James Gerard Thackray and Shaun Robert Fraser (As joint and several receivers and managers of Bonthorpe Pty Ltd) (Receivers and managers appointed) v Henderson
[2012] WASC 237
•3 JULY 2012
JAMES GERARD THACKRAY and SHAUN ROBERT FRASER (As joint and several receivers and managers of Bonthorpe Pty Ltd) (Receivers and managers appointed) -v- HENDERSON [2012] WASC 237
Pending Appeal
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2012] WASC 237 | |
| Case No: | CIV:1487/2012 | 28 JUNE 2012 | |
| Coram: | MASTER SANDERSON | 3/07/12 | |
| 11 | Judgment Part: | 1 of 1 | |
| Result: | Application granted in part | ||
| B | |||
| PDF Version |
| Parties: | JAMES GERARD THACKRAY and SHAUN ROBERT FRASER (As joint and several receivers and managers of Bonthorpe Pty Ltd) (Receivers and managers appointed) KIM HENDERSON SUSAN JANE HENDERSON |
Catchwords: | Summary judgment Application by receivers and managers to permit them to deal with company property Turns on own facts |
Legislation: | Nil |
Case References: | Nil |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiffs
AND
KIM HENDERSON
SUSAN JANE HENDERSON
Defendants
Catchwords:
Summary judgment - Application by receivers and managers to permit them to deal with company property - Turns on own facts
Legislation:
Nil
(Page 2)
Result:
Application granted in part
Category: B
Representation:
Counsel:
Plaintiffs : Mr T O Coyle
Defendants : In person
Solicitors:
Plaintiffs : Lavan Legal
Defendants : In person
Case(s) referred to in judgment(s):
Nil
(Page 3)
1 MASTER SANDERSON: This is the plaintiffs' application for summary judgment. As an alternative, the plaintiff seeks certain declarations and injunctive relief against the defendants. At the commencement of the hearing, the defendants applied for an adjournment of the application. Effectively, then, there were three applications. After hearing argument, I indicated to the parties I would reserve my decision on all of the applications. These reasons deal with all three of the applications.
2 The relevant facts as they appear in the statement of claim are as follows. The plaintiffs are the joint and several receivers and managers of Bonthorpe Pty Ltd in its own right and as trustee of the Wembrey Trust. The defendants are the directors of Bonthorpe and conducted a farming business on properties owned by Bonthorpe as partners under the name K & SJ Henderson Partnership.
3 By a business letter of offer dated 22 November 2005, the National Australia Bank Ltd agreed to provide Bonthorpe with a loan facility with a limit of $423,000. The loan facility was made available on or around 29 November 2005.
4 By business letter of offer dated 25 November 2005, the National Australia Bank agreed to provide Bonthorpe with three further loan facilities. Taken together, the four loans were for up to $5 million. Three further facilities were made available on or about 25 November 2005.
5 By business letter of offer dated 7 February 2007, the National Australia Bank agreed to provide Bonthorpe with a further loan facility of $3,510,000. This facility was made available on or around 7 February 2007.
6 The terms of these respective facilities are pleaded in the statement of claim. It is unnecessary to detail any of the particular provisions at this point. It is enough if I say the terms and conditions were the standard terms and conditions on which banks generally lend to their business customers.
7 Security for the loans was provided by mortgages over properties described as the 'York Property' and the 'Bremer Bay and Shadforth Properties'. The loan agreements allowed for cross-collateralisation - that is to say, a default on one of the loans could activate the security under either property. Further, Bonthorpe gave to the National Australia Bank a fixed and floating charge over its assets.
(Page 4)
8 The charge was over all Bonthorpe's assets and undertakings, including the York property and the Bremer Bay and Shadforth properties. The charge contained terms to the effect if Bonthorpe was in default under any of the loan agreements, it would be in default under the charge. A default would entitle the National Australia Bank to appoint one or more receivers over the assets and undertakings of Bonthorpe, and the receiver would be entitled to sell the property the subject of the fixed and floating charge. The receivers would also be entitled to sell the properties secured by the loan agreements.
9 From 30 June 2009 and thereafter, Bonthorpe defaulted on its obligations under various agreements. A default notice was issued on or about 21 October 2009. On 15 February 2010, the parties entered into a Deed of Extension and Repayment. By this agreement, the National Australia Bank agreed to temporarily forbear from taking steps to recover amounts owing to it by Bonthorpe. The deed of extension contained terms pursuant to which Bonthorpe and the defendants acknowledged Bonthorpe was in default of the agreements. It also acknowledged that the National Australia Bank was immediately entitled to enforce its rights under the mortgages, the fixed charges and the floating charge. Bonthorpe and the defendants also acknowledged they had no defence, set-off or counterclaim in relation to any of the loans, charges and agreements.
10 By the deed of extension, the National Australia Bank agreed not to enforce its rights until 12 April 2010. Bonthorpe agreed to repay all outstanding moneys by that date. Repayment was not made. A default notice was issued by the National Australia Bank on 5 May 2010, requiring rectification of the default by 18 May 2010. Bonthorpe and the defendants did not comply with the default notices. Under the terms of the default notices, National Australia Bank's rights and remedies crystallised as at 19 May 2010.
11 The plaintiffs were appointed receivers and managers of Bonthorpe on 18 May 2010. The plaintiffs then granted the defendants a licence to occupy the York property until 30 June 2011. The plaintiffs seek a declaration they are entitled to vacant possession of the York property.
12 The plaintiffs appointed agents to dispose of Bonthorpe's assets and the various properties. From about 3 February 2012, the defendants have obstructed the plaintiffs in the exercise of the plaintiffs' powers as receivers and managers. Without going into detail, the following example
(Page 5)
- gives a flavour of what the plaintiffs plead against the defendants (par 37 of the statement of claim):
On or around 3 February 2012, the defendants caused a sign to be affixed to the front gate of the York property, in substance stating that no-one was entitled to enter the York property without authorisation of the defendants.
1. Judgment be entered for the plaintiffs against the defendants pursuant to Order 14 rule 3.
2. The defendants do within five business days of service of this order give the plaintiffs vacant possession of the property situated at 6362 Great Southern Highway Gilgering, being Lot 1 on plan 6250 (certificate of title volume 1143 folio 577).
3. As and from the date of this judgment, the defendants, whether by themselves, their officers, servants, agents or otherwise, be restrained and an injunction is hereby granted restraining them from:
3.1 hindering the plaintiffs and their agents from taking and maintaining possession of the property referred to in paragraph 2;
3.2 making statements to Elders Real Estate (WA) Pty Ltd or any other persons to the effect that the plaintiffs are not entitled to possession of, and to market and sell property referred to in paragraph 2, or any statements to that effect; and
3.3 making any comments denying the validity of the plaintiffs' appointment as receivers and managers of Bonthorpe Pty Ltd (Receivers and Managers Appointed) in its own right and as trustee of the Wembrey Trust.
4. The defendants pay the plaintiffs' costs of the action on a solicitor client basis.
14 In support of the application, the plaintiffs rely on an affidavit of the first-named plaintiff (Mr Thackray), sworn 30 May 2012. The affidavit runs to some 384 pages. Essentially, the affidavit annexes all of the relevant security documentation. It is difficult to see any relevant document is missing. On their face, the documents are consistent with what is pleaded in the statement of claim. Mr Thackray says he believes there is no defence to the claim. So, the jurisdiction to order summary
(Page 6)
- judgment is enlivened. It then falls to the defendants to show they have an arguable defence to the claim.
15 A number of further affidavits have been filed by the plaintiffs in support of their application. In particular, the plaintiffs rely on an affidavit of Daniel Paul Butler, sworn 27 June 2012. This affidavit confirms a complaint made by the defendants to the Financial Services Ombudsman has been resolved. The ombudsman was satisfied there was no substance in the complaint. Mr Butler deals with one other issue, which I will come to in due course.
16 In opposition to the application, the defendants filed an affidavit of the second-named defendant (Mrs Henderson), sworn 21 June 2012. They also filed what they described as 'Defendants' application and request for orders'. It would appear this is a request for discovery, although they also seek an order the receivers be 'stood down' and judgment be entered against the receivers in an amount of $44 million. No argument was directed towards this application. It was not entirely clear what the evidentiary basis for this application was. It can perhaps be assumed it was the affidavit of Mrs Henderson.
17 Turning, then, to Mrs Henderson's affidavit, the first 10 paragraphs provide an introduction. At par 11, Mrs Henderson refers to a 'bill of exchange'. She attaches a copy of the bill of exchange. The document is a copy of a letter written by the plaintiffs' solicitors to a solicitor in Queensland who was, at the time, acting for the defendants. There is a series of handwritten notes on the copy which are difficult to follow. Whatever view is taken of the document, it is not a bill of exchange and it has no relevance to this dispute. Paragraphs 12 through to 16 deal with this document. Somehow, it is said to give rise to the defendants' claim against the plaintiffs for $44 million. With respect, all of this is just nonsense and says nothing about the liability of the defendants to the plaintiffs.
18 Paragraphs 17 and 18 refer to a 'certificate of protest'. The document is entirely meaningless and cannot give rise to any rights as between the plaintiffs and the defendants.
19 By pars 19, 21, 22, 24, 64 and 74 of the affidavit, Mrs Henderson makes various allegations of fraud against either the plaintiffs or the National Australia Bank. Allegations of fraud are easy to make. They should only be made when facts are available which support those allegations. In none of the paragraphs I have mentioned are there any
(Page 7)
- statements of fact which could justify a claim the plaintiffs or the National Australia Bank behaved deceptively with the aim of defrauding the defendants. These paragraphs do not provide any answer to the plaintiffs' claim.
20 At par 23, Mrs Henderson says the plaintiffs have relied upon documentation supplied by the National Australia Bank which is incomplete. I have reviewed the documentation annexed to Mr Thackray's affidavit. It seems to me to be complete in all respects. It shows what was lent by the National Australia Bank to Bonthorpe to the defendants, the terms upon which it was lent and the process undertaken to demand repayment. Mrs Henderson does not identify what documents she says are missing and, in my view, the plaintiffs did not have to provide anything more than is presently available.
21 By pars 25, 26 and 27, Mrs Henderson alleges the National Australia Bank is either engaged in 'predatory lending' or lending contrary to its own internal guidelines. Even if that were the case (and there is no evidence to suggest it is), it would not in any way affect the defendants' liability to repay the National Australia Bank. There is no defence disclosed by these paragraphs.
22 By pars 28 and 29, it is alleged that certain dates in the statement of claim are incorrect. No material is provided by Mrs Henderson to support that proposition. Even if it was, it would not affect the National Australia Bank's position.
23 By pars 30, 40, 41, 49, 50, 52, 53 and 55, Mrs Henderson alleges the National Australia Bank is claiming mortgages over lots which did not exist when the loan agreements were entered into. In one sense, she is correct. What has happened is that during the life of the facility agreements, some of the mortgaged properties were subdivided. The interest claimed by the National Australia Bank relates to the lots resulting from the subdivision. There is no suggestion the National Australia Bank would not be entitled to security over these lots. These paragraphs do not provide any answer to the plaintiffs' claim.
24 Paragraphs 31 and 32 amount to a denial by Mrs Henderson the defendants interfered with the receivers' conduct of the receivership. No details are provided. A defendant who seeks to resist a claim for summary judgment must provide some detail of the basis on which the claim is resisted. Paragraphs 31 and 32 do not meet that test.
(Page 8)
25 By par 33, Mrs Henderson says a complaint was made to the banking ombudsman. That was certainly the case. However, as I have indicated, that complaint has been dealt with and has been found not to be of any substance. Paragraph 33 does not assist the defendants.
26 Paragraphs 34 to 36, 38 and 39 highlight what really amounts to clerical errors. Even assuming there were some clerical errors either in Mr Thackray's affidavit or in certain documents, they do not affect the liability of the defendants to the National Australia Bank. These paragraphs do not raise any arguable defence.
27 Paragraphs 42, 48, 51 and 54 allege a document which was notice of a charge to be lodged with the Australian Securities and Investments Commission (ASIC) was altered by the National Australia Bank after it was signed by Mr Kim Henderson. It is true there is a handwritten addition on the front of the document and it may well have been the case the handwritten addition was added after the document was signed. The document itself is simply a charge lodged with ASIC. It is the description of the document which has been altered. The legal effect of the document remains the same as it was when the document was signed. These paragraphs provide no defence to the plaintiffs' claim.
28 Paragraphs 43 to 47 allege certain further clerical errors. Even if such errors existed, they would not make any difference to the plaintiffs' right to relief. They provide no defence to this claim.
29 Paragraph 56 deals with the licence agreement pursuant to which the defendants occupied the York property subsequent to the appointment of receivers. The fact the document is undated is of no consequence at all. It offers the defendants no defence to this claim.
30 Paragraphs 58, 59, 65, 72 and 75 seem to allege misfeasance by the plaintiffs in the conduct of the receivership. There are no facts alluded to in these paragraphs which could support such a claim. In the circumstances, the paragraphs do not provide any defence to the plaintiffs' application.
31 Paragraphs 61 to 64 and 66 to 68 seem to ask the plaintiffs to account for proceeds of sale of certain items as part of the receivership. It may be in due course the receivers will have to account to the defendants. Any obligations which may arise in the future would not influence the present application for summary judgment.
(Page 9)
32 Paragraph 71 deals with an allegation by the plaintiffs the defendants were interfering with the sale process of certain property. In particular, it is said the email referred to the complaint made to the Financial Services Ombudsman. This paragraph makes a valid point. It provides an answer to part of the claim the defendants were interfering with the plaintiffs in the exercise of their function as receivers. However, it does not go to answering all of the matters raised by the plaintiffs.
33 Paragraphs 72 and 73 make claims not supported by any facts. There is nothing to suggest the National Australia Bank is indebted to the defendants. Nor are there any facts which could lead to the conclusion the plaintiffs were not entitled to enter the property at Great Southern Highway, Gilgering.
34 Paragraphs 76 to 80 deal with an alleged failure of the plaintiffs to pursue legal action against a third party. There is no obligation on the plaintiffs to take such action. Furthermore, if the defendants allege there has been some default on the part of the plaintiffs in their conduct of the receivership, they must specify what that default is, explain why it is not excused under the terms of the plaintiffs' appointment and quantify their loss. None of that is attempted in these paragraphs. They do not provide a defence to the plaintiffs' claims.
35 By pars 81 to 85, the defendants allege a failure by National Australia Bank to explain how certain legal costs were debited to their account. Again, it may be National Australia Bank will have to, in due course, account for the moneys they received. However, at present, these paragraphs do not provide any defence to the claim.
36 Paragraphs 86 through to 92 allege certain property of Bonthorpe was sold for less than full value by the receivers. To make good that claim, some form of expert evidence would be necessary. Even if such evidence were produced, there is real doubt whether, under the terms of the plaintiffs' appointment, the defendants would have any right of action. As the evidence stands at the moment, it could not afford a defence to this claim.
37 Having examined the defendants' evidence in some detail and setting it against the evidence led on behalf of the plaintiffs, it is clear the defendants have no defence to this claim. To my mind, there would be no useful purpose served in granting an adjournment. Nor would there be any utility in ordering further discovery.
(Page 10)
38 It is important to bear in mind the relief sought by the plaintiffs is quite limited. It is for the delivery up of the Gilgering property. There can be no question about whether the plaintiffs are entitled to possession of that property. They clearly are. Nor can there be any question about the rights of the plaintiffs to go about their receivership unhindered. There is sufficient evidence to suggest the defendants are hindering the plaintiffs in the conduct of the receivership. The plaintiffs are entitled to an order preventing any further interference from the defendants.
39 As I indicated during the course of the hearing, I would not make orders in terms of pars 3.2 and 3.3 of the summons. These orders would seek to restrict what the defendants can say and to whom they can say it. Such an interference with the right of free speech is warranted only in the most extreme of cases. In my view, the evidence in this matter does not establish such injunctions are required. What is said by the defendants may be wrong and ill-informed, but unless it can be shown to cause real damage to the plaintiffs, no injunction should issue.
40 Subsequent to the hearing, the plaintiffs lodged what they referred to as 'Minute of Proposed Orders for Interlocutory Injunction'. The orders sought were as follows:
1. The defendants do forthwith provide the plaintiffs, their agents and their employees with unrestricted access to the remaining properties.
2. The defendants do forthwith leave the York property, removing any personal belongings, but otherwise leaving in place all machinery, plant, equipment and other property located on the York property (including, for the avoidance of doubt, all keys to machinery and gates).
3. The defendants refrain from interfering with, obstructing or disturbing the possession of the remaining properties by the plaintiffs, their agents or their employees.
4. The defendants refrain from interfering with, obstructing or disturbing the sale of the remaining properties by the plaintiffs, their agents or their employees.
5. The parties have liberty to apply on 72 hours' notice t the other party to vary or discharge orders 1 to 4.
41 The phrase 'remaining properties' used in the proposed orders is defined in the statement of claim as meaning the York property, and two
(Page 11)
- properties in Shadforth. The phrase was not used in the application for summary judgment.
42 It may be this minute is lodged as an alternative to the application for summary judgment. If that is so, in my view, it is unnecessary. I am satisfied the plaintiffs have made out their right to final relief so far as the question of interference with their right to deal with property is concerned. That being so, I propose to enter judgment on part of the claim. The orders will be in terms of pars 1, 2, 3 and 4 of the Minute of Proposed Orders, with the additional orders being:
6. The defendants have leave to defend the action in relation to the relief sought in pars 2.1 and 2.3 of the statement of claim.
7 The costs of this application be paid by the defendants.
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