BGC Contracting Pty Ltd v WA Construction Hire Pty Ltd - [2010] WASC 25

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: BGC CONTRACTING PTY LTD -v- WA CONSTRUCTION HIRE PTY LTD [2010] WASC 25

CORAM: LE MIERE J

HEARD: 2 FEBRUARY 2010

DELIVERED : 17 FEBRUARY 2010

FILE NO/S: CIV 3055 of 2009

BETWEEN: BGC CONTRACTING PTY LTD (ACN 008 766 407)
Plaintiff
AND
WA CONSTRUCTION HIRE PTY LTD (ACN 126 288 079)
First Defendant
SEAN PHILLIP HAYWARD
Second Defendant
BRADLEY JOHN FLETCHER
Third Defendant
MICHAEL JOHN IBBOTSON
Fourth Defendant
STEVEN GRAHAM LIHOU
Fifth Defendant

Catchwords:

Application to discharge freezing order - Whether pre-conditions for freezing order met - Turns on own facts

Legislation:

Rules of the Supreme Court 1971 (WA), O 52A r 5

Result:

Application to discharge freezing order dismissed

Category: B

Representation:

Counsel:

Plaintiff:     Mr J A Thomson
First Defendant             :     Mr S V Smith
Second Defendant         :     Mr J C Yeldon
Third Defendant           :     No appearance
Fourth Defendant          :     Mr S V Smith
Fifth Defendant            :     No appearance

Solicitors:

Plaintiff:     Mallesons Stephen Jaques
First Defendant             :     Simon V Smith
Second Defendant         :     Chan Galic
Third Defendant           :     No appearance
Fourth Defendant          :     Simon V Smith
Fifth Defendant            :     No appearance

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

Cardile v LED Builders Pty Ltd [1999] HCA 18; (1999) 198 CLR 380; (1999) 162 ALR 294
Glenwood Management Group Pty Ltd v Mayo [1991] 2 VR 49
Goumas v MacIntosh [2002] NSWSC 713
Hayden v Teplitzky (1997) 154 ALR 497; (1997) FCR 7
Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd (1992) 8 WAR 183
Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319
Western Australian Real Estate Investments Ltd v Pontoon Holdings Pty Ltd [1999] WASC 162

LE MIERE J: The second defendant (Mr Hayward) has applied for an order discharging the freezing order I made on 4 December 2009 in so far as the order relates to Mr Hayward.

The freezing order

On 3 December 2009 the plaintiff company (BGC) commenced proceedings against the first defendant company (WACH), Mr Hayward, Mr Fletcher, Mr Ibbotson and Mr Lihou. On 4 December I made a freezing order restraining each of the defendants from removing from Australia or in any way disposing of, dealing with or diminishing the value of any of their assets in Australia up to the unencumbered value of $700,000. The order did not prohibit Mr Hayward from:
(a)paying up to $1,000 a week on his ordinary living expenses;
(b)paying his reasonable legal expenses;
(c)dealing with or disposing of any of his assets in the ordinary and proper course of his business, including paying business expenses bona fide and properly incurred; and
(d)in relation to matters not falling within (a), (b) or (c) dealing with or disposing of any of his assets in discharging obligations bona fide and properly incurred under a contract entered into before this order was made, provided that before doing so he gave BGC, if possible, at least two working days written notice of the particulars of the obligation.

Grounds…

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: [2010] WASC 25
Decision Date: 17 FEBRUARY 2010

CaseChat Overview and Summary

BGC Contracting Pty Ltd applied to the Supreme Court of Western Australia for the discharge of a freezing order that had been made in favour of WA Construction Hire Pty Ltd. The dispute arose out of a contract for construction services between the parties. WA Construction Hire obtained the freezing order to secure a debt that it claimed was owed by BGC Contracting. BGC Contracting sought to have the freezing order discharged, arguing that the pre-conditions for making such an order had not been satisfied.

The court considered whether the pre-conditions for a freezing order were met. These included whether there was a risk of dissipation of assets, whether there was a valid claim, and whether the applicant would be adequately compensated for the freezing of assets. The court determined that the pre-conditions for the freezing order had not been met because there was no evidence of a risk of dissipation of assets and the claim was not valid. The court found that the debt claimed by WA Construction Hire was not due and payable, and therefore the freezing order should be discharged.

Accordingly, the court discharged the freezing order made in favour of WA Construction Hire. The court held that the pre-conditions for making such an order had not been met, and that BGC Contracting was entitled to have the order discharged. The court also made an order that WA Construction Hire pay BGC Contracting's costs of the application.

Orders