Canberra Residential Developments Pty Ltd v Canberra Land Developments Pty Ltd

[2009] FCA 110

FEDERAL COURT OF AUSTRALIA

Canberra Residential Developments Pty Ltd v Canberra Land Developments Pty Ltd [2009] FCA 110

CANBERRA RESIDENTIAL DEVELOPMENTS PTY LTD v CANBERRA LAND DEVELOPMENTS PTY LTD, J S O'CONNOR HARRIS & CO and KENOSS PTY LIMITED

ACD 11 of 2009

STONE J
13 FEBRUARY 2009
SYDNEY (VIDEO-LINKED TO CANBERRA)

IN THE FEDERAL COURT OF AUSTRALIA
AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY	ACD 11 of 2009

BETWEEN: CANBERRA RESIDENTIAL DEVELOPMENTS PTY LTD
Applicant

AND:

CANBERRA LAND DEVELOPMENTS PTY LTD
First Respondent

J S O'CONNOR HARRIS & CO
Second Respondent

KENOSS PTY LIMITED
Third Respondent

JUDGE:	STONE J
DATE OF ORDER:	13 FEBRUARY 2009
WHERE MADE:	SYDNEY (VIDEO-LINKED TO CANBERRA)

THE COURT ORDERS THAT:

1.The service of the notice of motion be dispensed with.

2.The notice of motion be made returnable instanter.

3.Otherwise the application in the notice of motion be dismissed.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY	ACD 11 of 2009

BETWEEN: CANBERRA RESIDENTIAL DEVELOPMENTS PTY LTD
Applicant

AND:

CANBERRA LAND DEVELOPMENTS PTY LTD
First Respondent

J S O'CONNOR HARRIS & CO
Second Respondent

KENOSS PTY LIMITED
Third Respondent

JUDGE:	STONE J
DATE:	13 FEBRUARY 2009
PLACE:	SYDNEY (VIDEO-LINKED TO CANBERRA)

REASONS FOR JUDGMENT

1. I have before me a notice of motion filed in the Australian Capital Territory Registry of this Court, pursuant to which the applicant seeks orders that the first respondent be restrained from instructing its solicitors, namely the second respondent, from taking any steps to deal with certain funds or to release them to any person.  The funds referred to are proceeds of the sale of land at Gungahlin. 

2. The dispute between the applicant and the respondents concerning the Gungahlin land was ventilated before Graham J in this Court over a number of days in 2008.  On 30 January 2009, his Honour dismissed the application.  The applicant was seeking an account of profits earned by the first respondent and others as well as declarations in relation to the land.  The dispute arose out of a joint venture in which the applicant was the trustee of land for the joint venturers.  It is not necessary for me to detail the facts which are amply canvassed in the judgment of Graham J; Canberra Residential Developments Pty Limited v Brendas (No5) [2009] FCA 34.

3. The land which was the subject of the joint venture had been subject to caveats preventing its sale.  Following the issue of a lapsing notice, Higgins CJ of the ACT Supreme Court had ordered that those caveats be maintained, however, by agreement between the parties, the caveats were lifted to the extent necessary to allow parts of the land to be sold.  This partial release was subject to undertakings given by the solicitors for the first defendant, (the second respondent in the present application) that the proceeds of sale would be held “until determination of the proceedings numbered ACD 21 of 2006 in the Federal Court of Australia, or order of the Federal Court releasing the funds”.

4. The time within which an appeal may be filed in respect of the judgment handed down on 30 January will expire on 20 February.  The applicant contends that the undertakings extend to 20 February.  The respondents do not accept that construction.  As the applicant wishes to preserve its position while it decides whether to appeal, it applied to the ACT Supreme Court for injunctive relief restraining the disbursement of the funds.  The application was considered by Master Harper on 11 February 2009.  His Honour expressed the view that any such application should be made to this Court but restrained the disbursal of the funds in question until 1 pm today.  The applicant seeks to extend that restraint until 4.30 pm on 20 February.

5. In considering such an application, it is necessary that I take into account whether the applicant has a prima facie case in respect of an appeal as well as the balance of convenience of the parties.  Given that no notice of appeal has yet been filed, it is difficult to assess the former issue.  I do not have the advantage of a notice of appeal directing my attention to aspects of the judgment which would be challenged on appeal. 

6. I note, however, that the issues involved concern fiduciary duties arising out of joint ventures and possible equitable defences.  These are notoriously difficult questions and, from my reading of the learned trial judge’s reasons I understand that the issues with which it deals are extremely complicated.  In those circumstances, and with the greatest respect to his Honour, it is not unlikely that an experienced advocate would be able to make a cogent submission as to the prospect of an appeal raising a prima facie case.  In any event, for present purposes I am prepared to assume that this is the case.

7. If that was the only question I had to consider, I would be disposed to give the relief sought.  I need, however, to consider the question of balance of convenience.  On that issue, I am not satisfied that the balance of convenience is in the applicant’s favour.  There is evidence in the affidavit of Alisa Jane Taylor, read in support of this application, that the third respondent, Kenoss, and its principals, have extensive assets.  This suggests that means are available to fund any orders made in the applicant’s favour following a successful appeal.

8. The interest claimed by the applicant is not a secured interest and, in the circumstances, I do not think that justice requires that the applicant effectively be given security in relation to any possible appeal.  It may of course be that the applicant’s contention that the undertakings extend to 20 February is correct.  In any event, on balance of convenience, I do not think it is appropriate for the Court to make the order sought.

9. The orders of the Court are:

   (1)       That the service of the notice of motion be dispensed with.

   (2)       That the notice of motion be made returnable instanter. 

   (3)       That otherwise the application in the notice of motion be dismissed.

10. I also order that the applicant pay the costs of the respondents in respect of this application.  I am not disposed to making any order in relation to the application in the Supreme Court. 

I certify that the preceding ten (10) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Stone.

Associate:
Dated:        19 February 2009

Counsel for the Applicant:	W Sharwood
Solicitor for the Applicant:	Bradley Allen Lawyers
Counsel for the 1st and 2nd Respondents:	B Salmon QC
Solicitor for the 1st and 2nd Respondents:	J S O’Connor Harris & Co

Solicitor for the 3rd Respondents:	I Gillespie, Gillespie-Jones & Co
Date of Judgment:	13 February 2009