In the matter of Strarch International Limited (ACN 004779 677 (In Liquidation) [2005] FCA 829 (17 June 2005)

Last Updated: 22 June 2005

FEDERAL COURT OF AUSTRALIA

In the matter of Strarch International Limited (ACN 004 779 677 (In Liquidation)
[2005] FCA 829

CORPORATIONS – examination summons – directors outside jurisdiction


PRACTICE AND PROCEDURE – whether examination summons is an originating process – service outside jurisdiction


Federal Court Rules – O 8
Corporations Act 2001 (Cth) - s 596A

Fiorentino v Irons (1997) 79 FCR 327 followed
National Australia Bank Limited v Stern [2000] FCA 588 referred to
Re Austral Oil Estates Limited (In Liquidation) (1986) 7 NSWLR 440 referred to

IN THE MATTER OF ROBERT ELLIOTT in the name of and as Liquidator of STRARCH INTERNATIONAL LIMITED (ACN 004 779 677) (IN LIQUIDATION)
NSD 942 of 2005

JACOBSON J
17 JUNE 2005
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 942 of 2005

ROBERT ELLIOTT in the name of and as Liquidator of STRARCH INTERNATIONAL LIMITED (ACN 004 779 677) (IN LIQUIDATION) Plaintiff (IN THE MATTER OF STRARCH INTERNATIONAL LIMITED)

JUDGE:	JACOBSON J
DATE OF ORDER:	17 JUNE 2005
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. That the Court issue Examination Summonses under section 596A of the Corporations Act 2001 to each of:

(a) Yoon Kwai Loh;
(b) Tsi Lip Lai;
(c) Peng Huah Teoh; and,
(d) Hock Keng Tan.

2. That the date and place for the examinations be 10:15 am on 10 and 11 August 2005 at Sydney.
3. That leave be granted, pursuant to Order 8 rule 2(2) of the Federal Court Rules to the Plaintiff to serve the examination summonses outside the Commonwealth, in Malaysia, on:

(a) Yoon Kwai Loh;
(b) Tsi Lip Lai;
(c) Peng Huah Teoh; and,
(d) Hock Keng Tan.

4. That, in lieu of the requirements of Division 3 of Order 8, such service be effected in each case by way of personal service by a private agent of the examination summons accompanied by a translation in the Bahasa Melayu language.

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

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 942 of 2005

ROBERT ELLIOTT in the name of and as Liquidator of STRARCH INTERNATIONAL LIMITED (ACN 004 779 677) (IN LIQUIDATION) Plaintiff (IN THE MATTER OF STRARCH INTERNATIONAL LIMITED)

JUDGE:	JACOBSON J
DATE:	17 JUNE 2005
WHERE MADE:	SYDNEY

REASONS FOR JUDGMENT

1 I have before me this morning an application for the issue of examination summonses under section 596A of the Corporations Act 2001 (Cth) ("the Act") and an application for leave to serve the summonses outside the Commonwealth pursuant to order 8 rule 2 of the Federal Court Rules. The application is to serve the examination summonses in Malaysia.

2 Section 596A provides that the court is to summon a person for examination about a corporation's examinable affairs if an eligible applicant applies and the court is satisfied that the person was an officer during or after the period of two years ending relevantly when the winding-up began.

3 I am satisfied that the plaintiff is an eligible applicant because he is the liquidator of the corporation; see the definition in section 9. I am also satisfied that each of the persons the subject of the application was an officer of the corporation when the winding-up began.

4 Order 8 rule 2(2) of the Federal Court Rules provides that the court may give leave to serve originating process outside the Commonwealth in accordance with division 2 or 3 of order 8 or subject to sub-rule 2B on such terms and conditions as it considers appropriate if the court is satisfied of three matters as follows:-

"(1) That the court has jurisdiction in the proceeding.

(2) That order 8 rule 1 applies to the proceeding.

(3) That the party seeking relief has a prima facie case for the relief sought by the party in the proceeding."

5 I will deal with each of these requirements.

6 First, the court has jurisdiction because it is a "court" under section 58AA of the Act.

7 Second, an examination summons is "originating process" within order 8 rule 1. The different approach which applies in the Supreme Court of New South Wales turns upon the different wording of the rules of that court; see Fiorentino v Irons (1997) 79 FCR 327 ("Fiorentino") at 330-331 (Foster J); cf Re Austral Oil Estates Limited (In Liquidation) (1986) 7 NSWLR 440 at 441 (McLelland J).

8 Foster J’s views in Fiorentino were followed by Einfeld J in National Australia Bank Limited v Stern [2000] FCA 588 at [6].

9 The present case is one for service outside the Commonwealth under order 8 rule 1(k) because the examination summonses affect the persons to be served in respect of their membership or office of the corporation or their conduct as officers of the corporation; see Fiorentino at 329.

10 Third, there is a prima facie case for the relief sought. As Foster J said in Fiorentino at 331 "[t]he relief which is sought is the attendance for examination before the court of the persons named in the originating process". His Honour had no difficulty in finding that a prima facie case for that relief had been made out in the affidavits before him. I, too, have no difficulty in being satisfied on the evidence relied upon in this application.

11 I propose to grant leave "on such terms and conditions as [the court] considers appropriate under order 8 rule 2(2) rather than to grant leave in accordance with division 3".

12 That division would apply because service is to be effected in Malaysia which is a non-Convention country. However, I have evidence before me that Malaysia does not accept documents for service through diplomatic channels. The Attorney General's Department advises that service should be effected by a private agent and that the documents should be accompanied by a translation in the Bahasa Melayu language. The order should give effect to this evidence.

13 I will make orders in accordance with the draft orders handed up by counsel for the plaintiff which I will initial and date.

I certify that the preceding thirteen (13) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jacobson.

Associate:

Dated: 21 June 2005

Counsel for the Applicant:	Mr E T Finnane
Solicitor for the Applicant:	McCabe Terrill
Date of Hearing:	17 June 2005
Date of Judgment:	17 June 2005