Parbery v QNI Metals Pty Ltd

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SUPREME COURT OF QUEENSLAND

CITATION:

Parbery & Ors v QNI Metals Pty Ltd & Ors [2018] QSC 213

PARTIES:

STEPHEN JAMES PARBERY AND MICHAEL ANDREW OWEN IN THEIR CAPACITIES AS LIQUIDATORS OF QUEENSLAND NICKEL PTY LTD (IN LIQ)
ACN 009 842 068

(first plaintiffs)

QUEENSLAND NICKEL PTY LTD (IN LIQ)
ACN 009 842 068

(second plaintiff)

JOHN RICHARD PARK, KELLY-ANNE LAVINA TRENFIELD & QUENTIN JAMES OLDE AS LIQUIDATORS OF QUEENSLAND NICKEL PTY LTD (IN LIQUIDATION)
ACN 009 842 068

(third plaintiffs)

v  

QNI METALS PTY LTD

ACN 066 656 175

(first defendant)

QNI RESOURCES PTY LTD

ACN 054 117 921

(second defendant)

QUEENSLAND NICKEL SALES PTY LTD
ACN 009 872 566

(third defendant)

CLIVE FREDERICK PALMER

(fourth defendant)

CLIVE THEODORE MENSINK

(fifth defendant)

IAN MAURICE FERGUSON

(sixth defendant)

MINERALOGY PTY LTD
ACN 010 582 680

(seventh defendant)

PALMER LEISURE AUSTRALIA PTY LTD
ACN 152 386 617

(eighth defendant)

PALMER LEISURE COOLUM PTY LTD
ACN 146 828 122

(ninth defendant)

FAIRWAY COAL PTY LTD
ACN 127 220 642

(tenth defendant)

CART PROVIDER PTY LTD
ACN 119 455 837

(eleventh defendant)

COEUR DE LION INVESTMENTS PTY LTD
ACN 006 334 872

(twelfth defendant)

COEUR DE LION HOLDINGS PTY LTD
ACN 003 209 934

(thirteenth defendant)

CLOSERIDGE PTY LTD
ACN 010 560 157

(fourteenth defendant)

WARATAH COAL PTY LTD
ACN 114 165 669

(fifteenth defendant)

CHINA FIRST PTY LTD
ACN 135 588 411

(sixteenth defendant)

COLD MOUNTAIN STUD PTY LTD
ACN 119 455 248

(seventeenth defendant)

EVGENIA BEDNOVA

(eighteenth defendant)

ALEXANDER GUEORGUIEV SOKOLOV

(nineteenth defendant)

ZHENGHONG ZHANG

(twentieth defendant)

SCI LE COEUR DE L’OCEAN

(twenty-first defendant)

DOMENIC MARTINO

(twenty-second defendant)

MARCUS WILLIAM AYRES

(first defendant added by counterclaim)

STEFAN DOPKING

(second defendant added by counterclaim)

FILE NO/S:

SC No 6593 of 2017

DIVISION:

Trial Division

PROCEEDING:

Application

DELIVERED ON:

17 September 2018

DELIVERED AT:

Brisbane

HEARING DATE:

12 September 2018

JUDGE:

Bond J

ORDER:

The orders of the Court are as follows:

1.       Bond J be recused from hearing the trial of this proceeding.

2.       The proceeding will remain on the Commercial List but Jackson J will now be the Commercial List judge responsible for the management of the proceeding.

3.       Order 16 of the orders made on 27 July 2018 regarding the 3 day hearing before Bond J commencing on 8 October 2018 be varied to delete the reference to “Bond J” and to insert in lieu thereof “Jackson J”.

4.       As to the orders made on 3 August 2018 –

(a)     Order 11 regarding the trial date be varied to add, at the end of the sentence, “before Jackson J”.

(b)     Direction 13 be varied to delete the reference to “Bond J” and to insert in lieu thereof “Jackson J”.

(c)      Items 18, 23 and 28 of Schedule 2 to the order be varied to delete the reference to “Bond J” and to insert in lieu thereof “Jackson J”.

CATCHWORDS:

COURTS AND JUDGES – JUDGES – DISQUALIFICATION FOR INTEREST OR BIAS – PARTICULAR GROUNDS – PREJUDGMENT – where the proceeding is…

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Details
Case
[2018] QSC 213
Decision Date

CaseChat Overview and Summary

In Parbery v QNI Metals Pty Ltd, the defendants sought the disqualification of Bond J on the basis of apprehended bias due to prejudgment. The defendants argued that Bond J had already made an assessment of the credibility of the fourth defendant's evidence in a previous interlocutory application, and that this assessment would likely be relevant to the trial of the proceeding. The defendants submitted that a fair-minded lay observer might reasonably apprehend that Bond J might not bring an impartial and unprejudiced mind to the determination of issues at the trial. The self-represented fourth defendant also contended that Bond J was actually biased against him and had failed to provide him with the requisite assistance or consideration.

The court considered whether there was any basis for a finding of actual bias, noting that the fourth defendant had not provided evidence to support his contentions. The court also considered whether there was a relevant risk of apprehended bias, and whether a fair-minded lay observer might reasonably apprehend that Bond J might not bring an impartial and unprejudiced mind to the determination of issues at the trial. The court found that there was a relevant risk of apprehended bias, and that a fair-minded lay observer might reasonably apprehend that Bond J might not bring an impartial and unprejudiced mind to the determination of issues at the trial.

Accordingly, the court ordered that Bond J be recused from hearing the trial of the proceeding, and that Jackson J be the Commercial List judge responsible for the management of the proceeding. The court also varied certain orders to reflect the change in judge. The court did not find any basis for a finding of actual bias.

Orders

Orders of the court

The orders of the Court are as follows:

1. Bond J be recused from hearing the trial of this proceeding.

2. The proceeding will remain on the Commercial List but Jackson J will now be the Commercial List judge responsible for the management of the proceeding.

3. Order 16 of the orders made on 27 July 2018 regarding the 3 day hearing before Bond J commencing on 8 October 2018 be varied to delete the reference to “Bond J” and to insert in lieu thereof “Jackson J”.

4. As to the orders made on 3 August 2018 –

(a) Order 11 regarding the trial date be varied to add, at the end of the sentence, “before Jackson J”.

(b) Direction 13 be varied to delete the reference to “Bond J” and to insert in lieu thereof “Jackson J”.

(c) Items 18, 23 and 28 of Schedule 2 to the order be varied to delete the reference to “Bond J” and to insert in lieu thereof “Jackson J”.

Background

Background to the litigation

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Evidence

Evidence Before The Court

The first step backwards from the overall evaluation would take one to the analysis under the heading “Does the relevant risk exist”.[33] The relevant parts of that analysis were as follows (emphasis added):[265]But the plaintiffs’ case does not rely on mere assertion or speculation. In this case, there are particular aspects of Mr Palmer’s previous conduct which would lead a prudent, sensible commercial person to infer that there is a real risk that he would take, or cause to be taken, steps outside court processes to attempt to frustrate or inhibit the prospects of enforcement or execution of any significant judgment against him or any of his companies. [266]The evidence does not support the conclusion that there is a real risk that Mr Palmer would abscond, but it does support the conclusion that there is a real risk of Mr Palmer entering into colourable transactions which, when discovered, would operate to inhibit or to frustrate enforcement or execution processes. I do not think that it is any answer to this concern to say that if the transactions were colourable, they might, or even should, be capable of being unwound by lengthy and expensive insolvency processes, in which evidentiary difficulties might abound. Nor am I troubled by the failure of the plaintiffs to identify particular transactions which might be entered into, because the point they make as to the ingenuity of schemes which a potential judgment debtor might devise is correct.[267]The relevant aspects of Mr Palmer’s previous conduct which justify this conclusion have either been proved before me in this application, or to the extent that the facts or their proper characterization are disputed, my qualitative evaluation of the evidence as a whole supports the conclusion I have expressed. In my view, this is a case in which the evidence which justifies the evaluations which I have expressed in the previous section of these reasons as to the underlying strength of some aspects of the plaintiffs’ case should be taken to have a strong bearing on the assessment of the risk which exists to the integrity of the Court’s processes: cf. [38] above.[268]First, there is evidence which suggests that Mr Palmer’s relationship to all of the corporate defendants against whom a freezing order is sought is such that he regards himself as the person who can make decisions on their behalf, including in relation to this proceeding. That much is clear from the fact and terms of exhibit 5, referred to at [238] above. Further, his ownership position and his directorships support the argument that he has both de facto and de jure control over the companies and their assets. They are effectively assets which he owns and the protection of their wealth is the protection of his wealth. Regard should also be had to the evidence which justified my conclusions as to the extent of Mr Palmer’s actual influence over Queensland Nickel: see [103]-[121] above. I think a prudent, sensible commercial person would regard it to be legitimate to draw inferences about the risk of how the corporate defendants would conduct themselves, by reference to an assessment of the risk of how Mr Palmer would conduct himself. [269]Second, I have explained why I have concluded that the plaintiffs’ case in relation to the Martino appointment and the Martino settlement deeds is a good arguable case and why my qualitative evaluation of that case is that it is a strong case: see [214]-[239] above. A prudent, sensible commercial person informed by the evidence presently before me would be gravely concerned about what Mr Palmer’s involvement in the Martino appointment and the Martino settlement deeds reveals concerning the risks of his future behaviour. A prudent, sensible commercial person could properly infer that the evidence suggested Mr Palmer had, and acted on, a positive intention to frustrate the possibility of any judgment against himself, Mineralogy and any of the other natural and corporate defendants within the ambit of the releases contained in the Martino settlement deeds and that he had, and acted on, a willingness to do so by illegitimate means. [270]In my view those considerations alone are sufficient to justify a conclusion that the plaintiffs have demonstrated the existence of the requisite risk, assessed by reference to the conclusion which a prudent, sensible commercial person would reach. It will be recalled that whilst it is not essential to prove that a defendant’s purpose or intention is to frustrate any potential judgment against the defendant, evidence of intention might well be very significant: see [36] above. [33] Freezing order judgment at [262]-[287].

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

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