Edmunds & Ors v Pickering & Ors (No 5) No. Scgrg-88-2452

[2000] SASC 354

[2000] SASC 354

EDMUNDS & ORS V PICKERING & ORS (NO. 5)

Civil (Ex Tempore)

1. LANDER J.      In this case I published reasons finding for the corporate plaintiffs against all of the defendants except Mrs Anthea Pickering on 23 December 1999.

2. I heard the parties further in relation to the relief which ought to be given and on 10 August 2000 I published further reasons in which I made certain orders in favour of the corporate plaintiffs against the remaining defendants.

3. One of the orders was that upon payment by the plaintiff, Smoothpool Nominees Pty Ltd, of the sum of $514,544 the defendant, Mr Gregory Pickering, should at his expense in all things execute the documents necessary to effect the registration of the transfer of the legal interest in Abalone Authority W17 to Dadeeton Pty Ltd.

4. Upon payment of that sum by Smoothpool Nominees Pty Ltd I also ordered Mr Gregory Pickering and Greg Pickering Investments Pty Ltd to jointly pay to Dadeeton Pty Ltd the sum of $1,099,351 inclusive of interest.

5. I also ordered Silver Glow Pty Ltd to pay to the plaintiff, Dadeeton Pty Ltd, the sum of $265,000 which sum, if paid, would discharge the amount owing by Mr Gregory Pickering and Greg Pickering Investments Pty Ltd.

6. I extended the time in which the parties had to appeal.

7. All of the defendants, with the exception of Mrs Anthea Pickering, have appealed against the orders made.  The grounds of appeal mainly relate to factual findings which the defendants say I should or should not have made.  The defendants, however, have also appealed against my interpretation of the Act and Regulations which were relevant to these proceedings and for my failure to find that the plaintiffs had been guilty of laches which disqualified them from any relief.

8. The plaintiffs have cross-appealed claiming that the plaintiffs were given insufficient relief.

9. The plaintiffs have also appealed against the dismissal of their claim against the defendant, Mrs Anthea Pickering.

10. The parties have advised me that the appeal is likely to take five days and I think that is as reasonable estimation of the time likely to be expended by the Full Court and determining the many issues raised by all parties in their respective appeals.

11. There is no prospect of an appeal involving that length of time being heard this year.

12. It is likely that the appeal could not be heard before late February or early March 2001.

13. The Abalone Authority, the subject of the order to which I have referred, entitles the holder to exploit the authority to the extent of a quota which was attached to the authority.  The holder of the authority can exploit that quota over a calendar year.

14. In this year the ordinary quota has been fully exploited by the defendant.  The plaintiffs allowed the defendant to continue to exploit the authority upon agreed terms.

15. However the defendant, Mr Gregory Pickering, seeks a stay of my order so as to enable him to continue to exploit the authority next year under such terms and conditions as may be imposed by the Court until such time as his appeal from my decision has been resolved by the Full Court.

16. In support of that application the defendant claims that if he was to comply with the orders which I have made the authority would be transferred in accordance with the order.  However if the Full Court was to uphold his appeal and discharge the order for the transfer of the authority there is a risk, it is submitted, that the Director of Fisheries would not consent to the re-conveyance of the authority to the defendant, Mr Gregory Pickering.

17. The defendant also claims that financial statements which are exhibited to an affidavit of the defendant’s solicitor, show that Dadeeton Pty Ltd may well be insolvent and in those circumstances if the defendants were to pay the money sum ordered to be paid to Dadeeton Pty Ltd there is a risk that that sum of money would be dissipated prior to the disposition of the appeal by the Full Court.

18. In those circumstances it is the defendants’ claim that there is a real risk that the defendants’ appeal to the Full Court will be rendered nugatory by a failure to stay those orders: Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (1986) 89 ALR 265.

19. The defendant also claims that there is a serious and reasonable concern that the plaintiff, Smoothpool Nominees Pty Ltd, is insolvent and may be unable to make the payment which is a condition of the obligation of the defendant to convey the authority to the plaintiff.

20. I can deal with the last point quickly.

21. If the plaintiff, Smoothpool Nominees Pty Ltd, is not able to make payment of the sum ordered on 10 August 2000 then the defendant, Mr Gregory Pickering, will not become obliged to convey to the defendant, Dadeeton Pty Ltd, the Abalone Authority.  In those circumstances the defendant will be able to continue to exploit the authority.

22. Moreover none of the defendants will become liable to pay any of the monetary sums to which I have referred unless and until Smoothpool Nominees Pty Ltd pays the amount it is obliged to pay in accordance with my orders.

23. I do not think that Smoothpool Nominees Pty Ltd’s financial position is relevant to a determination of whether or not a stay should be ordered.

24. The plaintiffs oppose the defendants’ application.

25. First the plaintiffs claim that Dadeeton Pty Ltd is not insolvent nor is it any risk of it becoming insolvent.  The plaintiffs point to the absence in the balance sheet of Dadeeton Pty Ltd of an actual asset namely a current Abalone Authority, which is owned by Dadeeton Pty Ltd, and a potential asset being the order for costs made in favour of the plaintiffs.

26. The plaintiffs also point to the fact that when the plaintiff, Smoothpool Nominees Pty Ltd, discharges its obligations the defendants will become obliged to pay in excess of $1 million and the plaintiffs, that is Smoothpool Nominees Pty Ltd and Dadeeton Pty Ltd’s financial position will improve to the extent of about $514,000.

27. In my opinion the financial statements of Dadeeton Pty Ltd properly understood do not disclose it to be at risk of becoming insolvent.

28. Next the plaintiffs claim that there is no real risk that the Director of Fisheries would not reconvey the authority to Mr Gregory Pickering in the event that Mr Gregory Pickering was successful on this appeal.  There is no doubt, the plaintiffs say, if Mr Gregory Pickering was successful he would seek an order seeking the re-conveyance of the authority to himself and the Director of Fisheries would be obliged to comply.

29. I think that is partly right.  I think if Mr Gregory Pickering was successful on appeal he could obtain an order from the court directing Dadeeton Pty Ltd to re-convey to him the Abalone Authority.  That order would not oblige the Director of Fisheries to comply but in the event that the Director did not comply, in my opinion, it would be open to the defendant to come to this Court to obtain the relief necessary to require the Director to assist in effectuating the order made by the Court.

30. The plaintiffs also point to one other matter which they say is important in determining whether or not a stay order should be made. 

31. They say that during the remainder of this year a quota will be available for research for the abalone industry.  Whilst the exploitation of that quota involves time and expense to the holder of the authority it is likely that it would give rise to a monetary benefit of $45,000.

32. It is submitted that if a stay order was made the plaintiffs would lose the benefit of that sum of money.

33. There is a real dispute between the parties as to whether or not such a quota is available, which I cannot resolve on this application.  However I do not think that the resolution of that matter is important.

34. I think the two grounds relied upon by the defendant for the stay order have not been made out.  As I have said I am not satisfied that there is any real risk that Dadeeton Pty Ltd  is or will become insolvent, nor do I think there is any real risk that the Director of Fisheries would fail to co-operate in the re-conveyancing of the authority to Mr Gregory Pickering in the event that his appeal was successful.

35. I think therefore that the problems raised by the defendant are illusory and should not give rise to a stay of the orders made on 10 August 2000.

36. Whilst I understand the defendant is anxious not to be parted from the authority which he believes he will retain after appeal a stay order should not be made in the circumstances such as this unless there is a real risk that the appeal will be rendered nugatory.  I do not believe that there is any such risk.  In those circumstances I dismiss the application for a stay.