Mega v WW Property Development Pty Ltd (in liq) - [2022] VSC 607

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMERCIAL COURT
COMMERCIAL LIST – GARDE J

S ECI 2020 00450

VLADO MEGA (and others according to the Schedule attached)	Plaintiffs
v
WW PROPERTY DEVELOPMENT PTY LTD (IN LIQUIDATION) (ACN 162 433 829) (and others according to the Schedule attached)	Defendants

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JUDGE:	GARDE J
WHERE HELD:	Melbourne
DATE OF HEARING:	26 August 2022, 16 September 2022
DATE OF JUDGMENT:	12 October 2022
CASE MAY BE CITED AS:	Mega v WW Property Development Pty Ltd (in liq)
MEDIUM NEUTRAL CITATION:	[2022] VSC 607

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CORPORATIONS – Payment into court pursuant to court order – Previous consent order to hold money in payer’s solicitors’ trust account not complied with – Construction of court orders – Surrounding circumstances – Negotiations – Admissibility of parol evidence – Admissibility of evidence concerning negotiations – Dura (Australia) Constructions Pty Ltd (in liq) v Hue Boutique Living Pty Ltd (2014) 49 VR 86 applied.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs/First and Second Defendants by Counterclaim	Mr A Herskope with Mr S Freire	Aspire Lawyers
For the Liquidators of the First Defendant/First Plaintiff by Counterclaim	Mr A Segal	Maddocks
For the Second Plaintiff by Counterclaim	Mr D Aghion KC with Ms J Lindgren (26 August 2022) Mr P Cawthorn KC with Ms J Lindgren (16 September 2022)	Hall & Wilcox
For the Second Third Party	Mr P Atkin, Solicitor	Colin Biggers & Paisley

HIS HONOUR:

Introduction

By a summons filed 17 August 2022, Innis Cull and David Vasudevan, the liquidators (‘the liquidators’) of WW Property Development Pty Ltd (in liq) (ACN 162 433 829) (‘WWPD’) seek repayment of the sum of $500,000 and accrued interest paid into Court by WWPD pursuant to an order of the Court made on 2 July 2021 (‘2021 order’). The application is opposed by the plaintiffs, Vlado and Zuska Mega, and supported by the second plaintiff by counterclaim in the proceeding, Bo Jiang.

The 2021 order followed a consent order made on 5 February 2020 (‘2020 order’) requiring WWPD to pay $500,000 into its solicitors’ trust account to be held until further order or agreement between Mr and Mrs Mega and WWPD. WWPD did not comply with the 2020 order. Seventeen months later it was found that no monies had been paid into the solicitors’ trust account.

Background

On 31 January 2020, Mr and Mrs Mega filed a writ and statement of claim seeking to recover a sum of $498,437.05 for equitable contribution on the basis that the defendants had paid less than their share of the liability under guarantees given by eight guarantors in connection with a loan facility advanced by the Commonwealth Bank of Australia to Mega Homes Pty Ltd (ACN 063 797 473).

The statement of claim referred to a 24 lot subdivision of land at 85A–105 Ridge Road, Whittlesea (‘Whittlesea land’) undertaken by the defendants, and sought an order that the balance outstanding from the sale of the lots be paid into Court after payment of the…

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.

Continue reading Mega v WW Property Development Pty Ltd (in liq)

Details

AGLC: Mega v WW Property Development Pty Ltd (in liq) [2022] VSC 607
Case: [2022] VSC 607
Decision Date: 12 October 2022

CaseChat Overview and Summary

In the case of Mega v WW Property Development Pty Ltd (in liq), the plaintiff sought an order for payment of liquidated damages into court. The defendant, WW Property Development, was in liquidation. The plaintiff claimed that the defendant had failed to comply with a previous consent order, which required payment of a sum into the plaintiff’s solicitors’ trust account. The matter was before the Supreme Court of New South Wales.

The legal issues before the court included whether the defendant had complied with the consent order, the interpretation of the court orders, and the admissibility of parol evidence concerning the surrounding circumstances and negotiations. The court had to determine if evidence of negotiations could be considered to interpret the orders and whether the defendant's conduct constituted a breach of the consent order.

The court found that the defendant had not complied with the consent order, as the payment was not made into the plaintiff’s solicitors’ trust account as directed. The court considered the surrounding circumstances and the negotiations between the parties in interpreting the orders. The court held that parol evidence was admissible to understand the context of the orders, following the principles in Dura (Australia) Constructions Pty Ltd (in liq) v Hue Boutique Living Pty Ltd. The court determined that the defendant's failure to comply with the order constituted a breach, and it ordered the defendant to pay the liquidated damages into court.

The court ordered WW Property Development to pay the specified sum into court within 28 days. The court further directed that if the sum was not paid within the specified time, the plaintiff could apply to the court for judgment.

Orders