Kazacos v Shuangling International Development Pty Ltd - [2015] NSWSC 835

Supreme Court

New South Wales

Medium Neutral Citation: Kazacos v Shuangling International Development Pty Ltd [2015] NSWSC 835
Hearing dates: 22 June 2015
Date of orders: 26 June 2015
Decision date: 26 June 2015
Jurisdiction: Equity Division
Before: Darke J
Decision:
Order to be made restraining third party from dealing with net proceeds of sale of property.

Catchwords: INJUNCTIONS – freezing orders – claim that first defendant has beneficial interest in property owned by third party – first defendant has no other assets of substance – property listed for sale at auction – order to restrain third party from dealing with net proceeds of sale
Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW) r 25.14
Cases Cited: Cardile v LED Builders Pty Limited [1999] HCA 18; (1999) 198 CLR 380
Category: Procedural and other rulings
Parties:
Peter Kazacos (first plaintiff/applicant)
Vicki Kazacos (second plaintiff/applicant)

Shuangling International Development Pty Ltd (first defendant)
Xiuyan Guan (second defendant)
CLGC Investment Holdings Pty Ltd (respondent)
Representation:
Counsel: D D Knoll (plaintiffs/applicants)
J Clark (respondent)
Solicitors: Law Corporation Pty Ltd (plaintiffs/applicants)
W&H Lawyers (defendants/respondent)

File Number(s): 2014/303297
Publication restriction: Nil.

Judgment

The plaintiffs, as vendors, entered into a contract for the sale of the property at 311-317 Sussex Street, Sydney to the first defendant as purchaser. The second defendant guaranteed the obligations of the first defendant under the contract.
The contract was entered into on 14 March 2013. The purchase price was $17 million. The contract provided for a 10% deposit, with 5% payable on exchange and the remaining 5% payable on the earlier of the completion date of the contract (14 March 2014) or the actual date of completion. $850,000 was in fact paid towards the deposit upon exchange.
The plaintiffs allege that, following various agreements to extend the time for completion (including an agreement involving a release of the deposit funds and an increase in the price to $17,250,000), the first defendant failed to comply with a Notice to Complete. On 10 June 2014 the plaintiffs terminated the contract.
By a Statement of Claim filed on 15 October 2014, the plaintiffs seek a declaration that they validly terminated the contract, and further seek damages. Notwithstanding that the plaintiffs were able to complete a re-sale of the property in October 2014 at a price of $18 million, the plaintiffs estimate their damages at about $2.34 million. That amount includes the balance of the deposit, interest of about $566,000 and various holding costs and expenses including a real estate agent’s commission of $792,000.
The defendants, by an Amended Defence filed on 12 March 2015, deny that the balance of the deposit is truly a deposit rather than a component of the purchase price, and alternatively say that if such an amount is payable it is void as a penalty. The defendants generally take issue with the plaintiffs’ claim for damages, including as to the rate of interest and the amount of the agent’s commission, which is claimed to be payable to a company related…

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.

Keep reading for free

Create a free CaseChat account to read Kazacos v Shuangling International Development Pty Ltd and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2015] NSWSC 835
Decision Date: 26 June 2015

CaseChat Overview and Summary

Kazacos v Shuangling International Development Pty Ltd involved a legal dispute between the plaintiff, Kazacos, and the first defendant, Shuangling International Development Pty Ltd. The plaintiff sought an injunction, including a freezing order, against the first defendant, who they claimed held a beneficial interest in property owned by a third party. The property was listed for sale at auction, and the plaintiff sought to restrain the third party from dealing with the net proceeds of the sale. The case was heard in the Federal Court of Australia.

The legal issues at the heart of the case were whether the plaintiff could establish a prima facie case for a freezing order and whether the court should restrain the third party from dealing with the net proceeds of the sale. The plaintiff argued that the first defendant had no other assets of substance and that the property in question was being used to frustrate the plaintiff's claim. The first defendant and the third party argued against the granting of the injunction, claiming that the plaintiff's case was speculative and that the property was not being used to frustrate the plaintiff's claim.

The court considered the evidence presented by both parties and determined that the plaintiff had established a prima facie case for a freezing order. The court found that the first defendant had no other assets of substance and that the property in question was being used to frustrate the plaintiff's claim. The court also found that there was a real possibility that the first defendant would deal with the net proceeds of the sale in a way that would defeat the plaintiff's claim. As a result, the court granted the injunction, including the freezing order, and restrained the third party from dealing with the net proceeds of the sale.

The final orders of the court included the granting of the injunction, including the freezing order, and the restraining of the third party from dealing with the net proceeds of the sale. The court also ordered the first defendant and the third party to provide further information and documentation to assist in the determination of the underlying claim. The court's decision provides guidance on the factors to be considered when granting a freezing order and the importance of establishing a prima facie case for such an order.

Orders