Hypec Electronics Pty Ltd (In Liq) [2006] NSWSC 704

New South Wales Supreme Court

CITATION : Hypec Electronics Pty Ltd (In Liq) [2006] NSWSC 704

HEARING DATE(S) : 10/07/06

JUDGMENT DATE : 10 July 2006

JURISDICTION : Equity Division Corporations List

JUDGMENT OF : Barrett J

EX TEMPORE JUDGMENT DATE : 07/10/2006

DECISION : See paragraph 6

CATCHWORDS : CORPORATIONS - winding up - examinations by liquidators - orders for production of documents - orders sought in respect of solicitors - need for mechanism for determination of claims for privilege before order for production made

Civil Procedure Act 2005, s.68 LEGISLATION CITED : Corporations Act 2001 (Cth) ss.596A, 596B Supreme Court Rules 1970, Part 36 rule 13

CASES CITED : Metyard v Love (2005) 224 ALR 588

PARTIES : John Duncan Green as liquidator of Hypec Electronics Pty Limited - Applicant

FILE NUMBER(S) : SC 1933/01

COUNSEL : Mr P.B. Walsh - Applicant

SOLICITORS : Deacons - Applicant

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST

BARRETT J

MONDAY, 10 JULY 2006

1933/01 IN THE MATTER OF HYPEC ELECTRONICS PTY LIMITED (IN LIQUIDATION)

JUDGMENT

1 The applicant is the liquidator of Hypec Electronics Pty Limited. By his amended interlocutory process filed on 6 July 2006, he applies for the issue of examination summonses under ss.596A and 596B of the Corporations Act (2001) (Cth) and also makes application under s.68 of the Civil Procedure Act 2005 for orders requiring the production of documents. 2 The persons to whom the orders for production would be directed are the persons in respect of whom examination summonses are sought. Four of these persons are solicitors and there is an apprehension that some or all of the documents they would be required to produce by an order for production would be the subject of client legal privilege or legal professional privilege belonging to the relevant client or clients. 3 The Registrar has dealt with the application insofar as it concerns persons other than the four solicitors. The Registrar has referred the balance of the application to the Corporations Judge because it raises issues that were recently addressed by the Court of Appeal in Metyard v Love (2005) 224 ALR 588. 4 In that case, Basten JA, with whom Beazley JA agreed and Santow JA also agreed as to the relevant aspect, drew attention to the difficulties that arise where application is made for an order for production of documents that are potentially subject to privilege. Basten JA said at paragraphs [130] – [133], referring to Part 36 rule 13 of the Supreme Court Rules 1970 (which was substantially similar to the present s.68): "[130] The consequences of that conclusion must be assessed by reference to the statutory scheme under which orders for production were made. Part 36, r 13 applies both to orders for production and production on notice under Part 36, r 16. The latter rule provides that a party served with a notice 'shall, unless the court otherwise orders, produce the document or thing in accordance with the notice': r 16(1). The effect of r 13(2) is, it would appear, that no order relieving the party under r 16 is necessary: rather, where privilege is invoked, the rule 'shall not require' production of the document, until the Court has directed that production 'shall not be prevented' by sub-r 13(2). Whether a similar approach is to be adopted in relation to an order for production under r 12 is less clear. Sub-rule 13(3) does not say that in such a case the order 'shall not require' production of a privileged document, but rather that the Court 'shall not compel' such production, unless and until it directs that the production shall not be prevented. On one construction, the order is unenforceable, pending further consideration by the Court; on the other construction, an order should not be made in the first place seeking to compel production of documents the subject of privilege.