Colbron, W. v St Bees Island P/L

[1994] FCA 747

7w J 9 9

JUDGMENT No. ..... , ....... ,. ,, ....,.

NOT FOR DISTRIBUTION

IN THE FEDERAL COURT OF AUSTRALIA	)
NEW SOUTH WALES DISTRICT REGISTRY )	No. G326 of 1994.
GENERAL DIVISION	1

WARWICK COLBRON

Applicant

ST BEES ISLAND PTY LTD
ACN 010 400 572
First Respondent

LIONEL NEIL BERCK Second Respondent

MARGARET OTTILLIE BERCK

Third Respondent

RECEIVED	JOHN FRANCIS URCH Fourth Respondent
WHITSUNDAY ISLAND DEVELOPMENTS, PTY LIMITED (ACN 059 374 882) Fifth Respondent

CORAM :	LINDGREN J
PLACE :	SYDNEY
DATE :	5 SEPTEMBER 1994

There is before me a notice of motion filed on 22 August 1994 by

the applicant seeking an order that judgment be entered as

order, that the fifth respondent, until the determination of	The notice of motion also seeks an order, to give effect to that
these proceedings, pay into Court four amounts specified in paragraph 2 in the notice of motion. They are four amounts totalling $240,000. The first, of $60,000, would fall due on 8 September 1994, and the further amounts would fall due on 8 October, 8 November and 8 December 1994.
It is necessary to have some understanding of the general nature of the proceedings. That can be gained from a reading of the amended statement of claim which was filed on 15 July 1994. The applicant seeks payment from the first to fourth respondents of a commission of $240,000 to which he says he is entitled for finding the fifth respondent to purchase from them the leasehold of St Bees Island off the coast of Queensland. The purchase price is payable by instalments under an agreement dated 9 March 1994. Clause 2.1 of the conditions of sale forming part of that contract lists 43 instalments of purchase price commencing with an instalment of $200,000 which fell due on 8 June 1994 and continuing to an instalment of $400,000 which will fall due on
8 December 1997. At the time 30f the hearing the next instalment

against the fifth respondent in the terms sought in paragraph 5

of the applicant's Application filed on 3 June 1994. Paragraph	.
5 of the Application is as follows:

"From the date of this Application and until further order of the Court the Fifth Respondent pay into Court any amount payable to the First to Fourth Respondents in respect of an agreement entered into as between the Fifth Respondent and the First to Fourth Respondents for the sale of the lease hold of St Bees Island Queensland."

to fall due is an instalment of $60,000 which will fall due on 8 September 1994 and this is the first amount to which the notice of motion refers.

As well as an action for breach of the contract by which, allegedly, the first to fourth respondents retained him, the applicant pleads misleading and deceptive conduct in	contravention of S. 52 of the Trade Practices Act, 1974 (Cth).	The nature of the pleaded cause of action in that respect is that
the first to fourth respondents negotiated and entered into the contract not intending to perform it.
There are numerous defences raised. It is not necessary for me to deal with all of them. Amongst other defences, it is pleaded that the applicant did not procure a contract of sale between the vendors and the purchaser which went to completion, that the contract for commission as pleaded is caught by provisions of the Auctioneers and Agents Act, 1971 (Qld), alternatively by
provisions of the ProDertv, Stock & Business Aaents Act, 1941
(NSW). There are numerous other defences pleaded.
The hearing before me has been treated by the applicant and the first to fourth respondents as interlocutory,- and it is not for me to resolve any issues of fact.
It is common ground that the four vendors have a contractual entitlement to be paid the instalments referred to in the contract of sale. The question before me is why, on an interlocutory basis, I should accede to the applicant's motion that I interfere with that contractual entitlement. It seems to me that the appropriate approach to that question is to treat the application as one for relief in the nature of a Mareva injunction and to apply generally the tests which are laid down

l

as correct to be applied to such an application.

On the question of the establishment of the cause of action, affidavits have been read on behalf of the applicant and of the first to fourth respondents. The evidence satisfies me that the fifth respondent is aware that the notice of motion is being heard and has indicated that it does not wish to be heard on the motion and, in effect, submits to whatever order the Court makes.

I do not find it necessary to deal with the question of the strength or otherwise of the cause of action. It is clear that

the object of Mareva relief is not to convert an unsecured	creditor into a secured creditor. It is not submitted for the
applicant that the applicant is at present secured. The applicant seeks to be placed in a position of having a fund held to secure what may be ultimately found to be the applicant's entitlement against the first to fourth respondents. In order to achieve this, it is necessary that the applicant show a risk of dissipation or a risk that the first to fourth respondents will take action to render themselves "judgment proof".
Evidence has been led on behalf of the first to fourth respondents as to their assets and liabilities, or at least as to the assets and liabilities of the second to fourth respondents, being the individual vendors. That evidence would suggest that they have ample assets to satisfy any liability which they may be found to have to the applicant. The evidence also shows that their solicitor is informed that they do not intend to vacate the jurisdiction of this Court, nor to remove any of the assets referred to in the solicitor's affidavit from the jurisdiction of the Court.
In my view the applicant has not demonstrated a threat of dissipation of assets or a threat that the first to fourth respondents will, unless relief is granted, render themselves "judgment proof". Therefore, on the existing evidence I may not interfere with the contractual entitlement of the first to fourth
respondents as vendors:  Jackson v Sterlina Industries ~imited
(1987) 162 CLR 612 at 622 (Deane J); Patterson v BTR Enaineerinq JAust) Ltd (1989) 18 NSWLR 319 (CA). It is conceivable that further evidence may come to light prior to the final hearing of these proceedings which would enable the applicant to discharge the onus upon him in that respect, but in my view, at present he has not done so.
I think, however, that the proceedings warrant as early a hearing as the commitments of the Court can give it. Reference has been
made by the applicant to what he perceives to be attempts by the first to fourth respondents to delay the hearing. I say nothing
about this. It does, however, seem to me desirable that the hearing be brought on as soon as may be. With that in mind I will direct the parties to apply their minds to devising consent directions, and if consent directions cannot be devised I will determine the directions, with a view to the matter being prepared for hearing.
The formal orders in relation to the notice of motion, filed on
22 August 1994 is that the motion is dismissed and the applicant
is ordered to pay the costs of the first to fourth respondents of the motion.

I certify that this and the preceding 4

pages are a true copy of the Reasons for Judgment of the Honourable Justice Lindgren

~ssociate:	&dd/fY
Dated:

l4 0ct0Y994

liswX!:	5 September 1994
Place:	Sydney
Date of Iudment:'	5 September 1994
A~~earances:	The applicant instructed by Colbran L Associates appeared for himself.
Mr S Burchett of counsel instructed by Brock Partners appeared for the 1st to 4th respondents.