FEDERAL COURT OF AUSTRALIA
Ng v Van Der Velde [2010] FCA 89
Citation: Ng v Van Der Velde [2010] FCA 89 Parties: KYM HON TOKE NG v TERRY VAN DER VELDE AND DAVID STIMPSON and RIBY PTY LTD (ACN 081 153 219) IN LIQUIDATION AS TRUSTEE FOR THE JADE TRUST File number: QUD 4 of 2010 Judge: REEVES J Date of judgment: 17 February 2010 Catchwords: PRACTICE AND PROCEDURE – Judgment and Orders – Stay of execution – Consideration of whether the Appellant demonstrated an appropriate case – Special or exceptional circumstances not necessary – Whether the appeal will be rendered nugatory if stay not granted is a relevant factor
PRACTICE AND PROCEDURE – Security for costs – Approach to impecuniosity of appellant fundamentally different on appeal – Consideration of what amounts to impecuniosity – Consideration of appellant’s prospects of success of appeal – Only a preliminary assessment is needed – Does the appellant have an arguable case
PRACTICE AND PROCEDURE – Application for leave to adduce new factual and legal issues on appeal – Adequate explanation for failure to raise these issues at first instance is needed – Consideration of whether the new issues have merit – Consideration of whether the respondent will suffer any prejudice if leave granted and whether that can be remedied
Legislation: Corporations Act 2001 (Cth), ss 468, 588FE, 588FG
Federal Court Rules, O 28 r 3, O 32 r 2(2), O 52 r 17, O 52 r 21, O 52 r 36Federal Court of Australia Act 1976 (Cth), s 56
Family Law Act 1975 (Cth)
Cases cited: Alexander v Cambridge Credit Corporation Ltd (Receivers Appointed) (1985) 2 NSWLR 685
Powerflex Services Pty Ltd v Data Access Corporation (1996) 137 ALR 498
Bell Wholesale Co Ltd v Gates Export Corporation (1984) 2 FCR 1
Equity Access Limited v Westpac Banking Corporation (1989) ATPR 40-972
Cowell v Taylor (1885) 31 Ch D 34
Skyring v Sweeney [1999] FCA 61
Thompson v Robinson [2005] QCA 253
Moore v Macks [2007] FCA 509
Bates v Omareef Pty Ltd [1998] FCA 536
Citrus Queensland Pty Ltd v Sunstate Orchards Pty Ltd [2008] FCA 1867
VUAX v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 158
NAJT v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 147 FCR 51Federal Commissioner of Taxation v Bruton Holdings Pty Ltd (in liq) (2008) 173 FCR 472
Date of hearing: 21 January 2010, 2 and 3 February 2010 Place: Brisbane Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 59 Counsel for the Applicant: Ms S Fajardo Solicitor for the Applicant: MLDG Lawyers Counsel for the First and Second Respondents: Mr MK Stunden Solicitor for the First and Second Respondents: Mills Oakley Lawyers
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 4 of 2010
BETWEEN: KYM HON TOKE NG
ApplicantAND: TERRY VAN DER VELDE AND DAVID STIMPSON
First RespondentRIBY PTY LTD (ACN 081 153 219) IN LIQUIDATION AS TRUSTEE FOR THE JADE…
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Details
- AGLC
- Ng v Van Der Velde [2010] FCA 89
- Case
- [2010] FCA 89
- Decision Date
CaseChat Overview and Summary
The case of Ng v Van Der Velde involved Ms Ng appealing a decision by Greenwood J that ordered the transfer of the 15 Brookvale Drive property back to Riby Pty Ltd, with Mr Van Der Velde and Mr Stimpson as liquidators. The appeal was subject to two applications: Ms Ng’s application for a stay of execution of Greenwood J’s orders and Mr Van Der Velde’s application for security for costs of the appeal. The primary legal issue was whether Ms Ng should be granted a stay of execution of the orders of Greenwood J, and if so, whether this stay should be conditional upon her providing security for costs of the appeal. Additionally, the court had to determine the appropriate quantum of security for costs if Ms Ng were to provide it.
The court found that Ms Ng’s appeal had arguable issues and prospects of success, particularly concerning the validity of the transfer and the potential for unjust enrichment. The court recognised the significant risk that Ms Ng would be unable to meet a costs order should her appeal be unsuccessful. Consequently, the court granted Ms Ng a stay of execution of Greenwood J’s orders, but made it conditional upon her providing security for costs of the appeal in the sum of $21,000. The court also extended the interim stay of the execution of the orders of Greenwood J to allow time for the provision of security for costs. If Ms Ng provided the security for costs within the specified timeframe, there would be a further stay until the appeal was finally determined. If she did not, the interim stay would cease, and Mr Van Der Velde would be able to proceed with the execution of the orders of Greenwood J.
In conclusion, the court ordered that Ms Ng should pay security for costs of the appeal in the sum of $21,000 and that the interim stay of the execution of the orders of Greenwood J would continue until a specified date. The court also noted that if the security for costs was not provided by the specified date, the interim stay would cease, and Mr Van Der Velde would be able to execute the orders of Greenwood J. The court would hear the parties on the form of the security, the appropriate date for the further stay, and any necessary amendments to the orders of Greenwood J.
The court found that Ms Ng’s appeal had arguable issues and prospects of success, particularly concerning the validity of the transfer and the potential for unjust enrichment. The court recognised the significant risk that Ms Ng would be unable to meet a costs order should her appeal be unsuccessful. Consequently, the court granted Ms Ng a stay of execution of Greenwood J’s orders, but made it conditional upon her providing security for costs of the appeal in the sum of $21,000. The court also extended the interim stay of the execution of the orders of Greenwood J to allow time for the provision of security for costs. If Ms Ng provided the security for costs within the specified timeframe, there would be a further stay until the appeal was finally determined. If she did not, the interim stay would cease, and Mr Van Der Velde would be able to proceed with the execution of the orders of Greenwood J.
In conclusion, the court ordered that Ms Ng should pay security for costs of the appeal in the sum of $21,000 and that the interim stay of the execution of the orders of Greenwood J would continue until a specified date. The court also noted that if the security for costs was not provided by the specified date, the interim stay would cease, and Mr Van Der Velde would be able to execute the orders of Greenwood J. The court would hear the parties on the form of the security, the appropriate date for the further stay, and any necessary amendments to the orders of Greenwood J.
Orders
Orders of the court
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Background
Background to the litigation
In response, Mr Van Der Velde has filed a notice of motion seeking security for costs of the appeal. These are the two applications I am required to determine.FACTUAL BACKGROUND Before turning to consider the issues that arise in these two applications, it is necessary to describe a little of the relevant factual background to these proceedings to provide some context for these applications. Mr Van Der Velde and Mr Stimpson are the joint liquidators of Riby Pty Ltd. They were appointed to that position by the Supreme Court of Queensland on 26 April 2006. As at that date, Riby had unsecured creditors totalling $262,702.55. Riby was the Trustee of The Jade Family Trust. As noted above, Ms Ng and her husband, Mr Hastings, used The Jade Family Trust to purchase the property at 15 Brookvale Drive, Underwood in 1999. Ms Ng and Mr Hastings were married on 21 November 1999. According to the Trust Deed, the primary beneficiaries of The Jade Family Trust were Ms Ng and Mr Hastings. Mr Hastings was also the Principal of the Trust and the sole director of Riby. The relationship between Ms Ng and Mr Hastings broke down. On 23 November 2005, they signed a document entitled “Terms of Settlement”, which was subsequently filed in the Family Court of Australia on 14 December 2005. That document formed the basis of a set of consent orders that were made by that Court on 20 December 2005. Under those consent orders, Mr Hastings was (among other things) to cause the transfer of the 15 Brookvale Drive property and another property at 58 Brookvale Drive, together with a Citroen car, from Riby to Ms Ng. On 3 April 2006, Ms Ng and Mr Hastings signed a new document entitled “Terms of Settlement” in much the same form as the earlier document of the same title. One of the main effects of this new document was to amend the earlier consent orders to exclude the property located at 58 Brookvale Drive from the properties to be transferred from Riby to Ms Ng. This new document formed the basis of a new set of consent orders that were made by the Family Court on 10 April 2006. The transfer of the 15 Brookvale Drive property was not registered until 17 May 2006. Most of this delay appears to have occurred because Ms Ng refinanced the loan on the property from Perpetual Trustees Limited to RAMS Mortgage Corporation Ltd (“RAMS”). Mr Van Der Velde commenced these proceedings by application filed on 12 December 2007. The main object of the proceedings was to set aside the 17 May 2006 transfer of the 15 Brookvale Drive property so it could be sold and the proceeds used to pay Riby’s creditors. To do that, Mr Van Der Velde relied upon various provisions of the Corporations Act 2001 (Cth) (“the Act”) relating to void or voidable transactions undertaken by a company before and after an application is made to wind it up. In addition to the transfer itself, the conduct of Ms Ng and Mr Hastings that was relied upon included:·their applying for the consent orders in the Family Court of Australia made on 20 December 2005 and 10 April 2006; and·their executing the “Terms of Settlement” documents dated 23 November 2005 and 3 April 2006.
Evidence
Evidence Before The Court
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Decision
Reasons for decision
For these reasons, I consider that at least these three groups of issues that are raised in Ms Ng’s amended notice of appeal are arguable. Conversely, I cannot conclude that they have no prospects of success. I should add that I have not sought to deal with every issue that is raised in Ms Ng’s amended notice of appeal because I do not consider that is called for when I have concluded that at least these three groups of issues are arguable.CONCLUSION To sum up, I consider that Ms Ng’s appeal will be rendered nugatory if there is no stay on the execution of the orders of Greenwood J – she will lose her home and it is highly unlikely that she will be able to recover it should she be successful on the appeal. Further, while I consider Ms Ng will confront some significant procedural difficulties in pursuing her appeal, I cannot conclude it has no prospects of success. I therefore consider she should be granted a stay of the execution of the orders of Greenwood J. However, I consider any stay must be on terms that will protect Mr Van Der Velde against the significant risk that Ms Ng’s will be unable to meet a costs order should her appeal be unsuccessful. I consider this can best be achieved by allowing Mr Van Der Velde’s application and ordering Ms Ng to provide security for costs of her appeal. I do not consider Ms Ng has shown she is impecunious and, therefore, I do not consider Ms Ng has established that her appeal will be stultified if such an order is made. In any event, even if Ms Ng had established these matters, I do not consider it would be fair to Mr Van Der Velde to allow Ms Ng to rely upon a claim to impecuniosity to absolve her from the necessity to provide security for costs of her appeal, particularly where Mr Van Der Velde has been entirely successful at first instance, including obtaining an order for costs against her and where Ms Ng now wishes to appeal that judgment based, in large part, upon advancing a raft of new legal and factual issues. At the same time, I consider it is necessary to address the possibility of a perverse outcome for Mr Van Der Velde if this order for security for costs is not met by Ms Ng. By this I mean Ms Ng choosing not to provide the security for costs and yet still being able to pursue her appeal protected by the stay. I, therefore, consider the stay order must be made conditional upon Ms Ng complying with the order for security for costs. Based on these conclusions, I consider that the orders that I should make should be along the following lines:·Ms Ng should be ordered to pay security for costs of the appeal in the sum of $21,000 in a form to be determined. I will hear the parties on the form of the security to be ordered. I should also note that the quantum of the security for costs sought by Mr Van Der Velde was not challenged by Ms Ng.·I will continue the interim stay of the execution of the orders of Greenwood J to the close of business on a date to be fixed in approximately four weeks time. I will hear the parties as to the appropriate date.·If, by that time, Ms Ng provides the security for costs as ordered, there will be a further stay of the execution of the orders of Greenwood J to take effect from the expiry of the interim stay and to continue until such time as the appeal is finally determined, or until further order. Of course, if by that time Ms Ng does not provide the security for costs as ordered, the interim stay will cease and Mr Van Der Velde will be able to proceed to execute the orders of Greenwood J. To achieve this outcome, it will probably also be necessary to amend some of the orders of Greenwood J, for example, to replace the date “Friday, 22 January 2010” with a new date to reflect the new timetable effected by these orders. I will also hear the parties on this aspect.
Ratio Decidendi
Legal Principle Established
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