Gunasegaram v Blue Visions Management Pty Ltd

[2017] NSWCA 187

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation:

Gunasegaram v Blue Visions Management Pty Ltd [2017] NSWCA 187

Hearing dates:

24 July 2017

Decision date:

24 July 2017

Before:

Leeming JA

Decision:

(1) Subject to order 3, stay the enforcement of the judgment in paragraph 7 and the orders in paragraphs 8, 9 and 13 of the Orders made on 10 May 2017 in NSW Supreme Court Proceeding 2014/192899, until 7 days after the final determination of the appeal in these proceedings or further order of this Court.

 

(2) Subject to order 3, stay the operation and effect of any garnishee order made in NSW Supreme Court Proceeding 2014/192899 in respect of payments to be made to the Respondent by each of:
(a) Commonwealth Bank of Australia (garnishee order made on 31 May 2017):
(b) Ernst & Young Services Pty Ltd (garnishee order made on 22 June 2017); and
(c) Westpac Banking Corporation (garnishee order made on 22 June 2017).

 

(3) In the event that Mr Gunasegaram fails by Friday 25 August 2017 to pay $400,000 by way of security for the judgment debt (a) into Court or (b) into a controlled monies account to be held jointly by his solicitor and the solicitor for Blue Visions Management Pty Ltd or (c) provides such other form of security as to which Blue Visions Management Pty Ltd agrees in writing, then the stays effected by orders 1 and 2 above are automatically discharged.

 

(4) Note Mr Gunasegaram’s undertaking to the Court to prosecute the appeal with reasonable expedition.

 

(5) Liberty to apply to a single Judge of Appeal on 2 days’ notice.

 (6) Each party’s costs of the notice of motion be that party’s costs of the appeal.

Catchwords:

PRACTICE – stay of execution pending appeal – appellant had paid undisputed amount of judgment debt – respondent had obtained post-judgment freezing orders – appellant failed to adduce evidence of his total assets and liabilities – inconsistencies in appellant’s evidence of value of assets – respondent had obtained garnishee orders – respondent acknowledged that accounts held by appellant jointly with his wife and mother had wrongly been frozen by banks – respondent undertook to repay all amounts received by it – appellant offered to provide security in respect of a small proportion of judgment debt - respondent asked for whole of unpaid judgment debt to be paid into court, and acknowledged that if that occurred, the freezing orders should be set aside – stay of execution of judgment and garnishee orders granted on terms that appellant pay a proportion of judgment debt into court or into joint account

Legislation Cited:

Evidence Act 1995 (NSW), s 75

Cases Cited:

Alexander v Cambridge Credit Corporation Ltd (Receivers Appointed) (1985) 2 NSWLR 685
Blue Visions Management Pty Limited v Chidiac [2017] NSWSC 255
Blue Visions Management Pty Limited v Chidiac (No 2) [2017] NSWSC 755
Deputy Commissioner of Taxation (NSW) v Westpac Savings Bank Ltd (1987) 72 ALR 634
Hirschorn v Evans (Barclay Bank, Ltd, garnishees) [1938] 2 KB 801
Kalifair Pty Ltd v Digi-Tech (Australia) Ltd (2002) 55 NSWLR 737; [2002] NSWCA 383
Macdonald v Tacquah Gold Mines Company (1884) 13 QBD 535
Phillips v MacMahon (1899) 15 WN (NSW) 206
Port Macquarie Hastings Council v Diveva Pty Ltd trading as Mid Coast Road Services [2017] NSWCA 4
Scott MacRae Investments Pty Ltd v Baylily Pty Ltd [2011] NSWCA 82

Category:

Procedural and other rulings

Parties:

Arun Gunasegaram (Applicant)
Blue Visions Management Pty Ltd (Respondent)

Representation:

Counsel:
Mr A McGrath SC; Mr D Krochmalik (Applicant
Mr J Giles SC (Respondent)

  Solicitors:
Brown Wright Stein Lawyers (Applicant)
Somerville Legal Pty Limited (Respondent)

File Number(s):

2017/168664

 Decision under appeal 

Court or tribunal:

Supreme Court of New South Wales

Jurisdiction:

Equity Division – Commercial List

Citation:

[2017] NSWSC 255

Date of Decision:

17 March 2017

Before:

Ball J

File Number(s):

2014/192899

EX TEMPore Judgment

1. LEEMING JA: By amended notice of motion filed on 3 July 2017, the appellant, Mr Arun Gunasegaram, seeks stays of enforcement of the judgment of the primary judge (Ball J) made on 10 May 2017 until seven days after the final determination of the appeal which he has brought and also of the operation and effect of three garnishee orders directed to the Commonwealth Bank of Australia, Ernst & Young Services Pty Ltd and Westpac Banking Corporation.

2. The procedural history of this appeal, and another appeal which more recently has been filed by the respondent, Blue Visions Management Pty Ltd, is not free from complexity and it will be necessary to provide some detail of that procedural background. I should say at the outset that the Court has been assisted by the written and oral submissions made by Mr McGrath of Senior Counsel who appears with Mr Krochmalik for the appellant/applicant as well as those of Mr Giles of Senior Counsel who appears for the respondent.

3. The proceedings brought by Blue Visions Management joined two other parties as well as Mr Gunasegaram and may be divided into four components: (a) a claim that there was an improper direction of business opportunities from Blue Visions Management to two officers of that company, including Mr Gunasegaram; (b) a claim that Mr Gunasegaram made certain misrepresentations concerning Blue Visions Management’s prospects of obtaining consulting work causing the retention by Blue Visions Management of an excessive number of workers; (c) a claim of breach of confidential information that was directed to another officer (not Mr Gunasegaram); and (d) Mr Gunasegaram's cross-claim for unpaid statutory employee entitlements when he ceased service with Blue Visions Management.

4. The first and third claims summarised above failed. Blue Visions Management succeeded in relation to the second claim and the judgment entered against Mr Gunasegaram, which is in the amount of some $1.44 million, is in respect of that claim. Mr Gunasegaram's cross-claim succeeded but that resulted in a judgment in his favour of just over $40,000.

5. Reasons for judgment were delivered on 17 March 2017: Blue Visions Management Pty Limited v Chidiac [2017] NSWSC 255. Thereafter, a relatively large number of steps by way of execution and in relation to the appeal have occurred, as follows.

6. On 4 April 2017, post-judgment Mareva orders, probably better described as freezing orders, were made against Mr Gunasegaram, subject to usual exceptions including for living expenses and legal expenses, preventing him from disposing of, dealing with or diminishing the value of his assets to a limit of $1.45 million. Those orders remain in place today and there is no reason to think that they will not remain in place until the appeal, or rather appeals, are heard and determined.

7. On 10 May 2017, final orders were made by the primary judge, resulting in the two judgment debts I have referred to above and a costs order in favour of Mr Gunasegaram in relation to his cross-claim, and a (partial) costs order in favour of Blue Visions Management against Mr Gunasegaram in respect of the claim in which it succeeded.

8. On 31 May 2017 and 22 June 2017, garnishee orders were made as identified in the amended notice of motion against the Commonwealth Bank of Australia, Ernst & Young Services Pty Ltd (Mr Gunasegaram's current employer) and Westpac Banking Corporation.

9. On 2 June 2017, Mr Gunasegaram filed a notice of motion in the Equity Division seeking, among other things, a stay of enforcement of final orders for a period of 28 days. It will be necessary to deal in what follows with the evidence adduced by Mr Gunasegaram on that occasion and the reasons of the primary judge for dismissing the motion on 14 June 2017: Blue Visions Management Pty Limited v Chidiac (No 2) [2017] NSWSC 755.

10. In this Court, Mr Gunasegaram filed a notice of appeal on 5 June 2017 and it is as well to say at the outset that Mr Giles of Senior Counsel conceded that the appeal was reasonably arguable. Mr Gunasegaram’s solicitors requested an undertaking from Blue Visions Management not to seek to take any enforcement action on the judgments in its favour, including service of a bankruptcy notice and the filing of a creditor’s petition, pending the determination of the appeal. No such undertaking has been given by them. There has also been a request from Mr Gunasegaram’s solicitors for documents outlining the asset position of Blue Visions Management Pty Ltd, the details of which may be passed over, because that company, constructively, accepts that it is appropriate that Mr Gunasegaram pay the judgment debt that he owes into Court, rather than to it, thereby avoiding the solvency risk that, in the event that his appeal succeeds, he is unable to recover funds paid to it.

11. Importantly, pursuant to some consent orders made earlier this month in this Court relating to the position pending the determination of the appeal, what has been described as the “undisputed sum” of $109,505.40 has been paid by Mr Gunasegaram to Blue Visions Management Pty Ltd. It is as well to say something about that amount and the consequences its payment has on the decision I have to make today. As I understand it, the amount is calculated by reference to the judgment in favour of Blue Visions Management, allowing for the judgment in favour of Mr Gunasegaram on his cross-claim, which would remain in place in the event that Mr Gunasegaram's appeal is wholly successful. (I interpolate that there appears to have been some measure of discretion and selectivity in the formulation of the notice of appeal, which is considerably more confined than it might otherwise have been.)

12. That said, in the event that Mr Gunasegaram is completely successful in this Court, he would most likely be entitled to a more favourable costs order than he presently has, and so the result of his paying the sum of just over $109,000 is to expose him to some risk in the event of the insolvency of Blue Visions Management if his appeal is successful.

13. On 13 July 2017, Blue Visions Management itself filed an appeal from the final orders made by the primary judge in respect of the dismissal of its claim against all defendants, including two which are not present before the Court today.

14. The essential position that emerges from the foregoing is this. First, there is a large judgment which has been ordered against the appellant, Mr Gunasegaram.

15. Secondly, of that large judgment, an appreciable amount, some $109,000, has already been paid, but that amount is undisputed (in the sense I have referred to above), and reflects slightly less than 10% of the judgment sum, while there are freezing orders in place protecting the position of the judgment creditor until the hearing and determination of this appeal as to the unpaid balance.

16. Thirdly, there are two appeals and this is a case where both parties seek to challenge aspects of the findings and conclusions of the primary judge.

17. Fourthly, the judgment creditor proposes that the balance of the judgment sum be paid into Court, protecting its position pending the determination of the appeal. The judgment debtor proposes to pay into Court an additional amount of some $190,000 by way of further security to the judgment creditor, and also undertakes to prosecute the appeal with reasonable expedition. Constructive discussions between the parties this morning suggest that the written submissions in support of both appeals should be finalised in the very near future, and there seems to be no reason to doubt that the matter will be ready to be listed for hearing in November this year. During the hearing, senior counsel of both parties also confirmed that it was not intended, in light of the regime established pursuant to this motion, for there to be any application for security for costs of the appeals.

18. The final matter which gives rise to some complexity is the making of the garnishee orders that I have referred to above. As best I can see, there is no evidence before me as to the present actual financial consequences of those orders. For example, there is no evidence as to whether any funds in bank accounts held by the Commonwealth Bank of Australia and Westpac Banking Corporation have been transferred to the judgment creditor or whether any proportion of the salary paid by Ernst & Young to Mr Gunasegaram has, in fact, been paid to the judgment creditor.

19. There is evidence that some of the bank accounts operated by the Commonwealth Bank of Australia have been “frozen” by that bank. That comes about, as I understand the evidence, because Mr Gunasegaram holds jointly with his wife two bank accounts with the Commonwealth Bank of Australia, both of which originally were frozen and one of which continues to be frozen, and he also is the joint holder, with his mother, of a third bank account with the Commonwealth Bank of Australia. He holds one or more bank accounts with the Commonwealth Bank of Australia in his own name, but the evidence before me does not disclose (a) whether any funds have been transferred from there or (b) what the balance of those accounts is.

20. Mr Gunasegaram gives evidence that he holds a single bank account with Westpac Banking Corporation, which has some $8,000 in it, which account is “connected with Westpac Equities Integrated Cash Account and has shareholdings in listed securities with a value of $49,107.66 as at [23 June 2017]”. What precisely that means is unexplained and is not entirely clear to me. Nor, for the reasons I am about to give, does it affect the determination of this application. The judgment creditor who caused the garnishee orders to be made has unequivocally put to me that the bank was wrong to freeze or to take any action in relation to (if any action has been taken) any of the joint accounts of which Mr Gunasegaram was a co-owner.

21. Mr Giles has taken me to Hirschorn v Evans (Barclay Bank, Ltd, garnishees) [1938] 2 KB 801 and Deputy Commissioner of Taxation (NSW) v Westpac Savings Bank Ltd (1987) 72 ALR 634 in support of the proposition that a garnishee order does not apply to joint bank accounts unless both holders are judgment debtors. The commentary to the practice is to the same effect and refers to Phillips v MacMahon (1899) 15 WN (NSW) 206 (subsequent to delivery of these reasons, I note that further support may be found in Macdonald v The Tacquah Gold Mines Company (1884) 13 QBD 535). It is not necessary for me to express a view on that proposition, in light of the fact that Mr Giles on behalf of Blue Visions Management Pty Ltd has undertaken to the Court that any funds received by it over the amount of $109,505.40 will be immediately paid by it into court.

22. The submissions advanced on behalf of Mr Gunasegaram may be summarised concisely. It is said that he remains at risk of the issuing of a bankruptcy notice, which, if that occurs, will give rise to reputational damage to him. He emphasises that Blue Visions Management is already protected by the extant freezing orders, it has been paid the undisputed amount and there is an offer to provide partial security, to a total amount of $300,000, in relation to the balance. And he emphasises that there is not the slightest evidence of any prejudice suffered by Blue Visions Management in awaiting the outcome of the appeal.

23. The essence of the submissions advanced by Mr Giles on behalf of Blue Visions Management may also be summarised concisely. He emphasised certain unsatisfactory aspects of the evidence adduced by Mr Gunasegaram as to his assets position and ability if any to satisfy the whole or part of the judgment debt. He linked this with the findings, some of which are challenged in this appeal, others not, which have already been made in relation to statements made by Mr Gunasegaram, and by reference to the latter judgment of Ball J to which I have referred. As I understood him, the effect of the undertaking as to any amounts received in relation to the garnishee orders was to enable this Court to put the prejudice in relation to those payments to one side.

24. It is convenient to deal with the garnishee orders first. There is a difficulty in quantifying the amount which either party says should be provided as a proper exercise of discretion for granting the stay sought when it is not clear if at all, and if so, to what extent, those orders have resulted in amounts being transferred from Mr Gunasegaram’s bank or from his employer to Blue Visions Management Pty Ltd. There is a further unfortunate aspect in that the judgment creditor who sought and obtained the garnishee orders concedes that in their application to some of the Commonwealth Bank of Australia accounts, as to which there is undisputed evidence of some at least temporary, and perhaps ongoing, prejudice, those orders should not have been so construed by the bank (in saying the foregoing, I should not be taken to be suggesting that it was inappropriate for a garnishee order to be issued to the Commonwealth Bank of Australia, at least in relation to the bank accounts which the evidence establishes do exist owned solely by Mr Gunasegaram).

25. What I propose to do, which is consistent with the undertaking proffered at the outset of this hearing by Mr Giles, is to stay the garnishee orders in the way sought in the notice of motion but to have regard to that in determining the outcome of the primary stay of enforcement of judgment which is sought in para 1 of the notice of motion.

26. In an application which as I have said is not free from complexity, there has at least been no dispute as to the relevant principles I am to apply. In Alexander v Cambridge Credit Corporation Ltd (Receivers Appointed) (1985) 2 NSWLR 685, this Court said that “special or exceptional circumstances” did not need to be made out before a stay of execution was ordered and that it was sufficient that the applicant demonstrated “a reason or an appropriate case to warrant the exercise of discretion” in the applicant’s favour. These principles have very often been applied subsequently. It is convenient to repeat the summary of Alexander v Cambridge Credit and Kalifair Pty Ltd v Digi-Tech (Australia) Ltd (2002) 55 NSWLR 737; [2002] NSWCA 383 given by Payne JA in Port Macquarie Hastings Council v Diveva Pty Ltd trading as Mid Coast Road Services [2017] NSWCA 4 at [29] to the effect that the Court must weigh a number of factors when considering such an application including:

“a. The onus is upon the applicant to demonstrate a proper basis for a stay which will be fair to all parties.

b. The court has a discretion involving the weighing of considerations such as balance of convenience and the competing rights of the parties.

c. Where there is a risk that if a stay is granted, the assets of the applicant will be disposed of, the court may refuse a stay.

d. Where there is a risk that the appeal will prove abortive if the appellant succeeds and a stay is not granted, courts will normally exercise their discretion in favour of granting a stay.

e. The court will not generally speculate upon the appellant’s prospect of success, but may make some preliminary assessment about whether the appellant has an arguable case, in order to exclude an appeal lodged without any real prospect of success simply to gain time.

f. As a condition of a stay the Court may require payment of the whole or part of the judgment sum or the provision of security.”

27. Of those factors, the third (risk of dissipation or disposal) is to be put to one side, having regard to the existing freezing orders and the absence of any suggestion that they will not be complied with. The fifth (not speculating about prospects of success) may also be put to one side, having regard to the concession that the appeal is reasonably arguable. It is the first, fourth and sixth of those matters which are most significant for the determination of the present application, and the first and the fourth are connected.

28. The first deals with onus, and the second deals with risk that the appeal will prove abortive if a stay is not granted. That takes me to the evidence adduced by Mr Gunasegaram, and the judgment of Ball J to which I have already referred. The essential difficulty is this. Unlike many such applications, Mr Gunasegaram has not provided, even by means of hearsay evidence on information and belief from his solicitor, evidence of his assets and liabilities. It is true that he has, through his solicitor, provided some evidence here of some of his assets and it is true that there is the statement at para 34 of the solicitor’s affidavit that: “The appellant informs me that he does not have the capacity to pay the judgment debt from his own financial resources.” Mr Giles acknowledged that he took no point about whether that bare statement of what the solicitor had been told satisfied s 75 of the Evidence Act 1995 (NSW), and the hearing proceeded on the basis that to the extent it was deficient in not reflecting the traditional language (see Scott MacRae Investments Pty Ltd v Baylily Pty Ltd [2011] NSWCA 82 at [33]), that was merely a slip. But the affidavit does not explain what Mr Gunasegaram’s own financial resources are, still less does it say anything about what other financial resources might be available to him, in the short term, pending the determination of his appeal, including such resources as may be available to provide security.

27. It is true as I noted that some evidence of real property assets is contained in the solicitor’s affidavit. However, this is the second time on which solicitors acting for Mr Gunasegaram have given hearsay evidence of the value of those assets. Less than four months ago, when Mr Gunasegaram was represented by Clayton Utz, in opposition to the making of the post-judgment freezing orders, his then solicitor gave the following evidence:

“I am instructed by Mr Gunasegaram and believe:

(a) That he is the sole registered proprietor and beneficial owner of the property at xxx Lakeside Drive, Joondalup, Western Australia. The property is unencumbered. The property has a current market value in the range of $1,000,000 to $1,200,000.

(b) That he is the sole registered proprietor and beneficial owner of Unit xxx, xxx Terrace Road, East Perth, Western Australia. The property is encumbered to the value of $565,350 with a mortgage. The property has a current market value in the range of $1.2 million to $1.4 million.

(c) Both properties are investment properties let to tenants.”

30. The affidavit also annexed, by way of support of those current market value estimates, a letter dated 5 April 2017 from what appears to be the manager of the properties stating that the Joondalup property would “be best marketed within a range of $1 million to $1.2 million” and that “we feel the viable price range” for the East Perth property “would be $1.2 million and $1.4” million.

31. The discrepancies in the evidence before Ball J earlier this year and me fall into two categories. The first is that contrary to what Ball J was told, the Joondalup property is encumbered, and appears to have been encumbered since around 2004.

32. The second is as to the current market value of both properties. The evidence before me relevantly is as follows:

“The Appellant is the registered proprietor and beneficial owner of properties at:

(a) xxx Lakeside Drive, Joondalup, Western Australia (Joondalup Property). The Joondalup property is subject to a mortgage in favour of the CBA. A valuation of the Joondalup Property from Herron Todd White as at 17 May 2017 … estimates the current market value of the Joondalup Property is $650,000. I am informed by the Appellant that, as at 8 June 2017, the amount owing to the CBA in respect of the mortgage on the Joondalup Property was $455,385.69.

(b) Unit xxx, xxx Terrace Road, East Perth, Western Australia (East Perth Property). The East Perth Property is subject to a mortgage in favour of the CBA. Success Venture Pty Limited has lodged a caveat over that property. A valuation from Herron Todd White as at 17 May 2017 … provides that the current market value of the East Perth Property is $825,000. I am informed by the Appellant that, as at 8 June 2017, the amount owing to the CBA in respect of the mortgage on the East Perth Property was $567,633.26.”

33. As may be seen, I have the benefit of more formal valuations from a reputable valuer which has resulted in the substantially smaller amounts of equity in those properties available to Mr Gunasegaram, of amounts approximately $195,000 and $257,000 for each property.

34. Conspicuous by its absence from the evidence adduced by Mr Gunasegaram is any statement that those two properties to which I have referred are the only interests in land that he has. The affidavit indeed is silent as to where he lives and what interests, if any, he has in that residence. In terms of assets other than land, the evidence is that, seemingly, there are shareholdings with a value of $49,107.66 as at 23 June 2017 connected in some way with the Westpac Equities Integrated Cash Account, and there is no evidence that those listed securities are the only such securities which Mr Gunasegaram owns. Nor is there evidence that the shares in four companies (Moon Faceet Pty Ltd, Aspire Corporation Pty Ltd, Nandy Corp Pty Ltd and Prime (Qld) Pty Ltd) which Mr Gunasegaram owns are the only shares in which he has a legal or beneficial interest. I also have evidence based on the joint bank account with Mr Gunasegaram's mother, and the offer by him to pay by way of security a further $190,000 as the price of the stays of execution that he seeks, that Mr Gunasegaram has available to him, and in the short term, at least some other amounts of money.

35. Ball J heard and determined, recently, and between the same parties, an application which turned upon substantially the same issue of primary fact which is central to the application for the stay of execution sought by Mr Gunasegaram in this Court. Ball J was critical of the lack of evidence which had been adduced on the part of Mr Gunasegaram as to his own assets and liabilities. It should immediately be said that the evidence before me is of a more detailed quality than the evidence before his Honour.

36. Yet, and this is not to convey any criticism of those acting for Mr Gunasegaram, the evidence is defective in the sense that there is no explanation of the significant differences in relation to the Joondalup and East Perth properties, which are at the forefront of the application before me, and it is also defective in what it does not disclose what if any other valuable assets that Mr Gunasegaram has available to him, either of his own, or from those entities and people connected with him.

37. I am reminded that the starting point that a judgment creditor is entitled to the fruits of its judgment and the onus is upon the judgment debtor, the appellant in this case, to demonstrate a proper basis for a stay which will be fair to all parties. On the other hand, the unusual feature of this case is that for the time being, until the appeals are heard and determined, the judgment creditor already has the benefit of the existing freezing orders.

38. Mr Giles SC conceded – and I think he was entirely correct to concede – that if as he sought the balance of the judgment debt were paid into court, then either by automatic operation, or by further order of this Court, those freezing orders should be discharged. Thus the underlying question of fairness, which is something which applies to all parties in the exercise of discretion I am called upon to make, is in my view directly impacted by the fact that those orders protect the position of Blue Visions Management against disposal or dissipation of such assets as Mr Gunasegaram has.

39. I am not satisfied that the appeal will be abortive if a stay is not granted in a fashion that is unconditional. Given the gaps to which I have referred in the evidence adduced by Mr Gunasegaram, and given also the context in which that evidence has been adduced, notably what occurred earlier this year before Ball J, I do not think that Mr Gunasegaram has discharged his onus. Fourthly, that Blue Visions Management already has the benefit of the freezing orders in relation to the whole of the judgment debt.

40. All of that said, it remains open for a stay to be imposed conditionally and for the condition to be the payment of whole or part of a judgment sum by way of security for that sum. I have decided that the appropriate order in this case is to grant the stay sought by Mr Gunasegaram in para 1 of the amended notice of motion but on terms that a significant amount be provided by way of security.

41. I have determined that an outcome which is fair to all parties in this case is that that amount be $400,000. I have reached that conclusion bearing in mind the following matters. First, Mr Gunasegaram has already paid some $109,000, being the undisputed amount. Secondly, even with the provision by way of $400,000, the amount paid will still be significantly less than half of the judgment amount from which he seeks to appeal. Thirdly, I have regard to the benefit to Mr Gunasegaram of the staying of the garnishee orders to which I have referred and the undertaking to pay any proceeds of the garnishee orders that Blue Visions Management receives back. That carries with it the benefit to him of, until the hearing and determination of this appeal, payments by his employer, Ernst & Young Services Pty Ltd. Fourthly, that Blue Visions Management already has the benefit of the freezing orders in relation to the whole of the judgment debt.

42. I am conscious that the amount that I have determined exceeds what was proffered by Mr Gunasegaram. Indeed in the way that para 36 of Mr Gunasegaram’s solicitor’s affidavit was explained (that payment by way of security of an amount of $300,000 was to be an amount of $300,000 less the $109,000 already paid) the $400,000 exceeds what was proffered by slightly more than a factor of two. But given the onus lying upon Mr Gunasegaram, and the inconsistencies and gaps in the evidence he has adduced, and, especially, given the magnitude of the judgment amount, I have concluded that is the appropriate amount in order to achieve the stays that he seeks.

43. I am minded to provide a reasonable period of time, until Friday 25 August 2017, which is just over a month, in order for that security to be paid and to provide mechanisms by which it can be paid either into court, or into a controlled moneys account held jointly by the solicitors of the parties, or by way of some other form of security which Blue Visions Management is agreeable to.

44. The formal orders that I will make are as follows:

1. Subject to order 3, stay the enforcement of the judgment in paragraph 7 and the orders in paragraphs 8, 9 and 13 of the Orders made on 10 May 2017 in NSW Supreme Court Proceeding 2014/192899, until 7 days after the final determination of the appeal in these proceedings or further order of this Court.

2. Subject to order 3, stay the operation and effect of any garnishee order made in NSW Supreme Court Proceeding 2014/192899 in respect of payments to be made to the Respondent by each of:

1. Commonwealth Bank of Australia (garnishee order made on 31 May 2017):

2. Ernst & Young Services Pty Ltd (garnishee order made on 22 June 2017); and

3. Westpac Banking Corporation (garnishee order made on 22 June 2017).

3. In the event that Mr Gunasegaram fails by Friday 25 August 2017 to pay $400,000 by way of security for the judgment debt (a) into Court or (b) into a controlled monies account to be held jointly by his solicitor and the solicitor for Blue Visions Management Pty Ltd or (c) provides such other form of security as to which Blue Visions Management Pty Ltd agrees in writing, then the stays effected by orders 1 and 2 above are automatically discharged.

4. Note Mr Gunasegaram’s undertaking to the Court to prosecute the appeal with reasonable expedition.

5. Liberty to apply to a single Judge of Appeal on 2 days’ notice.

6. [Discussion as to costs.]

7. Each party’s costs of the notice of motion be that party’s costs of the appeal.

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Decision last updated: 26 July 2017