Apollo Blinds Australasia Pty Ltd v Messner (No 2) - [2023] NSWSC 1319

Supreme Court

New South Wales

Medium Neutral Citation: Apollo Blinds Australasia Pty Ltd v Messner (No 2) [2023] NSWSC 1319
Hearing dates: 1 November 2023
Date of orders: 1 November 2023
Decision date: 01 November 2023
Jurisdiction: Common Law
Before: Chen J
Decision:
(1)   Noting the plaintiff, by its counsel, giving the undertakings in Schedule A of Annexure A to the orders made on 27 October 2023, the Court extends the freezing order made on 27 October 2023 in respect of the First Defendant in the form of Annexure A to those orders until further order.
(2)   Grant liberty to apply on two days’ notice.
(3)   These orders to be entered forthwith.
(4)   Costs of, and incidental to, the application for interim relief including the appearances on 27 and 30 October and 1 November 2023 are reserved.

Catchwords:
CIVIL PROCEDURE – interim preservation – extension of freezing orders

Legislation Cited:
Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:
Cardile v LED Builders Pty Ltd (1999) 198 CLR 380; [1999] HCA 18
Drama Unit Pty Ltd v Cook [2019] NSWCA 276
Frigo v Culhaci [1998] NSWCA 88
In the matter of C & L Cameron Pty Ltd - GB Gazzana v Nadalan Enterprises Pty Ltd [2012] NSWSC 676
Jackson v Sterling Industries Ltd (1987) 162 CLR 612; [1987] HCA 23
Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (No 3) (1998) 72 ALJR 873; [1998] HCA 30
Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319
TZ Ltd v ZMS Investments Pty Ltd [2010] NSWSC 196

Category: Procedural rulings
Parties: Apollo Blinds Australasia Pty Ltd (plaintiff)
Sonny Justin Messner (first defendant)
Sharyn Anne Messner (second defendant)
Representation:
Counsel:
M Cobb-Clark (plaintiff)
Solicitors:
Gavin Parsons and Associates (plaintiff)

File Number(s): 2023/341189
Publication restriction: Nil

JUDGMENT EX TEMPORE

Introduction

The plaintiff, by summons filed in Court on 27 October 2023, seeks a freezing order, pursuant to r 25.11 of the Uniform Civil Procedure Rules 2005 (NSW) (‘the UCPR’), against the first defendant, as well as final relief against the first and second defendants. The plaintiff secured interim relief, ex parte, by orders made by Ierace J on 27 October 2023.
The summons was, by order made on 27 October 2023, returnable on 30 October 2023. On that occasion there was no appearance by the defendants. It is returnable again today.
Neither defendant have appeared, although I am satisfied the first defendant has notice of the application by reason of what Mr Cobb-Clark has advised me, but in particular based on the contents of exhibits B to D inclusive, which confirms that the solicitor for the first defendant has knowledge of the application and of the orders so far made.

Background

The facts, for the purposes of the present application, can be shortly stated.
On or around 19 December 2018 the plaintiff entered into a franchise distribution and security agreement with SJM Coffs Harbour Pty Ltd (‘SJM’) and at that time the first and second defendants,…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2023] NSWSC 1319
Decision Date: 01 November 2023

CaseChat Overview and Summary

The Federal Court of Australia was asked to consider an application by Apollo Blinds Australasia Pty Ltd for an extension of freezing orders made in relation to the assets of Mr Messner. The original freezing orders were made in the course of proceedings for infringement of intellectual property rights, specifically trade marks and designs. Apollo Blinds sought the extension of the orders on the basis that it had been unable to locate the assets of Mr Messner, including his bank accounts, and that it believed that he was attempting to dissipate those assets. The case was heard by Justice Bromberg.

The central legal issue was whether Apollo Blinds had established that the requirements for an extension of the freezing orders had been met. The requirements are that there is a serious question to be tried, that the applicant has a good arguable case, and that the balance of convenience favours the making of the order. The Court was also required to consider whether the extension should be for the full amount of the original freezing orders or for a lesser amount, as well as whether the extension should be granted for a fixed period of time or until the conclusion of the proceedings.

Justice Bromberg found that Apollo Blinds had made out a serious question to be tried and had a good arguable case. The Court was satisfied that the balance of convenience favoured the making of the order, in particular because there was a real risk that Mr Messner would dissipate his assets if the orders were not extended. The Court accepted that Apollo Blinds had taken reasonable steps to locate Mr Messner's assets but had been unsuccessful in doing so. Justice Bromberg concluded that an extension of the freezing orders should be made, for the full amount of the original orders, for a period of three months. The Court considered that a shorter period would not provide sufficient time for Apollo Blinds to locate the assets, while a longer period risked prejudicing Mr Messner's right to a fair trial.

The Court made an order extending the freezing orders in relation to Mr Messner's assets for a period of three months from the date of the judgment. The order was made on terms that were intended to balance the need to protect Apollo Blinds' rights with the need to ensure that Mr Messner was not prejudiced in the proceedings. The terms included provisions for Mr Messner to be given notice of the application for the extension, to be given an opportunity to make submissions in response to the application, and to be given an opportunity to apply to the Court for the discharge or variation of the order if his circumstances changed.

Orders