Valofo, In the matter of - Sheahan & Lock as Liq of Valofo Pty Ltd (in liq) [2010] NSWSC 1255

New South Wales Supreme Court

CITATION : Valofo, In the matter of - Sheahan & Lock as Liq of Valofo Pty Ltd (in liq) [2010] NSWSC 1255

HEARING DATE(S) : 22 October 2010

JUDGMENT DATE : 22 October 2010

JURISDICTION : Equity Division Corporations List

JUDGMENT OF : Palmer J

EX TEMPORE JUDGMENT DATE : 22 October 2010

DECISION : Application dismissed.

CATCHWORDS : CORPORATIONS – EXAMINATION – ABUSE OF PROCESS – whether issue and maintenance of examination summons was designed to coerce applicant into settling proceedings – whether examination summons should be set aside as abuse of process.

LEGISLATION CITED : Corporations Act 2010 (Cth) – s 596B

CATEGORY : Procedural and other rulings

CASES CITED : Londish v Sheahan [2010] NSWSC 337 Williams v Spautz (1992) 174 CLR 509

PARTIES : John Sheahan & Ian Lock as Joint and Several Liquidators of Valofo Pty Ltd (in liq) (Plaintiffs/Respondents) Ross Edward Seller (Applicant)

FILE NUMBER(S) : SC 2010/152694

COUNSEL : D. Sulan (Plaintiffs/Respondents) T.D. Castle (Sol) (Applicant)

SOLICITORS : O'Neill Partners (Plaintiffs/Respondents) Atanaskovic Hartnell (Applicant)

2010/152694 Sheahan & Lock as Liq of Valofo Pty Ltd (in liq)

JUDGMENT – Ex tempore

22 October, 2010

1 On 30 June 2010, the liquidators of Valofo Pty Limited procured the issue of a Summons to Mr Ross Seller under s 596B of the Corporations Act 2010 (Cth), to attend an examination on 25 August 2010 into the affairs of Valofo. 2 On 25 August 2010, Mr Seller's examination was adjourned in order to enable him to apply to set aside the Examination Summons. Mr Seller now moves to set aside the Summons on the ground that it is an abuse of process. He says that the liquidators' predominant purpose in issuing the Summons was, and is, to coerce him into accepting a settlement of litigation on terms dictated by the liquidators but not agreed by Mr Seller. 3 The relevant background to this application is set out in my judgment in earlier and different proceedings between some of the parties: Londish v Sheahan [2010] NSWSC 337. The parties to this application have requested that I hear it, notwithstanding my involvement in the earlier proceedings. 4 The relevant portions of my earlier judgment which give a background to this application are as follows: "10. Valofo is the sole unitholder of the Baltarna Trust which, in turn, is the sole unitholder of the Prime Index Lease Trust ("PILT"). PILT Nominees Limited is the trustee of PILT. The assets of PILT are a number of service stations which had been leased to Shell Petroleum.