DRD Australasia APS v Stratton - [2008] WASC 98

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: DRD AUSTRALASIA APS -v- STRATTON [2008] WASC 98

CORAM: LE MIERE J

HEARD: 20, 26 NOVEMBER & 4 DECEMBER 2007, 24 JANUARY 2008

DELIVERED : 24 JANUARY 2008

PUBLISHED : 3 JUNE 2008

FILE NO/S: CIV 1797 of 2002

BETWEEN: DRD AUSTRALASIA APS
First Plaintiff
DRD AUSTRALASIA PTY LTD
Second Plaintiff
AND
JOHN STRATTON
Defendant

Catchwords:

Civil procedure - Interlocutory orders - Freezing orders - Whether defendant is required to make asset disclosure when application for freezing order is extended until further order - Turns on own facts

Legislation:

Nil

Result:

Application allowed

Category: B

Representation:

Counsel:

First Plaintiff                  :     Mr D J Martino
Second Plaintiff             :     Mr D J Martino
Defendant:     Mr G H Murphy SC & Mr G I Macnish

Solicitors:

First Plaintiff                  :     Allens Arthur Robinson
Second Plaintiff             :     Allens Arthur Robinson
Defendant:     Cocks Macnish

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

Nil

LE MIERE J: The defendant has applied, pursuant to liberty to apply, effectively for a variation of the orders that I made on 4 December 2007, with the effect that the time for compliance with [7] of the orders made on 26 November be extended until further order. Paragraph 1 of the order made on 26 November 2007 is in the form set out in the attachment to Supreme Court Practice Direction No 7 of 2007. Paragraph 1 provided that the order have effect up to and including 4 December, being the Return Date, and on the Return Date at not before 10.00 am there will be a further hearing in respect of the order. That was subject to [2] which provided that:
[a]nyone served with or notified of this order, [including the defendant], may apply to the court at any time to vary or discharge the order, or so much of it as affects the person served or notified.
Paragraph 5 of the order set out what is now referred to as a freezing order. Effectively, [5] is restraining the defendant from removing or disposing of assets, except as provided for. Paragraph 7 was an order for the disclosure of assets. Subject to the express exceptions in [9], [7] required that the defendant ‑
a)at or before the further hearing on the Return Date, (or within such further time as the court may allow), to the best of your ability to inform the applicant in writing of all your assets world wide, giving their value, location and details (including any mortgages, charges or other encumbrances to which they are subject) and the extent of your interest in the assets;
b)within 7 working days after being served with this order, swear and serve on the applicant an affidavit setting out the above information.
On 4 December 2007 at the further hearing on the Return Date, the plaintiff applied for the continuation of the order, and the defendant applied for the order to be discharged. The defendant did so, on grounds including, in effect, that there was no sufficient prima facie and no or no sufficient evidence of a disposition or disposal of assets by the defendant justifying the making of the order.
The defendant's application or submission, if successful, would have and will result in the discharge of the order of 26 November 2007 and the defendant would not have been and will not be, if the order is made, obliged to make the asset disclosure.
The court heard argument but was unable to deliver a decision on 4 December 2007 because time did not permit it. Earlier in the day I had informed counsel that I could not continue with the matter beyond 4.00 pm because I had another appointment which I was required to keep (ts 104). The hearing reached 4.00 pm and I then informed counsel that, although they had completed their submissions, I was unable to proceed to deliver a decision.
I informed counsel that I would reserve my decision (ts 144). Counsel for the plaintiffs, Mr Martino, then inquired about how this would affect the injunction orders made on 26 November 2007. I asked, 'What are the terms of the orders?' Mr Martino said, 'I think the standard orders, your Honour, contemplate it expiring automatically today. Yes, paragraph 1'. After that was confirmed, I then engaged in the following exchange with counsel for the defendant Mr Murphy SC. I said:
I'm afraid I just don't have the time or capacity to be able to consider the matter right now. In those circumstances, it seems to me appropriate to extend each of the orders until further order. Do you want to say anything about that?
Mr Murphy said, 'No, your Honour. It's the only practical solution'. I then stated:
Yes, I think that's right. I'll put it in these terms: the operation of the freezing order made on 20 November 2007 is extended until further order.
That was on the application and then there was reference made to Mrs Stratton. I did not expressly advert to the asset disclosure order operating separately from the freezing order. In referring to 'the orders', I was referring to all of the orders made on 26 November 2007 and, when I subsequently referred to 'the freezing order' made on 26 November 2007, I was referring or should be taken to have been referring to all of the orders made and not drawing a distinction between the freezing order and the asset disclosure order. To the extent that my words say or imply otherwise, they were poorly chosen.
As I have said, I informed counsel for the defendant that it was appropriate to extend each of the orders until further order. That would be or should be taken to include extending the time for compliance with the orders made on 26 November 2007. The orders that I actually pronounced did not have that effect. The order made on 4 December 2007 has not been perfected by extraction, and hence may be varied in the exercise of the court's discretion.
In all the circumstances it is appropriate that I should now make the order that I should properly have made on 4 December 2007, if the matter had been expressly adverted to and I had expressly addressed the matter at that time.
Counsel for the plaintiff submitted that the court has the power to make the asset disclosure order as an adjunct to the freezing order and that it is usually made as an adjunct to the freezing order. This submission was supported by reference to the form of order set out in the practice direction. I am mindful that the matter before me on 4 December 2007 included whether or not the asset disclosure order should be discharged ‑ that is, I was and I am required to determine whether or not the defendant should be obliged to make the asset disclosure.
The defendant's submissions included, in effect, that the order should not have been made and should not be continued because there was no or insufficient prima facie case and no or insufficient evidence of the dissipation or attempted dissipation of assets. In all the circumstances, it is appropriate to exercise my discretion to vary the order of 4 December 2007 to provide that [7] of the orders made on 26 November 2007, as varied on 4 December 2007, be amended with effect from 4 December 2007 so that the time for compliance with [7] of the order is extended until further order. It is appropriate, because to make any other order would have the effect of requiring the defendant to comply with the order in circumstances where he had, in effect, exercised his right to apply for that order to be set aside and the court had not given a decision in relation to that matter because time did not permit. In my view, it would be an unjust outcome to require the defendant to comply with the order in the meantime.
By extending the freezing order ‑ that is, in effect, the restraint upon the defendant from disposing or dealing with assets in the terms set out in [5] and [6] of the order of 26 November 2007 - there is some protection afforded to the plaintiffs to achieve the objects of a freezing order. In my view the justice of the situation does not require that the defendant should make the asset disclosure required by [7] of the orders until such time as the court delivers its decision on the application heard on 4 December 2007.
For those reasons, I will order that the order of 4 December 2007 be varied to provide that [7] of the orders made on 26 November 2007, as varied on 4 December 2007, be amended with effect from 4 December 2007, so that the time for compliance with [7] of the order is extended until further order.