Supreme Court New South Wales Medium Neutral Citation: In the matter of Recycling Holdings Pty Ltd (in liquidation) (deed administrator appointed) ACN 123 236 573 (No 2) [2015] NSWSC 2016 Hearing dates: 13 March 2015 Date of orders: 13 March 2015 Decision date: 13 March 2015 Jurisdiction: Equity Before: Brereton J Decision: Second respondent to attend court to be examined in respect of compliance with the notice to produce dated 22 December 2014. Catchwords: PROCEDURE – notice to produce – where failure to comply with notice to produce – where allegedly no documents to be produced – where objectively unlikely that there are no such documents. Legislation Cited: (NSW) Civil Procedure Act 2005, s 68 Cases Cited: Trade Practices Commission v Arnotts Ltd (No 5) (1990) 21 FCR 324 Category: Procedural and other rulings Parties: Salmat Limited ACN 002 724 638 (first plaintiff/first respondent) Salmat Mediaforce Pty Limited ACN 001 702 129 (second plaintiff/second respondent) Fuji Xerox Businessforce Pty Limited ACN 137 933 905 Recycling Holdings Pty Ltd (in liquidation) (deed administrator appointed) ACN 123 236 573 (first defendant) Philip Raymond Hosking and David Anthony Hurst in their capacities as deed administrators of Recycling Holdings Pty Ltd (in liquidation) (deed administrator appointed) ACN 123 236 573 (second defendants) Jason Kenneth Ryan (third defendant/first applicant) Front Foot Project Funding Pty Limited ACN 601 976 346 (fourth defendant/second applicant) Representation: Counsel: A Henskens SC w S A Wells (plaintiffs/respondents) D L Cook (third & fourth defendant/applicants) C Alexander (interested party) Solicitors: Thomson Geer (plaintiffs) Downeys Lawyers Pty Limited (first defendant) James Hamilton Surry Partners Lawyers (second defendants) Pure Legal (third & fourth defendants) File Number(s): 2014/354864 Judgment (ex tempore) 1. HIS HONOUR: On or about 22 December 2014, the plaintiff issued and served on the fourth defendant Front Foot Project Funding Pty Limited a notice to produce to the Court, requiring production on 2 February 2015 of the following documents: 1. A copy of the Funding Agreement dated 27 October 2014 between Front Foot Project Funding Pty Limited and the Company, including a copy of any Deed Poll entered into in relation to the Funding Agreement. 2. One copy of all documents evidencing or recording the financial position of Front Foot Project Funding Pty Limited including but not limited to financial accounts, balance sheets, profit and loss accounts, bank statements. 3. One copy of all documents evidencing or recording the financial capacity of Front Foot Project Funding Pty Limited to fulfil its obligations under the Funding Agreement dated 27 October 2014. 4. A copy of all agreements between Front Foot Project Funding Pty Limited and Jason Ryan with regard to the financial support or loans from Jason Ryan to Front Foot Project Funding Pty Limited. 5. A copy of all documents evidencing or recording any indemnity provided by Front Foot Project Funding Pty Limited to the first, second or third defendant or the liquidator of the first defendant, Mr Andrew Barnden. 1. No production was made on or before the return date. Repeated adjournments of the notice to produce, of which notice was given to the fourth defendant, and attempts to secure production of the documents went unanswered. The solicitors for the third defendant, who is the sole director and shareholder of the fourth defendant, did not have instructions to act for the fourth defendant. 2. On 3 March 2015, the plaintiff filed an interlocutory process claiming an order pursuant to (NSW) Civil Procedure Act 2005, s 68, that Front Foot Project Funding Pty Limited produce the documents requested in the notice to produce, and further or alternatively, that Mr Ryan, as Front Foot Project Funding Pty Limited's proper officer, attend Court to be examined in respect of the alleged non-compliance with the notice to produce. That interlocutory process is set down for hearing today. 3. Shortly before the hearing, Front Foot Project Funding Pty Limited filed a submitting appearance in the substantive proceedings. When the matter was called on, Front Foot Project Funding Pty Limited produced to the Court a Funding Agreement dated 27 October 2014 and a deed poll dated September 2014. Nothing has been produced which falls within paragraphs 2, 3 and 4 of the notice to produce, the answer being "nothing to produce". 4. The Funding Agreement in question, between Front Foot Project Funding Pty Limited and the plaintiff in other proceedings in this Court, imposes on Front Foot Project Funding Pty Limited an obligation to fund those proceedings and, it is accepted, imposes an obligation to provide security or to fund the provision of the security for costs which was ordered in those other proceedings. The evidence also establishes that that security for costs, in the sum of $210,000, was provided in early December last year, about 5 or 6 weeks after the Funding Agreement was entered into. It seems improbable that there is in existence no document in the possession of Front Foot Project Funding Pty Limited that evidences its financial position in any way, and that it has no financial accounts, and no bank statements at all – which is what would be indicated by its answer to this point to the notice to produce. That being so, the plaintiff has made out a case for examination on oath of Front Foot Project Funding Pty Limited's proper officer to ascertain that he understands the obligations imposed by the notice, has made proper and reasonable searches and enquiries in respect of discharging those obligations and has found nothing. It ought to be understood that such an examination is, at least prima facie, in the nature of an examination-in-chief, not a cross-examination, and that it is limited in its scope, as Beaumont J explained in Trade Practices Commission v Arnotts Ltd (No 5) (1990) 21 FCR 324. 5. The Court orders that the second respondent, Jason Ryan, in his capacity as proper officer and director of Front Foot Project Funding Pty Limited, attend Court to be examined in respect of compliance with the notice to produce dated 22 December 2014. ********** 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. Decision last updated: 18 February 2016