Gordana Smith v Colin Steingold - [2018] NSWSC 1390

Supreme Court

New South Wales

Medium Neutral Citation: Gordana Smith & Anor v Colin Steingold [2018] NSWSC 1390
Hearing dates: 4 July 2018
Date of orders: 23 August 2018
Decision date: 23 August 2018
Jurisdiction: Equity - Commercial List
Before: Rein J
Decision:
See [21]-[23]

Catchwords: EQUITY – Whether solicitor on record should be restrained from acting for the First and Second Defendants in proceedings alleging undue influence and oppressive conduct on the part of the First Defendant – Whether solicitor in possession of confidential information of the Plaintiffs – Whether solicitor possessed knowledge of Plaintiffs’ character and tendencies – Whether a fair-minded reasonably informed member of the public would regard proper administration of justice as requiring the solicitor to be restrained from acting; HELD: Solicitor restrained from continuing to act for the First and Second Defendants.
Cases Cited: Black v Taylor [1993] 3 NZLR 403
Byrne v Production Magic Pty Ltd [2012] ACTSC 6
Cleveland Investments Global Ltd v Evans [2010] NSWSC 567
D & J Constructions Pty Ltd v Head and Ors trading as Clayton Utz (1987) 9 NSWLR 118
Earl Cholmondeley v Lord Clinton (1815) 19 Ves. Jr. 261; (1815) 34 E.R. 515
Geelong School Supplies Pty Ltd v Dean (2006) 237 ALR 612; [2006] FCA 1404
In the matter of Edgecliff Car Rentals Pty Ltd (deregistered) [2017] NSWSC 244
In the matter of IPM Group Pty Ltd [2015] NSWSC 240
Jing Li v Jin Lian Group Pty Ltd [2018] NSWSC 479
Kallinicos v Hunt (2005) 64 NSWLR 561; [2005] NSWSC 1181
Sent v John Fairfax Publication Pty Ltd [2002] VSC 429
Spincode Pty Ltd v Look Software Pty Ltd (2001) 4 VR 501; [2001] VSCA 248
Yunghanns v Elfic Ltd (formerly known as Elders Finance & Investment Co Ltd) (Supreme Court of Victoria, Gillard J, 3 July 1998, Butterworth Cases 9803031)
Category: Procedural and other rulings
Parties: Gordana Smith (First Plaintiff/ Applicant on the Motion)
Paul Smith (Second Plaintiff/ Applicant on the Motion)
Colin Steingold (First Defendant/ Respondent on the Motion)
Shadeen Pty Limited (Second Defendant/ Respondent on the Motion)
CG Partnership Pty Limited (Third Defendant)
Citrus Group Pty Limited (Fourth Defendant)
Thomas Russell (Respondent on the Motion)
Representation:
Counsel:
Mr N. Kirby (Plaintiffs)
Mr R. Glasson (First and Second Defendants)
Mr E. Yamine, solicitor (Third and Fourth Defendants)
Solicitors:
Peterson Haines (Plaintiffs)
Gillis Delaney Lawyers (First and Second Defendants)
ESY Lawyers Pty Ltd (Third and Fourth Defendants)

File Number(s): 2018/00175708
Publication restriction: Nil

Reasons for Judgment

This is an application by the Plaintiffs, Mr Paul Smith and Mrs Gordana Smith (for whom Mr N. Kirby, of Counsel, appears), to restrain the solicitor for the First and Second Defendant, Mr Trevor Russell, from continuing to act for those Defendants in these proceedings. The Third and Fourth Defendants, for whom Mr E. Yamine, solicitor, appears, support the Plaintiffs’ application.
The proceedings concern a company known as Citrus Group Pty Ltd (“Citrus”), the Fourth Defendant, the shares in which are owned by a…

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: [2018] NSWSC 1390
Decision Date: 23 August 2018

CaseChat Overview and Summary

Gordana Smith, the Plaintiff, sought relief against Colin Steingold, the First Defendant, and his associated entities, the Second and Third Defendants, in the Federal Court of Australia. The Plaintiff alleged that the First Defendant had exerted undue influence and engaged in oppressive conduct against her. The Plaintiff also sought to restrain the First Defendant's solicitor, the Respondent, from continuing to act on behalf of the First and Second Defendants, on the basis that he was in possession of confidential information and had knowledge of the Plaintiff's character and tendencies.

The central issue before the court was whether the solicitor should be restrained from acting for the First and Second Defendants in light of the allegations of undue influence and oppressive conduct. The court was required to consider whether the solicitor was in possession of confidential information, whether he had knowledge of the Plaintiff's character and tendencies, and whether a fair-minded reasonably informed member of the public would regard proper administration of justice as requiring the solicitor to be restrained from acting.

The court found that the solicitor was in possession of confidential information relating to the Plaintiff's personal affairs and was aware of her character and tendencies. The court concluded that a fair-minded reasonably informed member of the public would regard proper administration of justice as requiring the solicitor to be restrained from acting for the First and Second Defendants. The court held that the solicitor was restrained from continuing to act for the First and Second Defendants in the proceedings.

The court did not make any further orders beyond the restraint of the solicitor from acting for the First and Second Defendants.

Orders