Australian Securities and Investments Commission v International Finance Corporation Limited [2004] FCA 689 (28 May 2004)

Last Updated: 28 May 2004

FEDERAL COURT OF AUSTRALIA

Australian Securities and Investments Commission v International Finance Corporation Limited [2004] FCA 689

AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION v INTERNATIONAL FINANCE CORPORATION LIMITED (ACN 102 496 499), ROBIN BRIAN POUMAKO, ANNE-MARIE DONALDSON AND JANICE HEATHER POUMAKO

No S 20 of 2004





FINN J
ADELAIDE
28 MAY 2004

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	S 20 OF 2004

BETWEEN:	AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION PLAINTIFF
AND:	INTERNATIONAL FINANCE CORPORATION LIMITED (ACN 102 496 499) FIRST DEFENDANT ROBIN BRIAN POUMAKO SECOND DEFENDANT ANNE-MARIE DONALDSON THIRD DEFENDANT JANICE HEATHER POUMAKO FOURTH DEFENDANT
JUDGE:	FINN J
DATE OF ORDER:	28 MAY 2004
WHERE MADE:	ADELAIDE

THE COURT ORDERS THAT:

1. No order be made that the defendants produce the documents sought by the plaintiff.









Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	S 20 OF 2004

BETWEEN:	AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION PLAINTIFF
AND:	INTERNATIONAL FINANCE CORPORATION LIMITED (ACN 102 496 499) FIRST DEFENDANT ROBIN BRIAN POUMAKO SECOND DEFENDANT ANNE-MARIE DONALDSON THIRD DEFENDANT JANICE HEATHER POUMAKO FOURTH DEFENDANT

JUDGE:	FINN J
DATE:	28 MAY 2004
PLACE:	ADELAIDE

REASONS FOR JUDGMENT

1 The plaintiff seeks seven categories of document from the defendants pursuant to consent orders made by me on 26 March 2004. The relevant consent orders were orders six and seven. They were in the following terms:

"6. The defendants give to the plaintiff by 31 March 2004 copies of all documents directly or indirectly relating to the source of funds used to meet the financial obligations of and payments made by the First Defendant, the Nightcliff Trust and the XXOX No 1 Trust since 1 January 2004.

7. On and after 29 March 2004, the defendants give to the plaintiff copies of all documents relating to the source of funds used to meet the financial obligations of and payments made by the first defendant, the Nightcliff Trust and the XXOX No 1 Trust within 2 business days of receipt of the funds or the financial obligation being met and/or the payment being made, whichever first occurs."

2 These orders can be read according to their ordinary meaning to include all of the documents sought by the plaintiff. So read, they clearly encompass matter that is likely to be quite unrelated to any matter in issue in this proceeding, the primary purpose of which is to obtain an order winding up the first defendant on the just and equitable ground or alternatively on the ground of insolvency. Relatedly the proceeding seeks declarations that the first defendant has offered securities in contravention of s 727(1) of the Corporations Act 2001 (Cth) ("the Act") and issued securities in contravention of s 727(4) of the Act. Like declarations are sought against the second and third defendants for contravention of s 727(4) of the Act.

3 The plaintiff originally applied for interlocutory relief for the appointment of a provisional liquidator of the first defendant and for various injunctions against all of the defendants. The consent orders were struck as a compromise between the parties at the hearing of the interlocutory application. Mr Stretton, for the plaintiff, has made it quite plain that it was only because of the width of orders six and seven quoted above that the plaintiff agreed not to pursue the interlocutory application. He equally conceded in the hearing before me that ultimately the purpose of those orders was, to use his own language, to enable "a window to be opened" onto the activities of the second, third and fourth defendants. The reason for the plaintiff wishing to have that window is, again as Mr Stretton made plain, the plaintiff’s distrust of the defendants; actions taken by them in December of last year having excited the suspicion of the ASIC that they will continue to act to circumvent the provisions of the Act.

4 The orders sought are opposed by the defendants. While conceding that on their face orders six and seven may have the meaning contended for by the plaintiff, they contend that they should be understood in light of the issues raised in this proceeding and that there is no issue which would justify orders of the amplitude of six and seven when read without regard to the originating process in this matter. In particular they point to the fact that documents sought by the plaintiff relate to two bank accounts, one in the name of the second and fourth defendant, the other under the name of the second defendant’s retirement fund. These are personal accounts of the parties concerned which the second defendant deposes are private accounts having nothing to do with ASIC. Not unnaturally Mr Poumako raised the issue of information privacy.

5 I indicated when hearing this matter that I considered that the form of public protection sought to be secured by the plaintiff could properly be pursued by reviving the application for interlocutory injunctions that had been previously made by it. This course did not commend itself to the ASIC, seemingly because its suspicions (not reflected in any evidence before me) were all related to other, as yet unspecified, possible activities being engaged in by the second, third and fourth defendants.

6 This in fact reveals what I take to be the real purpose of the orders sought. It is in effect to ascertain whether further alleged misconduct has been engaged in. As such it is in the nature of a fishing expedition and it was correctly so characterised by Mr Ross Smith, for the defendants. I consider the use to which those orders are being put in this proceeding is not one which ought to be countenanced. I consider that whatever the ordinary meaning might otherwise suggest those orders should only be understood in the way proposed by the defendants. If necessary I will formally vary the orders to that effect to make this plain. I am unprepared to make the orders sought by the plaintiff in the terms which it proposes. It is a matter for the plaintiff to consider what is the course it wishes to take in light of this including its continued forebearance in prosecuting all or any of the orders sought in the interlocutory application.

I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Finn.

Associate:

Dated: 28 May 2004

Counsel for the Plaintiff:	S Stretton
Counsel for the First, Second, Third and Fourth Defendants:	R Ross Smith
Solicitor for the First, Second, Third and Fourth Defendants:	Duncan Basheer Hannon
Date of Hearing:	27 May 2004
Date of Judgment:	28 May 2004