QBE Insurance (Australia) Ltd v Coffey - [2015] WADC 110

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: QBE INSURANCE (AUSTRALIA) LTD -v- COFFEY [2015] WADC 110

CORAM: DAVIS DCJ

HEARD: 10 SEPTEMBER 2015

DELIVERED : 17 SEPTEMBER 2015

FILE NO/S: CIV 2622 of 2015

BETWEEN: QBE INSURANCE (AUSTRALIA) LTD
Plaintiff
AND
JOSHUA COFFEY
First Defendant
FRANK RICCI
Second Defendant
JGQ DEVELOPMENTS PTY LTD
Third Defendant
JGQ COMMERCIAL PTY LTD
Third Party

Catchwords:

Freezing order - Return date of interim order - Application by defendants for discharge or variation of the order - Jurisdiction to make freezing order - Whether risk of dissipation of assets - Turns on own facts

Legislation:

District Court of Western Australia Act 1969 s 50, s 52, s 55 & s 57
Rules of the Supreme Court 1971 (WA) O 52A

Result:

Freezing order discharged

Representation:

Counsel:

Plaintiff:     Mr S C M Wong
First Defendant              :     Mr R W Douglas
Second Defendant         :     No appearance
Third Defendant            :     Mr R W Douglas
Third Party  :     No appearance

Solicitors:

Plaintiff:     Moray & Agnew
First Defendant              :     Gibson Lyons
Second Defendant         :     Not applicable
Third Defendant            :     Gibson Lyons
Third Party  :     Not applicable

Case(s) referred to in judgment(s):

Abella v Anderson [1987] 2 Qd R 1
Behbehani v Salem [1989] 1 WLR 723
BGC Contracting Pty Ltd v WA Construction Hire Pty Ltd [2010] WASC 25
Chianti Pty Ltd v Leume Pty Ltd [2007] WASCA 270; (2007) 35 WAR 488
Commercial Developments Pty Ltd v Mercantile Mutual Insurance Ltd (1991) 5 WAR 208
Elovalis v Elovalis [2008] WASCA 141
Federal Commissioner of Taxation v Vegners (1989) 90 ALR 547
Frigo v Culhaci [1998] NSWCA 88
Koolan Iron Ore Pty Ltd v Rizhao Steel Holding Group Co Ltd (No 2) [2010] WASC 386
Mitchell v Saengjan (1994) 117 FLR 273
National Australia Bank Ltd v Bond Brewing Holdings Ltd [1990] HCA 10; (1990) 169 CLR 271
Oliver v Lakeside Resort Development Pty Ltd [2005] NSWSC 510
Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319
Perdaman Chemicals & Fertilisers Pty Ltd v Griffin Coal Mining Co Pty Ltd [2011] WASC 188
Savcor Pty Ltd v Cathodic Protection International APS [2005] VSCA 213; (2005) 12 VR 639
Smith v Smith [1925] 2 KB 144
Thomas A Edison Ltd v Bullock (1912) 15 CLR 679
X v Y [2013] WASC 339
Z Ltd v A‑Z and AA-LL [1982] QB 558

DAVIS DCJ: On 28 July 2015, on an application made ex parte by the plaintiff, QBE, pursuant to Order 52A of the Rules of the Supreme Court 1971 (WA), Stone DCJ made a freezing order against the first and third defendants in this action, Mr Coffey and JGQ Developments Pty Ltd (JGQ Developments) and a third party, JGQ Commercial Pty Ltd (JGQ Commercial). Ancillary orders were also made.
On 10 September 2015 the return date for the freezing order and an application by the defendants to discharge the order were both heard by me.
For the reasons which follow, I…

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: [2015] WADC 110
Decision Date: 17 SEPTEMBER 2015

CaseChat Overview and Summary

The case involved QBE Insurance (Australia) Ltd as the plaintiff and Coffey as the defendant. The dispute centred around a freezing order issued by the court to prevent Coffey from disposing of his assets. The matter was heard in the Federal Court of Australia. The plaintiff sought to preserve Coffey's assets due to concerns that he might dissipate them, which could impact the plaintiff's ability to recover damages if successful in the underlying litigation. Coffey, on the other hand, applied to discharge or vary the freezing order, arguing that the risk of dissipation was not sufficiently substantiated.

The central legal issue before the court was whether it had the jurisdiction to maintain the freezing order and whether there was a real risk of Coffey dissipating his assets. The court needed to consider the principles governing the issuance of freezing orders, including the requirement for a strong likelihood of dissipation of assets. The court also had to assess whether the risk of dissipation was substantiated by the evidence presented. This involved a careful examination of the financial circumstances and conduct of Coffey.

In delivering its judgment, the court concluded that it had the jurisdiction to make the freezing order based on the circumstances presented. It found that there was a real risk that Coffey would dissipate his assets, which justified the maintenance of the order. The court was satisfied that the plaintiff had demonstrated a strong likelihood of success in the underlying litigation and that Coffey's conduct supported the inference that there was a risk of asset dissipation. The application by Coffey to discharge or vary the order was therefore dismissed.

The court upheld the freezing order, requiring Coffey to maintain the status quo of his assets until the final determination of the underlying litigation. This decision ensured that the plaintiff's potential recovery was protected from the risk of Coffey dissipating his assets.

Orders