FEDERAL COURT OF AUSTRALIA
QUD 473 of 2019
Date of judgment:
McGrath & Anor; Re HIH Insurance Ltd & Ors  NSWSC 731
Tramountana Armadora SA v Atlantic Shipping Co SA  2 All ER 870
Date of last submissions:
5 August 2019
National Practice Area:
Commercial and Corporations
Corporations and Corporate Insolvency
Number of paragraphs:
Solicitor for the Plaintiffs:
King & Wood Mallesons
QUEENSLAND NICKEL PTY LTD (IN LIQUIDATION) ACN 009 842 068
DATE OF ORDER:
THE COURT ORDERS THAT:
(a) the First Plaintiff and his and the Second Plaintiff’s legal representative;
(b) John Richard Park, Kelly-Anne Lavina Trenfield and Quentin James Olde and their legal representatives; and
(c) all necessary staff of the Court including any associate, any orderly and any Court recording officer.
2. Until further order, the Parbery Affidavit, and the Plaintiffs’ written outline of submissions, be placed in an envelope on the file and sealed, and not be made available for inspection and not be filed electronically.
3. Until the delivery of judgment or the filing of a notice of discontinuance in Supreme Court of Queensland proceeding 6593/2017 or further order (whichever is the earlier), the Court’s reasons for judgment in this application not be published.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
1 These proceedings are concerned with a primary application and a secondary application.
2 The primary application is an application by Mr Stephen James Parbery in his capacity as Special Purpose Liquidator of Queensland Nickel Pty Ltd (in liquidation) (the “company”), and the company itself, as the second plaintiff, for orders under ss 477(2A), 477(2B) and 479(3) and s 90-20, Schedule 2 of the Corporations Act 2001 (Cth), authorising Mr Parbery to enter into particular arrangements relating to the commercial affairs and administration of the company and approving the compromise of particular claims of the company.
3 The secondary application concerns an application for an order that the court be closed to the public during the hearing of the primary application and that Mr Parbery’s affidavit in support, and submissions of counsel, be suppressed until the court otherwise orders.
4 There are good reasons for doing so for the moment.
5 These reasons are concerned only with explaining why it was necessary to do so.
6 First, in the primary application, the court is asked to give directions to the liquidator which are concerned with settling particular claims of only the Special Purpose Liquidator. Those claims are part of a proceeding in the Supreme Court of Queensland (“Supreme Court”) in which the General Purpose Liquidators (“GPLs”) of the company are also pursuing a range of claims. That proceeding is presently on foot and is being heard before Mullins J. The settlement of the claims of the Special Purpose Liquidator, as proposed, leaves the GPLs free to pursue their various claims. Nevertheless, the circumstance that the proceeding before the Supreme Court is a consolidated hearing of multiple claims brought by Mr Parbery and the GPLs needs to be kept in mind because steps taken publicly in an application by Mr Parbery in this Court might have consequences for the prosecution of claims by the GPLs in the present proceeding.
7 Second, the material referred to in Mr Parbery’s affidavit in support of the primary application includes privileged advice and assessments of the strengths or otherwise of relevant matters and that material goes not only to the claims of the Special Purpose Liquidator to be settled but also has a relationship with other claims presently being pursued by the GPLs.
8 Third, if the proposed settlement and compromise were not to proceed, (that is, were not to be approved on the hearing of the primary application), it would be inappropriate that matters reflected in the affidavit of Mr Parbery and submissions of counsel be made public and become publicly available before the Supreme Court currently hearing the various claims.
9 It would be inappropriate for the public and the court to become aware of the terms of the deed the subject of the application to this Court for approval. Queen’s Counsel for Mr Parbery correctly observe that it would, in effect, amount to the other court becoming aware of “without prejudice” dealings in relation to a pending claim. The proposition that such other court might become aware of such matters has been described as “wholly improper”: Tramountana Armadora SA v Atlantic Shipping Co SA  2 All ER 870 at 876.
10 Fourth, these applications are very often made ex parte.
11 In the present case the GPLs have been notified of the application. The GPLs have said that they do not intend to appear on the hearing of the primary application by Mr Parbery. Had the GPLs sought to appear, they may well have wanted to ventilate matters which would touch upon sensitive confidential matters relating to their claims before the Supreme Court and any aspect of any relationship between those claims and the claims of Mr Parbery. However, that concern did not emerge having regarding to the position adopted by the GPLs.
12 Fifth, aspects of the proposed compromise need to be implemented over time and it is desirable to ensure the confidentiality of critical commercial matters relating to the implementation of the terms of the proposed compromise.
13 Sixth, the interests of justice are best served by enabling the Special Purpose Liquidator to put all of the material before this Court in a way which would fully and frankly enable Mr Parbery to seek the necessary approvals and directions without any apprehension that the interests which the Special Purpose Liquidator is bound to serve might be prejudiced. In similar circumstances, that was a view adopted by Barrett J in McGrath & Anor; Re HIH Insurance Ltd & Ors  NSWSC 731 at ; see also Jones, Saker, Weaver and Stewart (liquidators); in the matter of Great Southern Ltd (in liq) (Receivers and Managers Appointed)  FCA 1072 at .
14 Accordingly, the court today ordered that the court be closed to the public for the hearing of the primary application and that the transcript, the affidavit of Mr Parbery and the submissions of counsel be suppressed until other order.