OXC Bidco Pty Ltd v Dickson - [2016] NSWSC 968

Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: OXC Bidco Pty Ltd v Dickson [2016] NSWSC 968
Hearing dates: 7 July 2016
Decision date: 12 July 2016
Jurisdiction: Equity - Duty List
Before: Stevenson J
Decision:
Freezing order varied

Catchwords: PRACTICE AND PROCEDURE – injunctions – freezing orders – freezing order made ex parte – whether limit of freezing order should be varied from $28.4 million to $2.25 million – assessment of likelihood of plaintiffs making out “no transaction” case – assessment of likely damages recoverable by plaintiffs
Cases Cited: Cardile v LED Builders Pty Ltd (1999) 198 CLR 380
Frigo v Culhaci [1998] NSWCA 88
Gould v Vaggelas [1985] HCA 75; 157 CLR 215
Harris v Smith [2008] NSWSC 545
Potts v Miller (1940) 64 CLR 282
Texts Cited: P Biscoe, Freezing and Search Orders: Mareva and Anton Piller Orders, (2nd ed 2008, LexisNexis Buttterworths)
Category: Procedural and other rulings
Parties: OXC Bidco Pty Ltd (First Plaintiff)
Obex (NZ) Limited (Second Plaintiff)
Obex Medical Holdings Pty Ltd (Third Plaintiff)
Paul Gregory Dickson (First Defendant)
Dianne Dickson (Second Defendant)
Fandola Investments Pty Ltd (Respondent)
Representation:
Counsel:
I M Jackman SC with R M Foreman (Plaintiffs)
M A Ashhurst SC with S B Docker (Defendants/Respondent)
Solicitors:
Herbert Smith Freehills (Plaintiffs)
Thomson Geer (Defendants)

File Number(s): SC 2016/198984

Judgment

On 30 June 2016, Rein J made an ex parte freezing order against the defendants, Mr and Mrs Dickson, and against Fandola Investments Pty Ltd (the trustee of the New Dickson Family Trust) restraining those entities from disposing of, dealing with or diminishing their assets up to a figure in the order of $28.4 million.
On 7 July 2016, I heard an application on behalf of Mr and Mrs Dickson and Fandola to vary that order by reducing its limit from $28.4 million to $2.25 million.
Mr and Mrs Dickson and Fandola, without admissions, otherwise agreed to an extension of the freezing order to 5 August 2016 (on which date the matter will be in the Commercial List and on which occasion they may seek to have the freezing order dissolved altogether).

Decision

I propose to vary the freezing order in the manner contended for.

Background

The proceedings arise out of the sale by Mr and Mrs Dickson to the plaintiffs of their shares in Dickson & Dickson Healthcare Limited and Dickson & Dickson Healthcare NZ Limited (“the Companies” or “Company” as appropriate) pursuant to a Share Sale Agreement (“the Agreement”) dated 23 October 2015.
The business of the Companies is the sale and supply of medical compression garments and stockings, and equipment for hospital theatres in Australia, New Zealand, South Africa and the United States.
On completion of the Agreement on 24 November 2015, the plaintiffs paid out some $28.5 million, of which some $10 million was paid in cash to Mr and Mrs Dickson. The plaintiffs also procured that shares in a related company (with an agreed value of some $2.3 million) be transferred to Mr and Mrs…

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 OXC Bidco Pty Ltd v Dickson

Details

AGLC: OXC Bidco Pty Ltd v Dickson [2016] NSWSC 968
Case: [2016] NSWSC 968
Decision Date: 12 July 2016

CaseChat Overview and Summary

OXC Bidco Pty Ltd brought an action against Dickson seeking various relief, including an injunction and a freezing order. The High Court of Australia was called upon to determine whether the freezing order made ex parte should be varied from the amount of $28.4 million to $2.25 million. The plaintiffs, OXC Bidco Pty Ltd, sought to establish that the freezing order was excessive and disproportionate to the potential damages they might recover. The legal issues before the Court were the appropriate threshold for granting such an order and the assessment of the likelihood of the plaintiffs succeeding in their claim, particularly in relation to the "no transaction" case and the potential damages they could recover.

The Court considered the nature and purpose of a freezing order, which is to preserve assets that may otherwise be dissipated or removed from the jurisdiction. The Court also examined the evidence provided by the plaintiffs regarding the likelihood of their success in the substantive claim, including the potential for a "no transaction" case and the likely damages recoverable. The Court noted that the initial freezing order was made on an ex parte basis, meaning without notice to the defendant, and that the circumstances had changed since the order was made. The Court assessed the evidence presented by the plaintiffs and concluded that there was a reasonable prospect of the plaintiffs succeeding in their claim and that the initial freezing order was excessive. The Court determined that the limit of the freezing order should be reduced to $2.25 million, reflecting the likely damages recoverable by the plaintiffs.

The Court emphasised the importance of proportionality in granting freezing orders and the need for regular review and adjustment of such orders as circumstances change. The Court found that the lower amount of $2.25 million was sufficient to protect the plaintiffs' potential recovery while avoiding undue hardship on the defendant. The Court ordered that the freezing order be varied to limit the amount to $2.25 million, reflecting the updated assessment of the plaintiffs' likely damages. The Court also noted that the decision was specific to the circumstances of this case and did not set a precedent for future cases involving different facts and evidence.

Orders