Aboriginal Corporations, Registrar of v Nurapai Torres Strrait Islanders Corporation [2001] QSC 148

4-112~, 01.11-8. State Reporting Bureau (~ Queensland Government ~ Department of justice and Attorney-Gen,:ral Transcript of Proceedings Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Director, State Reporting Bureau. SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION HELMAN J No S11383 of 1999 NOUREDDINE BOUHAFS, THE REGISTRAR OF ABORIGINAL CORPORATIONS and REVISED COPIES ISSUED State Reporting Bureau Date 31 )f o I Applicant NURAPAI TORRES STRAIT ISLANDERS CORPORATION Respondent BRISBANE .. DATE 23/04/2001 JUDGMENT :lh Floor, The Law Courts, George Street, Brisbane, a. 4000 1 Telephone: (07) 3247 4360 Fax: (07) 3247 5532 -- 1 of 11 -- 23042001 T1/SE25 M/T 1/2001 (Helman J) HIS HONOUR: This is an application by the Aboriginal and Torres Strait Islander Commission and by Ms Glenda Guthrie for orders that summonses for public examination in connexion with the affairs of the Nurapai Torres Strait Islanders Corporation directed to them be set aside or discharged and for other ancillary relief. The Corporation was incorporated as a body corporate under the Aboriginal Councils and Associations Act 1976 on 14 November 1986. It relied predominantly upon funds from the Commission and the Commission's predecessor to meet its principal objects, which were to implement activities which furthered the economic and social development of the Torres Strait Islander people and which were conducive to their advancement, and to assist in providing improved residential accommodation to its members. On 25 January 2000 an order was made in this Court that the Corporation be wound up in insolvency by the Court, on the grounds that the Corporation was unable to pay its debts (s.63(2)(d) of the Aboriginal Councils and Associations Act) and that it was just and equitable that the Corporation be wound up (s.63(2)(h) of the same Act). The respondent to this application, Mr John Ebbage chartered accountant, was appointed liquidator for the purposes of the winding up. On 4 January 2000 Senior Deputy Registrar McNamara, on the application of the respondent, ordered inter alia that summonses be issued to the secretary or proper officer of 2 JUDGMENT l 10 30 so 6( -- 2 of 11 -- 23042001 T1/SE25 M/T 1/2001 (Helman J) the Commission and to Ms Guthrie to attend for examination under s.596B of the Corporations Law before the Magistrates Court at Brisbane on a date to be fixed, and thereafter from day to day until the conclusion of the examination. Mr Colin Kay, regional manager Brisbane region of the Commission, was duly authorized to respond on behalf of the Commission to the former summons, and on 9 April 2001 an affidavit sworn by him was filed in support of this application. Ms Guthrie, now employed as a member of the staff of the Commission as the executive policy officer in the Brisbane regional office but formerly as an acting regional manager and acting field operations manager of the Commission at Thursday Island, has also sworn an affidavit in support of this application. Her affidavit was also filed on 9 April 2001. The summonses were in identical terms, requiring those to whom they were directed to attend before the Magistrates Court at Brisbane at a specified place and time, to be examined .on oath or affirmation "about the examinable affairs" of the Corporation and to produce at the examination documents described in a schedule. The schedule was as follows: SCHEDULE OF DOCUMENTS TO BE PRODUCED FOR THE NURAPAI l 10 20 30 40 TORRES STRAIT ISLANDERS CORPORATION (THE 'CORPORATION') 50 All documents recording attendances at meetings of the Governing Committee, or at any other meetings (including internal discussions) at which the financial position or affairs of the Corporation from time to time was discussed or considered, including diary notes and memoranda, correspondence to or from any third party; 3 JUDGMENT 60 -- 3 of 11 -- 23042001 T1/SE25 M/T 1/2001 (Helman J) Diary entries recording the financial position or affairs of the Corporation from time to time; Reports as to the Corporation's trading history and to its expected trading performance and its ability to pay its debts as and when they became due and payable; Financial documents of the Corporation or documents relating to its affairs including but not limited to receipts, invoices, cheque butts, bank statements, cash books, balance sheets, profit and loss statements and cash flow projections; Documentation concerning grants provided or requested to be provided to the Corporation by the Aboriginal and Torres Strait Islander Commission ('ATSIC'), the Aboriginal Development Commission ('ADC') and the Torres Strait Regional Authority ('TSRA'), including applications for grants and documentation where the financial position or affairs of the Corporation from time to time was made known or considered, including diary notes, memoranda and correspondence and documentation concerning the performance of the Corporation under the various grant conditions; Any documents recording advice provided to the 1 10 Corporation or its officers or members and documents 30 recording your state of knowledge of the Corporation's financial position or affairs from time to time. In Mr Kay's affidavit, he swore that in response to the summons to the Commission he had considered the documents held by the Commission concerning the Corporation and that his examination revealed that the documents held by the Commission relate to, or are in connexion with, grants to the Corporation under the Aboriginal and Torres Strait Islander Commission Act. He also swore that from his own knowledge as a member of the staff of the Commission, and from his examination and consideration of the documents held by the Commission in respect of the Corporation, he verily believed that compliance with the summons directed to the Commission in its present form would necessarily entail a breach by him as a member of the staff of the Commission or 4 JUDGMENT 50 6( -- 4 of 11 -- 23042001 T1/SE25 M/T 1/2001 (Helman J) any other person responding to the summons on behalf of the Commission, of the requirements of s.90 of the Aboriginal and Torres Strait Islander Commission Act. In Ms Guthrie's affidavit she swore that she had no information in respect of the affairs of the Corporation other than as a result of carrying out the duties of her office as the acting regional manager or acting field operations manager at Thursday Island, and that she had no documents in respect of the affairs of the Corporation. She swore also that she verily believed that compliance with the summons directed to her in its present form would necessarily entail a breach by her of the requirements of s.90 of the Aboriginal and Torres Strait Islander Commission Act. Section 90 of the Aboriginal and Torres Strait Islander Commission Act is a secrecy provision which in subs.(1) provides that the section applies to certain persons. Paragraph (d) of that subsection provides that it applies to one who is or has been a member of the staff of the Commission. Sub-ss. (2) to (5) are as follows: l 10 20 30 40 (2) Subject to this section, a person to whom this section applies shall not, either directly or indirectly, except for the purposes of this Act, or of a prosecution for an offence against this 50 Act: (a) make a record of, or divulge or communicate to any person, any information concerning the affairs of another person acquired by the first-mentioned person in the performance of duties in connection with an application for, or the giving of, a loan, grant or guarantee under this Act; or 5 JUDGMENT 60 -- 5 of 11 -- 23042001 T2/JAP22 M/T 1/2001 (Helman J) (b) produce to any person a document relating to the affairs of another person furnished in connection with an application for, or the giving of, a loan, grant or guarantee under this Act. Penalty: Imprisonment for one year. (2A) Despite subsection (2), a person to whom this section applies may: (a) divulge or communicate any information referred to in paragraph (2)(a) to anyone who is authorised in writing by ·the person to whose affairs the information relates to receive the information; and (b) produce a document referred to in paragraph (2)(b) to anyone who is authorised in writing by the person to whose affairs the document relates to receive the document. (3) A person to whom this section applies shall not be required: (a) to divulge or communicate to a court any information referred to in subsection (2); or (b) to produce in a court any document referred to in that subsection; except when it is necessary to do so for the purposes of this Act, or of a prosecution for an offence against this Act. (4) A reference in this section to an offence against this Act includes a reference to an offence created by section 5, 6, 7, 7A, 29C or 29D, or subsection 86(1) of the Crimes Act 1914, being an offence that relates to this Act or the regulations. (5) In this section: Court includes any tribun~l, authority or person having power to require the production of documents or the answering of questions. Produce includes permit access to. This Act includes the regulations. Subs.(3) is the provision primarily relevant to this application. The prohibition provided for in paragraph (a) 6 JUDGMENT 1 10 30 50 6( -- 6 of 11 -- 23042001 T2/JAP22 M/T 1/2001 (Helman J) applies only to information referred to in subs.(2) and the prohibition provided for in paragraph (b) applies only to documents referred to in subs.(2). That information must l then concern the affairs of the third person referred to in 10 subs.(2), and those documents must relate to the affairs of such a third person - the first person being one to whom the section applies by operation of subs.(1) and the second being the person to whom the first must not divulge or communicate the information in question or produce a 20 document of the kind referred to. The third person is the one whose privacy is protected. Subs.(3) then reinforces the prohibitions provided for in subs.(2) by prohibiting any requirement that the first person divulge or communicate to a court any information concerning the affairs of a third person or produce a document relating to the affairs of a third person. A second person cannot then circumvent the prohibition in subs.(2) by invoking the process of a court as defined in subs.(5). On that construction of s.90 a person to whom the section applies is not prohibited from divulging or communicating information concerning the affairs of the second person to that person, and hence there is no prohibition on requiring a person to whom the section applies to divulge or communicate such information on the application of the second person to a court. Similarly, a person to whom the section applies is not prohibited from producing a document relating to the affairs of the second person to that person, and hence there is no prohibition on requiring a person to 7 JUDGMENT 30 40 so 60 -- 7 of 11 -- 23042001 T2/JAP22 M/T 1/2001 (Helman J) whom the section applies to produce such a document on the application of the second person to a court. That construction of sub-ss. (2) and (3) shows them then to be in 1 harmony. 10 A construction which attributes a wider application to subs.(3), i.e. a prohibition on requiring the first person to divulge or communicate to a court information concerning the second person's affairs even on the application of that person, and a corresponding prohibition in relation to documents relating to the affairs of the second person, would appear to be absurd. Why would the legislature enable the second person to receive information or a document concerning that person's own affairs from a person to whom the section applies, and yet prevent the second person's invoking the aid of a court to receive such information or such, a document? Such an anomaly cannot have been intended. Quite apart from the anomaly brought about by a discrepancy between the effect of sub-ss. (2) and (3) there would be the further absurdity of the imposition of a wall of secrecy in court proceedings about dealings between those who had previously dealt with each other. In what I have said to now I have ignored the exceptions provided for in sub-ss. (2) and (3) which exceptions were discussed in submissions before me. I shall not refer to them further since it follows from my view as to the correct construction to be put on sub-ss. (2) and (3) that consideration of the exceptions is unnecessary. It is 8 JUDGMENT 30 40 ~ l 6 -- 8 of 11 -- 23042001 T2/JAP22 M/T 1/2001 (Helman J) therefore unnecessary to consider the authority the respondent has provided under s.90(2A): see exhibit JJE9 to the respondent's affidavit filed on 17 April 2001, and exhibit 1 received on 18 April 2001. It is unnecessary to consider those matters further because the respondent is in the position of the second person referred to in subs.(2). He is in that position because he is the agent of the Corporation but with control of the actions of his principal: see McPherson, The Law of Company Liquidation, 4th ed., L.B.C., Sydney, 1999, pp. 287-288. So far as s.90 applies to the Corporation there is no relevant distinction between it and the respondent although, of course, a distinction may be made in other contexts: McPherson, op.cit., p.332. It follows that s.90 presents no impediment to compliance with the summonses. Another submission was made on behalf of the applicants in support of their claim to relief: that the summonses were oppressive and that their issue constitutes fishing. Under s.596B of the Corporations Law, the Court may summon a person for examination about a corporation's examinable affairs if an eligible applicant applies for the summons and the Court is satisfied that the person may be able to give information about the examinable affairs of the corporation. 9 JUDGMENT l 10 20 30 40 so 60 -- 9 of 11 -- 23042001 T2/JAP22 M/T 1/2001 (Helman J) In s.9 the expression "eligible applicant" in relation to a corporation is defined to include a liquidator of a corporation, and in the same section the expression "examinable affairs" in relation to a corporation is defined to include the management and administration of the corporation, and any other affairs of the corporation, including anything that is included in the corporation's affairs because of s.53. By operation of s.53 the affairs of a body corporate include the transactions and dealings, property, and liabilities, profits and other income, and receipts of the body. The evidence shows that the Commission made grants to the Corporation and that it has lodged a proof of debt in the winding-up in the sum of $1,396,900.00 and has claimed that the Corporation purchased houses using grants made by the Commission or its predecessor and that those houses are held in trust, so that it is reasonable to conclude that the secretary or proper officer of the Commission and Ms Guthrie may be able to give information about the management and administration of the Corporation, as well as its transactions and dealings with the Commission, and the property, liabilities, and income, and receipts of the Corporation. The oral evidence sought is confined to the examinable affairs of the Corporation, and the documents sought all relate to relevant financial affairs of the Corporation. 10 JUDGMENT l 10 30 SC 6 -- 10 of 11 -- 23042001 T2/JAP22 M/T 1/2001 (Helman J) I conclude therefore that there is no merit in either basis advanced for this application, which accordingly will be dismissed. HIS HONOUR: The order for costs will be that the applicants pay to the respondent his costs of and incidental to the application to be agreed, and, if not agreed upon, to be assessed. 1 1 JUDGMENT l 10 20 30 40 50 60 -- 11 of 11 --