Lewis v Nortex Pty Ltd (In Liq); Lamru Pty Ltd v Kation Pty Ltd

[2005] NSWSC 264

CITATION:	Lewis v Nortex Pty Ltd (In Liq); Lamru Pty Ltd v Kation Pty Ltd [2005] NSWSC 264
HEARING DATE(S):	7 & 8 March 2005
JUDGMENT DATE :	8 March 2005
JURISDICTION:	Equity
JUDGMENT OF:	Hamilton J
DECISION:	Further money released from Mareva restraint to meet costs of proceedings; Mareva restraint varied.

CATCHWORDS:	EQUITY [340] - Equitable remedies - Injunctions - Interlocutory injunctions - Injunctions to preserve property pending determination of rights - Mareva injunctions - Other matters - Need to fund litigation.
CASES CITED:	Lewis v Nortex Pty Ltd (In Liq); Lamru Pty Ltd v Kation Pty Ltd [2004] NSWSC 1238
PARTIES:	3081/97 Peter Lawrence Lewis (P) Lamru Pty Ltd (Applicant) Kation Pty Ltd (Respondent) Brian Raymond Silvia (Liquidator) 1750/02 Lamru Pty Limited (P) Kation Pty Limited (D1) Peter Lawrence Lewis (D2) Mark Lewis (D3) Nortex Pty Ltd (In Liq) (D4)
FILE NUMBER(S):	SC 3081/97; 1750/02
COUNSEL:	N A Cotman SC and J T Johnson (P L Lewis & Kation P/L) S J Motbey (Lamru P/L) V R W Gray (Liquidator & Nortex P/L)
SOLICITORS:	Kemp Strang (P L Lewis & Kation P/L) Lyons & Lyons (Lamru P/L) Abbott Tout (Liquidator & Nortex P/L)

LOWER COURT JURISDICTION:

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

HAMILTON J

TUESDAY, 8 MARCH 2005

3081/97 PETER LAWRENCE LEWIS v NORTEX PTY LTD (In Liq)
1750/02 LAMRU PTY LIMITED v KATION PTY LIMITED & ORS

JUDGMENT

1 HIS HONOUR: There is a further application before me for the release of money from funds subject to a Mareva restraint to meet costs. The costs are counsel’s fees in two invoices of Mr Stephen Motbey for attendances to the matter on behalf of Lamru in February and March 2005, totalling $31,607.70.

2 The only matter that Mr Baird, solicitor for the Lewis interests, raises in relation to the payment out of further funds, is to draw attention to the following matters. The relevant Mareva restraint is contained in orders of the Court made on 27 June 2003. Order 2 of those orders provided that interest upon the account might be released to Mr Lamb and his wife, Beverley Anne Tilbury. The release that was made most recently was made pursuant to a judgment of mine delivered on 15 December 2004: Lewis v Nortex Pty Ltd (In Liq); Lamru Pty Ltd v Kation Pty Ltd [2004] NSWSC 1238. I was not, during the course of the argument that led to that judgment, reminded of the provision concerning interest contained in the orders of 27 June 2003, nor was my attention drawn, either by Mr Motbey, nor by Mr Baird, to the fact that there was interest then accumulated in that account which might provide an available source of funds for the payment of costs. There was considerable debate in that argument, as is adverted to in the judgment, as to what funds were available to Lamru for the payment of costs other than the restrained fund.

3 Despite the lack of adversion to that possibly available interest, it now appears that some two days later, on 17 December 2004, some $13,000 of interest was paid out of the account to Mr Lamb. It is not in dispute between the parties that, of that sum, some $7,000 was used to pay Mr Motbey arrears of fees still owing in respect of proceedings in the Court of Appeal. It is not claimed that the other $6,000 was spent on these proceedings, but conceded that it was spent otherwise, perhaps in the acquisition of stock for the ongoing business of Ecodownunder Pty Ltd.

4 On this occasion I propose to make an order for payment out of the fund. For reasons which I have dealt with in earlier judgments leading up to and culminating in my judgment of 15 December 2004, I propose to allow release of the $31,607.70 to meet Mr Motbey's fees. To avoid accident or inadvertence of the sort that occurred in relation to the $13,000 interest released on 17 December 2004, I think the best course is to revoke order 2 of 27 June 2003 for the release of interest to Mr Lamb and Ms Tilbury. When that order was made it was not anticipated that there would have to be releases of considerable amounts from the restrained fund to meet ongoing costs. However, a number of releases have been made since that time. There are to be further proceedings before me relating to the form of orders to be made, and to costs in the proceedings, and it seems likely there will be further applications for releases of funds for those purposes. In those circumstances, I think it best that for the present the interest be accumulated in the account so as to be part of the funds available for payment of any further costs.

5 The order that I make is that $31,607.70 should be released from the fund subject to Mareva restraint for payment of Mr Stephen Motbey's invoices, Exhibit A92. The amount of that release is to be met first from any accrued interest in the account, and secondly from the corpus of the account.

6 There is to be no order as to the costs of the application for release of funds.

7 In the Common Law proceedings 10911/04, as well as in the proceedings 3081/97 and 1750/02 in the Equity Division, I order that existing stays be extended up to and including the day of delivery of judgment.

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