Ladewig, G.K. v Queensland Industry Development Corporation

[1992] FCA 818

JUDGMENT No. .... I

..., l ..%A .

IN THE FEDERAL COURT OF AUSTRALIA	1
QUEENSLAND DIS'I'KICT REGISTRY	1 No QG151 of 1992
GENERAL DIVISION	1

BETWEEN:  GRAWIM KEITH LADEWIG 1.

First	Applicant	1
<

AND:	GRAHAM KEITH LADEWIG as executor of the estate of	5 , '
the late Henry William Ladewiq	, .~
.
I I
.

Second Applicant

AND: GRAHhY KEITH LADEWIG as a beneficiarv under the

Will of Henrv William Ladewiq I .

Third Applicant 1

AND:	QUEENSTAND INDUSTRY DEVELOPMENT CORPORATION	, ,
..

First Respondent

r-

AND: D. P. REDDAN

Second Respondent

AND:  P. S. COOPER 1 ~

Third Respondent

MINUTES OF ORDER

R EcEIVED

JUDGE MAKING ORDER:  Spender J.

12 NOV 1992

DATE OF ORDER:  21 October 1992 FEDERAL COURT OF

PRINCIPAL

WHERE MADE:  Brisbane REGISTRY

THE COURT ORDERS THAT:	!
NOTE:	Settlement and entry of orders is dealt with in Order
36 of the Federal Court Rules.

(1) The application for interlocutory relief be dismissed.

(2) The costs of the motion be the respondents' costs in L

the principal proceedings. I

IN THE FEDERAL COURT OF AUSTRALIA	1
QUEENSLAND DISTRICT REGISTRY	) No QG151 of 1992
GENERAL DIVISION	)

BETWEEN: GRAHAM KEITH LADEWIG

First Applicant

AND:  GRAHAM KEITH LADEWIG as executor of the estate
of the late Henrv William Ladewiq

Second Applicant

AND:  GRAHAM KEITH LADEWIG as a beneficiarv under the
Will of Henrv William Ladewiq

Third Applicant

AND: QUEENSLAND INDUSTRY DEVELOPMENT CORPOFU+TION

First Respondent

AND: D. P. REDDAN

Second Respondent

AND: P. S. COOPER

Third Respondent

CORAM:  Spender J.

m: Brisbane

DATE:  21 October 1992

I

EX TEMPORE REASONS FOR JUDGMENT

This is an application by notice of motion seeking interlocutory relief. The application is filed by Mr Graham Keith Ladewig in respect of two properties in which he has an interest with his brothers. Mr Ladewig seeks orders restraining Queensland Industry Development Corporation ('QIDC') exercising power of sale pursuant to mortgages of land known as Lot 73 on Plan LY 736, Registered Number 16/10338 in the Dalby District being County of Lytton, Parish of Cooranga, and also in respect

of property known a s Lot 75 on Plan LY 736, Registered Number	f i
I_

16/10320 i n t h e Dalby Di s t r i c t being i n t h e County of Lytton,

I

par i sh of Cooranga. Mr Ladewig a l s o seeks t o r e s t r a i n t h e i

respondents from conducting by public auct ion t h e s a l e of property covered by a b i l l of s a l e , being B i l l of Sale Registered

Number 439. i

There i s fu r ther r e l i e f sought i n respect of t h e

p r inc ip le appl ica t ion, but I. am concerned today so l e ly with t h e

question of whether I should g ran t in te r locu tory r e l i e f , which

would postpone t h e exerciselof t h e s e c u r i t i e s held by QIDC.

It i s always a marter of concern when land which has

been t h e sub jec t of fami ly le f fo r t and money i s t o be sold i n

respect of a r r ea r s o r d e f a u t i n respect of payments secured by

mortgages o r b i l l s of s a l e . This case i s no exception. One of

t h e p roper t i es was a s e l e c t o n a s a s o l d i e r set t lement block i n 1950, and t h e o ther propert j was purchased i n 1976 by m Ladewig

and h i s two brothers .

The posi t ion , ho~ever, i s t h i s : t h e reg i s te red b i l l

of s a l e over t h e machinerywas granted t o John Henry Ladewig,

l

Colin Arthur Ladewig, and +ae appl icant Graham Keith Ladewig i n

1 9 9 0 . QIDC is t h e r e g i b r e d mortgagee i n respect of two

mortgages;	reg i s te red Mempnda of Mortgage numbers 171434 and
190467.	Copies of those mdtgages appear a s annexures A(3) and

~ ( 1 ) t o t h e statement of c,aim f i l e d by M r Ladewig.

From an affidavit by Darren Charles Solomon, a legal officer in the employ of the QIDC, it appears that there has been default by the Ladewigs pursuant to the two mortgages and bill of sale by failing to pay collective arrears in the sum of

Mr Solomon deposes that a letter of demand for all moneys owing to QIDC was forwarded to the Ladewigs on 8 January 1992 and a notice of exercise of power of sale in respect of the property secured by the two mortgages was forwarded on 31 January 1992. A notice of exercise of power of sale in respect of the items covered by the bill of sale, says Mr Solomon, was forwarded on 28 April 1992 to the Ladewlgs. Mr Solomon swears that default has continued since 8 January 1992.

A notice to quit the properties secured by the mortgages was forwarded to the Ladewigs on 8 September 1992 and the advertisements for the auction of the plant and equipment secured by the bill of sale and scheduled to take place today,

Wednesday, 21 October 1992, were first published on 2 October	1992. The advertisements forthe auction of the property secured
by the mortgages were first published on 17 September 1992 and the auctions are scheduled to take place tomorrow, 22 October 1992.
Mr Solomon says that QIDC has expended thus far in respect of the exercise of its powers pursuant to the security documents expenses of advertising of $6442.64, preparation of the properties for sale of $6160.00, and costs of moving plant and

equipment and other expenses involved in preparing for the auction of plant and equipment of $4300.00. If the auctions are postponed by court order, much of that spending will have to be repeated.

Mr Graham Ladewig, the applicant, says that the properties are worth of the order of $680,000.00, and it appears that QIDC is owed, as Mr Solomon swears, $398,323.31. M r Ladewig says that there is about $180,000.00 owing to the National Australia Bank and $60,000.00 owing to sundry creditors.

Having regard to those figures and the expenses at risk if the application for interlocutory relief were to be successful, there is very little equity in the property with which to meet an undertaking as to damages. So much is accepted by Mr Ladewig. On behalf of QIDC it is said that the rights it is seeking to exercise in respect of the auctions scheduled for today and tomorrow are those given by the bill of sale and the memoranda of mortgage. No reliance is placed upon the deed of

assignment of primary produce proceeds, which is exhibit A(8)	to the statement of claim of Mr Ladewig.
The real reason for the application is M r Ladewig's attempts to obtain refinance to pay out QIDC. It appears that the source of this finance is hoped to be Sabaron Corporation Pty Ltd, a company incorporated in Queensland and which gives its address as Ellis Street, Stones Corner, Queensland, 4120.
Mr Ladewig tells me that M r Poppleston, the director of Sabaron Corporation Pty Ltd, is aware of the dates of the proposed auctions and thus far his attempts to obtain refinancing from that source have been unsuccessful. Notwithstanding the knowledge of the dates of the auctions, a letter dated 21 October 1992 from Mr Poppleston on the letterhead of Sabaron Corporation Pty Ltd says:

" Dear M r Ladewig ,

F u r t h e r t o y o u r e a r l i e r d i s c u s s i o n w i t h the

w r i t e r , we a r e p l e a s e d t o c o n f i r m the r e c e i p t

o f a d v i c e from o u r a s s o c i a t e s t o whom we h a v e

made r e p r e s e n t a t i o n s on y o u r b e h a l f , o f

d e l i v e r y o f P r i m e Bank I n s t r u m e n t s for t r a d i n g

t o the	benefit o f y o u r	c o r p o r a t i o n .
As	the S e c o n d a r y B u y e r C o n t r a c t i s i n p l a c e ,	we
a n t i c i p a t e	t h a t f u n d s	w i l l b e g i n t r a n c h i n g for

y o u r r e q u i r e m e n t s w i t h i n the next seven d a y s ,

and t h a t c o n f i r m a t i o n o f th i s p o s i t i o n w i l l be

f o r t h c o m i n g from the Bankers i n the t r a n s a c t i o n

or their Attorneys	w i t h i n t w o Bank ing Days	(US
m a r k e t ) .

W e t r u s t t h a t t h i s a d v i c e i s t o y o u r

s a t i s f a c t i o n , and p l e a s e d o not h e s i t a t e i n

c o n t a c t i n g us s h o u l d you require a n y f u r t h e r

a s s i s t a n c e or c l a r i f i c a t i o n . " '

It seems to me that the thus far unsuccessful attempts

to refinance are not certain of being successful in the immediate
short term.

I find the contents of the letter unconvincing, but of more direct relevance is that no security is able to be offered to QIDC in respect of the grant of interlocutory relief. There is real doubt as to whether any undertaking as to damages would be able to be fulfilled.

There is no challenge directed to the security

documents relied on by QIDC.

Criticisms by M r Ladewig of the conduct of QIDC, particularly in relation to the deed of assignment earlier referred to, seem to me to sound solely in damages and that claim, if it be a valid one, is not prejudiced in any way by the refusal of the interlocutory relief the subject of the present application.

The final matter, as the chronology that I have recited indicates, is one of delay. This is a last attempt by Mr Ladewig to postpone the auctions of which he has had knowledge for some time now following notices of default a considerable time earlier this year.

The material was filed only yesterday in respect of
auctions planned for today and tomorrow. While I appreciate the

real anxiety and concern and the hope that Sabaron Corporation

of success thus far gives no confidence that any further time	Pty Ltd might be able to supply funds to pay out QIDC, the lack	given would have a different result.
On the totality of the material, in my opinion there is no serious question to be tried concerning the right of the QIDC to exercise its securities. Moreover, it seems to me that any undertaking as to damages is likely to be of little value so that real prejudice might in fact accrue to QIDC if the application were to be granted.

The attempt for interlocutory relief is really an attempt for time to continue efforts to refinance. ,

That purpose I _

is an insufficient basis on which a court should restrain a

i

secured creditor from exercising the powers conferred by his

I.

securities. In all the circumstances, I have to refuse the interlocutory relief sought in this notice of motion. !

The costs ,..

are to be the costs of QIDC in the principal proceedings.

I will adjourn this matter for further directions until 9.30 a.m. on Friday, 27 November 1992.

I cer t i fy t h a t t h i s and t h e [

preceding s i x ( 6 ) pages a r e a I .

t r u e c o p y o f t h e reasons f o r l

judgment here in o f t h e Honou a b l e

fi J. E. J. S p e n d e r / / L - ,	I
Date: 21 0 c t a r 1992	v

Mr G . Ladewig appeared i n person.

Counsel f o r t h e respondents	:	Mr J . C . Sheahan
i n s t r u c t e d by	F e e z Ruthning

Date o f Hearing 21 October 1992