Collins Marrickville Pty Ltd v Henjo Investments Pty Ltd

[1987] FCA 282

c

NOT FOR DISTRIBUTION

IN THE FEDERAL COURT OF AUSTRALIA	) )
NEW SOUTH MALES DISTRICT REGISTRY	) No. NSW G.211 of 1985
)
GENERAL DIVISION	)

BETWEEN:	COLLINS HARRICKVILLE	PTY
LIMITED Applicant

AND:

HENJO INVESTMENTS PTY

LIMITED

First Respondent

HENRY SAADE

Second Respondent

\ - '

NORMAN PFPER GEORGE

Third Respondent

SAADE DEVELOPMENTS FTY

..	LIMITED
._	Fourth Respondent

CORAM: WILCOX J

PLACE	:	SYDNEY
DATE :	29 APRIL 1987

MINUTES OF ORDER

Upon the applicant giving to the Court the usual undertaking

a s to damages, THE COURT ORDERS THAT:

2 .

1. Pending further order, the first, second and fourth

respondents and each of them be restrained from

taking any action to recover any payments due under,

or otherwise to enforce the rights granted by, a

mortgage dated 1 Hay 1985 from the applicant to the

first respondent, a copy of which is annexure A to

the affidavit of Ian Francis m e r dated 16 April

1987.

2 . Liberty to apply be granted to any party in respect

of the said order on 48 hours' notice.

3 .	The costs of the notice	of motion heard today is
reserved.

Note:	Settlement and entry of orders is dealt with in Order
36 of the Federal Court Rules.

NOT FOR DISTRIBUTION

IN THE FEDERAL COURT OF AUSTRALIA	1
)
NEM SOUTH WALES DISTRICT REGISTRY	) No. NSW G.211 of 1985
)
GENERAL DIVISION	)

BETWEEN:	COLLINS MARRICKVILLE	PTY
LIMITED Applicant

AND:

HENJO INVESTMENTS PTY

LIMITED

First Respondent

HENRY SAADE

Second Respondent

NORMAN PETER GEORGE

Third Respondent

SAADE DEVELOPMENTS PTY

LIMITED

Fourth Respondent

CORAM: WILCOX J

PLACE :	SYDNEY
DATE :	29 APRIL 1987

EXTEMPORE REASONS FOR JUDGMENT

2.

I am of the opinion that the Court should intervene

to prevent enforcement action on the mortgage dated 1 May

1985, which is annexed to the affidavit of Mr Dwyer sworn on

16 April 1987. I have already found as against the first

respondent, Henjo Investments	Pty Limited, and the second
respondent, Henry Saade, that	a case has been made out; of

conduct within 3 .52 of the Trade Practices Act 1974 in the

case of the first respondent and, in the case of the second

respondent, knowing involvement in that conduct.

The applicant is entitled to such relief as may be

appropriate when evidence in relation to relief is before the

Court and a hearing on that matter has been undertaken. The

amount which is due on the mortgage next Friday, 1 May. is

$230.000. This is both a considerable sum in itself and a

major proportion of the purchase price. Prima facie, it seems

to me, the value of the business which was purchased is likely

to be less than the purchase price, having regard to the

limitations in the way in which it may lawfully be operated.

Whether or not this is a case in which, in the end, there should be orders, in effect, setting aside the whole

transaction or any particular parts	of the transaction is a
matter about which I have formed no	views whatever.

However, it seems to me that, liability having been

established, it is most desirable	that the options of the
Court in relation to the ultimate	form of relief be preserved

insofar as that is possible. The matter is complicated by the

3 .

fact that there was an assignment of the mortgage from Henjo

Investments to Saade Developments Pty Limited, which is now

the fourth respondent, on some date after 17 July 1985.

I have no doubt that, before the negotiations between

Mr Saade and Mr Collins, Ur Henry Saade had reached an

agreement in principle with his brother George Saade that he,

Henry Saade, would buy into the assets of Mr George Saade, held in Melbourne, and that the two brothers would work

together.	That was conditional upon the sale of the New York
Deli.

I am not, at this stage, persuaded that this informal

agreement was consummated by a written agreement made on 2 May

1985, as would appear to be the position pursuant to an

agreement which has now been put in evidence. I note that

this agreement was not stamped until 8 October 1985, and it

may have been that the agreement came into existence at a

later date and was backdated. It is now clear beyond any

question that the assignment of the mortgage from Henjo

Investments Pty Limited to Saade Developments p y Limited,

which is dated 1 May 1985, was in fact backdated. The

evidence indicates that this document was prepared after 17

July 1985; and by 3 July 1985 the solicitors for Henjo

Investments were aware of a complaint made by the present

applicant in relation to the matters	the subject of this
action.

4 .

Hr Zucker has no diary note as to the date upon which

he received instructions for the assignment and, although he

says that his recollection is that it was before 3 July, there

is nothing put before the Court to indicate that this is more

likely than otherwise. Without any disrespect to Mr Zucker,

it seems to me difficult to rely upon the unsupported

recollection of a solicitor as to when he received

instructions, apparently by telephone, to take a particular

step in a conveyancing matter. I also have regard to the fact

that, on the whole of the material I have seen, Mr Zucker

appears to be in the habit of acting efficiently and promptly,

and I would be a little surprised if he had waited for over

two weeks to undertake such a small task as transfer of the

mortgage, particularly if he knew, as he did at that time,

that there was some complaint made by the present applicant,

the mortgagor.

I do not think that I have to reach any view about

this matter. What is quite clear is that the transaction

between the first and fourth respondent, although in one sense

at arm's length, was an inter-family transaction. It may be

that there will have to be some renegotiation of current

arrangements with Westpac if the payment due next Friday is

not available to be paid to the bank, but there is no reason

to believe that this will occasion any problem.

I propose to make an order but to reserve liberty to

apply in case some difficulty not presently foreseen does

arise. I do not think that it is appropriate to make order

5 .

(1) In the notice of motion, which I s , in effect, a variation

on an interim basis. I think that the appropriate course is

to take the more usual course of making an interlocutory

injunction and the price for that is that the applicant must

give the usual undertaking as to damages. Mr Moore has

informed me that he does have those instructions.

The order that I propose to make is as follows: upon

the applicant giving to the Court the usual undertaking as to

damages, I order that, pending further order, the first,

second end fourth respondents and each of them, be restrained

from taking any action to recover any payments due under or

otherwise to enforce the rights granted by a mortgage dated 1

May 1985 from the applicant to the first respondent, a copy of

which is annexure A to the affidavit of Ian Francis Dwyer

dated 16 April 1987.

I grant liberty to apply to any party in respect of

the said order on 48 hours' notice, and I reserve the costs of

this notice of motion.

I certify this and the four ( 4 )

preceding pages to be a true copy of

the Reasons for Judgment of

his Honour Mr Justice Wilcox.

6 .

Counsel for the Applicant: Mr G A Moore

Solicitors for the Applicant: Laurence Ei Laurence

Counsel for the Respondent:	Mr F G Lever
Solicitors for the Respondent:	Swaab & Associates
Date(s) of hearing:	29 April 1987