Oswal v BFPL [2013] FCAFC 9; Director's Right to Access Company Documents during Receivership

The Full Federal Court has dismissed the appeal by Pankaj Oswal to have orders allowing him access to seven categories of books and records belonging to Burrup Fertilisers Pty Ltd; Oswal v Burrup Fertilisers Pty Ltd (Receivers and Managers Appointed) [2013] FCAFC 9. The appeal was based on Oswal’s claim that there was an error in the primary judge’s application of relevant principles. However, the Full Court found that Oswal had failed to demonstrate sufficiently any degree of error.

The facts of the case

The relevant principle concerned is that receivership and management may well dominate exclusively a company’s affairs in its dealings and relations with the outside world, but it does not affect the company’s internal structure. To this extent, the Director still retains his duties. The primary judge had found that inspection of certain documents may be unduly onerous on the part of the receiver, and in particular documents concerning the sales of shares and assets, might threaten the proper administration of the receivership or imperil the assets forming the subject of the charge under which the receivers had been appointed.

The court's decision

The Full Court agreed with the primary judge's decision and found that “The documents…are documents created by or for the receivers after their appointment in respect of the realisation of the charged property.  They are not records of the business activities of BFPL.  They constitute material which, as a matter of principle and upon the true interpretation of the charge, deals with matters which are within the exclusive province of the receivers.”

To this extent, the appeal was dismissed.

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