In the matter of Iris Diversified Property Pty Ltd (in liquidation) [2019] NSWSC 1593

In the matter of Iris Diversified Property Pty Ltd (in liquidation) [2019] NSWSC 1593

IHG, as the current trustee, does not hold or control legal professional privilege to the exclusion of IDP (the former trustee) in documents created during IDP's trusteeship. Once files were produced to the liquidators pursuant to s 530B Corporations Act, any privilege was not enforceable to prevent their use by the liquidators in conducting examinations. As such, no legitimate ground to set aside the examination summonses or the orders for production on the basis of privilege or alleged misuse was established.

Parties
Plaintiff: The Owners – Strata Plan 84741; First Defendant: Iris Diversified Property Pty Ltd (in liq); Second Defendant: Henry Peter McKenna; First Applicant: Wassim Arnaout; Second Applicant: Rodney Paul Hawkins; Third Applicant: Iris Diversified Investments Pty Ltd; Fourth Applicant: Iris Group Management Pty Ltd; Fifth Applicant: Iris Hotel Business Pty Ltd; Sixth Applicant: Iris Hotel Group Pty Ltd; Seventh Applicant: IDI SPV7 Pty Ltd; Eighth Applicant: Brendan Warren Jones; Respondents: Christopher Palmer and Liam Thomas Bailey as liquidators of Iris Diversified Property Pty Ltd (in liq)
Jurisdiction
Australia
Judgment Date
18 November 2019
Procedural Posture
Interlocutory Application / Ruling on Application to Set Aside Examination Summonses and Production Orders; Application for Extension of Time
Outcome
Applications to set aside examination summonses and production orders dismissed; extension of time to seek to set aside summonses granted; orders for production not set aside in narrowed form.
Legal Topics
Legal Professional Privilege, Winding Up of Corporate Trustee, Public Examination of Directors, Orders for Production, Change of Trustee, Ownership and Use of Privileged Documents by Liquidators
Corporations Law Equity Evidence Trusts and Trustees Legal Professional Privilege Winding Up of Corporate Trustee Public Examination of Directors Orders for Production +2 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 4 Authorities cited 30 Party arguments 2 Amounts and remedies 4
Sign in to unlock

Parties

The Owners – Strata Plan 84741

Plaintiff

Iris Diversified Property Pty Ltd (in liq)

First Defendant

Henry Peter McKenna

Second Defendant

Wassim Arnaout

First Applicant

Rodney Paul Hawkins

Second Applicant

Iris Diversified Investments Pty Ltd

Third Applicant

Iris Group Management Pty Ltd

Fourth Applicant

Iris Hotel Business Pty Ltd

Fifth Applicant

Iris Hotel Group Pty Ltd

Sixth Applicant

IDI SPV7 Pty Ltd

Seventh Applicant

Brendan Warren Jones

Eighth Applicant

Christopher Palmer and Liam Thomas Bailey as liquidators of Iris Diversified Property Pty Ltd (in liq)

Respondents

Procedural Posture

Interlocutory Application / Ruling on Application to Set Aside Examination Summonses and Production Orders; Application for Extension of Time

Legal Issues

  1. 1 Whether the current trustee (IHG) or former trustee (IDP, in liquidation) holds legal professional privilege in documents obtained by the former trustee as client;
  2. 2 Whether liquidators of the former trustee can use privileged documents in liquidator's examinations;
  3. 3 Whether the examination summonses and production orders should be set aside due to an alleged misuse of privilege;

Ratio Decidendi

IHG, as the current trustee, does not hold or control legal professional privilege to the exclusion of IDP (the former trustee) in documents created during IDP's trusteeship. Once files were produced to the liquidators pursuant to s 530B Corporations Act, any privilege was not enforceable to prevent their use by the liquidators in conducting examinations. As such, no legitimate ground to set aside the examination summonses or the orders for production on the basis of privilege or alleged misuse was established.

Court Disposition

Applications to set aside examination summonses and production orders dismissed; extension of time to seek to set aside summonses granted; orders for production not set aside in narrowed form.

Orders

  • The examination summonses are not set aside.
  • The orders for production (as narrowed by the liquidators) are not set aside (subject to parties being heard as to the terms).