Glencore International AG v Selwyn Mines Limited [2005] FCA 801

Procedural Posture

Application for Preliminary Discovery Under Order 15 a R 6 of the Federal Court Rules / Reasons for Judgment Before Final Form of Preliminary Discovery and Costs Orders

Legal Issues

1. 1 ['Whether Order 15A r 6 permitted preliminary discovery where the applicant sought information about whether a judgment would be enforceable or sought discovery from a person other than the person from whom relief might be obtained.' "Whether there was reasonable cause to believe that Glencore had or may have a right to obtain relief from BankWest for being knowingly concerned in Selwyn's alleged misleading or deceptive conduct." 'Whether there was reasonable cause to believe that Glencore had or may have a right to obtain relief from BankWest for knowing receipt of trust property or knowing involvement in breach of trust based on an alleged Quistclose trust.' 'Whether there was reasonable cause to believe that Glencore had or may have a right to obtain relief from BankWest for inducing breach of the Glencore Finance Agreement.' 'Whether preliminary discovery should be ordered against the Selwyn companies when Glencore did not intend to sue them for recovery but sought information relevant to possible claims against BankWest and the directors.' 'Whether there was reasonable cause to believe that Glencore had or may have claims against Messrs Howe, Hogan, North and Daneel.']

Ratio Decidendi

Glencore established reasonable cause to believe it may have claims against BankWest only in limited respects concerning BankWest's knowledge of clause 2 of the Glencore Finance Agreement, the condition of consent, and the movement of the US$8 million advance and A$6.9 million escrow amount, and against the individual directors in the respects identified; however, Order 15A r 6 did not permit Glencore to obtain preliminary discovery from the Selwyn companies merely to assist possible claims against BankWest or the directors, and there was no reasonable basis for the alleged Quistclose trust claim against BankWest.

Court Disposition

Application for preliminary discovery allowed in part in reasons; proceeding listed for the making of orders, including costs.

Orders

• ['The proceeding be listed on 22 June 2005 for the purpose of the making of orders including orders as to costs.' 'The parties attempt to agree on the orders, including orders as to costs, to be made, and in default of agreement, they submit to the Associate of Lindgren J by 21 June 2005 the forms of orders,...