In the Supreme Court of New South Wales Justice Barrett recently confirmed the generally held view that signed transcripts of public examinations under sections 596A and 596B Corporations Act 2001 are admissible against the examinee but are not admissible against third parties.
In Fodare Pty Ltd v Shearn [2010] NSWSC 737 Justice Barrett considered whether the transcripts which were exhibited to an affidavit of the liquidator should be admitted. In considering the question His Honour was asked to resolve an apparent conflict between the Evidence Act 1995 (NSW) and the Corporations Act 2001.
The defendants argued that each statement recorded in the transcript is a "previous representation" of that examinee that had been obtained for the purpose of contemplated Court proceedings. It was said that the transcripts could therefore not be used to prove the existence of any fact that it could reasonably be supposed the examinee intended to assert by the statement. Essentially they offended the rule against hearsay (section 59 Evidence Act) and did not fall within one of the exceptions set out in section 69 of the Evidence Act.
In rejecting the defendants’ argument His Honour noted that the Corporations Act (section 597(14)) expressly contemplated that signed transcripts would be admissible against the examinee, and that this would be despite any other rule of evidence. In effect, the later Commonwealth Act prevailed over ”the general provisions with respect to hearsay contained in the New South Wales enactment". He concluded that the transcripts could be admitted however their use was specifically confined to use "against the person" who signed the transcript and were therefore not admissible as evidence against any third party in subsequent civil proceedings.
Whilst the decision will not take liquidators by surprise it is comforting to have judicial support for the standard practice of using transcripts against examinees in subsequent civil proceedings. The opposite conclusion would have severely hampered the value of this valuable weapon in the liquidator’s arsenal.
For further information please contact:
Richard Lyne | Senior Associate
T +612 8233 9542
F +612 8233 9555
Wendy Jacobs | Partner
T +612 8233 9537
F +612 8233 9555
