Marsden v DCL Developments Pty Ltd (Receivers and Managers Appointed) (No 2) - [2016] NSWSC 1038

Supreme Court

New South Wales

Medium Neutral Citation: Marsden v DCL Developments Pty Ltd (Receivers and Managers Appointed) (No 2) [2016] NSWSC 1038
Hearing dates: 21 July 2016
Date of orders: 21 July 2016
Decision date: 21 July 2016
Jurisdiction: Common Law
Before: McCallum J
Decision:
Reasons for rulings given during argument as to interim orders

Catchwords: INJUNCTIONS – where interim injunction granted restraining receivers from performing their functions in accordance with their appointment on conditions calculated to provide transparency as to the ongoing conduct of the business as a going concern pending expedited final hearing – where each party alleged breaches of the interim regime – receivers seeking order requiring defendants to respond “fully and honestly to questions reasonably asked” during inspections of the property and not to engage in “intimidatory tactics such as following delegates around with a video camera” – inappropriateness of involving court in ongoing supervision of unhappy commercial relationship
Cases Cited: Marsden v DCL Developments Pty Ltd (Receivers and Managers Appointed) [2016] NSWSC 823
Category: Procedural and other rulings
Parties: Peter William Marsden (in his capacity as Joint & Several Receiver and Manager of DCL Developments CAN 068 138 643 (Receivers and Managers appointed) (First Plaintiff)
Richard Andrew Stone (in his capacity as as Joint & Several Receiver and Manager of DCL Developments CAN 068 138 643 (Receivers and Managers appointed) (Second Plaintiff)
Andrew Bowcher (in his capacity as Joint & Several Receiver and Manager of DCL Developments CAN 068 138 643 (Receivers and Managers appointed) (Third Plaintiff)
DCL Developments (Receivers & Managers appointed) (1st Defendant)
Stuart Howe (2nd Defendant)
Linda Howe (3rd Defendant)
Representation:
Counsel:
B Katekar (Plaintiffs)
J Halley SC and T Boyle (Defendants)
Solicitors:
Gadens Lawyers (Plaintiff)
Jackson & Associates (Defendants)

File Number(s): 2016/176049

Judgment

HER HONOUR: These proceedings came before me as duty judge in late June 2016. On 20 June 2016, I granted an application by the defendants for injunctive relief, for the reasons stated in a judgment published that day: see Marsden v DCL Developments Pty Ltd(Receivers and Managers Appointed) [2016] NSWSC 823. In the concluding paragraph of the judgment I recorded my finding that, with appropriate conditions (as to which the bank was yet to be heard) the balance of convenience favoured maintaining the status quo pending the final hearing.
The “status quo” referred to in that paragraph was that the defendants were conducting the business of egg farmers at the property in respect of which the receivers have been appointed.
I subsequently heard argument as to the appropriate conditions and, on 21 June 2016, made orders providing for a regime under which I apprehended or at least hoped the business of the egg farm would continue to be conducted by the defendants with conditions which would allow the plaintiff receivers adequate access to the business and records of the defendants so as to be able to satisfy themselves of the ongoing integrity of the security property.
The proceedings have been relisted on the application of…

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.

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Details

Case: [2016] NSWSC 1038
Decision Date: 21 July 2016

CaseChat Overview and Summary

The matter before the court involved Marsden as the plaintiff and DCL Developments Pty Ltd (Receivers and Managers Appointed) as the defendant. The dispute centred around an interim injunction that had been granted, which restrained the receivers from performing their functions in accordance with their appointment. The injunction was imposed on the condition that there would be transparency regarding the ongoing conduct of the business as a going concern until a final hearing could be expedited. Both parties alleged breaches of the interim regime, leading to the receivers seeking an order that required the defendants to respond "fully and honestly to questions reasonably asked" during inspections of the property and to refrain from engaging in "intimidatory tactics such as following delegates around with a video camera."

The court was tasked with determining whether the interim injunction should be enforced and, if so, under what conditions. The receivers argued that their actions were necessary to ensure transparency and cooperation in the management of the property. They sought an order that would compel the defendants to respond honestly to questions and to avoid any intimidatory tactics during inspections. The defendants, on the other hand, argued that the court should not become involved in the ongoing supervision of their commercial relationship with the receivers. They contended that the court should not interfere with their discretion to manage the property as they saw fit, provided it was in accordance with their appointment.

The court found that the receivers' actions were not in line with the terms of the interim injunction. It held that the court should not become involved in the ongoing supervision of the commercial relationship between the parties. The court emphasised that it would not involve itself in the minutiae of the management of the property, as this would be inappropriate. It noted that the receivers were required to act honestly and in good faith, but that the court should not dictate how they exercised their discretion in managing the property. The court found that the receivers had not breached the terms of the interim injunction and that there was no need for further orders to be made. The court dismissed the application for further orders and upheld the interim injunction as it stood.

Orders