Gold Coast City Council v. Mountdene Pty Ltd & Ors
[2009] QPEC 2
•6 February 2009
PLANNING AND ENVIRONMENT COURT OF QUEENSLAND
CITATION: | Gold Coast City Council v Mountdene Pty Ltd & Ors [2009] QPEC 2 |
PARTIES: | GOLD COAST CITY COUNCIL (Applicant) |
FILE NO/S: | 482/06 |
PROCEEDING: | Contempt and application to vary |
DELIVERED ON: | 06 February 2009 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 29 January 2009 |
JUDGE: | Kingham DCJ |
ORDER: | 1. The further hearing of the contempt application brought by the Council and the 2nd respondent’s application to vary the order of 11 September 2008 are adjourned until 09 March 2009 in Brisbane. 2. The 2nd respondent to advise the Council in writing and as soon as is reasonably practicable after he, Timothy Dooney or his solicitor become aware of any of the following: (a) That the HSBC Hong Kong has declined to issue the letter of credit. (b) That the NAB has declined the purchaser’s application for finance. (c) That the date for settlement of the contracts of sale of the Avalon or Mt Perry Rd properties has been extended. (d) Any other impediment to the settlement of those contracts of sale on or before 27 February 2009. 3. Upon settlement of either property, the net proceeds of sale are paid into the trust account of the 2nd respondent’s solicitors and are retained in that account pending further order of this court. |
CATCHWORDS: | CONTEMPT – Opportunity to purge – Further adjournment APPLICATION TO VARY ORDERS – Adjournment of hearing |
COUNSEL: | N Kefford for the applicant B G Cronin for the first and second respondents |
SOLICITORS: | Minter Ellison - Gold Coast for the applicant Haney Lawyers for the first and second respondents |
Background & current applications
This development has been beleaguered by ongoing delays in the works necessary to stabilise the site. To the large part those delays may be explained by liquidity difficulties experienced by the developer (the 1st and 2nd respondents).Consequently, the Council and a number of owners of lots in the development (the remaining respondents) have borne the burden of proceedings designed to secure site rectification. On Council’s application, on 25 November 2008, I made an order the 2nd respondent was in contempt of the Planning and Environment Court by his non-compliance with the Court’s order of 11 September 2008 that he provide an unconditional bank guarantee in relation to the costs of rectification works. To afford the 2nd respondent the opportunity to purge his contempt, I adjourned the further hearing of the contempt application to 29 January 2009 and indicated I would then hear submissions as to penalty. The other respondents have not played an active part in the contempt application.
On that date, the 2nd respondent filed by leave an application to vary the date for compliance with the order of 11 September 2008. His counsel also applied orally to adjourn both that application and the further hearing of the contempt application for further mention after 27 February 2009. That is the extended settlement date on the sale of two properties, referred to as Avalon and Mt Perry Rd, which are owned by companies controlled by the 2nd respondent. His contention is that, if these properties are sold the net proceeds will be adequate to fund the rectification works. He urges me to accept this is currently the only option available for the 2nd respondent to purge his contempt and to fund the rectification works.
The Council did not oppose the application to vary the order of 11 September 2008 but opposed the adjournment of the further hearing of its contempt application. Its counsel argued the application to vary was a matter I should take into account in determining the penalty for the 2nd respondent’s ongoing non-compliance but that I should proceed to fix a penalty now.
Affidavit evidence in support of his application was supplemented by oral evidence from the 2nd respondent and his brother Timothy Dooney. For ease of reading I will refer to Timothy Dooney as Mr Dooney and John Dooney as the 2nd respondent. By agreement, correspondence between the parties and regarding the sale of the properties was received as exhibits.
I am persuaded by that evidence of the following matters:
· Mr Dooney assists in managing the financial affairs of the 2nd respondent and his group of companies, in particular in dealings with financiers.
· The 2nd respondent has, in effect, delegated to Mr Dooney, responsibility for purging his contempt.
· Mr Dooney has taken reasonable steps in Australia’s current financial climate to seek to raise finance through further securities against the group’s assets.
· Further attempts to raise security in the immediate future are unlikely to be productive.
· The best option for securing site remediation is to achieve the sale of group assets.
· Contracts for the sale of the Avalon and Mt Perry Rd properties will provide sufficient funds to fund outstanding remediation works.
· The purchaser proposes to fund the purchase of those properties and a number of others owned by the group through finance raised from the National Australia Bank upon a letter of credit issuing from the HSBC Hong Kong.
· Those contracts are due to settle on 27 February 2009.
· The settlement date was fixed to accommodate the time involved in the HSBC Hong Kong issuing the letter of credit to the NAB and the NAB providing finance to the purchaser.
It is troubling that, once again, the 2nd respondent was aware before the matter was brought back before the court that compliance was impracticable yet took no steps to formally draw that to the court’s attention until the return date on 29 January 2009. Council did all it reasonable could to clarify the 2nd respondent’s position once it became aware in late December that the settlement dates had been extended. I do accept that it was somewhat of a moving feast. Approaches to financiers were being undertaken at the same time as ongoing dealings about settlement of sale contracts. Nevertheless, by 19 December 2008, the settlement date had been extended past the return date and sometime in January 2009 it was plain enough to the 2nd respondent he would not be in a position to purge his contempt by raising further finance. I am unable to be more specific about the date due to the characteristically vague nature of the affidavit material filed on the 2nd respondent’s behalf. I am concerned there is an ongoing reluctance by the 2nd respondent to be forthcoming with the Council or with the Court about progress in attempts to purge his contempt.
With some reluctance, given the difficult history of these proceedings, I have decided the appropriate course is to adjourn both the further hearing of the contempt application and the application to vary the 11 September order. I have decided to do so on the 2nd respondent’s undertaking that the net proceeds of sale of Avalon and Mt Perry Rd will be paid into the trust account of his solicitors and upon further conditions which are specified in the orders below. Those further conditions are intended to ensure that the Council is kept fully informed of progress relating to those sales and of any impediment to their settlement or any changes to the current timetable. They should be interpreted in that spirit.
My orders are:
1. The further hearing of the contempt application brought by the Council and the 2nd respondent’s application to vary the order of 11 September 2008 are adjourned until 09 March 2009 in Brisbane.
2. I direct the 2nd respondent to advise the Council in writing and as soon as is reasonably practicable after he, Timothy Dooney or his solicitor become aware of any of the following:
(a) That the HSBC Hong Kong has declined to issue the letter of credit.
(b) That the NAB has declined the purchaser’s application for finance.
(c) That the date for settlement of the contracts of sale of the Avalon or Mt Perry Rd properties has been extended.
(d) Any other impediment to the settlement of those contracts of sale on or before 27 February 2009.
3. Upon settlement of either property, I order the net proceeds of sale are paid into the trust account of the 2nd respondent’s solicitors and are retained in that account pending further order of this court.
0
0
0