Merhi v Green - [2007] NSWSC 722

CITATION: Merhi & Anor v Green [2007] NSWSC 722

HEARING DATE(S): 04/07/2007

JUDGMENT DATE :
9 July 2007

JUDGMENT OF: Associate Justice Malpass

DECISION: The application for extension of time is refused. Leave to appeal is not granted. The Summons is dismissed. The plaintiffs are to pay the costs of the Summons.

CATCHWORDS: Local Court proceedings brought against a Court appointed liquidator - "in the course of his duties as liquidator" - no cause of action disclosed - no prior leave - pleading struck out - interlocutory decision - leave to appeal

CASES CITED: Re Siromath Pty Limited (No 3) (1991) 25 NSWLR 25

PARTIES: Simon Merhi (1st Pl)
Betty Merhi (2nd Pl)
Martin Green of GHK Green Kregci (Def)

FILE NUMBER(S): SC 16091/06

COUNSEL: Mr J. Azzi (Pl)
Mr S. Golledge (Def)

SOLICITORS: John B Hajje & Associates (Pl)
Colin Biggers & Paisley (Def)

LOWER COURT JURISDICTION: Local Court

LOWER COURT FILE NUMBER(S): 12432/05

LOWER COURT JUDICIAL OFFICER : Lulham LCM

LOWER COURT DATE OF DECISION: 31/10/2006

- 6 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

ASSOCIATE JUSTICE MALPASS

9 JULY 2007

16091/06 Simon Merhi & Anor v Martin Green of GHK Green Kregci

JUDGMENT

1 HIS HONOUR: The plaintiffs are the owners of premises at Hornsby (the premises). The premises were let to Moonprom Pty Limited (the company).

2 The company was wound up and the defendant was appointed as liquidator on 3 May 2005.

3 An auction took place in respect of plant and equipment owned by the company and installed at the premises. Certain of the plant and equipment was sold at the auction and subsequently removed from the premises.

4 The plaintiffs claim that damage was caused to the premises by reason of the removal and seek to recover the repair costs (in the order of $12,000).

5 Proceedings were brought in the Local Court. The company was named as the first defendant and the defendant was named as the second defendant.

6 On 20 April 2006, by consent, the company was dismissed as a party to the proceedings.

7 The defendant filed a Notice of Motion. It sought an order striking out the Amended Statement of Claim. The defended application was heard by a Magistrate (Mr Lulham LCM). On 31 October 2006, he delivered his reserved judgment. He came to the view that the proceedings were an abuse of process and he ordered that the plaintiffs’ claim be struck out.

8 On 11 December 2006, the plaintiffs filed a Summons in this Court. It purports to bring an appeal as of right against the decision of the Magistrate. The purported appeal has been filed out of time and an extension of time is required by the plaintiffs.

9 The Summons was heard on 4 July 2007. The parties were legally represented. Written submissions were made, which were supplemented by oral argument.

10 At the outset, it became apparent that the plaintiffs also required leave to bring the appeal…

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: [2007] NSWSC 722
Decision Date: 9 July 2007

CaseChat Overview and Summary

Merhi v Green was a case before the Local Court of New South Wales, where the plaintiff sought to bring proceedings against a Court-appointed liquidator. The plaintiff alleged that the liquidator had acted negligently in the performance of his duties. The case was dismissed on the basis that the plaintiff had failed to disclose a cause of action and had not obtained prior leave to proceed with the proceedings. As a result, the Court struck out the pleadings and denied the plaintiff's application for leave to appeal.

The primary legal issue before the Court was whether the plaintiff had established a cause of action against the liquidator. The Court held that the plaintiff had not disclosed a cause of action, as the allegations were made in a vague and general manner and did not specify the nature of the alleged negligence or its consequences. The Court also found that the plaintiff had not obtained prior leave to proceed with the proceedings, which was a requirement under the relevant legislation. The Court emphasised that leave was necessary to ensure that proceedings against a liquidator were not brought frivolously or without merit.

The Court reasoned that the liquidator was entitled to immunity from proceedings in the absence of a disclosed cause of action and prior leave. The Court held that the liquidator's actions were taken in the course of his duties and that there was no evidence to suggest that the liquidator had acted outside the scope of those duties. The Court also noted that the plaintiff had not provided any evidence to support their allegations of negligence. As a result, the Court dismissed the proceedings and denied the plaintiff's application for leave to appeal.

The Court's decision in Merhi v Green highlights the importance of obtaining prior leave before bringing proceedings against a Court-appointed liquidator. The Court emphasised that such proceedings should only be brought where there is a disclosed cause of action and where the plaintiff has obtained the necessary leave. The Court's decision also underscores the need for plaintiffs to provide specific and detailed allegations in their pleadings, rather than vague and general statements. The Court's interlocutory decision in this case may have significant implications for future proceedings against liquidators in New South Wales.

Orders