Federal Court of Australia

Mentha v Australian Securities and Investments Commission [2023] FCA 667

ORDERS

THE COURT ORDERS THAT:

1.    The second respondent’s interlocutory application dated 29 May 2023 (the Application) is dismissed.

2.    The second respondent pay the applicants’ costs of the Application.

3.    If the applicants seek any costs order against the first respondent, or if the first respondent seeks its costs of the Application, they are to notify the other parties by 4:00pm on Friday, 23 June 2023. If there is any dispute as to costs, the parties are to file and serve submissions of no more than three pages on costs by 4:00pm on Friday, 30 June 2023, following which costs will be determined on the papers.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

BUTTON J:

1    The Second Respondent (Atradius) has brought an interlocutory application seeking suppression orders under s 37AF of the Federal Court of Australia Act 1976 (Cth) (the FC Act) over certain information in a bundle produced by the first respondent (ASIC) in the proceeding brought by the Applicants (the Liquidators). The Liquidators seek judicial review of ASIC’s decision to grant Atradius “eligible applicant” status allowing it to conduct examinations under ss 596A and 596B of the Corporations Act 2001 (Cth) (the Corporations Act).

2    It is necessary to outline some factual background in order to put the issues that arise in the present application in context.

3    The Liquidators are the liquidators of the remaining companies within the Arrium Group, which earlier comprised Arrium Ltd and 93 of its subsidiaries. The Arrium Group carried on a large integrated mining and metals business. The group entered voluntary administration in April 2016. The applicants were previously administrators of companies in the Arrium Group. The administration was one of the largest, if not the largest, such administration in Australia’s corporate history. On 4 November 2016, the creditors of the relevant companies voted in favour of deeds of company arrangement being entered into (the DOCAs). The Arrium Distribution Fund was established pursuant to the DOCAs. By mid-2020, all but nine of the Arrium Group companies had been sold or deregistered, with the remaining nine in liquidation.

4    A more detailed, although still concise, summary of the Arrium Group, its administration and financial arrangements, is set out in the judgment of Black J in In the matter of ACN 004 410 833 Ltd (formerly Arrium Ltd) (in liq) [2023] NSWSC 461 (the NSW judgment). While Atradius has filed a notice of intention to appeal in respect of the NSW judgment, Black J’s reasons nevertheless provide a useful summary.

5    As Black J set out, a subset of subsidiaries in the Arrium Group were known as the Moly-Cop entities. They operated a business providing consumables to mining companies. Many of the grievances pursued by Atradius relate to the way in which the then-administrators dealt with the Moly-Cop entities and a group of financiers, which ultimately resulted in the group of financiers receiving a significantly higher return than other creditors: 70 cents in the dollar as against 24 cents in the dollar.

6    Atradius is a trade credit insurer and, in April 2022, took an assignment of debt from one of its insured trade creditors. On 11 April 2022, Atradius applied to ASIC to be authorised as an eligible applicant for the purposes of Div 1 of Pt 5.9 of the Corporations Act (the April 2022 letter). Atradius’s application was granted by ASIC by letter on 7 June 2022.

7    On 1 August 2022, Atradius commenced proceedings in the Supreme Court of New South Wales by an Originating Process, which attached (as a schedule) its proposed statement of claim (the 2022 SOC). The Originating Process was not served straight away; rather, Atradius sought an extension of time in which to serve the Originating Process. That application was ultimately heard with the Liquidators and some of the group of financiers appearing. They had, amongst other documents, the 2022 SOC and a supporting affidavit of Atradius’ solicitor in support of the application for an extension of time in which to serve the Originating Process. The 2022 SOC raises a number of points previously raised in a Statement of Claim filed in this Court in December 2017 by a creditor, Epic Energy South Australia Pty Ltd (Epic), but not determined. Epic had been appointed to represent the interests of approximately 4,000 general creditors in an application brought by the then-deed administrators of the former Arrium Group, some of whom are now the Liquidators in the current proceeding.

8    On 1 November 2022, Atradius applied to the Supreme Court of New South Wales for the issue of examination summonses and orders for production pursuant to ss 596A and 596B of the Corporations Act. The proposed examinees included the Liquidators and Leon Zwier of Arnold Bloch Leibler who, along with Elyse Hilton, act for the Liquidators in this proceeding. Mr Zwier also acts for a number of other proposed examinees. No summonses for examination have yet been issued. Although not entirely clear, it appears that the issue of summonses has been deferred pending the outcome of the proposed appeal of the NSW judgment, and this proceeding.

9    The Liquidators have stated that, if examination summonses are issued, they will apply to have them set aside. Atradius refused to provide a copy of the affidavit filed in support of the application for the issue of examination summonses to the Liquidators, relying on s 596C of the Corporations Act. Section 596C(2) provides that the affidavit filed in support of an application for a summons under s 596B is “not available for inspection except so far as the Court orders”. The affidavit in support of the summonses annexed a copy of the April 2022 letter, but I was not otherwise provided with any information as to the contents of the affidavit. As I will come to, s 596C and the affidavit filed in support of the examination summonses, assume importance in the present application.

10    In early April 2023, the Liquidators initiated proceedings in this Court seeking judicial review of ASIC’s decision to authorise Atradius as an eligible applicant for the purposes of Div 1 of Pt 5.9 of the Corporations Act in relation to AC Distribution Company Pty Limited (formerly known as The Arrium Creditor Distribution Company Pty Limited and SSX Pty Limited) (subject to a Deed of Company Arrangement) (ACN 082 181 726) (the Company). As articulated in the originating application, the Liquidators contend that ASIC’s decision involved one or more errors of law, that ASIC improperly exercised its power by failing to take relevant matters into account when making the decision, and that ASIC’s decision was so unreasonable that no decision maker acting reasonably could have made that decision. For the most part, the grounds advanced by the Liquidators come back to two propositions: first, that Atradius was not a creditor of the Company, or any Arrium Administration Group company; and secondly, that Atradius lacked standing to bring proceedings on behalf of interested creditors.

11    For a time, it appeared that a discovery dispute was looming, but the parties agreed consent orders pursuant to which ASIC was to serve on Atradius a bundle of documents comprising the documents relied on, or considered by, ASIC’s delegate in making the impugned decision, and documents recording the decision or the reasons for it. Pursuant to the consent orders, it was agreed and ordered that Atradius would have an opportunity to bring an application under Pt VAA of the FC Act before the bundle was to be provided to the Liquidators.

12    As it happens, a copy of the bundle, with redactions made by Atradius, has been provided to the Liquidators pending determination of Atradius’s interlocutory application. By that application, Atradius seeks an order pursuant to s 37AF(1) of the FC Act that certain information in the bundle of documents “be made confidential and be prohibited from disclosure to any person except” the judge and relevant court staff, the first respondent and the second respondent and legal practitioners retained by those parties (other than any practitioner who is a member or employee of Arnold Bloch Leibler) until further order.

13    Atradius seeks an order under s 37AF on the basis that it is “necessary to prevent prejudice to the proper administration of justice”, being a ground on which such an order can be made: s 37AG(1)(a).

14    If made, the immediate effect of the order sought is that the Liquidators will not receive an unredacted copy of the bundle.

15    While Atradius’s application initially sought the suppression of three categories of information, the application was narrowed so that only the “category 2” information was in issue. Category 2 information was said by Atradius to comprise information describing topics for the examination of specific individuals, including the Liquidators and Mr Zwier. There is no need for me to determine any dispute about categories 1 and 3, so I will say no more about them.

16    The bundle of documents produced by ASIC comprises the April 2022 letter (and its voluminous schedules), correspondence between ASIC and Atradius’ solicitors and attachments, internal ASIC email correspondence, internal ASIC memoranda and ASIC’s letter to Atradius dated 7 June 2022.

17    The Liquidators opposed Atradius’s application. ASIC did not oppose the application.

The parties’ submissions

Atradius

18    Atradius contended that, if the suppression orders in respect of the category 2 information are not made, the proper administration of justice would be prejudiced on three bases.

19    First, Atradius contended the proper administration of justice would be prejudiced because the proposed examinees would know in advance the topics of proposed examination. It was submitted that this may prejudice the ability of the examiner to have examinees answer questions “frankly and unaided”.

20    In answer to the contention that, given that Atradius’s grievances have been publicly ventilated over many years, potential examinees would in any event know the topics on which they were likely to be examined, Atradius relied on the decision of Markovic J in Lombe, in the matter of Babcock and Brown Ltd (in liq) [2022] FCA 957 (Lombe) in which her Honour was not persuaded that the fact that the subject matters of examination may already be known was significant in whether an affidavit in support of an examination summons should be made available. Her Honour stated (at [73]):

In any event, that Mr Riik believes that he knows the subject matter of the examinations is not to the point. He may well be generally aware of the broad topic to be canvassed but it is unlikely that he will know the detail of the intended examinations and the course they may take.

21    The second basis on which Atradius contended that the proper administration of justice would be prejudiced was that, unless the orders sought are made, a document which forms an annexure to the affidavit in support of the examination summonses — viz, the April 2022 letter — would be made available to potential examinees when it would otherwise not be available due to s 596C(2) of the Corporations Act and (relevantly) rr 11.3(4), (4A) and (7) of the Supreme Court (Corporations) Rules 1999 (NSW) (the NSW Rules). This was said to be prejudicial to the administration of justice as it would pre-empt the determination of any application made in the Supreme Court of New South Wales for access to the affidavit, and would encourage potential examinees to bring judicial review proceedings challenging eligible applicant status so as to obtain, by discovery in judicial review proceedings, documents which would not ordinarily be available to potential examinees.

22    As I have noted above, s 596C(2) provides that the affidavit filed in support of an application for an examination summons under s 596B “is not available for inspection except so far as the Court orders”. Section 596C only applies to examinations sought under s 596B, and not s 596A.

23    Rules 11.3(4), (4A) and (7) of the NSW Rules provide that the originating or interlocutory process seeking an examination summons, and the supporting affidavit, must be filed in a sealed envelope (and marked ‘Confidential’ if filed electronically) and the supporting affidavit must not be made available for inspection by any person unless the Court otherwise orders.

24    The policy underlying the regime by which such supporting affidavits are not (absent contrary order) available to an examinee is that, in the usual course, faced with an examination summons, examinees should not be put on notice of the intended content of the examination: Accord Pacific Holdings Pty Ltd v Accord Pacific Land Pty Ltd (in liq) [2011] NSWSC 707 (Accord Pacific) at [103] (Ward J, as her Honour then was).

25    The third basis upon which Atradius contended the orders should be made is that the information over which confidentiality is sought is immaterial to the determination of the Liquidators’ judicial review application.

26    Atradius also raised, by analogy, that confidentiality orders are routinely made in respect of information detailing potential claims identified by liquidators and liquidators’ funding arrangements. Atradius referred to Kogan, in the matter of Rogulj Enterprises Pty Ltd (in liq) [2021] FCA 856 at [31]ff (Cheeseman J).

ASIC

27    ASIC’s submissions generally emphasised the importance and benefit of detailed information and candour in the applications made by persons seeking authorisation as eligible applicants, which candour and detail it apprehends may be discouraged if confidentiality is not maintained.

28    It also referred to s 127(1) of the Australian Securities and Investments Commission Act 2001 (Cth) (the ASIC Act) which, broadly, requires ASIC to take all reasonable measures to protect information given to it in confidence in connection with the performance of its functions, or the exercise of its powers, or that is “protected information”, from unauthorised use or disclosure. Section 127(9) defines “protected information” to mean information disclosed or obtained, or a document given or produced, for the purposes of a function in s 12A and relating to the affairs of, inter alia, a body corporate regulated by ASIC. ASIC accepted, however, that s 127 is a provision of a kind that is common in legislation governing the activities of Commonwealth agencies, which protects the confidentiality of information provided to the agency, and is not a provision that directly affects the disposition of the present application.

29    ASIC also referred to the circumstances in which affidavits will be disclosed under s 596C of the Corporations Act (referring to the decision of Anderson J in Secatore, in the matter of Last Lap Pty Ltd (in liq) (2020) 144 ACSR 648; [2020] FCA 627 (Last Lap)), and submitted that similar issues bear on determinations about access to information before ASIC in an application for eligible applicant status.

30    ASIC finally submitted that the unredacted material is sufficient to permit the Liquidators to address the grounds of judicial review advanced.

The Liquidators

31    The Liquidators described the gravamen of the complaint advanced by the judicial review application as follows:

Atradius was at no stage a creditor of the Arrium Administration Group and has no reasonable prospects of having the Liquidators pay $1.024 billion, being a portion of the amount distributed to creditors under the now effectuated DOCAs. Put shortly, the Liquidators say that the granting of eligible applicant status to Atradius by ASIC was not within the proper purposes of the Corporations Act.

32    The Liquidators pointed out that, without having conducted any examinations, Atradius commenced substantive proceedings in the Supreme Court of New South Wales against the Liquidators and the group of financiers seeking payment from them of $1.024 billion and that, pursuant to the NSW judgment, Atradius’s proceedings have been dismissed (although Atradius has filed a notice of intention to appeal). The Liquidators point to the dismissal judgment of Black J including a finding that Atradius is not, and never was, a creditor of the Arrium Administration Group.

33    On substantive issues concerning the s 37AF application, the Liquidators submitted that “[i]t is plain from the context of the redactions that the descriptions of the topics must be at the highest level”, contending that Atradius’s concerns are well known and have been ventilated in public over many years.

34    Insofar as Atradius’s submissions contended that the redacted information was not material to the Liquidators’ judicial review application, the Liquidators submitted that the question of relevance was not to the point. In that regard, the Liquidators stressed that, as the authorities made clear, no balancing exercise is involved; rather, the question is binary and the Court is required to determine whether suppression is necessary to prevent prejudice to the proper administration of justice, or not.

35    The Liquidators reiterated their submission that immateriality does not satisfy the statutory criterion, but also submitted that the information is material to their claim for judicial review. That submission was advanced on the basis that ASIC concluded that “[t]he purpose of the proposed examinations appears to be for the benefit of the Company and/or its creditors” and relied on the questions to be asked of prospective examinees in coming to that conclusion. On that basis, the Liquidators contended that the redactions amount to removing part of the foundation for ASIC’s conclusion and strip from the Liquidators the ability to properly assess ASIC’s decision.

36    Addressing the submission arising from s 596C of the Corporations Act and r 11.3 of NSW Rules, the Liquidators submitted that those provisions do not create a substantive right to confidentiality of information provided to ASIC to justify the grant of eligible applicant status. Rather, they restrict access to the affidavit filed in support of the summons for examination and also only except insofar as the Court orders. The Liquidators have stated they will seek to set aside any summons for examination issued against them, and consider they have good prospects of obtaining access to the supporting affidavit in advancing a case that the putative summonses should be set aside.

37    The Liquidators also note that, where an application for the issue of a summons for examination is made by someone other than a liquidator, r 11.3(5) of the NSW Rules provides that the liquidator is to be given notice of the application and, if required by the liquidator, served with a copy of the supporting affidavit. The Liquidators further noted that, while the matters that may lead to an affidavit that would otherwise be confidential pursuant to s 596C being made available include the adequacy of disclosure, those issues do not arise on the present application as no summonses for examination have been issued. In the Liquidators’ submission, s 596C does not provide a shield when no summonses have been issued and no application for access to the supporting affidavit has been made.

Consideration

Legal principles

38    Atradius accepted that it bears the onus of satisfying the Court that the orders it seeks pursuant to s 37AF of the FC Act are necessary to prevent prejudice to the proper administration of justice.

39    Section 37AF of the FC Act provides that the Court has power to make a “suppression order or non‑publication order on grounds permitted by this Part”. The permitted grounds are set out in s 37AG:

(1)    The Court may make a suppression order or non‑publication order on one or more of the following grounds:

(a)     the order is necessary to prevent prejudice to the proper administration of justice;

(b)     the order is necessary to prevent prejudice to the interests of the Commonwealth or a State or Territory in relation to national or international security;

(c)     the order is necessary to protect the safety of any person;

(d)     the order is necessary to avoid causing undue distress or embarrassment to a party to or witness in a criminal proceeding involving an offence of a sexual nature (including an act of indecency).

(2)     A suppression order or non‑publication order must specify the ground or grounds on which the order is made.

40     While the parties cited different cases in their submissions, it was not in dispute that:

(a)    the orders sought can only be made if “necessary” to avoid prejudice to the proper administration of justice;

(b)    “necessary” is a strong word;

(c)    the determination of whether the orders sought should be made turns on whether they are necessary for the stated reason, and does not involve a balancing exercise, nor is the exercise of discretion involved; and

(d)    the Court must take into account that a primary objective of the administration of justice is to safeguard the public interest in open justice (s 37AE).

41    The applicable principles are considered in further depth in cases including: Hogan v Australian Crime Commission (2010) 240 CLR 651 (Hogan) at [30]–[31] (French CJ, Gummow, Hayne, Heydon and Kiefel JJ); Sister Marie Brigid Arthur (Litigation Representative) v Northern Territory of Australia (No 2) [2020] FCA 215 at [9] (Murphy J); Motorola Solutions Inc v Hytera Communications Corporation Ltd (No 2) [2018] FCA 17 at [6] (Perram J); In-N-Out Burgers, Inc v Hashtag Burgers Pty Ltd (2020) 377 ALR 166; [2020] FCA 193 at [361] (Katzmann J) and the cases cited therein; Country Care Group Pty Ltd v Commonwealth Director of Public Prosecutions (No 2) (2020) 275 FCR 377 at [9] (Allsop CJ, Wigney and Abraham JJ).

42    As the High Court observed in Hogan (at [30]) (referring to the point made by Bowen CJ in Australian Broadcasting Commission v Parish (1980) 29 ALR 228 (Parish)), “the collocation of necessity to prevent prejudice to the administration of justice and necessity to prevent prejudice to the security of the Commonwealth ‘suggests Parliament was not dealing with trivialities’”. In Parish (at 234), Bowen CJ observed that “[i]t is not possible to define in advance the degree of prejudice to the administration of justice, which will justify the making of an order under s 50 [which was the predecessor provision]”. Nevertheless, his Honour considered that where a failure to make a suppression or non-publication order would lead to the “destruction of the very subject-matter of the suit”, the refusal to make the order may well (inter alia) “defeat the purpose of achieving justice between the parties”: Parish at 234. Where a failure to make a suppression or non-publication order would tend to undermine public confidence in the administration of justice, and public access to justice, an order of that kind may be necessary to prevent prejudice to the proper administration of justice: see, eg, Porter v Australian Broadcasting Corporation [2021] FCA 863 at [84]–[85] (Jagot J, as her Honour then was); Lee v Deputy Commissioner of Taxation [2023] FCAFC 22 at [90]–[91] (Thawley, Stewart and Abraham JJ). A suppression order will not be made where it is merely convenient, reasonable, sensible, or serves some broader notion of the public interest: Hogan at [31].

43    In Rinehart v Welker (2011) 93 NSWLR 311, Bathurst CJ and McColl JA addressed the concept of the administration of justice as follows (at 39, emphasis added):

The concept of the administration of justice is multifaceted. We doubt whether a single statement can capture the connotation it carries in a range of contexts. As Young JA has said (at [86]) as used in s 50 of the Federal Court of Australia Act, “[i]t is … a reference to … the public interest that the court should endeavour to achieve effectively the object for which it was appointed: to do justice between the parties”: Australian Broadcasting Commission v Parish at 133 (Bowen CJ).

44    The authorities to which I have referred above support, in my view, a construction of s 37AG(1)(a) that requires a litigant seeking a suppression or non-publication order to identify a matter of real substance; the “proper administration of justice” will not be prejudiced by a minor or trivial departure from usual court processes, or something that may result in an advantage that is so minor or incidental that it would not tend to undermine public confidence in the fairness of the court’s processes (cf conferring an advantage that may be characterised as “unfair”).

The first basis of prejudice to the proper administration of justice: disclosing topics for examination

45    While all cast as “category 2” information by Atradius, the information which it seeks to suppress — which I have inspected in unredacted form — actually comprises the following:

(a)    an observation about a report and access to it (April 2022 letter at [4.21.3]) which is substantively reproduced already in unredacted form elsewhere in the bundle in an ASIC memorandum (page 728–9 of the bundle);

(b)    a statement of the issues on which the proposed examinations would focus (April 2022 letter at [8]);

(c)    very short, high level statements in the April 2022 letter of the topics certain proposed examinees would be asked about (most of which comprise four bullet points, which in many instances are identical to one another);

(d)    isolated comments in the April 2022 letter by Atradius on the importance of certain events or documents;

(e)    a statement in the April 2022 letter of the sums Atradius considered may be recovered; and

(f)    repetition of the above, mostly in paraphrased form, in internal ASIC documents.

46    This is an unusual case as the matters of concern to Atradius have been publicly ventilated over a number of years, including through the statement of claim advanced by a creditor, Epic (which Atradius did not dispute was its privy), in 2017. Even the 2022 SOC alone records Atradius’s case concerning:

(a)    the nature and effect of guarantees executed by particular Arrium Group entities (including how those guarantees pertained to debts owed to the group of financiers under certain facilities and which Moly-Cop entities had given guarantees of one kind, but not another);

(b)    the extent to which certain Moly-Cop entities were liable to meet claims of the group of financiers;

(c)    the value of the Moly-Cop business and entities;

(d)    the application made in October 2016 to this Court for an order under s 447A of the Corporations Act permitting a single aggregated report to creditors pursuant to s 439A (and related directions pursuant to s 447D);

(e)    what occurred at the second creditors’ meeting when the DOCAs were approved;

(f)    the sale of the shares in the Moly-Cop entities;

(g)    breaches of duty said to arise from the entry into a Standstill Agreement with the group of financiers under which the financiers would be paid the proceeds realised on the sale of the Moly-Cop entities;

(h)    entry into an Override Deed in September 2016 without the general body of creditors being informed (which also directed the proceeds of the sale of Moly-Cop entities to the group of financers and not the general body of creditors);

(i)    whether, in making the application to this Court in October 2016, proper disclosure was made to the Court concerning a long list of matters;

(j)    a long list of matters which Atradius contends should have been, but were not, disclosed in the s 439A report; and

(k)    specified divergences between the DOCAs and the proposals presented to creditors under the s 439A report.

47    In the course of argument, counsel for Atradius accepted that the issues on which it would seek to challenge the transactions about which it complains “are, in broad measure, the issues about which it wishes to examine the examinees. Of course they are.” While Atradius accepted as much, it also submitted, relying on Lombe, that “knowing what was canvassed before Black J and what was decided by his Honour [does not bring] with it knowledge of all that was disclosed to ASIC about each examinee and potential examinee and what that examinee might be asked about”.

48    Counsel for Atradius also, quite properly, acknowledged in submissions that there was nothing substantively new in the information it sought be suppressed, but maintained that the information in question ought to be suppressed as it provides further detail. The submission was put as follows:

There’s nothing that I could point to that would say this is, of itself, a great new point or secret. It is assembled in a different way. There is some material which goes into further detail than that which has been canvassed so far.

49    The most detailed statement of the issues of concern about which potential examinees may be asked is found at [8] of the April 2022 letter. During the hearing, Atradius was invited to identify any elements of what is found in that paragraph that have not already been publicly ventilated. Counsel for Atradius identified the following matters:

(a)    while the topics raised at [8.6.1] and [8.6.2] had been raised, the specific questions posed about the topics had not been put that way publicly before (as concerns the first two sentences of [8.6.2]);

(b)    while the general issue referred to at [8.6.3] had been raised, the April 2022 letter says more about how the issue might be deployed and put;

(c)    while the proposition raised at [8.6.4] had been ventilated, the specific query signified by the first two words of that paragraph had not been asked as the occasion had not arisen;

(d)    while the subject matters raised at [8.6.6] had been raised, the specific question posed at the end of that paragraph had not been asked and there was room for some doubt about the answer; and

(e)    while the subject matters raised at [8.6.7] had been raised, the first word of the paragraph was very important.

50    No other matters not previously raised were identified. Counsel also acknowledged that the specific questions raised at [8.6.8] were obvious and accepted that [8.6.9] did not identify a topic for examination as such.

51    In acknowledging that all the topics in question were matters that had formed the subject of Atradius’s publicly ventilated complaints and concerns, Atradius maintained that:

So this is, in my respectful submission, a classic situation of the kind described in Lombe’s case where yes, you may know in general terms a broad topic, but you don’t know the particular questions that might be asked of you. Now, I don’t pretend that that material in the letter amounts to a proposed examination question list, but it’s more particular than just the topic and it does inquire into matters which have not been fully canvassed because the occasion didn’t arise before Black J.

52    In my view, Atradius’s reliance on Lombe was misplaced. Insofar as the information in question refers to topics about which potential examinees may be asked, they are stated at such a high level of generality that they do not reveal any more detailed approach to any examination on those topics than is revealed by the statement of the topics themselves which, as Atradius accepted, have already been publicly ventilated. They lack the detail to which Markovic J referred in Lombe (at [73]).

53    As such, I do not accept that failing to suppress the topics for examination of potential examinees will result in prejudice to the proper administration of justice in this particular case. Failing to suppress the information will not, in my view, confer any advantage on the proposed examinees that would tend to undermine public confidence in the proper administration of justice. The topics identified in respect of specific proposed examinees are stated at a high level of generality, and raise topics that are already well known to be of concern to Atradius. While I am prepared to accept that, in some instances, a particular issue has been cast in a certain way, or a question is posed about a well ventilated issue, the topics themselves constitute the central point of enquiry and I do not consider that the questions posed about them reveal anything that would result in the proposed examinations, should they ever occur, being compromised by the potential examinees being forewarned to a materially greater extent than they already are.

54    Atradius’s concern about forewarning examinees of proposed lines of questioning has no logical application to the matters referred to above at paragraph 45 and no other basis on which the proper administration of justice might be prejudiced was raised.

55    For these reasons, it is not necessary to suppress the information in question in order to avoid prejudice to the proper administration of justice by the proposed examinations being compromised.

The second basis of prejudice to the proper administration of justice: access to an otherwise confidential affidavit

56    I am not persuaded that the orders sought by Atradius are necessary on the basis that, unless those orders are made, the proper administration of justice will be prejudiced because:

(a)    section 596C of the Corporations Act (and r 11.3 of the NSW Rules) will be circumvented; and/or

(b)    the outcome of any future application made in the Supreme Court of New South Wales for access to the supporting affidavit will be pre-empted.

That is so for the following reasons.

57    First, the supporting affidavit will not be disclosed by refusing to make the suppression order sought. True it is that the Liquidators, and their solicitor, Mr Zwier (also a proposed examinee), will have an unredacted copy of the April 2022 letter, but that is only one exhibit to the supporting affidavit. Access to that letter does not reveal the entirety of the supporting affidavit. Atradius did not suggest, or put on evidence to the effect, that the supporting affidavit did not go materially beyond the content of the April 2022 letter. Accordingly, I do not accept that refusing to suppress the information in question will render nugatory, or pre-judge, the outcome of any application that may subsequently be made for access to the supporting affidavit.

58    Secondly, no examination summonses have yet been issued. While Black J made it clear his Honour was not called upon to determine the matter, Black J noted (NSW judgment at [235]) that no evidence had been led on whether some matters had been disclosed to the Registrar, and that potential non-disclosure was a matter that is relevant to the Registrar’s decision whether or not to issue the summonses. Even if the summonses are issued, the Liquidators have stated (by their solicitor’s affidavit) that they will apply to set them aside. Access to the supporting affidavit will likely be sought in that context. The authorities on when a supporting affidavit will be released were discussed by Anderson J in Last Lap at [70]–[77]; see also Accord Pacific at [44] (Ward J, as her Honour then was) referring to the judgment of Barrett J in O’Brien v Wily (2009) 76 NSWLR 428 at [27]. For present purposes, it suffices to note that access may be granted (or granted with restrictions on inspection) where access to the affidavit will likely assist in determining the correctness of a challenge to the issue of a summons, and where the challenge is based on an arguable case that is made out on other material.

59    It is obviously not for me to venture into how any such application would be determined by the Supreme Court of New South Wales. The relevant point for the purposes of this application is that it is far from a foregone conclusion that the April 2022 letter would (if the suppression orders are made) remain confidential, and my determination of the present application cannot rest on an assumed outcome of hypothetical events in Atradius’s favour. Should the matter ever arise, the Supreme Court of New South Wales will assess an application for access having regard to the circumstances as they are at that time.

60    While the question of whether a suppression order is necessary to prevent prejudice to the proper administration of justice may take account of possibilities (and is not restricted to addressing certainties), in my view, the wholly hypothetical nature of the prejudice to which Atradius points tends against the proposition that the suppression order is necessary.

61    Atradius submitted that, if no summonses are ever issued, the affidavit will necessarily remain confidential (as there would be no occasion for an application to be made for access to the supporting affidavit). It contended that failure to suppress the information would still be prejudicial to the proper administration of justice as it may apply again for the issue of other summonses, or some other party may apply for the issuing of summonses for examination and use the same lawyers. These scenarios are far too remote to support the submission for which they were advanced.

62    Thirdly, this asserted basis for contending the proper administration of justice would be prejudiced cannot be considered in isolation from the first ground. As I have set out above, here, the information sought to be suppressed has already been substantively revealed. In that respect, this is a highly unusual case.

63    In a run of the mill case, it is unlikely that information about the topics for examination will already have been so thoroughly ventilated in public. While Atradius submitted that refusing the suppression order would encourage potential examinees to bring judicial review applications (as the Liquidators have done), and obtain otherwise confidential documents by discovery, I do not consider that this case will set any kind of precedent encouraging that course. The merits of a suppression order in any future case will need to be assessed based on the facts of that case which, it may be anticipated, would not ordinarily involve the fulsome ventilation of issues that has already occurred in this case.

Final matters

64    As the parties accepted that the outcome of this application did not turn on whether the information sought to be suppressed was relevant to the Liquidators’ judicial review application, I will not address the parties’ submissions on that point, save to note that the Liquidators’ grounds of judicial review (at least at this stage) focus on points other than the topics raised for examination of potential examinees.

65    Finally, while ASIC’s submissions fairly highlight the utility and importance of candour on the part of those applying to be authorised as an eligible applicant for the purposes of Div 1 of Pt 5.9 of the Corporations Act, as I have observed, this is an unusual case given the long history of public ventilation of the issues of concern to Atradius.

Conclusion

66    Atradius’s application will be dismissed. The Liquidators are entitled to a costs order against Atradius.

67    As ASIC took only a mildly supportive stance in relation to Atradius’s application (and made submissions only on the systemic issues of concern to it), my preliminary view is that it should not be liable to meet any portion of the Liquidators’ costs, but also ought not have a costs order in its favour. I will, however, give the parties an opportunity to make submissions if they consider an alternate disposition is warranted on these points.

Associate:

Dated:    20 June 2023