authority of the Commonwealth or a State" is used, was, like the definition itself, introduced by the Corporate Law Economic Reform Program Act 1999. All the references to "public authority" in unqualified form existed before the Act of 1999 inserted the definition of "public authority of the Commonwealth or a State". 34 In light of these timing factors and what appears to be deliberate use of the longer defined expression in one place but not others, I do not consider it appropriate to apply the definition of "public authority of the Commonwealth or a State" in determining the meaning of "public authority" where appearing in the s.9 definition of "exempt public authority". The definition of "public authority of the Commonwealth or a State" is employed in a particular provision for a particular purpose. It follows that the continued use of the unqualified "public authority" in each of several places where it was used before that definition was adopted should be taken to indicate that the purposes with which the defined term is concerned were not (and are not) applicable to the contexts in which the unqualified and pre-existing references to "public authority" appear. It is accordingly necessary, for present purposes, to construe "public authority" without regard to any statutory definition. Attributes of a public authority 35 In Re Honey Pool of Western Australia (1987) 6 ACLC 208, Olney J said: "Although the term 'public authority' has been used in a number of statutes, no general definition of what is or is not a public authority has been attempted by the courts. The question has however been decided in a variety of legislative and factual contexts." 36 While it remains true that no general definition has been attempted, a number of relevant propositions were stated by Hill J (with whom Wilcox and Drummond JJ agreed) in Commissioner of Taxation v Bank of Western Australia Ltd (1995) 61 FCR 407 by reference to the decisions of the High Court in Commissioner of Taxation v Silverton Tramway Co Ltd (1953) 88 CLR 558, Committee on Direction of Fruit Marketing v Australian Postal Commission (1980) 144 CLR 577, Renmark Hotel Inc v Commissioner of Taxation (1949) 79 CLR 10, Western Australian Turf Club v Commissioner of Taxation (1978) 139 CLR 288, Re Anti-Cancer Council (Vic); Ex parte State Public Services Federation (1992) 175 CLR 442 and General Steel Industries Inc v Commissioner for Railways (1964) 112 CLR 125. The propositions stated by Hill J are as follows: "1 A question whether a particular entity is an authority will be a question of fact and degree dependent upon all the circumstances of the case: Western Australian Turf Club per Stephen J with whom Barwick CJ agreed at 290. No one factor will be determinative, rather there will be a "range of considerations": the Fruit Marketing case at 580. 2 A private body, corporate or unincorporated, established for profit will not be an authority: Renmark Hotel at 17 per Rich J; Silverton Tramway at 566 per Dixon CJ. 3 Incorporation by legislation is not necessary before a body may be classified as an authority: Renmark Hotel at 19 per Rich J; Western Australian Turf Club at 293. 4 For a body to be an authority of a State or of the Commonwealth, the body in question must be an agency or instrument of government set up to exercise control or execute a function in the public interest. It must be an instrument of government existing to achieve a government purpose: the Fruit Marketing case at 580. 5 The body in question must perform a traditional or inalienable function of government and have governmental authority for so doing: Renmark Hotel at 16 per Rich J; General Steel at 134 per Barwick CJ; Anti-Cancer Council case at 450-451 per Mason CJ, Brennan and Gaudron JJ. 6 It is not necessary for a person or body to be an authority that he, she or it have coercive powers, whether of an administrative or legislative character: Renmark Hotel at 18 per Rich J. Conversely the fact that a person or body has statutory duties or powers will not of itself suffice to characterise that person or body as an authority: Western Australian Turf Club at 297 per Stephen J. 7 At least where the question is whether a body is a "public authority" the body must exercise control power or command for the public advantage or execute a function in the public interest: Silverton Tramway at 565 and 567 per Dixon CJ. The central concept is the ability to exercise power or command: the Fruit Marketing case at 580 per Gibbs J. " His Honour added (at 430-1) that the authority to exercise exceptional powers is a further indicator that an entity is an authority. 37 Judicial definition of "authority" and "public authority" has occurred in relation to many different pieces of legislation. It has consistently been said, however, that cases dealing with one enactment may be applied in cases dealing with another. The Bank of West Australia case was concerned with the word "authority" under sales tax legislation. Hill J was content to apply principles derived from cases in which the meaning of "public authority" had been considered. On this view, it is appropriate to apply Hill J's propositions to the present case concerned with the meaning of "public authority", even though his Honour was considering the meaning of "authority". It has been expressly recognised that cases concerned with income tax exemptions for public authorities can be applied to cases arising under the Corporations Law. In Re Woorabinda Aboriginal Council (1995) 18 ACSR 191, Demack J said (at 195): "In my opinion, the judgment of the Anti-Cancer Council case gives an explanation of the meaning of the words "a public authority" which can be applied to the Corporations Law . In other words, the High Court applied the earlier cases which were concerned with s 23(d) of the Income Tax Assessment Act to a different context and in so doing gave them general application." 38 In surveying the decided cases, I begin with the three that seem to me to deal with circumstances most closely resembling those now at hand. The three cases are Committee of Direction of Fruit Marketing v The Delegate of the Australian Postal Commission (above), Re Honey Pool of Western Australia (above) and Marshall v Scottish Milk Marketing Board [1956] SLT 162. 39 In the first of these cases, it was held that the Committee of Direction of Fruit Marketing ("COD") constituted by Queensland legislation was a public authority within the meaning of a by-law made under the Postal Services Act 1975 (Cth) granting concessional postage rates for publications of an authority of the Commonwealth or of a State. The COD was responsible for the marketing of fruit and could impose levies on various participants in the fruit industry. 40 Gibbs J said (at 582-3) "There can in my opinion be no doubt that the COD exercises exceptional powers conferred on it by the State. The purpose for which those powers are conferred is to perform a function which under modern conditions is widely regarded as the proper function of a State, viz, to control the marketing of an important commodity produced by many people in many parts of the State. The producers of the commodity are enabled to play a part in controlling the exercise by the COD of its powers, but that only means that the State has allowed the persons affected by the powers to play a part in their exercise. On a consideration of the whole of the provisions of the Act, it seems to me that the powers are intended to be exercised in the interests of the community rather than in the interests of particular individuals. The fact that the powers of the COD extend to the regulation and control of a particular industry of course does not mean that the COD is not exercising the powers of the State. Even if it is right to say that the powers are intended to be exercised in the interests of the industry, that does not mean that they are not intended to be exercised in the public interest, for it is in the public interest that an important industry such as that of the growing of fruit and vegetables in Queensland should be successfully conducted. For these reasons I consider that the COD is given by the Act exceptional powers to direct and control the affairs of others for the purposes of the State and in the interests of the community and not for individual profit or gain. I accordingly conclude that the COD is an authority of the State within the meaning of those words in by-law 118." 41 Mason and Wilson JJ (with whom Barwick CJ agreed) said (at 593-4): "The question to be determined is whether the appellant is or is not 'the Commonwealth, a State or an authority of the Commonwealth or of a State'. No other test is provided. Nevertheless the totality of the provision is instructive, and some conclusions may be drawn from it. Clearly, it is not confined to the Crown and those bodies which are so closely identified with the Crown as to enjoy its immunities. Consequently, the provisions of s 6 (4) cannot be decisive in favour of the appellant. Again, the test is not whether the body in question draws its funds from government sources. In our opinion, the focus is upon government, and the function of government. If the appellant is to succeed, it must be because the proper conclusion, based on the legislation, is that the COD is not engaged in the work of government, notwithstanding that it is created a statutory authority with a wide range of powers. It would have to be shown that the authority represented by those powers in reality is derived from the growers, not from the State. We have endeavoured to state the proposition in terms as favourable as possible to the appellant, but however it be stated it is with respect manifestly insupportable. The purpose of the Act is to organize the marketing of fruit. That is as capable of being a governmental purpose as the maintenance of law and order and the administration of justice (cf Professional Engineers Case , per Windeyer J (1959) 107 CLR 208, at p 275). The range and scope of governmental purposes may vary from time to time, and will be determined by the content of the public laws that are in force for the time being. The manner in which the Act pursues the objective of organized marketing of fruit is clearly, in our opinion, to impress the stamp of government upon the activities of the COD. The concern of the legislature to ensure that the wishes of the growers are reflected in the decisions of the COD in the matter of directions as to how and when and where marketing should proceed, and in the imposition of certain levies, does not alter the fact that those decisions are essentially governmental decisions." 42 Their Honours then referred to the extent of the direct participation in the scheme by the Minister and Governor-in-Council before holding (at 595): "In our opinion, the legislation clearly creates the appellant an instrument of government and equips it with the powers to achieve the organized marketing which is the purpose of the legislation. It is properly described as "an authority of a State" within the meaning of Postal By-law 118." 43 The COD may be contrasted with the Honey Pool of Western Australia, the body corporate constituted under the Honey Pool Act 1978 (WA) which was the subject of the decision of Olney J in Re Honey Pool of Western Australia (above). In that case, it was necessary to determine whether the Honey Pool was a "corporation" for the purposes of the Companies (Western Australia) Code. The answer depended, in part, on whether it was a "public authority". Olney J said (at 212-3): "The Honey Pool Act 1978 can fairly be described as setting up a voluntary orderly marketing scheme. The Act does not give the Honey Pool any coercive powers, it does not give it a monopoly on the sale of honey, there is no compulsory acquisition of honey or products of the hive and no producer or owner of honey is obliged to participate in the scheme. So far as the management of the Honey Pool is concerned although it is the fact that the power of appointing the directors is vested in the Governor the right to nominate directors is vested, as to one director, in a commercial company and, as to the others, is dependent upon the election of persons participating in the scheme. The Honey Pool as it presently exists is of course not the same body that was incorporated under the 1955 Act. That Act simply incorporated a business which theretofore had not enjoyed corporate status. But despite the differences, the similarities are marked and the present body has obviously evolved progressively out of the original desire of honey producers to participate in a marketing scheme of their own invention and under their own control. There is nothing in the statute or indeed in the legislative history which suggests other than that the honey Pool was established for the convenience and benefit of the participants. There is nothing to indicate that any public object is sought to be achieved by the Act. The public revenue is not put at risk and none of the functions of the Honey Pool can be described as the normal functions of government. The provisions relating to the winding up and liquidation of the body corporate are inappropriate for a public authority. In my opinion the Honey Pool is not a public authority." 44 In the third case, Marshall v Scottish Milk Marketing Board, the House of Lords was called upon to decide whether the Scottish Milk Marketing Board was a public authority for the purposes of the Public Authorities Protection Act 1893 (UK) and therefore entitled to the benefit of a special limitation provision in relation to claims against it. The Milk Board performed functions and enjoyed powers similar to those of the COD. Unlike the Honey Pool, it held a monopoly on the sale of the regulated product and possessed coercive powers. Their Lordships held that the Milk Board was not a public authority. Viscount Simonds said (at 167): "the argument for the respondents has not satisfied me that they have the status of a 'public authority', but that I regard them rather as "a group of co-operative traders who have obtained statutory powers to control minorities and to fix prices". In a case heard by Denning, J., as he then was, at Cardiganshire Assizes in 1948, the status of a Board in all respects similar to the respondents fell to be considered, and that learned judge expressed himself thus: 'I see no reason to hold this Board to be a public authority any more than railway companies are a public authority. They have always been held not to be – Swain v Southern Railway Co [1939] 2 KB 560. I have got to look at the Scheme as a whole and the Board as a whole and see what they are. It seems to me that they are nothing more than a co-operative society of producers approved by Parliament to administer the marketing of milk.' I agree with this view. In particular I think that it is of little importance that the public generally may benefit from a marketing board being established under the Act: so also they benefit from a railway company obtaining monopolistic powers and rights from Parliament. Nor do I attach any significance to safeguards being attached to the exercise of such powers, of it is, I think, a corollary of a monopoly, local or general, being created that it should be jealously controlled. On the other hand, I do find in the manner of initiation and determination of any Scheme, in the collection and disposition of funds and in the power of the Board itself to buy milk and to produce cream, butter, butter-milk and other milk products very strong pointers in favour of the view that the Board is a trading concern rather than a 'public authority'." 45 Part of this passage was quoted with apparent approval by Olney J in Re Honey Pool (at 209). The Scottish Milk Marketing Board case was not referred to in the Fruit Marketing case. 46 It is instructive to note some other cases that emphasise particular features relevant to the characterisation of bodies as public authorities. In Incorporated Council of Law Reporting (Q.) v Federal Commissioner of Taxation (1924) 34 CLR 580, a body having the function of preparing and publishing law reports was held not be a public authority for the purposes of taxation legislation. Speaking of that case in Western Australian Turf Club v Commissioner of Taxation (above), Stephen J said: "… the Court denied to that council status as a "public authority". Its reason for doing so appears only from an observation of Isaacs ACJ made in the course of argument. He is reported as saying that for the Council's revenue to be exempt as that of a "public authority" the Council would have to have been authorized by statute "to act on behalf of the public or of the State": 47 A community hotel constituted by legislation and managed by a committee which applied all profits to improving the hotel and the community was held not to be a public authority in Renmark Hotel Inc v Federal Commissioner of Taxation (above). The same conclusion was reached in relation to a racing club constituted by statute, on the principal ground that it had absolute control over the disposition of its assets and its members were entitled to share in the division of assets upon dissolution: Western Australian Turf Club v Commissioner of Taxation (above). 48 The Anti-Cancer of Victoria was held to be one of the "public authorities, commissions, or corporations" referred to in an eligibility clause in the rules of an organisation of employees registered under the Industrial Relations Act 1988 (Cth): Re Anti-Cancer Council of Victoria; Ex parte the State Public Services Federation (above). The High Court there said (at 451): "Notwithstanding that the maintenance of the Cancer Register does not constitute the Council a State instrumentality, its activities in that regard may fairly be viewed as a public service. That and other activities, such as the anti-smoking programme, are directed to important aspects of public health. The Council's objects are designed to promote the interests of the public. And the Act governs its affairs in a way that ensures a large measure of public accountability. Its existence and powers derive from an Act of Parliament which governs its membership and the composition of its committees. Some members of the Council and some members of its committees are members ex officio because of the public positions which they hold (s 6(1)(a)) and others are appointed by the Governor in Council as representatives of particular sections of the public (s 6(1)(b)) or on the nomination (s 6(1)(c)) or recommendation of the Minister of Health (s 6(1)(d)). In our view, these features indicate that the Council has a public aspect sufficient to constitute it a corporation of the kind referred to in r 3(G)." 49 The Government Insurance Office of New South Wales, as it existed before privatisation, was held to be an authority for the purposes of sales tax legislation in Government Insurance Office of New South Wales v Commissioner of Taxation (1992) 35 FCR 247. Heerey J said (at 251) "In my opinion, whatever the precise ambit of the term "authority" in this context, it extends to GIO as an entity incorporated under statute, not subject to any degree of private ownership, and controlled by the Government of New South Wales." 50 In Re Woorabinda Aboriginal Council (above), an aboriginal council was held to be a public authority so that it was not a "registrable body" as defined by the Corporations Law. Demack J said (at 195) "The Council carries out an undertaking of a public nature for the benefit of a geographical division of the community, and it does so solely under statutory authority. Its functions are of a public nature within the trust area. In my opinion, the Council is a public authority ..." 51 The Coal Mining Industry (Long Service Leave Funding) Corporation, a body which spread employers' losses from long service leave accruals applicable to shared employees, was held to be a public authority for the purposes of the exemption in section 23(d) of the Income Tax Assessment Act 1936 (Cth): Coal Mining Industry (Long Service Leave Funding) Corporation v Commissioner of Taxation (1999) 85 FCR 416. The Court said that that the delegation by the Commonwealth of a tax collecting function to the body suggested strongly that it was performing the functions of government. That and the public interest (as opposed to the interests of the employers) that the body served meant that it was a public authority (at 424-5). On the other side of the coin, the Edith Cowan University Student Guild was held not to be a public authority, and therefore a Part 5.7 body capable of being wound up under the Corporations Law in Edith Cowan University v Edith Cowan University Student Guild [1999] WASC 35. There was no compulsion upon students to join the Guild the facilities of which existed for private purposes unrelated to public functions. 52 The message from these cases is that it is necessary to make a close examination of the functions, activities and objects of the particular body in order to determine whether or not it is a public authority. The starting point, in the present case, is the provisions of the Grain Marketing Act. The functions, role and accountability of the Grains Board 53 The Grains Board's principal functions are conferred by Part 3 of the Grain Marketing Act. Those functions relate to "commodities". That term is defined by s.3(1) as follows: " 'commodity' means any of the following: (a) barley, (b) canola, (c) grain sorghum." 54 Division 1 of Part 3 (ss. 32 to 38) is headed "General functions of the Board", while Division 2 (ss. 39 to 44) deals with authorised agents of the Grains Board, authorised buyers and other functions. The first two provisions in Division 1 are ss. 32 and 33: "32. General functions of the Board The Board may do all things necessary for or incidental to achieving the purpose of improving the marketing of commodities in New South Wales. 33. Functions relating to the marketing of the commodity The Board may market or arrange for the marketing of a commodity vested in or delivered or to be delivered to it, and do all acts, matters and things necessary or expedient to exercise those functions." 55 Section 34 empowers the Grains Board to enter into arrangements with producers of commodities for the delivery of commodities to the Grains Board. Those powers subsist only until 1 October 2005. Section 35 empowers the Grains Board to acquire commodities. Section 36 confers a power to establish grades, classes or descriptions of a commodity and to fix the price at which a grade, class or description may be sold by wholesale. Under s.37, the Grains Board may, with the approval of the Minister and subject to such conditions as the Minister may approve, establish and conduct processing facilities and engage in processing activities, as well as marketing resultant products. Similar functions may be undertaken in relation to other primary products with the approval of the Minister: s.38. 56 Sections 39 and 40 empower the Grains Board to appoint authorised agents and authorised buyers. These agents and buyers are to play a part in the acquisition of commodities by the Grains Board. Sections 41 and 42 allow the Grains Board to act as a marketing agent and a purchasing agent in relation to commodities. Section 43(1) is as follows: "(1) The Board may: (a) make such arrangements as it considers necessary with regard to sales of the commodity or any other product with which the Board is associated for export or for consignment to other countries or other parts of Australia, and (b) enter into insurance contracts relating to the commodity or any other product with which the Board is associated, and (c) promote and encourage the use, sale or consumption of the commodity or any other product with which the Board is associated, and (d) establish and maintain laboratories and carry out research and make investigations into matters relating to the commodity and any other product with which the Board is associated (including chemical, physical, bacteriological and economic research and investigations), and (e) devise and initiate as far as may be practicable improved methods of producing, marketing and using the commodity and any other product with which the Board is associated, and (f) devise and initiate as far as may be practicable means to prevent or eliminate wasteful, unnecessary or unhygienic methods, practices, costs or charges in connection with producing, marketing or using the commodity and any other product with which the Board is associated, and (g) enter into agreements for the use (within New South Wales or elsewhere) of any trade mark of which it is, or is entitled to be, registered as proprietor, and (h) publish reports, information and advice concerning the producing, marketing or use of the commodity or any other product with which the Board is associated." 57 These provisions concerning the Grains Board's functions must be read in the light of Part 4 of the Act the general effect of which is to cause all commodities coming into existence before 1 October 2005 to vest in the Grains Board immediately upon their being harvested or, if there exists an arrangement under s.34 for delivery of the commodity to the Grains Board by the producer, upon its being delivered (see s.45). In support of these provisions, contracts for the sale of commodities vested in the Grains Board are made void by s.48 and rights of persons with crop liens are converted by s.49 into rights in respect of moneys due by the Grains Board in respect of vested commodities. The Grains Board is made liable by s.54 to make payments to producers for commodities vested in the Grains Board which the producers deliver to it. The succeeding provisions of Part 4 make detailed provision for such payments, including as to schemes for payments. 58 Part 5 of the Act is headed "Finance". It deals with a number of matters concerning the financial affairs and operations of the Grains Board, including accounting periods, charges and fees, creation of reserves, obtaining of financial accommodation, investment of funds and entering into of hedging contracts on futures markets. Accounting and financial matters affecting the Grains Board are also dealt with by the Public Finance and Audit Act 1983 and will be mentioned presently. Part 6 of the Grain Marketing Act, headed "Public accountability", is concerned with reporting, public meetings, strategic plans and audit. 59 Certain of the functions of the Grains Board may be undertaken only with the approval of the Minister. In particular, the power to establish and conduct processing facilities and the power to market primary products other than commodities are exercisable only with the approval of the Minister (ss.37 and 38). The ability to act as a marketing agent for products other than commodities requires the approval of the Minister, as does the ability to act as a purchasing agent for machinery, seed, fertiliser and the like (ss.41 and 42). The Grains Board may not join in the formation of a company or hold shares in a company except in accordance with guidelines determined by the Minister (s.43(6)). Payment schemes in respect of vested commodities delivered to the Grains Board may only be operated by the Grains Board if approved by the Minister; and such schemes may be varied or cancelled by the Minister at the request of the Grains Board (s.55). 60 It is also pertinent to note other roles of the Minister in relation to the Grains Board, as well as roles of the Governor. The six part time members of the Grains Board are appointed by the Governor on the nomination of a selection committee of at least five persons appointed by the Minister (ss.6 and 8). Four of these persons are to be appointed from a panel of at least six nominated by the New South Wales Farmers' Association. Members of the Grain Marketing Consultative Committee for which provision is made in ss.10 to 13 are appointed by the Minister. Four of the five members of that committee are appointed from a panel nominated by the New South Wales Farmers' Federation. The committee has a recommending function. A central role is played by both the Governor and the Minister in any winding up and dissolution under ss.20 to 24. The Governor has power under s.29 to remove all the members of the Grains Board. The Governor has a particular power of removal under s.30 if the Grains Board becomes involved in party politics in a manner inconsistent with that section. The power of appointing an administrator of the Grains Board under s.31 (being the power that has been exercised in respect of the plaintiff) is vested in the Governor. 61 The Grains Board's accounting periods are such as are approved by the Minister (s.58). The obtaining of financial accommodation and the investment of the Grains Board's money, unless confined within certain avenues, may only be undertaken in ways approved by the Minister with the concurrence of the Treasurer (ss.64 and 65). 62 Part 6 of the Act headed "Public accountability" has already been mentioned briefly. It obliges the Director-General of the Department of Agriculture to keep the activities of the Grains Board under review and to make regular reports on those activities (s.68). The Grains Board must furnish reports to the Director-General as requested (s.69). The Grains Board must furnish an annual report to the Minister and the Minister, in turn, must lay each such report before both Houses of Parliament (s.70). The Minister plays a part in setting standards for the convening of public meetings by the Grains Board and the circulation of reports at or before such meetings (s.71). The Minister is the recipient of the Grains Board's strategic plans under s.72. The Director-General's role in relation to management audits of the Grains Board is stated in ss.73 to 76. The Director-General must give copies of reports to the Minister (s.76). The Crown, the Minister, the Director-General, members of the Grains Board and members of the staff of the Department and the Grains Board, as well as persons acting under their direction, are protected by s.98 from liability for things done or omitted to be done in good faith under and for the purposes of the Act. 63 The Act makes provision in Division 4 of Part 2 for the winding up of the affairs of the Grains Board. The process may be initiated by petition of producers leading to a poll of the producers of all commodities on the question whether the Grains Board should be dissolved. Alternatively, the Minister alone may initiate the process. The affairs of the Grains Board may, in either case, be wound up by proclamation of the Governor. Upon completion of the winding up, the Governor may dissolve the Grains Board, whereupon "all money and other assets of the Grains Board [are] to be dealt with or disposed of as the Governor, on the recommendation of the Minister, may direct": s.24(8). 64 I refer next to provisions in Part 8 of the Act. Section 85 allows the Minister to appoint persons as "authorised officers" for the purposes of the Act. Under s.86, each of the Minister, the Director-General and the Grains Board has power to require, by notice, that a person furnish "such information relating to any commodity or other product as is specified in the notice". A person subjected to such a requirement must comply on pain of penalty. Section 87 allows police officers and authorised officers to enter premises where the officer has reasonable grounds to believe that any commodity is stored or any documents relating to a commodity are kept. An officer may, for these purposes, apply for a search warrant. Part 3 of the Search Warrants Act 1985 applies to a warrant issued upon application made by such an officer. Other coercive functions are conferred on an authorised officer by ss.87(7) and 88. Under s.89, it is an offence to obstruct an authorised officer in the exercise of any function conferred by the Act or the regulations. Offences are also created by s.87. An example of a prosecution under s.87 in which an officer of the Grains Board was prosecutor and the Grains Board was ordered to pay costs may be found in New South Wales Grains Board v Davis (unreported, NSWCCA, 17 July 1997). 65 The last provision of the Grain Marketing Act to be noted is s.100 which has the effect of putting beyond the reach of the restrictive trade practices provisions in Part IV of the Trade Practices Act 1974 (Cth) the making by the Grains Board of any contract arrangement or understanding relating to the marketing of a commodity or primary product, where the contract, arrangement or understanding is (or is of a kind that is) prescribed for the purposes of that section and is approved by the Minister. The performance the Grains Board of any such contract, arrangement or understanding is likewise protected. 66 Reference should also be made to provisions of the Public Finance and Audit Act 1983. The Grains Board is a "statutory body" for the purposes of Division 3 of Part 3 of that Act. The Auditor-General is therefore charged by s.41C with the duty of auditing financial reports produced by the Grains Board in accordance with s.41A. That section requires annual financial statements to be prepared by the Grains Board and to be submitted by it to the Minister and the Auditor-General. Certain departures from the manner of preparing accounts laid down by the Act are permitted with the approval of the Minister. 67 Finally, I note that s. 3(2) of the Government Guarantees Act 1934 provides that the Treasurer may, with the approval of the Governor, execute a guarantee in favour of any bank or other body approved by the Minister for the repayment of any advance made or to be made to the Grains Board. Section 3 as a whole authorises guarantees by the Treasurer in respect of indebtedness of a number of other bodies, many of which could not conceivably be classified as public authorities. The activities of the Grains Board 68 It is necessary to look also at the activities actually engaged in by the Grains Board and the ways in which its objectives were presented. For that purpose, Mr Bathurst QC, who appeared for the plaintiff, took me to the Grains Board's annual reports for the years ended 31 August 1998 and 31 August 1999, as well as the explanatory statement circulated to creditors in August 2001 in connection with the scheme of arrangement proposal. He did so with a view to showing that the Grains Board is essentially a commercial trading concern. 69 It is instructive to set out the "charter" of the Grains Board contained in the 1998 report: " A Multi-grain Marketing Organisation for NSW The NSW Grains Board (NSWGB) commenced operations on 1st August, 1991. It was established by the Grain Marketing Act 1991 as the single statutory marketing authority responsible for the marketing of coarse grains and oilseeds in NSW. That Act replaced the four Boards previously responsible for the marketing of barley, oats, oilseeds and grain sorghum and is now a single stronger body more capable of influencing the marketing environment than a number of smaller authorities. The restructuring has placed NSW to the forefront in developing marketing expertise for coarse grains and oilseeds. The Board is empowered to do all things necessary to achieve the purposes of improving the marketing of coarse grains and oilseeds and is able to provide a full range of commercially viable marketing options for grain producers, including pooling; cash trading; and futures. The Act provides for the vesting of commodities in the Board and for the granting of exemptions from vesting by the Board. The products vested in the Board are oilseeds and coarse grains. Other primary products may be proclaimed if a majority of producers in a poll are in favour. The Board may take delivery of any commodity on a commercial or voluntary basis. The Board's powers extend to the provision of storage and transport; setting of prices of vested products and enable it to undertake the manufacturing and processing of commodities being marketed by it. The Board also has power to establish grades, classes and descriptions, for grains regulated to it. The Board has wide powers in respect of promotion of products and in encouraging improved methods of production, marketing and use of products. It is able to enter into a wide range of joint activities and to appoint agents and buyers on its behalf. The powers and functions of the Board differ significantly from the four Boards it replaced: (i) It is a body corporate established at the request of producers to act on their behalf; (ii) It is financed by industry, to operate in a commercial manner and to be financially self supporting; (iii) A consultative committee is establishing to make recommendations to the Board on its operation and on commodities covered by the Board." 70 The origin and provenance of this "charter" are not stated but it may, I think, be taken to be a statement of the understanding of the Grains Board's members as to the reasons for its existence, at least in 1998. 71 The chairman's review in the 1998 annual report refers to seven years of growth in reserves and another operating surplus for the year under review. The profit and loss account shows a trading surplus of $4.27 million for the year (on sales of $228 million), compared with $6.976 million for the preceding year. Accumulated funds at year end were $21.556 million. The chairman's review also refers to a continuing focus on improving services to growers and customers. There is reference to a survey of both groups having shown that the "vast majority" wished the Grains Board to continue its role in the market place. 72 In the following year (the year ended 31 August 1999), sales revenues reached $475 million and there was a trading surplus of $6.359 million. The new chairman reported continued grower support for the Grains Board's marketing activities under the Act. In the year ended 31 August 2000, there was a net trading loss of $46 million and a net operating loss of more than $91 million. The plaintiff, having been appointed administrator, reported as follows in the documents sent to creditors in connection with the scheme of arrangement: " 3.2 Key issues contributing to failure The quantitative factors contributing to the loss of $90,000,000 for the year 2000 included: · The substantial increase in grain purchases and sales activity and, in particular, the entry into unfavourable sales contracts, resulting in trading losses of at least $44,000,000, primarily incurred in relation to Canola ($19,000,000), Sorghum ($8,000,000) and Wheat ($12,000,000); · Bad and doubtful debts of $15,000,000; · Unfavourable foreign exchange movements leading to exposure on significant sales denominated in foreign currencies and foreign exchange losses of $20,000; · Considerable overhead expenses of $10,000,000. There were many other factors contributing to the poor financial performance, including: · Entry into unprofitable joint venture arrangements, where NSWGB assumed responsibility for a greater proportion of losses incurred than profits realised; · Involvement in both cash and pool trading activities, leading to confusion regarding the underlying objectives of NSWGB and the administration of growers' pools; and · Managerial, accounting and control weaknesses resulting in an inability to accurately measure the financial performance and position of NSWGB over a long period. While I have conducted initial enquiries, there remains considerable work to fully determine and attribute the reasons for the failure of NSWGB. I refer to this matter again towards the end of this Explanatory Statement." 73 There seems no doubt that the Grains Board did engage in extensive trading and that much of its trading was speculative. But it did so in the performance of its functions as its members apparently saw them. 74 One notable feature of the annual reports is the emphasis they place on both growers and customers as groups whose interests the Grains Board sought to foster. Growers no doubt wished prices to be high, while customers wished them to be low. The Grains Board could never fully accommodate the desires of both groups. The interests it was intended to promote and serve in the pursuit of its activities do not seem to have been clearly articulated. This is particularly so in light of the fact that the Act makes no provision as to ownership or distribution of profits. It is not possible to conclude that the Grains Board was a body intended to serve the interests of growers, at least in any direct sense. The aim was rather to produce benefits to the State through orderly and coordinated marketing, with concomitant benefits, no doubt, to both growers and customers who were spared the need to engage in direct negotiation and contracting on what would otherwise be a fragmented and diversified basis in which market power of particular parties might be exercised to the full, unchecked by what, on one view, would be the stabilising influence of the centralised system based on pooling and supported by statutory vesting. 75 I do not lose sight of the fact that the general complexion of the Grains Board changed in late 2000 when the day to day grain marketing functions were sold to Grainco Australia Ltd and the plaintiff was appointed administrator under s.31 of the Grain Marketing Act. The arrangement under s.80 of the Act followed in the latter part of 2001. Despite these developments, the basic statutory scheme was left largely intact, although with some adjustments effected by the Grain Marketing Amendment Act 2001 which received the Royal Assent on 14 December 2001. It was that Act which confined the Grain Board's functions to barley, canola and grain sorghum and fixed 1 October 2005 as the date beyond which the statutory vesting of commodities in the Grains Board would not be continued. Neither those changes nor the appointment of the plaintiff under s.31 did anything to alter the Grain Board's substantive powers and functions as they presently exist. The statutory framework continues, albeit in relation to a confined group of commodities and for a limited period, with the plaintiff as administrator, instead of its members, exercising the functions of the Grains Board. Marketing board models 76 One type of pooled marketing arrangement is exemplified by the Scottish Milk Marketing Board and the Honey Pool of Western Australia, another by the COD. 77 The Scottish Board was formed under statutory provisions enabling producers to obtain the benefits of centralised marketing for their product. The particular board was brought into existence by the legislation through a decision of producers in the particular locality. The board consisted of elected producers. Alteration of the scheme required the approval of two-thirds of votes cast by producers. The scheme could be terminated by a vote of producers. There was compulsion upon producers in that those in the particular area were not permitted to sell except through the scheme. Producers were entitled to share in surplus funds and might be required to contribute on any winding up. The case was clearly one of a compulsory producers' co-operative. 78 The Honey Pool of Western Australia was a voluntary arrangement under which owners of honey (whether or not producers) might elect to sell on a pooled basis. The board of directors was appointed by the Governor, as to one member on the nomination of a particular farmers' co-operative and as to the others after election by participants. Profit making was expressly precluded, as was the payment of dividends. On a winding up, any surplus was distributable in a defined way to persons who had been participants in the last five years. This was a case of a voluntary orderly marketing scheme without coercive powers. Furthermore, there was nothing in the legislation to show that any public object was sought to be achieved. The body was established, in the words of Olney J, "for the convenience and benefit of the participants". 79 The COD was a quite different body. The statutory scheme in that case did not contain any mechanism for winding up. There was no indication that its purposes included the making of profits or capital gains to be devoted to participating producers. The COD was given by statute what Gibbs J described as "exceptional powers to direct and control the affairs of others for the purposes of the State and in the interests of the community and not for individual profit or gain". As with the Honey Pool, although Board members were formally appointed by the Minister, appointees were first nominated or elected by participant groups. The authority represented by powers of the COD did not in any sense derive from the growers; they derived from the State. Conclusions in relation of the Grains Board 80 The Grains Board created by the Grain Marketing Act cannot be regarded as comparable with the Scottish Milk Board or the Honey Pool of Western Australia. The much closer and more striking analogy is with the COD. 81 Although the Grains Board's annual reports identify producers as an important constituency, there is also a strong emphasis on serving the interests of customers. The New South Wales Farmers' Association plays a limited role by nominating panels from which members of the Grains Board and the Consultative Committee are appointed. This falls short of any form of direct participation by producers. As individuals, they have no equity interests and play no part in the composition or decisions of the Grains Board. Their role is confined to that of creditors to whom payment rights accrue by virtue of vesting and delivery of their crops. A poll of producers may provide a basis on which the Minister delivers to the Governor a certificate which, in turn, causes the Governor to direct that the affairs of the Grains Board be wound up. But producers are in no sense beneficiaries of or participants in any such winding up. They are merely given an inconclusive say on the question of continuation of the Grains Board. 82 The Grains Board's monopoly position is underwritten by statutory compulsion and coercive powers. A form of compulsory acquisition of commodities is to continue in New South Wales until 1 October 2005, with the Grains Board made the owner of all commodities, regardless of the wishes of producers, subject to an obligation to make payment against delivery. There are no doubt elements of intended benefit to growers in this system but its universal and compulsory nature shows that it does not exist solely for that purpose. The general function of the Grains Board, as stated in s.32, is to do "all things necessary for or incidental to achieving the purpose of improving the marketing of commodities in New South Wales". The emphasis is on the improvement of a particular field of enterprise within the State, without reference to any sectional interest. The objective seems quite clearly to be related to a public interest and to the welfare of the community. That impression is confirmed by the roles played by the Governor, the Minister and the Director-General, each of whom, as part of the executive government, participates in the effectuation of the purposes of the Act both by action and by oversight. 83 That the public interest is the guiding principle is also borne out by the provisions in Part 8 of the Act. The Grains Board and its authorised officers are armed with powers of a kind that are exercisable only by the state, including prosecutorial powers and powers to search and seize. These are hallmarks of the authority of the state. 84 In my judgment, the nature of the Grains Board is precisely summed up in words used by Gibbs J in the Fruit Marketing case (above), at 582-3, which I have already quoted. I also adopt, as entirely applicable to this case, the statement of Smithers J at first instance in the Fruit Marketing case quoted in the judgment of Mason and Wilson JJ (at 585): "To my mind the central and arresting feature of the COD is the nature and extent of its duties, functions and powers in the matter of issuing commands inconsistent with the ordinary rights of citizens in property and commerce to implement the intention of Parliament that marketing of fruit be organised marketing." 85 The considerations that led in the Fruit Marketing case to the conclusion that the COD was an authority of the State are present in this case. When the propositions stated by Hill J in the Bank of Western Australia case are applied to the circumstances of the Grains Board, propositions 4, 5 and 7 are seen to apply and to indicate clearly a conclusion of "public authority" status. 86 I therefore hold that the Grains Board is a "public authority" as referred to in paragraph (a) of the definition of "exempt public authority" in s.9 of the Corporations Law, with the result that it is an "exempt public authority" and is not a "corporation" within the meaning of s.57A. Consequences of the Grains Board's not being a "corporation" 87 This finding that the Grains Board is not a "corporation" means that jurisdiction sourced in ss.596A and 596B of the Corporations Law is not available in relation to the affairs of the Grains Board via s.4B of the Grain Marketing Act. The plaintiff is therefore not entitled to the relief sought in the originating process. 88 While that is sufficient to dispose of these proceedings, the possibility that my conclusion on the "corporation" question may be reviewed on appeal makes it desirable that I deal with the remaining issues. "Eligible Applicant" 89 The term "eligible applicant" is defined by s.9 of the Corporations Law as follows: "eligible applicant" , in relation to a corporation, means: (a) the Commission; or (b) a liquidator or provisional liquidator of the corporation; or (c) an administrator of the corporation; or (d) an administrator of a deed of company arrangement executed by the corporation; or (e) a person authorised in writing by the Commission to make: (i) applications under the Division of Part 5.9 in which the expression occurs; or (ii) such an application in relation to the corporation." 90 This definition must, for present purposes, be read in the modified way dictated by clause 4(1)(a) of the Grain Marketing Regulation 2001. The references to "the Commission" are to be read as references to the Minister. If the plaintiff is to be regarded as an "eligible applicant", it must be seen that he has been authorised in writing by the Minister in the way referred to in paragraph (e) of the definition of that term. 91 There are in evidence three letters from the Minister to the plaintiff relevant to his "eligible applicant" status. The first is dated 29 November 2001 but, because it is expressed by reference to provisions of the Corporations Act upon which the plaintiff does not seek to rely, it may be disregarded. The other letters are dated 1 May 2002 and 14 August 2002. They are as follows: " 1 May 2002 I refer to your letters of 21 November 2001 and 5 April 2002, concerning your request for authorisation to conduct public examinations. Pursuant to section 4(B)(3) of the Grain Marketing Act 1991 and section 4(1)(a) of the Grain Marketing Regulation 2001, I hereby authorise you to make application as an eligible applicant under section 596A and 596B of the Corporations Law, to conduct examinations concerning the examinable affairs of the NSW Grains Board. I understand that the persons you propose to examine are identified in your letter to me of 21 November 2001, a copy of which is attached." " 14 August 2002 I refer to your letter of 12 July 2002, which in turn makes reference to the following correspondence between us: · your letter to me dated 21 November 2001; · my letter in response dated 29 November 2001; · your letter to me dated 5 April 2002; · my letter in response dated 1 May 2002. Pursuant to section 4(b)(3) of the Grain Marketing Act 1991 and section 4(1)(a) of the Grain Marketing Regulation 2001 , I hereby authorise you, in your capacity as Administrator of the NSW Grains Board, and as the Scheme Administrator appointed by order of the Supreme Court of New South Wales on 24 October 2001, to make application as an eligible applicant under sections 596A and 596B of the Corporations Law, to conduct examinations concerning the examinable affairs of the NSW Grains Board. I understand that the persons you propose to examine are identified in your letters to me of 21 November 2001 and 12 July 2002, copies of which are attached." 92 Despite the incorrect references to "section 4(B)(3)" in one case and "section 4(b)(3)" in the other, each of these letters would constitute an authority in writing with sub-paragraph (e)(i) of the s.9 definition sufficient to make the plaintiff an "eligible applicant" in relation to the Grains Board, if the Grains Board were a "corporation". The secrecy provisions 93 I turn now to the question whether, if the Grains Board were a "corporation" and the plaintiff were an "eligible applicant" in relation to it, the secrecy provisions of the Public Finance and Audit Act 1983 would compel the Audit Office parties to decline to answer questions that the court directed them to answer upon any examination under Part 5.9 of the Corporations Law. 94 I have already referred to the fact that the Auditor-General is required by s.41C of the Public Finance and Audit Act to audit financial reports of the Grains Board. Section 38 of that Act is as follows: " 38. Secrecy (1) The Auditor-General, an auditor and an authorised person shall preserve and aid in preserving secrecy with respect to all matters and things that come to the knowledge of the Auditor-General, auditor or authorised person in the exercise of the functions of the Auditor-General, auditor or authorised person under this Act and the prescribed requirements and shall not communicate to any person any such matter or thing. (2) Nothing in subsection (1) applies to or in respect of: (a) the conduct of any matter necessary for the proper administration of this Act or the prescribed requirements, or (b) proceedings for an offence relating to public money, other money, public property or other property or for the recovery of public money, other money, public property or other property, or (c) disciplinary proceedings brought against an officer of an authority, or (d) a report or communication authorised or required to be made by or under this Act or the prescribed requirements, or (e) a report or communication that the Treasurer authorises the Auditor-General to make to a person for the purposes of a due diligence or similar process relating to the sale of any government undertaking. " Section 52 says that a person who contravenes or fails to comply with a provision of the Act is guilty of an offence and liable to a penalty not exceeding 20 penalty units. 95 It should be explained that "an auditor" refers to a person or firm appointed by the Auditor-General to be an auditor for the purposes of the Act. (s.35) and that "an authorised person" is a person authorised by the Auditor-General. It is accepted, as I understand it, that the defendants I have called "the Audit Office parties" are within s.38, as supplemented by s.52. 96 If either of the Audit Office parties were summoned by the court under s.596A or s.596B on the application of the plaintiff, that person would be required by s.597 to attend, to produce books and to answer questions as directed by the court, unless relieved of those obligations by aspects of s.597 which use the words "without reasonable excuse" (see ss.597(6) and (7)). The question to be determined is therefore whether the existence and effect of s.38 of the Public Finance and Audit Act, as it operates upon and in relation to the Audit Office parties, would constitute "reasonable excuse". 97 It can be said at once that s.38 would not constitute "reasonable excuse" for failure to attend. To the extent that it gave rise to a "reasonable excuse" at all, the section would operate only in relation to the obligations to produce books and to answer questions. 98 Much of the case law in which the scope of a "reasonable excuse" exception has been considered concentrates on the distinction between "lawful excuse" and "reasonable excuse". The distinction was discussed in the joint judgment of Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ in Attorney-General v Breckler (1999) 197 CLR 83: "The phrase 'reasonable excuse' has been used in many statutes but whether an excuse answers that description depends not only on the circumstances of the particular case but also on the purpose of the provision to which the exception is provided. However, the scope of the phrase 'lawful excuse' appears to be more limited. A trustee will have a lawful excuse for failure to comply with an order, direction or determination of the Tribunal if the trustee has a reason recognised by law as sufficient justification for such failure, whether by way of answer, defence, justification or other legal right or immunity." 99 "Reasonable excuse" may thus be wider than "lawful excuse", but I understand the members of the High Court to be saying that, where some reason recognised in law justifies failure, there is not only "lawful excuse" but also "reasonable excuse". In a case such as the present, where one compulsory provision of New South Wales law would be asserted as justifying non-compliance with another expressed to operate subject to a "reasonable excuse" exception, I do not see that the question whether the exception was available would entail anything more than reconciliation of the respective requirements according to the proper construction of the provisions. This is not a case in which the objective reasonableness of countervailing conduct asserted as "reasonable excuse" can arise for consideration (cf Taikato v The Queen (1996) 186 CLR 454 and Bank of Valletta plc v National Crime Authority (1999) 90 FCR 565): obedience to a conflicting but specific statutory compulsion is, of its inherent nature, "reasonable". The prohibition imposed by s.38 of the Public Finance and Audit Act upon a person within the purview of that section, if applicable, is thus of its very nature a "reasonable excuse" when a provision of s.597 of the Corporations Law expressed to be subject to a "reasonable excuse" exception operates, on its face, to compel the person to do what s.38 prohibits. The present inquiry therefore resolves itself into the single question whether s.38 will operate as a prohibition upon the Audit Office parties. The immediate answer is that it will, unless, in the particular circumstances, a provision in s.38(2) causes the prohibition not to operate. 100 The first basis on which it has been suggested that s.38(2) would apply is that the particular communication, being communication pursuant to s.597 of the Corporations Law, would be of the kind referred to in s.38(2)(b), in that it would be "in respect of … proceedings … for the recovery of public money, other money, public property or other property". 101 The basis for this submission lies in the nature of examinations under Part 5.9 of the Corporations Law. The procedure exists in order that information about the affairs of a corporation may be obtained by a person recognised by the statute as likely to require assistance of that kind. It represents a means by which those with a need to know may come to know with the assistance of the court. In the case of a liquidator, the need to know about the past is born of the duty to collect assets, ascertain liabilities and complete the winding up. The matter was put thus in the joint judgment of McPherson, Pincus and Derrington JJ in Adler v Qintex Group Management Services Pty Ltd (1996) 22 ACSR 446: "In the nature of things, liquidators when they are appointed labour under the particular disability of not knowing as much about the affairs of the company as former directors and others, and that they often cannot obtain reliable information about suspicious transactions. Generally, the only source available to them is the records of the company as former directors and others, and that they often cannot obtain reliable information about suspicious transactions. Generally, the only source available to them is the records of the company such as books and documents, if still available, and the information they contain is always vulnerable to contrived explanations and even to distortion by persons not anxious to disclose what they really know about events that took place when they were in charge of the company' s affairs." 102 In the case of liquidators charged with the duty of recovering property for the benefit of creditors, lines of inquiry will commonly centre on possibilities of litigation, including attempts to recover by reference to apparent misfeasance on the part of directors and officers and to counter the effects of voidable transactions. Another possibility may be an action against an insurer (cf Grosvenor Hill (Qld) Pty Ltd v Barber (1994) 12 ACSR 646). 103 It is to be emphasised, however, that the examination provisions in Part 5.9 of the Corporations Law are not confined to cases of winding up. In Hong Kong Bank of Australia Ltd v Murphy (1992) 28 NSWLR 512, Gleeson CJ said of the purposes for which the examination power was made available: "Those purposes include the protection of shareholders and creditors and of interested members of the public." 104 In the present case, the plaintiff submits that s.38(2)(b) prevents the Audit Office parties relying on s.38(1) in circumstances where one of the purposes of the examination is to determine whether or not proceedings should be brought to recover damages in respect of the losses suffered by the Grains Board. Such an examination, it is said, is "in respect of … proceedings … for the recovery of … other money". This submission is advanced in the context of an explanation of aspects of the Grain Board's activities in the period before the appointment of an administrator which, it is said, provide grounds for a belief that members and officers of the Grains Board made decisions that were negligent or in breach of duties owed to the Grains Board. 105 The submission proceeds on the basis that recovery of money is something that may be pursued as a result of information obtained in the examination and that the examination therefore bears such a relationship to proceedings for such recovery as is contemplated by the very wide expression "in respect of". An examination under Part 5.9 of the Corporations Law cannot, by any stretch of the imagination, be said to be "proceedings … for the recovery of … money", although there can, I think, be no doubt that it is a "proceeding": Re Interchase Corporation Ltd (1996) 68 FCR 481; Re Doran Constructions Pty Ltd (2002) 20 ACLC 909. But that, the plaintiff says, does not matter: the examination is so concerned with or relevant to the general issue of recovery of money that the giving of answers is "in respect of" proceedings for recovery. 106 I do not accept this submission. Before the part of the exception in s.38(2)(b) concerned with civil actions can operate, it must be possible to identify actual or, at least, proposed proceedings and to see that they entail a claim for a remedy of the kind encompassed by the words "recovery of public money, or other money, public property or other property" against some identified person. While a Part 5.9 examination might have, as one of its purposes, investigation of the question whether there are grounds for instituting such proceedings against particular persons, the giving of answers at such an examination could not be said to bear to any proceedings, apart from the examination itself, any relationship of the kind envisaged by the words "to or in respect of". Unless and until some recovery proceeding is cogently formulated, it cannot be said to exist. 107 Nor do I accept the plaintiff's alternative submission based on s.38(2)(d). That submission proceeds on the basis that the answering of questions by one of the Audit Office parties upon examination under Part 5.9 would be "in respect of … a report or communication authorised or required to be made by or under this Act …", on the basis that all past communications made in the course of the party's duties (whether by or to the party) were authorised or required by the Grain Marketing Act. If this were correct, any officer otherwise bound by s.38(1) could divulge any such communication to any person at any time simply because it was a communication authorised or required by the Act. That is not what the exception is intended to achieve. Its purpose is merely to free from the s.38(1) restraint reports and communications authorised or required by the Act, together with disclosures incidental to and necessary for such reports and communications. 108 In my judgment, the fact that questions were asked of the Audit Office parties at an examination under Part 5.9 of the Corporations Law would not mean that they were not precluded by s.38 of the Public Finance and Audit Act from providing such answers as were within the scope of sub-s.(1) of that section. 109 It should be noted, in conclusion, that the secrecy provisions in the Grain Marketing Act would not have the same consequences in relation to persons who are "prescribed persons" as defined by s.92(3) of that Act. The obligation of secrecy imposed on such persons by s.92(1) does not preclude a person from doing any of the things in s.92(2): "(2) Nothing in subsection (1) precludes a person from: (a) producing a document to a court in the course of criminal proceedings or in the course of any proceedings under this Act or a prescribed Act, or (b) divulging or communicating to a court in the course of any proceedings referred to in paragraph (a) any matter or thing coming under his or her notice in the exercise of his or her official functions, or (c) producing a document or divulging or communicating information that is required or permitted by any Act, or any Act of the Commonwealth, to be produced, divulged or communicated." 110 Section 92(2)(c) would negate the prohibition where production or divulging was required by s.597 of the Corporations Law, as continued by s.4B of the Grain Marketing Act. Decision 111 The plaintiff's originating process filed on 30 August 2002 is dismissed. ********** Last Modified: 10/04/2002 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. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.