McLeary v Swift

[2014] NSWSC 870

Supreme Court

New South Wales

Medium Neutral Citation:

McLeary v Swift [2014] NSWSC 870

Hearing dates:

24 June 2014

Decision date:

24 June 2014

Jurisdiction:

Equity Division - Duty List

Before:

White J

Decision:

1. Order that the freezing orders made in terms of orders 2(a) and 2(b) on 22 March 2013 (but recorded as having been made on 22 April 2013) be extended until 5 pm on 26 August 2014.

2. Stand the proceedings over to the Registrar's list on 25 August 2014.

3. Give the parties liberty to apply on five days' notice to vary or discharge the orders.

Catchwords:

PRACTICE AND PROCEDURE - judgments and orders - freezing orders - application for extension of time of assets freezing orders - orders sought to enable plaintiff to pursue enforcement of previous orders - application granted

Cases Cited:

McLeary v Swift [2012] NSWSC 1403
McLeary v Swift [2014] NSWCA 52
McLeary v Swift [2013] NSWSC 1674
Johnson v Agnew [1980] AC 367
Buckman v Rose (1980) 1 BPR 9558
JAG Investments Pty Limited v Strati [1981] 2 NSWLR 600
Riltang Pty Ltd v L Pty Ltd [2004] NSWSC 977
Zorbas v Titan Properties (Aust) Pty Ltd [2005] NSWSC 440
Georges v Wieland [2010] NSWSC 1378

Category:

Interlocutory applications

Parties:

Jeffrey John McLeary (Plaintiff)
Martin Swift (Defendant)

Representation:

Counsel:
F G Kalyk (Plaintiff)
J T Johnson (Defendant)
Solicitors:
Shotters Lawyers (Plaintiff)
Beazley Singleton Lawyers (Defendant)

File Number(s):

2011/69385

Judgment

1. HIS HONOUR: This is an application for the extension of a freezing order. It is not opposed. The question is for how long the freezing order should be extended.

1. On 26 November 2012 Windeyer AJ made orders for the specific performance of an agreement between the plaintiff and the defendant. His Honour ordered that the defendant pay a sum of $822,595.47 to the Deputy Commissioner of Taxation. (See McLeary v Swift [2012] NSWSC 1403.)

1. An appeal was filed on 22 March 2013. Young AJ made freezing orders. Those orders were initially made up to the determination of the appeal. The appeal and a cross-appeal was determined by the Court of Appeal on 4 March 2014. Both the appeal, the cross-appeal and a notice of motion apparently filed by the plaintiff appellant were dismissed (McLeary v Swift [2014] NSWCA 52).

1. The plaintiff's position is that he has paid, or caused to be paid, the moneys to the Deputy Commissioner of Taxation that the defendant was ordered to pay by the orders of 26 November 2012.

1. In the meantime an application had been made by the plaintiff for the issue of a writ for the levy of property.

1. That application was rejected on 14 November 2013 by Windeyer AJ (McLeary v Swift [2013] NSWSC 1674). His Honour found that because the moneys payable under the order were not payable to the plaintiff, but to the Deputy Commissioner of Taxation, the plaintiff was not a judgment creditor who could enforce the judgment by the usual means of execution.

1. The extension of the freezing order is sought in order that the plaintiff can pursue other means to enforce the orders. The foreshadowed means of enforcement is by an application for contempt, presumably with an associated claim for the sequestration or the appointment of a receiver to the assets of the defendant.

1. Consideration would also need to be given to whether an application should be made to vacate the order for specific performance and for an order for the payment of damages, or damages in lieu of specific performance.

1. It is not clear to me whether or not such a claim may already have been determined adversely to the plaintiff by orders made by the Court of Appeal.

1. In the Court of Appeal's reasons Barrett JA said (at [47]):

"[47] Counsel for the respondent suggested that if his client was ultimately unsuccessful in obtaining the full fruits of the order for specific performance, he might wish to return to the Equity Division with a view to further attention being given to his claim for damages against the appellant. Such an approach is entirely misconceived. The respondent's cause of action based on breach of the agreement ceased to have any independent existence when he obtained the order for specific performance. The cause of action merged in the judgment. The basis for the making of an order for specific performance was, in words used by Kindersley V-C in Falcke v Gray (1859) 4 Drew 651; 62 ER 250 at 252, that 'a mere compensation in damages is not a sufficient remedy and satisfaction for the loss of the performance of the contract'. If, having been awarded specific performance, the respondent fails in the long run to achieve full satisfaction (because, for example, the appellant simply does not have the money necessary to comply with the order), that circumstance represents no basis whatsoever for attempting some form of retrospective revival of an alternative claim said to arise from the wrong for which a remedy had been provided by the order actually made. It might, of course, permit other steps to enforce the court order."

1. It does not appear that the Court of Appeal was referred to relevant authorities such as Johnson v Agnew [1980] AC 367 at 393-394, Buckman v Rose (1980) 1 BPR 9558 or JAG Investments Pty Limited v Strati [1981] 2 NSWLR 600 at 603-604. (See also Riltang Pty Ltd v L Pty Ltd [2004] NSWSC 977 at [51], Zorbas v Titan Properties (Aust) Pty Ltd [2005] NSWSC 440 at [12] and Georges v Wieland [2010] NSWSC 1378 at [25].)

1. The plaintiff will need to consider whether or not the orders of the Court of Appeal would preclude any such application or whether such an application should be made in addition to, or as an alternative to, a claim to punish the defendant for contempt and associated relief.

1. I think the freezing order should be extended for sufficient time for the plaintiff to consider advice upon such issues and to commence such application to seek to enforce the orders of 26 November 2012 as he might be advised.

1. I note that I am told that the freezing orders in questions are recorded on JusticeLink as having been made on 22 April 2013, but it is clear from the associate's record of proceedings that they were made on 22 March 2013.

1. I will extend the freezing orders for a period of two months and grant the parties liberty to apply.

1. I order that the freezing orders made in terms of orders 2(a) and 2(b) on 22 March 2013 (but recorded as having been made on 22 April 2013) be extended until 5 pm on 26 August 2014. I stand the proceedings over to the Registrar's list on 25 August 2014.

1. I give the parties liberty to apply on five days' notice to vary or discharge the orders.

Decision last updated: 28 June 2014