Andrew Koh Nominees Pty Ltd as Trustee for KL Unit Trust v Pacific Corporation Ltd [No 3]

[2010] WASC 248

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   ANDREW KOH NOMINEES PTY LTD As Trustee for KL UNIT TRUST -v- PACIFIC CORPORATION LTD [No 3] [2010] WASC 248

CORAM:   ALLANSON J

HEARD:   31 AUGUST 2010

DELIVERED          :   10 SEPTEMBER 2010

FILE NO/S:   CIV 2545 of 2003

BETWEEN:   ANDREW KOH NOMINEES PTY LTD As Trustee for KL UNIT TRUST

Plaintiff

AND

PACIFIC CORPORATION LTD
First Defendant

SIN JEN HWANG
Second Defendant

ROBERT ANGELO ARRIGONI
Third Defendant

GREAT VICTORIA CORPORATION PTY LTD
Fourth Defendant

CONSORTIUM LAND PTY LTD
Fifth Defendant

FILE NO/S              :CIV 1398 of 2004

BETWEEN             :PACIFIC CORPORATION LTD

Plaintiff

AND

ANDREW KOH NOMINEES PTY LTD As Trustee for THE KL UNIT TRUST
Defendant

FILE NO/S              :CIV 1704 of 2004

BETWEEN             :ANDREW KOH NOMINEES PTY LTD As Trustee for ANDREW KOH FAMILY TRUST

First Plaintiff

ANDREW KEE SUAN KOH
Second Plaintiff

ANDREW KOH NOMINEES PTY LTD As Trustee for KL UNIT TRUST
Third Plaintiff

AND

GREAT VICTORIA CORPORATION PTY LTD
First Defendant

PACIFIC CORPORATION LTD
Second Defendant

FILE NO/S              :CIV 2051 of 2004

MATTER                :An application by the Receiver and Manager of the Balneum Joint Venture for interpleader relief against the claims of Pacific Corporation Ltd and Andrew Koh Nominees Pty Ltd as trustees for the KL Unit Trust

BETWEEN             :GARY JOHN TREVOR As Receiver and Manager of BALNEUM JOINT VENTURE

Applicant

AND

PACIFIC CORPORATION LTD
First Respondent

ANDREW KOH NOMINEES PTY LTD As Trustee for KL UNIT TRUST
Second Respondent

JAVEL HOLDINGS PTY LTD
Third Respondent

AL PING KEE
JARRAD HEE
Fourth Respondents

MOH KUY LIM
AH MOI LIM
Fifth Respondents

DANREG NOMINEES PTY LTD
Sixth Respondent

BROADCOURT PTY LTD
Seventh Respondent

(BY ORIGINAL ACTION)

PACIFIC CORPORATION LTD
JAVEL HOLDINGS PTY LTD
DANREG NOMINEES PTY LTD
BROADCOURT PTY LTD
Plaintiffs by Interpleader

AND

ANDREW KOH NOMINEES PTY LTD As Trustee for the KL UNIT TRUST
AI PING KEE
JARRAD HEE
MOH KUY LIM
AH MOI LIM
Defendants by Interpleader

(BY COUNTERCLAIM)
 

Catchwords:

Practice and Procedure - Simultaneous civil and criminal proceedings - Application for stay of proceedings until completion of criminal proceedings - Turns on own facts

Legislation:

Nil

Result:

Application dismissed

Category:    B

Representation:

CIV 2545 of 2003

Counsel:

Plaintiff:     Mr G R Donaldson SC with Mr D B Shaw

First Defendant            :     Mr D N Ryan

Second Defendant        :     Mr D N Ryan

Third Defendant           :     Mr D N Ryan

Fourth Defendant         :     Mr D N Ryan

Fifth Defendant            :     Mr D N Ryan

Solicitors:

Plaintiff:     DLA Phillips Fox

First Defendant            :     Talbot Olivier

Second Defendant        :     Talbot Olivier

Third Defendant           :     Talbot Olivier

Fourth Defendant         :     Talbot Olivier

Fifth Defendant            :     Talbot Olivier

CIV 1398 of 2004

Counsel:

Plaintiff:     Mr D N Ryan

Defendant:     Mr G R Donaldson SC with Mr D B Shaw

Solicitors:

Plaintiff:     Talbot Olivier

Defendant:     DLA Phillips Fox

CIV 1704 of 2004

Counsel:

First Plaintiff                :     Mr G R Donaldson SC with Mr D B Shaw

Second Plaintiff            :     Mr G R Donaldson SC with Mr D B Shaw

Third Plaintiff              :     Mr G R Donaldson SC with Mr D B Shaw

First Defendant            :     Mr D N Ryan

Second Defendant        :     Mr D N Ryan

Solicitors:

First Plaintiff                :     DLA Phillips Fox

Second Plaintiff            :     DLA Phillips Fox

Third Plaintiff              :     DLA Phillips Fox

First Defendant            :     Talbot Olivier

Second Defendant        :     Talbot Olivier

CIV 2051 of 2004

Original Action

Counsel:

Applicant:     No appearance

First Respondent          :     Mr D N Ryan

Second Respondent      :     Mr G R Donaldson SC with Mr D B Shaw

Third Respondent        :     Mr D N Ryan

Fourth Respondents     :     Mr G R Donaldson SC with Mr D B Shaw

Fifth Respondents        :     Mr G R Donaldson SC with Mr D B Shaw

Sixth Respondent         :     Mr D N Ryan

Seventh Respondent     :     Mr D N Ryan

Solicitors:

Applicant:     DLA Phillips Fox

First Respondent          :     Talbot Olivier

Second Respondent      :     DLA Phillips Fox

Third Respondent        :     Talbot Olivier

Fourth Respondents     :     DLA Phillips Fox

Fifth Respondents        :     DLA Phillips Fox

Sixth Respondent         :     Talbot Olivier

Seventh Respondent     :     Talbot Olivier

Counterclaim

Counsel:

Plaintiffs by Interpleader     :    Mr D N Ryan

Defendants by Interpleader :     Mr G R Donaldson SC with Mr D B Shaw

Solicitors:

Plaintiffs by Interpleader     :    Talbot Olivier

Defendants by Interpleader :     DLA Phillips Fox

Case(s) referred to in judgment(s):

McMahon v Gould (1982) 7 ACLR 202

R v Glennon [1992] HCA 16; (1992) 173 CLR 592

Robins SM, Re; Ex parte West Australian Newspapers Ltd [1999] WASCA 16; (1999) 20 WAR 511

State of Western Australia v Bond Corp Holdings Pty Ltd [No 2] (1992) 114 ALR 275

1. ALLANSON J:  In October 2002, Andrew Koh Nominees Pty Ltd (Andrew Koh Nominees) and Pacific Corporation Limited (Pacific Corporation) entered an agreement for a joint venture to develop high quality residential apartments on land fronting the Swan River at Belmont.  The development was to be in three stages.  Andrew Koh Nominees and Pacific Corporation each had a 50% interest in the joint venture.

2. Andrew Kee Suan Koh and his wife Christine Koh are the directors of Andrew Koh Nominees.  Andrew Koh Nominees is the trustee of the KL Unit Trust, and also of the Andrew Koh Family Trust.

3. Sin Jen Hwang and Robert Angelo Arrigoni are the directors of Pacific Corporation.  They are also directors of Great Victoria Corporation Pty Ltd (Great Victoria Corporation) and Consortium Land Pty Ltd (Consortium Land).

4. The parties opened a joint venture bank account with the National Australia Bank.  Each of Mr Koh, Mrs Koh, Mr Hwang, and Mr Arrigoni was a signatory to the account, and any two of them were authorised to sign cheques drawn on the account.

5. During 2003, the joint venture parties were in dispute.  Andrew Koh Nominees commenced the first of the actions (CIV 2545 of 2003) in December 2003.  In March 2004, on the application of Andrew Koh Nominees, the court appointed a Receiver and Manager of the property of the joint venture.  Four more actions were commenced in 2004 between the joint venture parties – two by Mr Koh and Andrew Koh Nominees; one by Pacific Corporation against Andrew Koh Nominees; and one by the Receiver and Manager seeking interpleader relief.

6. Mr Koh, Mr Hwang, Mr Arrigoni, Great Victoria Corporation, and Consortium Land are now parties in one or more of these actions.

7. In either 2003 or 2004, Mr Koh and his wife made complaints to the police about Mr Hwang and Mr Arrigoni.  The police began an investigation in 2004.  On 16 March 2010, the police charged Mr Hwang and Mr Arrigoni jointly with five offences, and Mr Arrigoni separately with a further 16 offences. 

8. Mr Hwang and Mr Arrigoni have been committed to the District Court for trial.  The first hearing date in the District Court is 1 October 2010. 

9. Mr Hwang, Mr Arrigoni and the parties associated with them (including Pacific Corporation, Great Victoria Corporation and Consortium Land) now apply for a stay of all of the civil actions until the conclusion of criminal proceedings against Mr Hwang and Mr Arrigoni.  In the following reasons I will, on occasion, refer to these parties as the applicants.

The civil actions

1. There are five matters before the court (two of them consolidated) arising out of the joint venture.  The actions raise different issues, some of which are only remotely related to the issues in the criminal proceedings.  Neither party suggests, however, that there should be any separation of the claims.

CIV 2545 of 2003 and CIV 1335 of 2004

1. The main action (CIV 2545 of 2003 consolidated with CIV 1335 of 2004) is a claim by Andrew Koh Nominees as plaintiff against Pacific Corporation. Mr Hwang, Mr Arrigoni, Great Victoria Corporation, and Consortium Land have been added as defendants by later amendments to the claim. 

2. The plaintiff's claim is now set out in a Further Substituted Consolidated Statement of Claim dated 20 March 2009.  The substance of the claim is that Mr Hwang and Mr Arrigoni drew and signed cheques on the funds of the joint venture for purposes other than the purposes of the joint venture.  It is alleged that in so doing, they acted in breach of express or implied terms of the joint venture agreement and further, or alternatively, in breach of fiduciary duties each of them owed to the joint venture.  It is further alleged against Great Victoria Corporation and Consortium Land that each of them received payments knowing that they were made in breach of a fiduciary duty. 

3. The plaintiff claims that the breaches by Pacific Corporation, Mr Hwang and Mr Arrigoni were a compulsory sale event that triggered buy out provisions in the joint venture agreement, and that the plaintiff called on Pacific Corporation to sell its interest in the joint venture at a stipulated price.  Pacific Corporation has refused to sell.  The plaintiff claims specific performance of the obligation to sell, and loss and damages, as well as equitable relief against Great Victoria Corporation and Consortium Land.

4. The defence is set out in a Substituted Consolidated Defence dated 16 February 2007 on behalf of Pacific Corporation, Mr Hwang and Mr Arrigoni.  The defendants deny that there was a compulsory sale event.  Further, they plead that the compulsory sale event clause in the joint venture agreement is void and unenforceable as a penalty clause, or alternatively, it is void for uncertainty.  Significantly, the defendants plead that they did draw and sign the cheques pleaded in the statement of claim, and say that the cheques were used to discharge costs or liabilities properly incurred by the joint venture. 

5. Great Victoria Corporation and Consortium Land have not yet pleaded to the claims against them.

CIV 1398 of 2004

1. The claim in CIV 1398 of 2004 is brought by Pacific Corporation against Andrew Koh Nominees. In substance, Pacific Corporation alleges that Andrew Koh Nominees breached express and implied terms of the joint venture agreement by its refusal to proceed with stage 2 of the development project. Pacific Corporation claims that Andrew Koh Nominees repudiated the agreement and claims damages. It also seeks an order under s 126 of the Property Law Act 1969 (WA) for the sale of land jointly held by the joint venture participants.

2. In its defence, Andrew Koh Nominees refers to the proceedings in the main action by which it seeks specific performance of the agreement requiring Pacific Corporation to sell and transfer to it the whole of its interest in the joint venture.  The allegations made in the main action about the conduct of Mr Hwang and Mr Arrigoni are also in issue in CIV 1398 of 2004.

CIV 1704 of 2004

1. The third action is CIV 1704 of 2004 between Andrew Koh Nominees (as trustee of the Andrew Koh Family Trust and also as trustee of the KL Unit Trust) and Andrew Kee Suan Koh as plaintiffs, and Great Victoria Corporation and Pacific Corporation as defendants.  The plaintiffs allege that one or other of them entered into an agreement to lend $200,000 to Great Victoria Corporation, which has not been repaid.  The plaintiffs claim payment of that sum and interest. 

2. In its defence, Pacific Corporation admits the loan but says the plaintiffs, Pacific Corporation and Great Victoria Corporation agreed that the loan was discharged, and the sum was credited to the benefit of Andrew Koh Nominees in the joint venture accounts. 

CIV 2051 of 2004

1. The last of the proceedings is an application brought by the receiver and manager of the joint venture for interpleader relief against the claims of Pacific Corporation and Andrew Koh Nominees and others in relation to certain property developed by the joint venture. 

The criminal proceedings

The joint charges

1. There are four stealing charges brought jointly against Mr Hwang and Mr Arrigoni, alleging that an amount of $1,545,000 was removed from the bank accounts of the joint venture between 8 April 2003 and 8 May 2003 by three cheques written out to Great Victoria Corporation and one to Consortium Land.  It is alleged that three of the cheques are in Mr Arrigoni's handwriting, all of them have been signed by Mr Arrigoni, and all bear a signature purporting to be that of Mr Hwang.  It is alleged that Mr Hwang and Mr Arrigoni did not have authority to take this money from the joint venture account as it was not for the purposes of the joint venture agreement. 

2. In relation to two of the cheques, the statement of material facts refers to Mr Hwang's answers to interrogatories in the civil proceedings in which he states that he did not sign the cheques, that on each occasion Mr Arrigoni signed the signature that purports to be that of Mr Hwang, and that Mr Hwang did not authorise anybody to sign the cheque.

3. The charge of money laundering under s 563A(1) of the Criminal Code (WA) alleges that Mr Hwang and Mr Arrigoni carried out transactions that involve money that is the proceeds of the stealing offences.

Charges against Mr Arrigoni

1. Mr Arrigoni faces a further 16 charges.  All but two of them relate to a meeting on 4 September 2003 between Mr Arrigoni and Mr Yzelman, the accountant for Mr Koh.  The prosecution alleges that Mr Arrigoni provided Mr Yzelman with various documents which had been fraudulently altered.  The documents all related to payments purportedly made by or on behalf of the joint venture.

2. There is a separate charge against Mr Arrigoni of fraudulently using two documents that falsely recorded a payment to the joint venture by Mr Hwang. 

3. Finally, Mr Arrigoni is separately charged with stealing an amount of money by writing and drawing a cheque on the joint venture account which he deposited directly into his own back account.  He has pleaded guilty to that charge already. 

4. The charges are next before the District Court on 1 October 2010.  There is no evidence before me regarding when a trial is likely to take place.  Although Mr Ryan, counsel for the applicants, anticipates an indictment being presented on 1 October 2010, with a trial in the first half of 2011, that timetable is speculative.

The relationship between the civil and criminal proceedings

1. The allegations of stealing against both applicants, and fraudulent altering of documents (against Mr Arrigoni) are relevant to the credibility of each of them.  Issues of credibility arise in all of the civil actions.

2. The four cheques that are the subject of the charges brought jointly against Mr Hwang and Mr Arrigoni are the first four cheques particularised in par 13(a) of the statement of claim in the main action.  There are another 60 cheques specified in the statement of claim.  One of those is the cheque that is the subject of the separate stealing charge against Mr Arrigoni, and to which he has already pleaded guilty. 

3. Whether documents have been altered, and whether they were fraudulently altered, are likely to be relevant to issues other than credibility in the main action.  It is not necessary, for present purposes, to explore the extent to which those issues will arise.

The same comments apply to CIV 1398 of 2004

1. Other than the general subject matter relating to the joint venture, it is not immediately clear what relationship there is between the factual and legal issues raised in the other two civil actions and the criminal proceedings against Mr Hwang and Mr Arrigoni. 

Procedural history

1. The first of the actions, CIV 2545 of 2003, was commenced by writ on 18 December 2003 against Pacific Corporation.  The plaintiff filed the statement of claim on 24 February 2004.  On 27 April 2004 that action was consolidated with CIV 1335 of 2004.  This consolidated action is regarded as the main action.

2. A consolidated statement of claim was filed in April 2004.  The defendant filed a consolidated defence on 20 July 2004.  Discovery was given in 2004. 

3. On 12 July 2006, the plaintiff filed a substituted consolidated statement of claim in the main action.  It was then that Mr Hwang and Mr Arrigoni were added as defendants.

4. The matter was admitted to the CMC List in October 2006, and in January 2007 the Master ordered that the main action and the other three matters be heard at the same time, or one after the other, as the trial judge may direct.

5. On 16 February 2007, the then defendants filed a substituted consolidated defence.  Further discovery was given in 2008 by both the plaintiff and the defendants.  In 2009, the plaintiff administered interrogatories which were answered by Mr Arrigoni and Mr Hwang.

6. In March 2009 the plaintiff issued a further substituted consolidated statement of claim.  Great Victoria Corporation and Consortium Land were added as defendants.  The current defence, however, is that filed in February 2007.  The plaintiff has not yet amended its pleading regarding the particulars of loss and damage, but it provided the expert evidence relating to proof of loss and damage to the defence in December 2009.

7. The applicants rely on the need to file a further consolidated defence that will follow amendments by the plaintiff to the statement of claim dealing with the issues of loss and damage.  I assume that when that is done, Great Victoria Corporation and Consortium Land will plead to the claims against them.  Mr Ryan also informed me that the defendants in the main action will 'plead out in more substance the defence and do that as a job lot' once they have received the particulars of loss and damage.

8. The applicants do not say that they either need or intend to substantially change their defence in so far as it relates to the conduct of Mr Hwang and Mr Arrigoni.  They have not submitted, or presented evidence, that they would be prejudiced in further pleading by the need to avoid self incrimination.  The risk of incrimination is not raised in the grounds of the application.

9. There are other procedural steps that must be taken by both sides before trial.  Pacific Corporation (as plaintiff in CIV 1398 of 2004) has not yet particularised loss and damage, and in its statement of claim foreshadows that particulars will be provided after the provision of expert evidence.  That statement of claim was filed in 2004.  I have not been told whether any steps have been taken in the following years to engage experts. 

The applications to stay proceedings

1. In each of the stay applications, the defendants rely upon (the same) eight grounds as follows:

   1.There is a substantial overlap in the factual and legal issues to be determined in each of the criminal and civil proceedings;

   2.The criminal proceedings have reached the stage where full disclosure has been made by the prosecution and the matter is ready to be committed to the District Court for trial;

   3.The plaintiff is yet to plead its loss and damage in its entirety, which will require it to further amend its statement of claim and the defendants to further amend their defence;

   4.The hearing of the criminal trial prior to the civil trial may either resolve the civil matter or shorten any proceedings considerably, particularly if the second and/or the third defendants are convicted;

   5.The publicity that a civil trial may bring, prior to the hearing of the criminal trial, may cause prejudice to the second and third defendants and thereby deny them the opportunity for a fair trial before a jury;

   6.The burden on the second and third defendants in preparing for both a civil trial and criminal trial would be unmanageable and excessive, due to the likely cost and length of both the civil and criminal trials; particularly as the second defendant has numerous business  interests overseas and spends most of his time out of Western Australia;

   7.The civil matter has already been on foot for 6 1/2 years, through no fault of the defendants.  The plaintiff would not suffer any prejudice if the civil matter was partially delayed until the conclusion of the criminal matter; and

   8.The second and third defendants both have various medical and health issues and are likely to suffer adversely, given the stress that they would undergo in having to prepare for and participate in criminal and civil trials, which may occur on or around the same time.

The evidence in the application

1. Mr Hwang and Mr Arrigoni filed an affidavit in each matter in support of the application to stay.  Mr Andrew Kee Suan Koh and his wife Christine Koh filed affidavits in opposition. 

2. Mr Hwang states that should the criminal matter be determined first, depending on the outcome, many, if not all, of the issues in the civil matters may be resolved without the necessity for a trial.  In particular, he expresses the belief that if either he or Mr Arrigoni were to be convicted, it would create substantial difficulties in their ability to defend the civil claims. 

3. Mr Hwang refers to the costs that will be incurred should the proceedings not be stayed.  Those costs may be unnecessary - particularly where the outcome of the criminal trial may resolve the civil matter by settlement, or clarify the evidence to the point where the parties are able to settle or significantly reduce the issues in the civil proceedings. 

4. Mr Hwang says that he will suffer real prejudice in that it will be difficult for him to prepare for two trials simultaneously.  Through his various companies, he is responsible to oversee various projects in Western Australia and overseas.  It would be extremely difficult, if not impossible, for him to perform his duties as a director of these companies if the civil and criminal trials were held in close proximity to one another.  This is particularly so because each trial is expected to be long – the civil trial may be six to eight weeks and the criminal trial may be four to six weeks.

5. Mr Hwang points to the cost of the trials, and the burden of meeting both sets of costs at the same time. 

6. Mr Hwang is not an Australian citizen, and has a Malaysian passport.  He lives in Singapore and travels overseas frequently.  If the civil action is not stayed, it will be difficult for him to travel. 

7. Mr Hwang refers also to the difficulties suffered by his business because various banks are reluctant to provide finance to his ventures while he faces criminal charges.  This factor presumably supports the need to give priority to the criminal proceedings. 

8. Mr Hwang states his concern about the risk of prejudice to the criminal proceedings as a result of publicity the civil trial may receive. 

9. Finally, he refers further to his age (70 years) and health problems including hypertension, diabetes and heart disease.  He states concern that he is unable to deal with the combined stress of attending to his various and demanding business ventures, while preparing simultaneously for criminal and civil trials.  The medical report in support of that claim is from a 'Neighbourhood Clinic' in Singapore, and is short on detail.

10. Mr Arrigoni refers to similar considerations.  While he is a much younger man, he also has some health concerns, including high blood pressure and high cholesterol, and bowel problems.  The medical evidence confirms those conditions, but says nothing about how it affects his ability to participate in the various proceedings.

11. Mr Koh is 73 years old and also suffers from health problems including hearing loss, diabetes, enlarged prostate, asthma and bronchiectasis.  He refers particularly to the need for surgical intervention for the prostate problem and his anxiety about undergoing surgery under general anaesthesia prior to trial because of the possible effect on his ability to think and recall events.  He refers also to present concern about loss of memory.

12. Mrs Koh is 63 years old.  She refers to the stress of events and its effect on her mental and physical wellbeing, but not to any specific medical condition.  In her affidavit, she states further that the accountant to Andrew Koh Nominees, Mr Ian Yzelman, who will be a witness in the proceedings, has not been in good health and has had difficulty walking, requiring a walking aid.  I am told in submissions that he also is elderly.

13. Finally, Mrs Koh refers to the strata levies, rates and land tax which continue to be incurred by the joint venture participants in relation to the joint venture land.

The principles governing a stay

1. The parties are in general agreement about the principles to be applied in considering this application. Each refers to the guidelines relevant to the exercise of the power to stay proceedings, set out by Wootten J in McMahon v Gould (1982) 7 ACLR 202, and since applied regularly. Those guidelines are comprehensive, but not necessarily exhaustive: State of Western Australia v Bond Corp Holdings Pty Ltd [No 2] (1992) 114 ALR 275 at 297. The applicants' grounds are drawn from them. The guidelines are:

   1.Prima facie a plaintiff is entitled to have his action tried in the ordinary course of the procedure and business of the court.

   2.It is a grave matter to interfere with this entitlement by a stay of proceedings, which requires justification on proper grounds.

   3.The burden is on the defendant in a civil action to show that it is just and convenient that the plaintiff's ordinary rights should be interfered with.

   4.Neither an accused nor the Crown is entitled as of right to have a civil proceeding stayed because of a pending or possible criminal proceeding.

   5.The court's task is one of 'the balancing of justice between the parties', taking account of all relevant factors.

   6.Each case must be judged on its own merits, and it would be wrong and undesirable to attempt to define in the abstract what are the relevant factors.

   7.One factor to take into account where there are pending or possible criminal proceedings is what is sometimes referred to as the accused's 'right of silence', and the reasons why that right, under the law as it stands, is a right of a defendant in a criminal proceeding.

   8.However the so called 'right of silence' does not extend to give such a defendant as a matter of right the same protection in contemporaneous civil proceedings.  The plaintiff in a civil action is not debarred from pursuing action in accordance with normal rules merely because to do so would or might, result in the defendant, if he wished to defend the action, having to disclose, in resisting an application for summary judgment in the pleading of his defence, or by way of discovery or otherwise, what his defence is likely to be in the criminal proceedings.

   9.The court should consider whether there is a real and not merely notional danger of injustice in the criminal proceedings.

   10.In this respect factors which may be relevant include:

   (i)the possibility of publicity that might reach and influence jurors in the civil proceedings;

   (ii)the proximity of the criminal hearing;

   (iii)the possibility of miscarriage of justice, for example, by disclosure of a defence enabling the fabrication of evidence by prosecution witnesses, or interference with defence witnesses;

   (iv)the burden on the defendant of preparing for both sets of proceedings concurrently;

   (v)whether the defendant has already disclosed his defence to the allegations;

   (vi)the conduct of the defendant including his own prior invocation of civil process when it suited him.

   11.The effect on the plaintiff must also be considered and weighed against the effect on the defendant in which regard it may be relevant to consider the nature of the defendant's obligation to the plaintiff; and

   12.In an appropriate case the proceedings may be allowed to proceed to a certain stage, for example, setting down for trial, and then staying them.

2. I accept the submission on behalf of the defendants that while, prima facie, the plaintiff has an entitlement to have its action tried in the ordinary course of the court's business, the court's task on this application is 'the balancing of justice between the parties', taking account of all relevant factors. Each case must be judged on its own merits. 

3. I also take into account that the applicants have already disclosed their defence in the civil proceedings to the allegations about the drawing of the cheques, and have answered interrogatories.  

Consideration of the grounds for a stay

1. The applicants have not based their application on considerations relating to their right not to disclose their defence – perhaps because in that respect the civil claims have been fully pleaded – and do not assert that they would be at risk of incriminating themselves should they testify in the civil proceedings. Accordingly it has not been necessary for me to consider the 'right to silence' or the privilege against self incrimination, and the effect of s 11 of the Evidence Act 1906 (WA).

Ground 1

1. It is common ground that there is substantial overlap in the factual and legal issues to be determined in each of the criminal and civil proceedings.  Each of the cheques which are the subject of the charges against Mr Hwang and Mr Arrigoni are specified in par 13 of the Statement of Claim in the main action.  The conduct in drawing those cheques is pleaded to be in breach of the joint venture agreement (statement of claim par 17), and a breach of the fiduciary duties owed by Mr Hwang and Mr Arrigoni to the joint venture (pars 18 ‑ 20).  While the documents which Mr Arrigoni is alleged to have fraudulently used are not specifically referred to in the Statement of Claim, the allegations are generally relevant to the conduct of the parties in relation to the joint venture and the expenditure of joint venture funds.  The allegations in the criminal proceedings are relevant to the credit of the applicants.

Ground 2

1. The criminal proceedings have been committed to the District Court for trial.  The prosecution has not yet presented an indictment.

2. The initial prosecution disclosure was four lever arch files, and further disclosure (after taking repetition into account) was an additional 12 documents. It is not possible to make any accurate assessment of the state of readiness of the criminal charges or the 'burden' of preparing for trial from those numbers and facts.

3. The charges may be listed for trial early in 2011, but there can be no certainty.  On the evidence before me, I can make more or less educated guesses regarding the timing of steps in both the criminal proceedings and the civil claims, but they remain guesses.

Ground 3

1. I have referred above to the current position of the civil claims, and the need for further pleading.  Mr Hwang and Mr Arrigoni have pleaded their cases, given discovery and answered interrogatories.  The defendants in the main action must amend their defence, and Pacific Corporation will need to plead particulars of loss and damage in CIV 1398 of 2004.  The applicants may also need to obtain expert evidence, although I am not aware of any order programming that evidence.

2. Mr Ryan suggested the applicants will make more extensive amendments, but did not reveal the extent of them.

3. In summary, most of the pre‑trial steps have been completed – the actions have been before the court for over six years – but there is still a bit to be done before any of the civil matters is ready for trial.  Neither party has given information from which I may make an accurate estimate of how long those steps will take, and when the matter will be ready to be listed for trial.

Ground 4

1. The applicants' request for a stay was primarily supported by the (perhaps) unnecessary cost and effort of preparing for the civil trial when, first, the criminal trial has priority for them; and, second, that cost and effort may be wasted because the outcome of the criminal trial would surely affect the parties attitudes in the civil matter. 

2. The second contention was not supported by any reference to the issues raised in the civil and the criminal proceedings, but by general reference to the impact of a conviction on the credibility of the defendants, and on their attitude (or that of their legal advisors) to the desirability of a settlement.  It is not enough to justify the relief sought.

3. The civil matters involve a large range of issues – some of which are independent of any questions of credibility.  For example, the defendants in the main action contend that, as a matter of law, the compulsory sale event clause is void.  I am not satisfied that the outcome of the criminal proceedings will determine the attitude of the parties to the civil claims.  While all matters are in issue in the civil claims, I do not accept that attending to the remaining pre‑trial steps is, or is likely to be, unnecessary.

Ground 5

1. Both applicants refer to the publicity that attended the laying of charges against them.  On the evidence presented, it was not extensive.  The prospect of publicity that may affect the criminal trial is a factor that should be taken into account.  It is not, as Mr Ryan conceded, a strong factor.  The law acknowledges that publicity may lead to jurors in a criminal trial acquiring irrelevant or prejudicial information.  But it proceeds on the basis that jurors, acting in conformity with instructions given by the trial judge, will deliver a true verdict in accordance with the evidence: see R v Glennon [1992] HCA 16; (1992) 173 CLR 592 at 603; Robins SM, Re; Ex parte West Australian Newspapers Ltd [1999] WASCA 16; (1999) 20 WAR 511.

2. The prospect of prejudice from pre-trial publicity is, at present, entirely speculative.

Ground 6

1. Each defendant refers to the physical and emotional burden of preparing for both trials at the same time.  Mr Hwang refers to the cost of preparing for each trial, particularly when that preparation will affect his income producing activities.  That may be accepted as a general statement, but there is no detail before me.  In particular, I cannot assess what difference granting a stay would make.  Further, I cannot predict when the two trials are likely to occur, or when those burdens are likely to arise.

2. I also take into account that, as Mr Ryan informed me, both men will be represented by him at trial in the criminal matter, and senior counsel will appear in the civil trial.  Senior counsel would be instructed by Mr Ryan's firm, and he would be junior counsel or an instructor.  There must be substantial overlap material and tasks to be done.  Even if the material is organised differently for the criminal and civil trials, it has not been shown that the difference creates a significant difficulty.

Ground 7

1. It is a fact that the civil proceedings have been on foot for over six years.  I have no idea why it has taken so long to get to trial.  I am informed there have been delays on both sides.  I do not accept that the respondents to the application are behaving hypocritically in opposing the stay.

Ground 8

1. The medical evidence on both sides is not decisive.  Mr Hwang, Mr Koh and Mr Yzelman are elderly, and they (and Mr Arrigoni) suffer from various ailments.  The evidence about their health does not enable me to determine how I should approach the application for a stay.  It merely shows that both sides would benefit from having all matters resolved as soon as practicable.

Conclusion

1. Having regard to all of the grounds cumulatively, I am not satisfied that the applicants have made out the case to exercise the discretion in their favour as matters now stand.  I am not satisfied that the applicants have demonstrated a real risk of injustice in the criminal proceedings, or that failure to stay at this juncture would impose an unjust burden on them.  The court needs to know more about when the criminal proceedings are likely to take place, what is required to be done to prepare for them and how long they are likely to take.  The court also needs to know what steps are now in contemplation in the civil proceedings, what must be done to complete those steps (having regard to work already done), and the timeframes proposed for those steps.

2. Further, I find the ground on which the applicants placed most emphasis – the likely effect on the civil proceedings of a conviction or acquittal in the criminal trial – to be quite unconvincing.

3. I dismiss the application.