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Ansell Limited & Ors v Davies & Ors [ 2008] HCATrans 373  (13 November 2008)

Last Updated: 17 November 2008

 [2008] HCATrans 373 

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Adelaide No A19 of 2008

B e t w e e n -

ANSELL LIMITED AND ATIV PAC PTY LTD AND BONDS INDUSTRIES PTY LTD AND DEXBOY INTERNATIONAL PTY LTD AND UNION KNITTING MILLS PTY LTD AND SHERIDAN AUSTRALIA PTY LTD AND CLARKS SHOES PTY LTD AND SONY AUSTRALIA LTD AND AUSTRALIAN WEAVING MILLS PTY LTD AND SONY COMPUTER ENTERTAINMENT (AUST) PTY LTD AND ADIDAS AUSTRALIA PTY LTD AND CHARLES PARSONS & CO PTY LTD AND CHARLES PARSONS VIC PTY LIMITED AND RAPEE PTY LIMITED AND SAMSUNG ELECTRONICS AUSTRALIA PTY LTD

Applicants

and

SAMUEL CHARLES DAVIES AND COLIN MCINTOSH NICOL (IN THEIR CAPACITY AS LIQUIDATORS OF HARRIS SCARFE LIMITED) (RECEIVERS & MANAGERS APPOINTED) (IN LIQUIDATION) & HARRIS SCARFE WHOLESALE PTY LTD (RECEIVERS & MANAGERS APPOINTED) (IN LIQUIDATION) AND GORDON SMITH MARKETING PTY LTD

Respondents

Application for special leave to appeal

FRENCH CJ
HAYNE J

TRANSCRIPT OF PROCEEDINGS

AT ADELAIDE ON THURSDAY, 13 NOVEMBER 2008, AT 10.05 AM

Copyright in the High Court of Australia

__________________

MR M.C.J. HOFFMANN, QC: If the Court pleases, I appear with my learned friend, MR E.W. WOODWARD, for the 1st to 6th named applicants (instructed by Madsen Rowley), for the 7th to 8th named applicants (instructed by Cowell Clark Commercial Lawyers), for the 11th named applicants (instructed by Clayton Utz), for the 12th to 14th named applicants (instructed by Minter Ellison), for the 15th named applicant (instructed by Farrar Lawyers) and I appear alone for the 9th and 10th named applicants (instructed by Allens Arthur Robinson)

MR P.A. McNAMARA, QC: May it please the Court, I appear with my learned friend, MR T.W. COX, for the 1st and 2nd named respondents, the respondent liquidators. (instructed by DMAW Lawyers)

FRENCH CJ: Yes, Mr Hoffman.

MR HOFFMANN: Thank you, your Honours. Your Honours, the application for special leave in this matter arises in the context of section 588FF of the Corporations Act, which itself is part of Part 5.7B of the Act, an aspect of corporations life and insolvency in this country that arises in the courts throughout the country every day. Specifically, your Honours, section 588FF(3) arises for consideration on the proposed appeal and its interaction with the rules of court in South Australia. But the issue that arises, arises in my submission under the rules in each State throughout the country, and indeed, federally.

Your Honours, this Court has considered the interaction of section 588FF(3) with the rules in Tolcher’s Case. It is found in that case, firstly, the commencement of an application under 588FF(1) is of the essence of the provision within - - -

HAYNE J: Tolcher never went to judgment, did it?

MR HOFFMANN: I am sorry, your Honour?

HAYNE J: Tolcher never went to judgment?

MR HOFFMANN: No, your Honour. Time is of the essence of the right to bring proceedings for relief specified in section 588FF(1), firstly. Secondly, there is a concept of an application built into section 588FF, both in subsection (1) and in subsection (3). But, your Honours, what is an application, how it might be governed and litigated, is a matter not dealt with in the Act, which is not surprising, it is dealt with by the rules. Your Honours, the court in Tolcher’s Case made it quite clear that one commences an application, but thereafter it is dealt with in accordance with the rules of a particular state which are picked up by force of section 79.

Your Honours, there is, in my submission, a clear inconsistency between intermediate appellate courts as to how that interaction between the Act and rules is to operate and whether, indeed, the rules would operate in accordance with their terms. The decision of the Full Court, subject of this application, in my submission, raises yet further inconsistency and uncertainty in that the gravamen of the Full Court’s decision by reason that the appeal was dismissed the primary judge has upheld is that it is not necessary in an application brought by a liquidator to seek an extension of time under section 588FF(3)(b) to join creditors or other parties against whom one may be considering proceedings under subsection (1) to that application.

Now, your Honours, in effect the Full Court’s decision has some unexplained process that will be conducted apparently at the option of the liquidator because the court does find that joinder is possible, but not necessary. So that there would be some form of unique process whereby creditors would have a right to be heard, but would be non-parties in what ultimately, your Honours, would be ordinary inter partes litigation as the learned Chief Justice contemplates.

HAYNE J: Well, we start with the Act, 588FF in (1) is directed to “the application of a . . . liquidator . . . that a transaction” – presumably an identified transaction – “is voidable”.

MR HOFFMANN: Yes, your Honour.

HAYNE J: We are concerned then with 588FF(3) with the time limit, an application under (1), that is, an application in respect of an identified transaction may only be made relevantly (b) “within such longer period as the Court orders on an application” during the paragraph (a) period.

MR HOFFMANN: Yes, your Honour.

HAYNE J: Now is it the position, following the decision of the Court of Appeal of New South Wales that a practice has developed of making these orders, in effect, in gross giving an extension to a liquidator to bring applications unspecified in respect of unidentified transactions of the company?

MR HOFFMANN: Your Honour, I do not know that I can say that it is a practice, but there are numerous examples of the situation arising.

HAYNE J: Is that what happened here?

MR HOFFMANN: Yes, your Honour, and that is what happened in Greig v Stramit and that is what happened in - - -

HAYNE J: Yes, but the root question is whether that order – the order permitting an extension of time without reference to an identified transaction of the company which it is sought to impugn under 588FF(1) is authorised by the Act?

MR HOFFMANN: Yes, your Honour.

HAYNE J: Where do we get to the question of intersection with the rule?

MR HOFFMANN: Because an application of that sort made ex parte against an “unidentified creditor” has been in this case, as it was in the other cases, Brown and Greig, set aside applying the rules of natural justice Cameron v Cole. One then confronts the position where there is no order of general application targeting the specific creditor.

HAYNE J: But if the order is infirm because it is not authorised by the Act you are not in the realm of natural justice. There has been no order properly made extending time, end of question. Whereas, if the order is properly made extending time, and that is the contrary contention against you, where then does that take us?

MR HOFFMANN: Well, your Honour, my submission on that is that properly construed section 588FF(3)(b) does not authorise a general or shelf order of the sort made in this case, or indeed, in other cases. I acknowledge, of course, that there is - - -

HAYNE J: But it seemed to me you either stand or fall on that point. If you do not get that point home – and I am not saying you can or cannot, I just do not know – but if you cannot get that point home is there another string to the bow?

MR HOFFMANN: There is another string to my bow, your Honour, and the proposition is that properly construed section 588FF is concerned with applications against particular persons or persons in contemplation and consistency of construction.

HAYNE J: It is about particular transactions, yes.

MR HOFFMANN: Yes, because one starts with a transaction defined in the Act which weaves its way through to relief under 588FF(1) against a person. It is all talking about specific process and in my submission there is nothing in 588FF(3)(b) in its context in that section that in terms dictates that it be construed as authorising general or shelf orders as a matter of construction by reference to subsection (1). It ought be construed as requiring an application for an extension against specific persons or parties.

Your Honour, the second string to my bow if I might call it that – hopefully I have one – is that when one makes a general or shelf order and the order is set aside the issues that have arisen in the various intermediate appellate courts, your Honours, is what is the position so far as the liquidator seeking an order pursuant to the application commenced within the three-year period against a specific or identified creditor at that time. In this particular case there is a series of preference actions. The order has been set aside against the creditors. The liquidator now seeks to target specifically these creditors and obtain an extension of time against them for the purpose of thereafter pursuing relief under 588FF(1).

The interaction with the rules arises by reason of that very proposition because in the submission of the applicants on any view the order and relief that is sought has more than a possibility of affecting the rights and interests of these applicant creditors; so much is accepted by the Chief Justice in his reasons. Your Honours will know that there is a raft of authority – indeed in this Court – to the effect that in most circumstances joinder is required. Joinder, in my submission, brings into play the interaction of 588FF(3)(b) with the rules of court. Now, in this case, your Honours, the court took the view that rule 28.05 as it stands now, albeit the rules have been replaced, one must accept, the same issue arises. But it did not operate so as to in any way stipulate or dictate that on joinder of the applicant creditors the application is deemed to commence against them on and from the date of service, which is the terms of rule 28.05, and therefore the matter is out of time.

Now, your Honours, the inconsistency, if I might just identify that, is on this question, aside from construction, where really that issue of the interaction of subsections (1) and (3) has not, in my respectful submission, been clearly grappled with in any of the authorities. But inconsistency arises on the question of joinder because in Queensland the majority of the Court of Appeal found that joinder was essential, that joinder was futile in circumstances where by force of section 81 of the Queensland Act the commencement was deemed to be after the expiration of the three-year period. In New South Wales in Brown’s Case in essence joinder is accepted as being required, albeit it must be said that the question of the requirement of joinder was not squarely before the Appeal Court.

Now in South Australia in light of this decision there is a real question as to whether joinder is required at all, by reason of this alternate non-party process that the Full Court has endorsed, which is a concept that the primary judge brought to bear without any description, with all due respect, as to the jurisdictional basis, nor the powers that would be exercised in doing that. Next, your Honours, the area of consistency is whether or not joinder is futile. In Queensland, as I said, the position is, yes, it is by force of their equivalent, section 81. In New South Wales, on the face of it, no, it is not. In South Australia, the alternate basis of the Full Court’s analysis, no, it is not. Your Honours - - -

HAYNE J: I think the point – if we were to take this case and we have yet to hear your opponent – but if we were to take this case the point that you would have then to grapple with is whether these discordances between intermediate courts turn upon questions about the rules or turn upon the more fundamental issue presented by the construction of 588FF, because at least as at present I understand the matter it seems to me that your central ground of appeal is at page 46 of the application book, or 45 to 46, in ground 6. Although that is cast in terms of where the Full Court went wrong, which seems to implicate Marlborough Gold questions, which are distracting, if you have a point it seems to me there is the point.

MR HOFFMANN: I agree, your Honour.

HAYNE J: I see you have given 78Bs, is it your side that gave the 78Bs?

MR HOFFMANN: Yes, your Honour.

HAYNE J: It seemed to me that again you do not get to those issues, at least it is not yet clear to me how you get to those issues, if you are right in this basic point.

MR HOFFMANN: Your Honours - - -

FRENCH CJ: It will require a recasting, would it not, if one were to look at, for example, 6? The simple proposition in 6 is – forgetting reference to other cases – simply that the Full Court erred to the extent that they held that general shelf orders are admissible.

MR HOFFMANN: Yes, your Honours, and at page - - -

FRENCH CJ: That would be a very simple straightforward – well, not straightforward – but a simply expressed ground.

MR HOFFMANN: Yes, your Honours. Your Honours, it is a matter of, in my submission, general importance because underlying all of this is a legislative policy that was acknowledged in Tolcher’s Case which is these things to be commenced within three years, the Harmer Report brought back the time limit from six to three, and these general orders do have the real propensity to have creditors on risk for years without knowing. Your Honours, I just should point out at page 33 of the application book, paragraph 51 of the Full Court’s reasons, that the topic of shelf orders was in fact addressed, albeit it is described as being implicit from the earlier reasoning founded on Brown’s Case. But, in my submission, the issue squarely arises from the reasons, and squarely arises from the submissions put to the Full Court, and is an important question of construction of section 588FF.

HAYNE J: Was there any application for leave in Brown’s Case? I could not find it.

MR HOFFMANN: No, I could not either. There is an editorial note in the New South Wales report to the effect that an application had been made, but there is no reference to it ever having been before the court that certainly our researchers could find.

HAYNE J: I could not find it in the archive drive.

MR HOFFMANN: Your Honours, on just the second string, acknowledging that it may not be the best, is this interaction between the rules and the section. But combined with that is this concept of no requirement for joinder and, your Honours, that is a most unusual to say the least procedure that the Chief Justice contemplates at pages 34 to 35 of the application book, paragraphs 58 and 59. The Chief Justice speaking for the court accepts “that the interests of a creditor . . . are affected”. But he then goes on to find, “It does not follow that the creditor must be joined” without
addressing any of the long line of authorities about circumstances in which a joinder is required and appropriate. But what your Honours - - -

FRENCH CJ: It gives the creditor a right of hearing in opposition.

MR HOFFMANN: Yes, yes, your Honours, but as a non-party.

HAYNE J: But then goes on and says he does not decide the point. I mean again, are we not straying from – if you have a target I do not know whether you yet have – but if you have a target are we not straying from the bullseye?

MR HOFFMANN: Yes, well, I am hearing your Honours and the bullseye is clearly the construction of section 588FF and whether subsection (3)(b) authorises a general or shelf order. It is the submission of the applicants it does not. Properly construed the section authorises only applications against specified and identified parties.

FRENCH CJ: All right, Mr Hoffman, we will hear from Mr McNamara.

MR HOFFMANN: If the Court pleases.

MR McNAMARA: May it please the Court. To employ the language of your Honour Justice Hayne might I remind your Honours of what my learned friend’s target is. His target is formulated very concisely at application book page 51 in his special leave question and there is only one special leave question. Page 51, if it please the Court, top of the page paragraph number [2], and I remind your Honours - - -

HAYNE J: It would not be the first time that a target has been a little redrawn in the course of a leave application, Mr McNamara.

MR McNAMARA: No, of course not, your Honour, but the - - -

FRENCH CJ: We do have the draft matters of appeal.

MR McNAMARA: Yes, of course, your Honour, and your Honours are absolutely right with respect to say that - - -

HAYNE J: But it is not the point about FF and can you make these orders engross a point that, if it exists, is a point on general application and of importance?

MR McNAMARA: Yes, yes, no question, your Honour.

HAYNE J: Is it a point that exists?

MR McNAMARA: Not in this case because no order stands against the applicants. An application stands against them, but to the extent to which the Master had made an order against my learned friends it has been set aside as against them by Justice Debelle. Your Honours have that in paragraph 22 of his Honour’s reasons at page 8 of the application book. That is a very long paragraph, but your Honours will see – perhaps I will go back into the history. His Honour made an order in September 2006 setting aside as against my learned friend’s clients the order for extension that the Master had made. Yes, your Honours, I am sorry, your Honours, it is at page 8, but it is the very last sentence of paragraph 20 at the very top of the page; page 8 of the book, paragraph 20 at the judgment of Justice Debelle, the very last sentence.

The facts are rather complex, if it please the Court, but the structure of the litigation was this. The liquidators made an application for an extension of time with really two barrels. One component dealt with identified creditors, ascertained creditors they were called. They were all joined as defendants and they were served and they were heard.

FRENCH CJ: No controversy about that?

MR McNAMARA: No controversy about them, thank you, your Honour. As to my learned friend’s clients, they were among a larger group of what the liquidators described as unidentified creditors. They were not named as parties, they were not joined, they were not served. Some of them, including my learned friend’s clients complaining of a breach of the rules of natural justice, had the Master’s order by way of extension set aside. Justice Debelle, as your Honours see in paragraph 22 at page 8, referring back to paragraph 50 of his Honour’s reasons of September 2006, set that order aside for the purpose that there would be a rehearing, and that rehearing has not yet occurred. No order, therefore, stands against my learned friend’s clients, and indeed no order might ever be made against them. They might win on the merits of our extension of time application.

It is for that reason that my learned friend’s second target, the one that he does not have in his special leave question but he does have in his grounds of appeal, might never arise against his own clients.

HAYNE J: Can I take you to page 14 of the application book which is the order of Justice Debelle left intact following the Full Court, is that right?

MR McNAMARA: Yes, that is correct, your Honour, thank you.

HAYNE J: What is the application dated 28 March 2004 which is referred to in paragraph 1 of that order?

MR McNAMARA: That is the application under subsection (3)(b), your Honour, for an extension of time. Can I take your Honour back to page 4 of the book, or perhaps your Honour would be assisted I think by going back to page 3, paragraph 6? I think there might be a typing error in the order, I think the reference should have been to 31 March, rather than 28 March.

HAYNE J: Be it so, the application is an application for extension of time initiated against named parties which did not include Ansell and others, is that correct?

MR McNAMARA: That is correct. If your Honour goes over the page to page 4 his Honour – as part of paragraph 7 – has set out the structure of the order and your Honour will - - -

HAYNE J: Justice Debelle’s order and his reasoning proceeds, does it not, from the premise that the application for extension of time is not statute barred?

MR McNAMARA: That is correct because it was made - - -

HAYNE J: That is the application as against Ansell - - -

MR McNAMARA: Indeed.

HAYNE J: - - - is not statute barred. Does that not tender the question directly which is identified in ground 6 of the notice of appeal?

MR McNAMARA: Well, no, it does not, your Honour, because the application was made within time, it was made within the three-year period.

HAYNE J: Well, there was a piece of paper within three years, but not as against Ansell?

MR McNAMARA: Yes, your Honour.

HAYNE J: And it was in the nature of a shelf application, as against Ansell, is that right?

MR McNAMARA: As against. That is correct, your Honour.

HAYNE J: Why is that issue not tendered directly?

MR McNAMARA: Then the special leave question, your Honours, would be, what is meant by making an application for the purposes of subsection (3)(b)?

HAYNE J: Yes, but must it relate to an identified transaction?

MR McNAMARA: Indeed. That would be the special leave question.

HAYNE J: Yes.

MR McNAMARA: But, your Honour, my learned friend has never challenged the application as such. He has never applied to set it aside and from time to time below he has conceded that it is valid. His point is that while it might be valid it cannot be prosecuted. Your Honours have that at page 71, paragraph [17] in my learned friend’s reply. My learned friend’s argument has always been, yes, the application is valid but it cannot be prosecuted because his clients are not before the court as defendants on the record.

HAYNE J: Can I just pursue this one stage further?

MR McNAMARA: Yes, your Honour.

HAYNE J: On page 21 do I find the process in the Full Court of the Supreme Court?

MR McNAMARA: Yes, your Honour.

HAYNE J: At paragraph 6 do I not find there tendered for consideration by the Full Court the issue which it is said would arise in this Court?

MR McNAMARA: Yes, indeed, but on the basis that no order has yet been made and no order may ever be made against my learned friend’s clients.

HAYNE J: He says he goes further than no application has been made. He says no order may be made because the application as against his client is beyond power. It is outside (3)(b).

MR McNAMARA: His argument would have to be reconstructed this way, any order on the application would be beyond power. But, again, that question has not yet arisen because no order stands against my learned friend and may never be made against him because he may win on our extension of time application. I just remind your Honours of this. My learned friend’s high water mark in terms of decisions against that of the Chief Justice in Brown’s Case is Greig v Stramit where two members of the Court of Appeal in Queensland did not say that the statute implied be prohibited blanket ex parte orders. Justices Williams and Jerrard said that as a general rule such orders should not be made. In other words, they did not accept - - -

HAYNE J: A possible point of view is that it is not a question of what the statute prohibits, it is a question of what the statute permits.

MR McNAMARA: Indeed, and what the statute requires, if it please the Court, is an application made by the liquidators within time. In my submission, what is meant by “made” is a matter for State law to regulate in the sense that it is for the court to prescribe what is a sufficient communication to constitute the making of an application and what in form is a valid application. What as a matter of discretion the court later does with that application will depend on the facts but, in my submission this case – I am sorry, I go back to my learned friend’s alternative argument. My friend’s primary argument is that shelf orders are bad.

His secondary argument is that they are bad other than in exceptional circumstances. Because no order has been made against my friend, no findings have been made below as to whether this case might fall inside that exception and so if your Honours were to grant special leave, there would be that practical difficulty that your Honours could not explore the existence of the exception which their Honours Justices Williams and Jerrard in the Court of Appeal of Queensland embraced.

The point is this, your Honours, that your Honours on an appeal would not have the benefit of an express argued disagreement between members of intermediate courts. The point would really come before your Honours de novo. My learned friend raised the point, it is true, before the Full Court but expressly on the footing that he did not need to develop it because interstate cases were against him and he was reserving his better ammunition for this Court.

Your Honours, on the point of principle, we remind your Honours about what the Chief Justice said in Brown’s Case. Can I take your Honours to page 33 of the application book, first of all, and perhaps to take it out of sequence, in paragraph 53 of the judgment of Chief Justice Doyle himself. His Honour notes that “there will be situations in which a liquidator cannot identify” potential respondents within the three year period.

HAYNE J: It is the next statement that is the hinge about which the reasoning turns, that that is a surprising result.

MR McNAMARA: No, your Honour.

HAYNE J: Why?

MR McNAMARA: I am sorry, your Honour. With respect, I should not interrupt.

HAYNE J: No.

MR McNAMARA: Thank you, your Honour. The difficulty, your Honour, is this, that in very economical language the Parliament has laid down a power to extend time which must fit every company that goes into winding-up, the one director, one member, one transaction company, at the other extreme, the HIH, where the liquidator said to the court, “I’ve had to go through 100,000 boxes of documents and index them before I could make up my mind about whom I might sue”.

If it please the Court, courts, particularly in New South Wales and, to a lesser extent, Victoria, have accepted that as a fact of a life, come the third anniversary of the relevant day, there will be some liquidators who cannot identify every possible candidate for an insolvency recovery. Your Honour will remember that section 588FE avoids transactions up to 10 years in the past prior to the winding-up date. So that the period that must be investigated by a liquidator is or may be in a particular case a very long period. Many liquidators, your Honour would know, are confronted with potentially fraudulent transactions that have to be unravelled by a close analysis of documents, not all of which might be in the custody of the liquidator.

So, if it please the Court, our submission is that the scheme of the Act is this, as the Chief Justice said in Brown’s Case the Parliament vests the court with a power to grant a liquidator a single extension for a determinate period. What particular order will be made in particular circumstances is a question for the exercise of the court’s discretion. It is a question of fact and degree as to what is reasonable between the unsecured creditors and the intended defendant. In my submission, with respect, it is not what the Chief Justice said has to be read in that light, but the section has to be made to work in a broad spectrum of cases.

It is a facultative provision. It exists for the benefit of the winding-up. It exists for the benefit of enabling unsecured creditors to recoup assets of the company that have been wrongly paid away. With respect, it is not a surprising result. His Honour Chief Justice Spigelman in paragraph [170] of his own judgement which your Honours have at paragraph 52 of the judgment of the Full Court puts the matter, in my submission, impeccably, that the Court must read (3)(b) flexibly against the
known exigencies of windings-up, given the history of substantial corporate collapses in this country which shows no sign of ending.

If it please the Court, to go back to the starting point, at the moment my friend does not have a special leave question which crystallises around subsection (3)(b). He has a special leave question which attaches to the application. He does not have an order against him. On the hearing of any appeal, the focus would be on the rules of court and primarily the corporations rules which in our State used to pick up our general rules but may not do so any longer. That is not clear. It is also not clear whether the corporations rules in other jurisdictions pick up the general State rules. That is a matter very much for the judges of the Supreme Court.

So that the primary focus, in my submission, of any appeal at the moment in this matter would be the rules of court, not the meaning and effect of subsection (3)(b). So, in my submission, if it please the Court, the application should be refused. Those are my submissions.

FRENCH CJ: Thank you, Mr McNamara. Yes, Mr Hoffmann.

MR HOFFMANN: Your Honours, very briefly. In each of the intermediate appellate court decisions what was before the court was an application for a shelf order. It is no different in this case, the order made pursuant to that shelf order having been set aside. The very issue was raised in ground 6 before the Full Court and it arises, in my submission, on the application before this Court because the very question that arises is an application of the sort identified at page 4 of the application book, one that is valid and authorised by the terms of section 588FF(3) of the Act.

HAYNE J: What order would you seek to have this Court make if leave were to be granted?

MR HOFFMANN: Your Honours, I would seek an order that an application in the terms identified at page 4 is not authorised by section 588FF(3).

FRENCH CJ: Your page 47, I think, sets out the orders that you seek, or would seek?

MR HOFFMANN: Yes.

FRENCH CJ: That is primarily an order that the application for leave to join the appellants as defendants be dismissed. So it goes to the joinder question.

MR HOFFMANN: Yes. I would need to add a further ground of relief dealing with the application in the terms at page 4.

HAYNE J: It seems to me if leave were to go, you would need a wholesale recasting and at least consideration to abbreviation of the notice of appeal and some specific attention to precisely what order the Full Court should have made. Our jurisdiction is to make such order as the Full Court should have made. What order do you say that court should have made in respect of the process that was before it?

MR HOFFMANN: Yes, your Honour. The order that, in my submission, the Full Court should have made was that the application in the terms appearing at page 4 of the application book is not authorised by section 588FF.

FRENCH CJ: Can I just track how it all happened, just to make sure I have the structure correct. Page 4 is the application which was before the Master, is that right, and then considered by Justice Debelle?

MR HOFFMANN: Yes. Your Honour, the history is: 31 March 2004, that application is filed; 14 April 2004, the Master makes an order in terms of that application; 30 September 2005, various 588FF(1) proceedings are filed in the District Court of South Australia; March 2006, proceedings are served on the various applicants before this Court, they being the District Court proceedings; August 2006, application before Justice Debelle to set aside that extension order upon which those proceedings relied specifically pleading the 14 April order; September 2006, Justice Debelle sets that aside; November 2007, relevantly for this application, the liquidators apply to join Ansell and others as defendants in the proceeding; February 2008, that is argued; June 2008, it is before the Full Court on the appeal but - - -

FRENCH CJ: March 2008, Justice Debelle orders that:

The current liquidators are at liberty to have the application herein dated 28 March 2004 listed for hearing –

That is at page 14.

MR HOFFMANN: Yes.

FRENCH CJ: Then it goes off to the Full Court, appeal against that order and that appeal was dismissed.

MR HOFFMANN: That is correct, your Honour.

FRENCH CJ: So the order that was in issue before the Full Court was liberty to have the application for joinder listed for hearing?

MR HOFFMANN: No, the application for an extension of time in terms appearing at page 4 of the application book listed for hearing against the applicants.

FRENCH CJ: The named companies?

MR HOFFMANN: Yes.

HAYNE J: It seems to me that the orders you would have to seek would be that the appeal to the Full Court should have been allowed, the orders of Justice Debelle should have been set aside and in their place there should have been orders that the application against Ansell and the other creditors for whom you appear, whether to join those parties or to seek other relief against those parties, should stand dismissed.

MR HOFFMANN: I entirely agree, your Honour.

HAYNE J: That is usually a safe course but whether it is wise, Mr Hoffmann, is an entirely separate question. Beware of gifts.

MR HOFFMANN: Yes, indeed, your Honour, but I saw one there. If the Court pleases.

FRENCH CJ: Thank you, Mr Hoffmann.

There will be a grant of special leave in this matter. Leave is not formally confined to ground 6, but it will be for the appellants to consider whether they persist in elaboration of the grounds as foreshadowed.

Will this be a one-day case, Mr Hoffmann, Mr McNamara?

MR McNAMARA: Yes, your Honour.

FRENCH CJ: Yes, all right. Set down for one day. Thank you.

We now adjourn to reconstitute. Thank you.

AT 10.46 AM THE MATTER WAS CONCLUDED