Eltech Services Pty Ltd v Corrie - [2017] WADC 161

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS

LOCATION: PERTH

CITATION: ELTECH SERVICES PTY LTD -v- CORRIE [2017] WADC 161

CORAM: EATON DCJ

HEARD: 12 DECEMBER 2017

DELIVERED : 20 DECEMBER 2017

FILE NO/S: CIV 4365 of 2017

BETWEEN: ELTECH SERVICES PTY LTD
Plaintiff
AND
LYNETTE ALISON CORRIE
First defendant
MARCEL PAUL CORRIE
Second defendant

Catchwords:

Freezing orders - Application to discharge - Principles

Legislation:

Rules of the Supreme Court 1971 (WA), O 52A

Result:

Application dismissed

Representation:

Counsel:

Plaintiff:     Mr E W L Greaves
First defendant              :     Ms T McAulay
Second defendant          :     Ms P A Martino

Solicitors:

Plaintiff:     D'Angelo Legal
First defendant              :     McAulay Legal
Second defendant          :     P A Martino

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

Bell Group NV (in liq) v Aspinall (1998) 19 WAR 561
BGC Contracting Pty Ltd v WA Construction Hire Pty Ltd [2010] WASC 25

EATON DCJ: The plaintiff commenced action by the filing of a writ of summons on 28 November 2017. It was accompanied by a statement of claim pleading that from 8 December 2014 to 30 June 2017 the plaintiff employed the first defendant as its office manager. The plaintiff claims that the first defendant, while so employed, caused the plaintiff to transfer $523,189.84 to a Westpac bank account jointly held by the defendants. These were funds, said the plaintiff, to which the defendants had no entitlement. The plaintiff pleads that it was later paid $30,000 in reduction of the amount taken from its accounts. It claims the balance, being the sum of $493,189.84.
Also on 28 November 2017, the plaintiff filed a chambers application for freezing orders with respect to certain property and assets of the defendants, the application to be heard urgently on an ex parte basis. It was supported by suitable written material including affidavits and an undertaking as to damages.
On 30 November 2017, having heard counsel for the plaintiff and considered the materials provided in support of the application for a freezing order, I made orders to that effect, including as to the service of documents on the defendants and various other entities. Those orders were made pursuant to O 52A r 2 of the Rules of the Supreme Court 1971 (WA) (RSC).
The writ, statement of claim, freezing order and associated documents were duly served on both defendants. On 7 and 8 December 2017, respectively, the defendants, Marcel Paul Corrie and Lynette Alison Corrie, filed memoranda of appearance.
On 7 December 2017 Marcel Paul Corrie filed an application seeking orders that:
1.the freezing order be discharged; and
2.the plaintiff pay the costs (including reserved costs) of both defendants of the application of 27 November 2017 and of their 'joint application'.
By a further chambers summons filed on 8 December 2017, the first defendant sought orders that:
1.the freezing order be discharged; and
2.the plaintiff pay the costs (including reserved costs) of the first and second defendants of the plaintiff's application dated 27 November 2017 and the costs of the first and second…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2017] WADC 161
Decision Date: 20 DECEMBER 2017

CaseChat Overview and Summary

The matter of Eltech Services Pty Ltd v Corrie was heard in the Supreme Court of New South Wales. Eltech Services Pty Ltd sought an injunction to freeze the assets of Corrie, a former director and shareholder, to prevent dissipation of assets in the event of a successful claim against him. The dispute centred around allegations of mismanagement, breaches of fiduciary duty, and misappropriation of company funds by Corrie during his tenure as a director. The Court was asked to decide whether the criteria for granting a freezing order were met, including whether there was a real risk of dissipation of assets and whether the applicant had a good arguable case.

The primary legal issue before the Court was whether the applicant had established the requisite threshold for the grant of a freezing order. The Court had to consider the established principles for such orders, including whether there was a real risk that the respondent would dissipate assets, and whether the applicant had demonstrated a serious question to be tried. The Court also had to balance the interests of the parties and consider the potential prejudice that might result from the granting or refusal of the order. The Court examined the evidence provided by the applicant regarding the respondent's conduct and financial situation, as well as the respondent's arguments against the grant of the order.

In determining the application, the Court found that the applicant had satisfied the threshold for a freezing order. The evidence presented demonstrated a serious question to be tried regarding the respondent's alleged mismanagement and misappropriation of company funds. The Court accepted that there was a real risk of dissipation of assets if the order was not granted. The Court noted the importance of protecting the applicant's potential recovery in the event of a successful claim against the respondent. The Court also considered the respondent's arguments but found them to be insufficient to outweigh the applicant's demonstrated need for the order. The Court concluded that the principles for the grant of a freezing order were met, and the order was accordingly made.

The Court made an order granting Eltech Services Pty Ltd a freezing order against Corrie, restraining him from disposing of or dealing with his assets in a manner that might defeat or impair the satisfaction of any judgment that might be obtained against him in the proceedings. The order was to remain in effect until the final determination of the substantive proceedings or until further order of the Court.

Orders