Re James Mccartney Anderson and Malcolm Nelson Johns v David Lewis Clout; James Howard and Simon Daley [1987] FCA 17 (30 January 1987)

FEDERAL COURT OF AUSTRALIA

Re: JAMES McCARTNEY ANDERSON and MALCOLM NELSON JOHNS
And: DAVID LEWIS CLOUT; JAMES HOWARD and SIMON DALEY
No. W859 of 1983
Bankruptcy

COURT

IN THE FEDERAL COURT OF AUSTRALIA
BANKRUPTCY DISTRICT OF THE STATE OF NEW SOUTH WALES AND THE AUSTRALIAN CAPITAL TERRITORY
Evatt J.

CATCHWORDS

Bankruptcy - public examination - Application to set aside summons to attend for public examination - Summons in identical terms to earlier extant summons - Whether second summons vexatious or an abuse of process - Practice in relation to statements of reasons grounding the issue of summons under ss. 69 and 81 of the Bankruptcy Act 1966 - Practice of issuing second summons in identical terms when first summons stood over generally - Whether second summons needed to base an application under s.264B if witness fails to attend before Registrar.

Bankruptcy Act 1966 ss. 14, 69, 81, 264A,264B

Bankruptcy Rules r.33, r.129

Re Abrahams (Unreported, Lockhart J, Federal Court of Australia, 23 April 1985

In Re Rolls Razor Limited (No 2) (1970) 1 Ch. 576

Re Csidei (1979) 28 ALR 381

HEARING

SYDNEY
30:1:1987

Counsel for the Applicant: Mr Einfeld QC and Miss Schurr

Solicitors for the Applicant: Malcolm Johns & Co., Sydney

Counsel for the First Respondent: Mr Toner

Solicitors for the First Respondent: H.N. Chippindall & Co., Sydney

ORDER

1. The application for review be dismissed.

2. The applicant to pay the respondent's costs.

Note: Settlement and entry of orders is dealt with in Order 36

of the Federal Court Rules.

DECISION

Before the Court is an application for review brought under s.14(5) of the Bankruptcy Act 1966 (the Act) by the abovenamed applicant, Malcolm N. Johns, solicitor, against the three abovenamed respondents. The first named respondent, David Lewis Clout (the Trustee), a registered Trustee within the meaning of s.5 of the Act, is the Trustee of the estate of one James McCartney Anderson (the bankrupt) who was made bankrupt on 13 september 1983, the act of bankruptcy being 24 June 1983. The second and third named respondents are officers of the Federal Court of Australia, Mr Howard being its Principal Registrar and as such enabled to exercise the powers of the Registrar in Bankruptcy, whilst Mr Daley was, at all relevant times, a Deputy Registrar appointed under the Act.

2. Section 14 of the Act makes provisions for a Registrar in Bankruptcy and for Deputy Registrars. Sub-sections (2) and (2A) provide:

(2) Each Registrar and Deputy Registrar has such powers and
functions as are conferred or imposed on a Registrar by
this Act.

(2A) A power or function conferred or imposed on a Registrar
by this Act, when exercised or performed by a Deputy
Registrar, shall, for all purposes, be deemed to have
been exercised or performed by the Registrar.

It is clear that the firm of Malcolm Johns & Co., Solicitors, of which the

present applicant is and was at relevant times a member, had, for some years before Mr Anderson was declared bankrupt, acted as his solicitor. The present application arises as a result of a s.81 summons directed to Mr Johns dated 5 November 1985 for his public examination before a Registrar in Bankruptcy on 13 November 1985. Mr Johns' complaint simply put is that at that date there was in additional to that summons, an earlier summons in identical terms dated 31 August 1984 which had been returned on 11 September 1984 and which was extant at all relevant times, it having been stood over generally by a Deputy Registrar in Bankruptcy on 11 September 1984 in circumstances outlined below.

3. When the application for review was called on before the Court as presently constituted on 14 November 1985 Mr Einfeld QC with Miss Schurr appeared for Mr Johns, whilst Mr Toner of counsel appeared for Mr Clout. The Court was then informed that Mr Howard and Mr Daley would not be represented, it being indicated that each would submit to any order that the Court might make.

4. Having heard submissions from Mr Einfeld and Mr Toner and having perused the file in the matter, the Court is satisfied that as at 13 November 1985 there were in fact two summonses under s.81 in identical terms directed to Mr Johns, the earlier being dated 31 August 1984 and the second dated 5 November 1985. It is clear that the first summons had been called on before a Deputy Registrar in Bankruptcy on 11 September 1984 and was then stood over generally in circumstances which are set out later herein and that the second summons was first listed for hearing before the Registrar on 13 November 1985, it having been served on Mr Johns on 6 November 1985.

5. Further, the Court after hearing those submissions had the clear impression that the events before the Registrar on 13 November 1985 leading up to the filing of an application by the applicant under s.14(5) of the Act late on 13 November 1985 was a storm in a tea-cup. After lengthy argument before the Court on 14 November, Mr Einfeld conceded that Mr Johns was ready and willing to appear before the Registrar on the restoration of the earlier summons in accordance with r.33 of the Bankruptcy Rules. This, so it would seem, was Mr Johns' attitude on the afternoon of 13 November 1985. That being the case the Court has difficulty in accepting the statement made through his legal representative, that Mr Johns was, on the afternoon of 13 November 1985 genuinely embarrassed by the second summons. Why he, as an officer of the Court, did not elect either to give evidence or seek particulars as to which particular matters of Mr Anderson it was that information was being sought and then request an adjournment so that he might inspect those particular files for the purposes of refreshing his memory and thus being more readily able to assist the inquiry has not been explained to the Court. When such a course was suggested by the Court on 14 November, Senior counsel for Mr Johns was adamant that he wished to test the issuing of the second summons and the procedure under which it had been issued.

6. A perusal of the transcript taken before the Registrar on 13 November shows that more than once Counsel for Mr Johns stated to the Registrar that the issue of the second summons in the circumstances was oppressive, vexatious and an abuse of the Court's process. As these allegations have been persisted with before the Court on the present application, the Court is of the view that events leading up to the present application should be set out in some detail.

7. As stated, Mr Anderson was declared bankrupt on 13 September 1983, Mr Clout being appointed trustee of his estate.

8. An affidavit verifying the Statement of Affairs as at the date of the sequestration order was sworn by the bankrupt on 22 November 1983. Annexed to that affidavit was a Statement of Affairs, Part II of which listed debts owing to some 15 unsecured creditors, the total amount of such debts being shown as $451,970.29. Listed as No. 13 of such creditors was one Malcolm Johns & Co. (Address Sydney), the amount owing being shown as $43,000.00 (est).

9. Since 13 September 1983, applications for summonses for public examinations of the bankrupt and other persons under both ss. 69 and 81 of the Act have been made by the Trustee in matter No. W859 of 1983.

10. In particular a summons under s.81 dated 31 August 1984 directed to the present applicant was issued by a Deputy Registrar in Bankruptcy at the request of the Trustee in the following form:

In pursuance of the power conferred on the Registrar by
Section 81 of the Bankruptcy Act, 1966, the Registrar hereby
summons you to attend before the Court at 10:00 am on
Tuesday, 11th September, 1984, to give evidence in connection
with your knowledge of the business, property and affairs of
the bankrupt and in relation to the affairs of companies in
which the bankrupt had or claimed to have an interest and to
produce any of the following documents which are in your
custody or power and which related to the said bankrupt or
his trade dealings of affairs and in particular to produce
all files in relation to matters in which you acted for the
bankrupt, or for companies controlled by him; trust ledgers;
diary sheets; cost journals, memoranda and correspondence and
any other records relating to moneys paid by the bankrupt to
you and moneys received and disbursed on behalf of the
bankrupt and any other material relating to instructions
issued to you by the bankrupt or any company or corporation
controlled by the said bankrupt. (Emphasis added).

Section 81 of the Act so far as is relevant reads:

81(1) ... the Registrar may, on the application of the
Trustee at any time summon -

(a) ...

(b) a person who is known or suspected to have in his
possession any of the property of the bankrupt, or
is supposed to be indebted to the bankrupt or able
to give information concerning the bankrupt or his
trade dealings, property or affairs

to attend on a date and at a time and place fixed in the
summons before ... the Registrar ... to give evidence
concerning and produce any books (whether or not in existence
at the time the bankrupt became a bankrupt) in his custody or
power relating to the bankrupt or his trade dealings,
property or affairs.

(2) ...

(3) ... the Registrar ... may at any time adjourn the
examination of a person under this section either to a fixed
date or generally, or conclude the examination.

(4) ...

(5) ...

(6) ...

(7) A person summoned to attend before ... the Registrar ...
for examination under this section is entitled to be
represented on his examinaton by Counsel or a Solicitor who
may re-examine him after his examination.

Two additional s.81 summonses directed to a Mr John Gilbert of the Australian and New Zealand Banking Group Limited (the ANZ Bank) and a Mr Richard Joseph Jankowski were also issued at the request of the Trustee and made returnable before a Deputy Registrar in Bankruptcy on 11 September 1984.

11. On that date the summons directed to Mr Gilbert was called on first. Mr Toner appeared for the Trustee who informed the Deputy Registrar that Mr Gilbert was then on holidays but that a representative of the Bank was present with certain documents. A Ms Denise Rosanne Samios was then called into the witness box and after giving her name and address produced certain documents from the custody of the ANZ Bank. She was unable to say what those documents were and it was clear that she was merely attending to produce documents handed to her that day by the Acting Manager of the Kings Cross Branch of the ANZ Bank. After producing the documents Ms Samios was excused. The transcript taken that day before the Deputy Registrar reads:

MR TONER: Well, I can probably make a formal application
now that that summons be stood over generally.

D REGISTRAR: Yes, certainly. Well, I will simply make the
direction, Mr Toner, that the summons to John
Gilbert, under section 81, which was
returnable for today's date, 11 September, be
adjourned generally.

MR TONER: Well, is it ---

D REGISTRAR: Has the effect of to a date to be fixed.

MR TONER: Yes, that is right.

D REGISTRAR: Just approach the registry for another date.

MR TONER: Yes. Well, the second summons I would call
upon is that directed to Malcolm N. Johns,
Registrar.

The summons directed to Mr Johns was then called on. A Mr Castle, a solicitor employed by Malcolm Johns & Co., appeared for Mr Johns and stated:

I am producing certain lists of documents filed (sic - sc
"and files"); certain ledger sheets in relation to some 219
matters which have been listed right throughout our office.

indicating that to bring those files to court would be very expensive and inconvenient. As Mr Castles was pointing out to the Deputy Registrar the time taken to prepare the list, Mr Toner interrupted and the transcript shows the following.

MR TONER: Well, sorry to interrupt my friend, but there
is a simple way of dealing with this: perhaps
the same procedure can be followed in relation
to this summons as was followed in relation to
the bank - the one directed to Mr Gilbert -
that is, Mr Castles going the witness-box,
being sworn and producing what he has; and it
would then be my application in relation to
that summons that the matter be stood over
generally as well.

D REGISTRAR: I see. Are you agreeable to that?

MR CASTLES: Yes, quite.

D REGISTRAR: Probably they can be - if those documents are
agreed and they are not actually produced one
by one, that list can be handed up to me as
produced under the summons in a similar way.

MR TONER: Yes. All right, then, otherwise we will be
here ---

D REGISTRAR: As these files are produced to the court, I am
happy to mark them but the understanding is
that you can have access to them but they will
remain with the Court file during the duration
of the matter.

MR CASTLES: I have a separate list of copies for my
friends, if they so required.

D REGISTRAR: I would just like the list produced to remain
with the file; as to the documents, I am happy
for them to be inspected. Yes. Just for the
sake of formality, Mr Castles, if you could go
into the witness-box and formally produce
them.

Mr Castles, after being sworn, gave evidence that Mr Johns was not present before the Registrar but was then either in his office preparing to go to another court or already at that other court.

12. Mr Castles then described what was contained in the three folders that he had produced.

The first one contains a list of files and matters which are
files in storage, not in our possession ... but in our store
... there are some 114 matters listed there; accompanying
that list are a set of photostated ledger sheets,
computerized ledger sheets, of accounts relating to those
matters. In the second folder there are a list of files
which are present in our office ... and are available to be
picked up; there are some, I think 47 - sorry 58 files,
accompanying that is a set of ledger sheets and accounts
sheets similarly with the first folder. In the third folder,
there is a list of files which have not yet been located,
accompanying that list are a similar set of ledger sheets and
accounts as contained in the other two matters.

After the various folders had been marked for identification, Mr Castles was permitted to step down from the witness box. The transcript then shows:

MR TONER: It would be my application that that summons
be stood over generally as well, Registrar.

D REGISTRAR: In respect of this matter, Mr Castles, do you
have anything to say about that?

MR CASTLES: No, I have no objection to it being stood
over.

D REGISTRAR: Yes. Well, I will just simply make the same
direction, Mr Toner, that the matter - or both
of you, gentlemen, that the summons be
adjourned generally.

Thereafter the third summons to Mr Jankowski was called on. Mr Jankowski, a solicitor formerly employed by Malcolm Johns & Co., appeared and was sworn and gave evidence which has been transcribed in the official transcript. At the conclusion of his evidence the Deputy Registrar excused him and indicated that his examination was concluded.

13. Rule 33(1)(d) of the Bankruptcy Rules made under the Act reads:

Procedure where examinations under sections 69 and 81
of the Act have been adjourned.

33(1) Where -

(a) ...

(b) ...

(c) ...

(d) the examination of a bankrupt or other person under
section 81 of the Act has been adjourned by ..., the
Registrar ... generally or for further hearing before
... the Registrar on a date to be fixed; or

(e) ...

the trustee shall cause notice of the date, time and place
fixed for the commencement of the examination of the
bankrupt, or for the further examination of the bankrupt or
other person, as the case may be, to be served on the
bankrupt or other person.

On 21 January 1985 Mr J.K. Chippindall of H.N. Chippendall, Solicitors for the Trustee, wrote to the Registrar of the Federal Court of Australia requesting a summons under s.81 of the Act in respect of a Mr Ockrim. The letter then reads:

At the same time we would believe it to be desirable to
restore to the list the examination of the bankrupt himself
and also to restore to the list the examination of Mr Malcolm
Johns, which was stood over generally on 11 September 1984.
We would estimate the examination of these three persons, if
past experience is any indication at all, would have to last
for a period of at least two days.

We would be grateful if we could have the earliest possible
date for the conduct of these examinations. (Emphasis
added).

The letter then dealt with other matters which are not relevant to the present application.

14. That letter is endorsed with a note as follows:

Rung Mr Chippindall - told him we needed summons against Mr
Anderson and Mr Ockrim - have booked them all in for 20 June.
11/3/85 (Signature of an officer of the Federal Court
Registry).

By letter dated 9 April 1985 Mr Chippindall again wrote to the Registrar of the Federal Court as follows:

We refer to our previous discussions with Camilla Baker (then
an officer of the Court Registry).

We understand you are disposed to issue a summons under s. 81
against Mr Lionel Ockrim for the 19th and 20th June next.

We attach hereto further summonses directed to the bankrupt
James McCartney Anderson and to Mr Malcolm Johns for the same
days together with some further short Reasons in respect of
the examination of Mr Johns and further application for
examination of the bankrupt under s. 69.

If these are in order could you please arrange for the
summonses all to be issued and returned to us for service.

Included in the file in this matter is a document headed, "Summons Under Section 81", addressed to Malcolm N. Johns dated (blank) April 1985 in matter No. W859 of 1983 ("the April 1985 s.81 summons") plus two copies thereof together with the Trustee's Reasons for Examination of Mr Johns dated 11 April 1985. These four documents are clipped together, the original undated summons being the top document. Adhered to that document is a yellow marker endorsed, "Will not issue till further reasons provided. Simon D". It is understood that Simon D. is Simon Daley, the third named respondent.

15. The opening paragraph of the said Reasons for Examination dated 11 April 1985, omitting formal parts, reads:

I, DAVID LEWIS CLOUT ... do hereby request the issue of a
further summons under s.81 of the Bankruptcy Act directed to
Malcolm Johns, Solicitor, ... for the following reasons.
(Emphasis added).

Then are set out five paragraphs. Paragraphs 1, 2, 3 and 4 set out reasons which need not be set out herein. Paragraph 5 then reads:

It is my belief that Malcolm Johns can provide further
information as to the affairs of the bankrupt and I request,
therefore, that he be ordered to attend and be examined and
to produce and bring with him all his files in relation to
matters in which he acted for the bankrupt, or companies
controlled by the bankrupt and also his trust ledgers, diary
sheets and costs journals and other records relating to
monies paid by the bankrupt to him or to his firm and monies
received by him and dispersed by him on behalf of the
bankrupt. (Emphasis added).

There is in the Court file some rough notes made by Mr Daley regarding whether the "April 1985 s.81 summons" directed to Mr Johns should be issued. These rough notes are not dated but clearly refer to the request for the issue of the said summons. They read:

1. It appears from transcripts and previous record of
proceedings sheets that Malcolm Johns (solicitor) has
not been examined on a past occasion.

Letter from Chippindall's (dated 21.I.85) indicates that
his examination took place on 11/IX/84 and was stood
over generally. If this is correct (and it appears it
is not) then perhaps a fresh s.81 should not issue - see
reasons for issue (11.IV.85) point 3.

(NB Confusion may have arisen because Richard Jankowski
was examined on 11/9/84. His examination concluded -
Jankowski was a partner to Mr Johns.

2. Reasons re s.81 to issue for Malcolm Johns are simply
that M. Johns & Co were bankrupt's solicitors in
numerous matters. That examination of another partner
did not prove entirely fruitful (and witness could/did
not provide answers re some dealings between bankrupt
and solicitor) - what dealings?

Pt 4 of reasons is v. vague - is consultation alleged a
sufficient reason by itself, ie shouldn't occasions and
dealings be specified to some degree.

It is noted that Mr Chippindall's letter of 21 January 1985 does not state that Mr Johns' examination took place on 11 September 1984. This fact is clearly stated in para 3 of the Reasons dated 11 April 1985 which simply reads:

Mr Johns has not been previously examined.

The Court is unaware whether Mr Daley's then belief that Mr Chippindall was apparently mistaken as to the fact that Mr Johns had given evidence on 11 September 1984 was a reason for Mr Daley refusing to issue the "April 1985 s.81 summons". A further note in the file in Mr Daley's handwriting dated 22 April 1985 seems to confirm that it was because Mr Daley believed the Reasons for Examination dated 11 April 1985 were in some way deficient that resulted in his refusal to issue the April 1985 summons. This note of 22 April reads:

- Spoke to John Chippindall (who has just returned to his
office from an overseas trip) re my refusal to issue s.81
summons against Malcolm Johns. He suggested that he would
file further reasons for issue of this summons within a
week.

- In the meantime he asked if I would go ahead and issue the
s.69 summons (Anderson) and other s.81 summons (Ockrim).

I told him I would sign these today.

(Signed): Simon Daley

The two further summonses which are referred to in Mr Chippendall's letter of 9 April 1985 directed to Mr Anderson and Mr Ockrim were in fact issued on 22 April 1985 returnable on 19 June 1985. On that date matter No. W859 of 1983 was listed before Deputy Registrar Simon Daley when, according to the record of proceedings, the only appearance was that of Mr Toner who appeared for the Trustee. That record is endorsed:

S.69 summons (to bankrupt) discharged (no service).
S.81 summons (to Lionel Ockrim) discharged (no service).

Thereafter on 25 October 1985 a further draft summons under s.81 directed to Malcolm N. Johns, together with Reasons for Examination dated 24 October 1985, was lodged with the Court by Mr Chippendall. The summons was in fact dated 25 October 1985 in the manner referred to later herein and it and the Reasons for Examination bear the Court's "lodging" stamp showing the date, 25 October 1985. As appears below, that summons was not then issued.

16. The opening paragraph of the Reasons for Examination dated 24 October 1985, omitting formal parts, again reads:

I ... do hereby request the issue of a further summons under
s.81 of the Bankruptcy Act directed to Mr Johns ... for the
following reasons. (Emphasis added).

Then are set out six paragraphs. Paragraphs 1, 2 and 3 give particulars of certain events which need not be set out. Relevant parts of paragraphs 4, 5 and 6 read:

4. On 11 September 1984 a prior summons issued by this
Court against Malcolm N. Johns was stood over although
he permitted inspection of certain books and records,
did not attend Court and was not examined as to the
dealings of the affairs of the bankrupt.

5. It is desired to restore the examination of Mr Johns to
the list for 13 November 1985 and to examine him further
as to the matters for which he acted for the bankrupt
and in particular (emphasis added)

then are set out paragraphs a), b), c) and d) which are not herein reproduced.

6. It is requested that the examination of Mr Johns be
restored to the list for hearing before the Registrar of
this Honourable Court on 13 November 1985. (Emphasis
added).

A perusal of the file then shows that chronologically there is an apparent relevant letter from Mr Chippendall to the Deputy Registrar of the Court, reference Mr S. Daley, dated 5 November 1985 which, omitting formal parts, reads:

We refer to our telephone conversation with Mr Daley today.

We write to confirm that we will be relying on the Reasons
for Examination of the Trustee of April 1985 in respect of
the issue of the present summons against the bankrupt, Mr
Malcolm Johns and Mr Lionel Ockrim which are returnable on 13
November 1985.

The summons under s.81 directed to Mr Johns and which had been lodged with the Court on 25 October 1985 for sealing was then issued by the Court and dated 5 November 1985, signed by Mr Daley as Deputy Registrar in Bankruptcy. The file copy of that summons shows the figures and word, 25th October, (the "25th" having been written in in ink and the "October" being typed) being crossed out in ink and the 5th November written in in ink above.

17. Matter No. W859 of 1983 was listed before Mr Howard, Principal Registrar of the Court on 13 November 1985 at 10.00am when Mr Toner appeared for the Trustee and Mr Castles, solicitor, appeared for Mr Johns. Mr Toner then informed the Registrar that Mr Ockrim was present and he desired to deal with Mr Ockrim's matter first and suggested that the summons directed to Mr Johns be stood down to 2.00pm. The Registrar then asked Mr Castles what his attitude was in that regard. The official transcript of the proceedings shows that Mr Castles replied as follows:

MR CASTLES: Mr Johns is in his office. He is only awaiting
a call, Registrar. We can be here at 2 or at
such time before that ---

REGISTRAR: That presents no problem to either yourself or
your client?

MR CASTLES: That presents no problem at all.

REGISTRAR: All right. And you - Mr Toner, you are rather
sure that the three hours between now and 1pm
can be properly filled in with the examination
of Mr Ockrim?

MR TONER: I anticipate that but to a large extent it
depends on the answers I get.

REGISTRAR: Right. I can understand that also. Mr Castles,
we will make a not before 2pm direction at this
stage, so that you are not in a state of
suspended animation.

MR CASTLES: Thank you, Registrar.

Mr Ockrim was then called and sworn and gave evidence, his evidence covering some 40 pages (concluding at p 44 of the official transcript when he was excused). The record of proceedings before Mr Howard does not indicate the actual time when the examination of Mr Ockrim concluded but at the foot of p 43 Mr Toner said:

I have no further questions. I cannot take it to one
o'clock.

There was then a discussion between the Registrar and Mr Toner in respect of a statutory declaration before Mr Toner on p 44 stated:

In normal circumstances I would have asked - it would be my
application that the examination (ie of Mr Ockrim) be
concluded. Further in this instance I would ask that the
examination stand over generally because there are some other
enquiries that the trustee wishes to make and it may well be
that Mr Ockrim may be required again. I know that that is a
little unusual and that it would be available to the trustee
to simply seek another s.81 summons so in the circumstances I
would ask for it to stand over generally.

There being no objection by Mr Ockrim, the Registrar stood his examination under s.81 over generally. Matter W859 of 1983 was then stood down until 2.00pm.

18. On resuming at 2.00pm, Mr Toner called on the summons directed to Mr Johns. Mr Einfeld QC then sought leave to appear for Mr Johns indicating that Mr Johns was present in Court. Mr Einfeld then stated:

An application for order of review (under s.14(5) of the
Bankruptcy Act) is being filed in Court to review the
summonses issued (directed to his client), the named
respondents of that application being the trustee, yourself
and Mr Daley.

Mr Einfeld then sought an adjournment of the summons before the Registrar until the Federal Court had had an opportunity of ruling on the application for review. Discussion then ensued during which Mr Einfeld pointed out that there appeared to be two current s.81 summonses directed to Mr Johns, the first dated 31 August 1984 and a second "totally different summons" dated 5 November 1985. This, Mr Einfeld claimed, was oppressive and raised questions for determination not by the Registrar but of necessity by the Court. Mr Einfeld then indicated to the Registrar that he was hoping to attend upon a Federal Court Judge to seek abridgment of time for service of the necessary documents to have the application for review dealt with as a matter of urgency. Subsequently, during those discussions Mr Einfeld agreed that the second summons was in identical terms to the first.

19. The transcript taken before the Registrar that day at p 55 shows:

THE REGISTRAR: Thank you, Mr Einfeld. Mr Einfeld, I do not
quite understand what you meant when you said
that the reasons for the examination were not
relevant. It is clear that reasons for the
examination were filed in the Bankruptcy
Registry on 25 October 1985, and pursuant to
those reasons the Deputy Registrar in
Bankruptcy issued a summons under section 81
of the Bankruptcy Act returnable today, and
issued that summons on 5 November 1985; and I
think it is common ground that it was served
on your client on 6 November. So your client
has had one week in which to do something
about this summons.

The matter was called on at 10 o'clock this
morning. Mr Castles appeared for your client,
and at that time stated that - after
discussion with Mr Toner - that Mr Johns was
available in his office to come down on short
notice to give evidence. He did not, at that
stage, indicate that there would be any
application made to review the decision of the
trustee to seek the issue of a summons or for
a registrar to issue a summons. I had a
conversation during our exchange earlier - I
asked the - when you mentioned that there was
a judicial review of the decision to issue the
summons being sought, I ask whether that was
an application under the Administrative
Decisions Review Act. You indicated that it
was an application that was being made under
the Bankruptcy Act.

It would seem that your instructing solicitor
visited the registry with an application in
the form of an application under the
Administrative Decisions Judicial Review Act.
a Federal Court Judge has not stayed this
examination under section 81. It is open to
you; you said that you intended to see a Judge
at 3 o'clock; that is a matter for you or
those instructing to see a Federal Court
Judge, and I would certainly abide by any
order that the Federal Court Judge saw fit to
make.

However, until such times as a Federal Court
Judge does make an order, the examination will
proceed, and, Mr Toner, would you call the
witness?

There was further exchanges between Mr Einfeld and the Registrar before Mr Johns was called and sworn. The Registrar then informed Mr Einfeld that there was nothing to prevent him or the solicitor instructing him from leaving in order to see a Judge of the Court at any time. Mr Howard then pointed out that before giving the decision that Mr Johns was to be examined he had read the Reasons advanced to the Deputy Registrar when he (the Deputy Registrar) exercised his discretion to issue the s.81 summons. He had offered to make those reasons and the reasons for the issue of the first summons available to Mr Einfeld. The transcript then shows:

MR EINFELD: Yes, but do you know whether Mr Johns has ever
seen these things?

THE REGISTRAR: That is a matter, Mr Einfeld, that you should
discuss with your client. Your client is no
stranger to the bankruptcy jurisdiction, and
no doubt, those instructing you are no
strangers. I am unaware that the Bankruptcy
Act has been available for a long time for
those who wish to peruse the - excuse me for a
moment - to peruse the matters touching on
section 81, and the matters that need be
presented to a Registrar to obtain the issue
of a summons under section 81; and indeed, you
referred to the Csiedi case where Lockhart J
looked very closely at the issue of section 81
summonses.

MR EINFELD: But Mr Registrar, this very document (ie the
Reasons for Examination) is not the basis for
the issue of a summons. This document says it
is desired to restore the examination, "having
sighted the previous summons of 11 September,
it is desired to restore the examination of Mr
Johns to the list for 13 November and to
examine him further in relation to matters".
That is not the basis for the issue of a
summons at all.

THE REGISTRAR: The registrar is relying on the original
application that was made, together with the
further reasons for it to be restored.

MR EINFELD: But it has not been restored. A new one has
been issued, quite falsely.

THE REGISTRAR: How do you suggest, Mr Einfeld, that the
matter should have been brought back and what
should have been served on your client?

MR EINFELD: The - he should have been notified that it was
desired to - that the registrar had been
advised - had been asked - to restore the
previous summons to the list. The registrar
has never been asked to issue ---

THE REGISTRAR: Mr Einfeld, what would be the effect of that
if your client said, "Well, I don't wish to
attend"?

MR EINFELD: Well, he would be subject, no doubt, to the
penalties.

THE REGISTRAR: But what is the penalty for failing to
acknowledge a letter from a solicitor asking
you to attend at court for an adjourned
hearing?

MR EINFELD: I am not going to give judicial advice from
the bar table, but the ---

THE REGISTRAR: I do not expect you to, Mr Einfeld.

MR EINFELD: But the fact is, sir, that this is not the
reason - there is no reason set out in here,
no request, for the issue of the current
summons. The current summons has been
invalidly issued.

THE REGISTRAR: Well, that is a matter, Mr Einfeld, that you
can canvass before a Judge at the time that
you say that you intend to canvass it.

MR EINFELD: But you do not have any jurisdiction to even
deal with this matter, because this summons
has not been issued on these reasons at all.
What these reasons do is ask to restore the
previous examination to the list. This does -
says nothing whatever about that.

THE REGISTRAR: The summons that has been issued to your
client, Mr Einfeld, requires him to present
himself at 10 o'clock on Wednesday, 13
November, to give evidence in connection with
his business - in connection with your
knowledge of the business, property, and
affairs of the bankrupt, etcetera, and you
state that that is identical terms with the
summons that was issued against your client in
1984.

MR EINFELD: Yes.

THE REGISTRAR: What, then, is his objection to giving
evidence that is called for under section 81,
whether it was under the original summons that
issued or pursuant to the summons that is
issued now?

It will be seen from the Reasons for Examination dated 24 October 1985 which were lodged by Mr Chippindall with the Court on 25 October 1985 and which have been set out earlier herein, that the introductory paragraph of those reasons requested the issue of a further summons under s.81 directed to Mr Johns. Apparently this opening paragraph had not been read by Mr Einfeld at the time of the above exchanges between the Registrar and himself during the afternoon of 13 November 1985.

20. No questions were asked of Mr Johns that afternoon as the Registrar was informed before any questioning commenced that an appointment had been made with a Federal Court Judge almost immediately and accordingly the matter was stood down pending further advice from the Court. Subsequently, shortly after 4.00pm the matter was formally stood over generally by the Registrar.

21. Shortly before 4.00 pm on 13 November 1985 the Court, as presently constituted, in chambers, abridged time for service of documents in the application for review making that application returnable before the Court at 9.30am on 14 November 1985.

22. The application for review after setting out allegations that the second summons was issued by the third named respondent and that the second respondent proposes to hear and conduct the examination pursuant to that summons then sets out the fact that an earlier summons had been issued and that subsequent thereto Mr Johns by his attorney had appeared before a Deputy Registrar in bankruptcy and "supplied the information and documentation sought in the summons and at a later date the first respondent (the Trustee) attended on a number of occasions at the office of Mr Johns and inspected, took notes from, took photostat copies of accounts, documents and other writings and files supplied by Mr Johns, and that since the above occurrence for a period of almost 12 months no further requests for information, documents or other matters in relation to these files have been made by the Trustee to Mr Johns".

23. The application in paragraph 4 of the so-called grounds of the application, then states:

4. The existing summons is unnecessary, oppressive,
vexacious and unfair.

The application then proceeds to claim that the applicant will be aggrieved if the Registrar conducts the proposed examination, the grounds therefor being shown as:

The applicant has not had the opportunity to review, inspect
and study the files, accounts and documentation upon which it
is proposed to conduct the examination for at least 12
months. In the case of some matters and in many other
matters it is some years since he had dealt with the matters
which will be the subject of the examination...

Mr Einfeld has argued that the summons dated 5 November 1985 should be set aside for the following reasons:

1. The summons is invalid because there was no compliance with
r.129; that is, no Reasons for Examination had been supplied
by the Trustee nor a copy served on Mr Johns..

2. In the circumstances of this case it was unreasonable to use
the power of a s.81 summons for a public examination without
giving the applicant the opportunity of knowing in advance
details of the particulars of the matters about which he was
to be interrogated.

3. The Trustee had not asked for a fresh summons to issue but
had requested the restoration of the first summons to the
list in accordance with r.33 and the issue by the Deputy
Registrar of the 5 November summons apparently on his own
motion was accordingly invalid.

4. The summons is vexatious and oppressive because it is
identical (apart from its date and its return date) to an
earlier extant summons dated 31 August 1985 directed to the
applicant which had been stood over, by consent of Mr Johns'
solicitor, generally on 11 September 1984.

The Court rejects the first submission.

24. Rule 129(1) reads:

An application to the Court or to the Registrar for a summons
under sub-section 50(2) or 81(1) of the Act shall set out the
grounds on which the application is made and, except where
the application is made by the trustee of the bankrupt to
whom the application relates, shall be accompanied by an
affidavit setting out the facts relied on by the applicant in
support of his application.

I am satisfied that there had been compliance with r.129 by the Trustee before the issue by the Registrar of the second summons, the grounds being those in the document dated 24 October 1985 together with the earlier reasons dated 11 April 1985 and 29 July 1984.

25. Further, a breach of r.129 that does not necessarily occur if a person to whom a s.81 summons is addressed does not receive a copy of those grounds before the examination. Lockhart J in Re Abrahams (Federal Court of Australia, 23 April 1985) stated (@ p 9):

(P)rima facie those who are to be examined should not have
access to the statement of the liquidator or the trustee
given to the Court or the Registrar stating why it is that
they are proposed to be examined or on what matters it is
proposed to examine them.

See also In Re Rolls Razor Ltd (No 2) (1970) 1 Ch 576 @ 595.

26. In the present matter, reasons for the summons were placed in the file and were therefore available for inspection by any person who looked at the file. There is no requirement, and in fact there are often compelling reasons that such grounds should not be known to the person to be examined. This has led to a practice within the Registry of placing a document setting out such grounds in a sealed envelope, not to be opened without the permission of the Registrar or the Court. For some reason this was not done in this case, so that if Mr Johns (or those representing him) had looked at the file he would have been able to peruse those reasons.

27. In support of his second submission, Mr Einfeld submitted that this case was analagous to Re Csidei (1979) 28 ALR 381. Lockhart J there set aside a summons issued to the liquidator of a company which had had property transactions with the bankrupt. At page 388 His Honour said:

Each case must be determined on its merits. Sometimes
written or oral questions ought to be submitted to the
proposed examinee before application is made under s.81, and
the court or registrar informed why such procedure has proved
inadequate or unsuccessful. At other times not.

It is clear from that decision, that an important consideration in the exercise of the Court's discretion to set aside that particular summons was the fact that the liquidator was not personally interested in the winding up of the company nor had the liquidator failed to assist the trustee in his inquiries.

28. But here the bankrupt's Statement of Affairs discloses the firm of Malcolm Johns and Co, Solicitors, as a creditor in the sum of $43,000.00 (est). This in my view is a relevant and material consideration in determining whether it would have been reasonable in the circumstances for written interrogatories to have been first submitted to Mr Johns (cf re Abrahams cited earlier). In my view having considered all the circumstances disclosed in the file in this matter the Registrar, in the exercise of his discretion, might readily have determined that written interrogatories were inappropriate.

29. The present application as filed claims that subsequent to the first summons and before the issue of the second summons, inspection of documents at Malcolm Johns & Co. relevant to the bankrupt had taken place. Mr Toner for the Trustee, indicated to the Court that he had in fact attended such inspection and his recollection was that this had occurred in March 1984, that is before the issue of the first summons. Mr Einfeld stated that his instructions were that the inspection had occurred subsequent to the hearing of 11 September 1984 at which Mr Castles produced the three folders, the contents of which have been referred to earlier herein.

30. Paragraph 4 of the Reasons for Examination dated 24 October 1985, set out earlier herein, is ambiguous in this regard. But paragragh 7 of the Reasons for Examination dated 29 July 1984 leading up to the issue of the first summons shows that certain records of Malcolm Johns & Co. had been produced to the Trustee and examined by him prior to July 1984.

31. The Court expresses no view as to whether there was an inspection of documents at Malcolm Johns' office after 11 September 1984 and before 24 October 1985. But it is clear that the Trustee wished to interrogate the applicant in respect to certain matters following the production of the documents in September 1984 by Mr Castles.

32. As stated above the subject reasons for examination are such that the trustee is entitled to have Mr Johns give oral testimony rather than answer written interrogatories from the Trustee. For these reasons I reject the applicant's second argument.

33. As to the third submission by Mr Einfeld, it is clear that the Trustee in his Reasons for Examination dated 24 October 1985, had asked for the issue of a further summons directed to Mr Johns and that in those Reasons he had also asked that the examination of Mr Johns be restored to the list.

34. It is felt that any suggested inconsistency in the requests set out in those Reasons for Examination may be the result of an apparent practice that has developed in the Registry when s.81 examinations, which have been stood over generally or to a specific date, are to be relisted before the Registrar. The Court believes that it is usual in such circumstances that reasons be requested by the Registrar from the Trustee and that a further summons is issued in identical terms to that which had already been called on earlier and stood over either generally or to a date to be fixed. In this regard it is of interest to note the exchange between Mr Howard and Mr Einfeld during the afternoon of 13 November set out earlier herein relative to the obligation of the witness to attend before the Registrar on the restored date without being served with a summons. The Court expresses no view as to whether the powers given to the Registrar pursuant to s.264A and s.264B of the Act in dealing with a person who fails to attend before the Registrar on a restored date of a summons under s.81, which had previously been stood over generally, if in fact no fresh summons is issued and served. It may well be that if a witness whose summons had previously been stood over generally receives a letter from the solicitor for the Trustee informing him that his examination had been restored for hearing at some specified future date and he fails on that date to attend that he does not "fail to appear and report himself from day to day" as that expression is used in sub-section (1) of s.264A and s.264B. But the Court draws attention to this problem and suggests that the position be clarified either by an amendment to r.33 or to the relevant sections of the Act or both.

35. Clearly this third submission must be rejected.

36. This then leaves for consideration Mr Einfeld's final submission, namely that the issue of a second summons in identical terms is vexacious and an abuse of the Court's process. As I understand his submissions in this regard, Mr Einfeld is endeavouring to equate the issue of an identical summons for the attendance of a witness to give evidence and/or to produce documents before the Registrar in Bankruptcy to the issue of identical originating processes in a Court, where the Courts have repeatedly said such a procedure amounted to an abuse of the Court process.

37. It is clear that a second summons might be served on a person to produce documents in addition to documents set out in an earlier summons which is then extant. The Court as presently constituted, can see nothing misleading in issuing a second summons in identical terms to an earlier summons but returnable on a subsequent date as was done here. Mr Einfeld's complaint in this regard is that the first examination having been stood over and later restored for hearing on the same date on which a second identical summons is made returnable the person to whom the two summonses are directed would not know which summons he had to obey. This to me is a nonsense. If he attends on that date his obligations are the same under either summons.

38. Accordingly, the applicant's fourth submission is rejected.

39. During argument the Court asked Mr Einfeld was it hoped that if he were successful in having the second summons set aside and if the first summons was restored for hearing before the Registrar at some future date, the applicant, through his representative, would then argue that the first summons was for some reason invalid with the object of preventing his client being interrogated. Mr Einfeld's answer is set out.

MR EINFELD: No, your Honour, no. No. We have already
responded to summons number one and are
prepared to respond to it again. That is not
the issue. And I proceed on the basis that
summons number one was issued legitimately and
as a proper exercise of the Registrar's
powers. It is summons number two that we are
concerned about ...

After further submissions from Mr Einfeld, the Court asked both Counsel if there was any reason why the first summons should not be simply restored under r.33. Both Mr Einfeld and Mr Toner agreed that there was no mystery about that and that it could be restored before another Registrar.

40. At the conclusion of all submissions the Court, even though it then had a firm view that the application for review should be dismissed and indicated that it would reserve its decision as it wished to further consider a certain point raised in argument. Being of that view the Court informed the parties that the Court would not be offended if, whilst the Court was considering the matter, the first summons which was then extant was restored and the interrogation of Mr Johns proceeded with if the parties so desired.

41. Shortly after reserving the present application for consideration, the file in the matter was subpoened for production before another court in Sydney before which certain lengthy committal proceedings were being heard. It is notorious that Mr Anderson was to be called as a witness in those committal proceedings. As the Court then was unable to have access to the file, perusal of the many documents which have been referred to in these reasons for judgment was not possible. The file has recently been returned from that other Court.

42. Accordingly, for the reasons expressed, the application for review must be dismissed with costs. Orders accordingly.