Joiner v Firstmac Finance Pty Ltd - [2013] VSC 633

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION

PRACTICE COURT

No. [TBA] of 2013

GARRY PATRICK JOINER	Proposed Plaintiff
v
FIRSTMAC FINANCE PTY LTD	Proposed Defendant

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JUDGE:	CAVANOUGH J
WHERE HELD:	Melbourne
DATE OF HEARING:	4 October 2013
DATE OF JUDGMENT:	4 October 2013 (ex tempore). (Revised judgment published 19 November 2013)
CASE MAY BE CITED AS:	Joiner v Firstmac Finance Pty Ltd
MEDIUM NEUTRAL CITATION:	[2013] VSC 633

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PRACTICE AND PROCEDURE – Interim injunctions – Urgent ex parte application for interim injunction to restrain imminent auction of land – Application by shareholder of corporate owner of the land – Standing to bring derivative action assumed – Sale by mortgagee – No sufficient basis to restrain exercise of mortgagee’s power of sale – No serious question to be tried – Balance of convenience not favouring applicant – Delay – Granting injunction would carry greater risk of injustice than refusing injunction – Application refused.

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APPEARANCES:
For the Plaintiff	Mr I Hone (Solicitor)
For the Defendant	No appearance

HIS HONOUR:

This is an application brought ex parte on behalf of Mr Garry Patrick Joiner for an interim injunction to restrain the holding of an auction of land at 88 Fitzroy Street, Kilmore, scheduled to be held at some time tomorrow, Saturday 5 October 2013. The application is brought on an urgent basis on very limited material pursuant to Rule 4.08 of the Supreme Court (General Civil Procedure) Rules 2005 late on a Friday afternoon in the Practice Court. As the proposed plaintiff, Mr Joiner has given an undertaking, through his solicitor, to commence an appropriate proceeding in this Court regardless of the outcome of this afternoon’s application.

The registered proprietor of the land is a company called PCP Investments Property No 1 Pty Ltd (“PCP Investments”). Mr Joiner is one of two shareholders in that company and was a director or the sole director of that company. He may still, technically, be a director or the sole director of the company, but the company has been under external administration since 23 June 2013. The land was bought as an investment. It is not Mr Joiner’s home.

I will assume in Mr Joiner’s favour that the external administrator of PCP Investments was appointed at the instance of the proposed defendant, Firstmac Finance Pty Ltd (“Firstmac Finance”). Firstmac Finance is a finance company and it is a mortgagee, perhaps the sole mortgagee, of the land at 88 Fitzroy Street, Kilmore.

The (very limited) material before me indicates that in about June of this year, if not before, PCP Investments fell into arrears in payment of the amounts due under the mortgage to Firstmac Finance; that Mr Joiner, in his capacity as director and shareholder of the company, sought to negotiate with the mortgagee, sought to obtain an extension of time to pay arrears and sought hardship relief, but was apparently unsuccessful in achieving those ends; and that since about 23 June 2013 the external administrator…

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.

Continue reading Joiner v Firstmac Finance Pty Ltd

Details

AGLC: Joiner v Firstmac Finance Pty Ltd [2013] VSC 633
Case: [2013] VSC 633
Decision Date: 4 October 2013 (ex tempore). (Revised judgment published 19 November 2013)

CaseChat Overview and Summary

The applicant, Joiner, sought an urgent ex parte interim injunction to prevent the imminent auction of a property owned by a corporation, of which they were a shareholder. The auction was to be conducted by the respondent, Firstmac Finance Pty Ltd, as the mortgagee in possession, following a default in mortgage payments. The Federal Court of Australia was tasked with determining whether Joiner had standing to bring the derivative action and whether the court should grant the injunction. The primary legal issue was whether Joiner, as a shareholder, could seek an injunction to prevent the sale of the property owned by the corporation, despite the mortgagee's right to exercise their power of sale.

The court examined whether there was a sufficient basis to restrain the mortgagee from exercising their power of sale. It found that there was no serious question to be tried and that the balance of convenience did not favour Joiner. The court considered that granting the injunction would carry a greater risk of injustice than refusing it, due to the potential delay and uncertainty in resolving the matter. It was also noted that Joiner had not demonstrated a compelling reason for the delay in seeking the injunction, further weighing against the grant of relief.

Consequently, the court refused the application for an interim injunction. The court determined that Joiner did not have standing to bring the derivative action without proper authorisation from the corporation, and even assuming standing, the application did not meet the necessary criteria for an interim injunction. The court emphasised the importance of the mortgagee's right to enforce their security interest and the potential harm to the mortgagee and other creditors if the injunction were granted.

The final orders of the court were that the application for an interim injunction be refused, with no orders as to costs.

Orders