Australian Receivables Ltd v Tekitu Pty Ltd

The case of Australian Receivables Limited versus Tekitu Pty Limited involved a dispute concerning the preservation of assets and the granting of injunctions. The plaintiff, Australian Receivables Limited, sought an interlocutory injunction to protect funds in the defendant's accounts, arguing that they were entitled to the funds. Tekitu Pty Limited, the defendant, countered that they had an arguable set-off against the plaintiff's claims. The court was required to determine whether the plaintiff had a sufficiently strong case to justify an injunction to preserve the funds and whether the set-off was available under the circumstances.

The court examined the principles governing interlocutory injunctions, particularly those designed to preserve the subject matter of the proceedings, distinguishing these from Mareva injunctions which restrain all assets. The court concluded that the plaintiff had a strongly arguable claim to the beneficial entitlement of the funds, and while the defendant's set-off was arguable, it did not outweigh the plaintiff's interest in preserving the funds. The balance of convenience favoured granting the injunction to the plaintiff. Additionally, the court found that an exception should not be made for legal and living expenses in the restraint of dispositions, as this would undermine the purpose of the injunction.

The court determined that the plaintiff was required to provide an undertaking as to damages, which was deemed sufficient notice to require the plaintiff to demonstrate their capacity to pay. The potential risk of damage was evaluated, and the court found that the plaintiff's undertaking was adequate. The final orders included the granting of an interlocutory injunction to preserve the specified funds in the defendant's accounts, with the exception noted for legal and living expenses, and the requirement for an undertaking as to damages.