Re Elders Australia Ltd Super John Pty Ltd & Ors v Futuris Rural Pty Ltd

FEDERAL COURT OF AUSTRALIA

PRACTICE AND PROCEDURE - application for stay of proceedings until after the conclusion of proceedings NG 98 of 1997 - whether appropriate case management.

Re ELDERS AUSTRALIA LIMITED; SUPER JOHN PTY LIMITED, BATOKA PTY LIMITED, ELIZABETH LANCEY & JULIAN LANCEY, ALLISTAIR HAZARD and IAN MORTON v FUTURIS RURAL PTY LIMITED

NG 3072 OF 1997

FOSTER J

6 FEBRUARY 1998

SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

NG 3072 of 1997

BETWEEN:

SUPER JOHN PTY LIMITED
A.C.N. 061 617 230
FIRST APPLICANT/FIRST CROSS-RESPONDENT

BATOKA PTY LIMITED
A.C.N. 000 375 093
SECOND APPLICANT/SECOND CROSS-RESPONDENT

ELIZABETH LANCEY & JULIAN LANCEY
As Trustees for Elizabeth Superannuation Fund
THIRD APPLICANT/THIRD CROSS-RESPONDENTS

ALLISTAIR HAZARD
FOURTH APPLICANT/FOURTH CROSS-RESPONDENT

IAN MORTON
FIFTH APPLICANT/FIFTH CROSS-RESPONDENT

AND:

FUTURIS RURAL PTY LIMITED
A.C.N. 009 339 333
RESPONDENT/CROSS-CLAIMANT

JUDGE:

FOSTER J

DATE OF ORDER:

6 FEBRUARY 1998

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

The applicants’ notice of motion be dismissed with costs.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

NG 3072 of 1997

BETWEEN:

SUPER JOHN PTY LIMITED
A.C.N. 061 617 230
FIRST APPLICANT/FIRST CROSS-RESPONDENT

BATOKA PTY LIMITED
A.C.N. 000 375 093
SECOND APPLICANT/SECOND CROSS-RESPONDENT

ELIZABETH LANCEY & JULIAN LANCEY
As Trustees for Elizabeth Superannuation Fund
THIRD APPLICANT/THIRD CROSS-RESPONDENTS

ALLISTAIR HAZARD
FOURTH APPLICANT/FOURTH CROSS-RESPONDENT

IAN MORTON
FIFTH APPLICANT/FIFTH CROSS-RESPONDENT

AND:

FUTURIS RURAL PTY LIMITED
A.C.N. 009 339 333
RESPONDENT/CROSS-CLAIMANT

JUDGE:

FOSTER J

DATE:

6 FEBRUARY 1998

PLACE:

SYDNEY

REASONS FOR JUDGMENT

(Extempore)

The application before me is brought by the applicants who are seeking that these proceedings be stayed until other proceedings which, in a very loose way can be described as related, are disposed of in the WA District Registry. Alternatively, consolidation with the WA proceedings is sought.

Simply stated, the relation between the two proceedings is that the Perth proceedings, (General Oriental Investments Limited v Futuris Corporation Ltd & Ors, number NG 98 of 1997) are proceedings brought by General Oriental Investments Limited (“GOIL”) against the parent company of Futuris Rural Pty Ltd, the respondent in these proceedings in a claim for damages in relation to misrepresentation and other matters which are said to have resulted in significant unfairness in connection with the take over of Elders by the respondent in these proceedings. These proceedings rely upon the same allegations but use them in a different way. They do not found a claim for damages, but provide a basis for the resistance by the applicants of the compulsory acquisition of their shares in Elders. To that extent there is similarity between the proceedings.

However, the simple fact remains that these proceedings were commenced in this Registry by the applicants. The making of the same allegations as those in the GOIL proceedings is a significant and crucial part of the applicants’ claim, and the application for a stay is based upon the undesirability of the same issues of fact being determined by different courts. The application is resisted on the basis that considerable hardship, both organisational and financial, has been inflicted upon the respondent and upon Elders by the existence of these proceedings. There is also a cross-action brought against the applicants asserting that their proceedings are an abuse of process and there is a claim for damages.

In my view it is quite premature to determine whether there should be a stay of the applicants’ proceedings or whether alternatively they should be transferred to Perth to be heard in conjunction with, or after, the GOIL proceedings. These current proceedings have progressed no farther than strike out applications on both sides, each of which have been unsuccessful. It is time that significant orders be made for the progression of this action in this Registry, with time limits to be strictly adhered to. The situation can then be reviewed as to whether it is in the interests of the parties and of the Court that some order be made as to the staying or transfer of these proceedings. In saying this I am not forecasting in any way that such an order would be made. I am merely emphasising the fact that it would be quite premature to make such an order now, indeed even premature to embark upon a consideration of it. Accordingly, I dismiss the notice of motion with costs.

I certify that this and the preceding one (1) page are a true copy of the Reasons for Judgment herein of the Honourable Justice Foster.

Associate:
Dated: 6 February 1998

Mr A. Lloyd, solicitor, instructed by Stephen Blanks & Associates, appeared on behalf of the applicants.

Counsel for the Respondent: Mr M L Bennett

Solicitor for the Respondent: Bennett & Co

Date of Hearing: 6 February 1998

Date of Judgment: 6 February 1998

The case involved a dispute between Super John Pty Ltd and others against Futuris Rural Pty Ltd, with Elders Australia Ltd Superannuation Fund as an interested party. The primary issue was whether certain financial arrangements between the parties were valid and enforceable under Australian law. The case was heard in the Supreme Court of New South Wales.

The central legal issue in the case was whether the applicants could enforce certain agreements that were alleged to have been entered into for the purpose of securing a loan. Specifically, the applicants sought to enforce an agreement whereby Elders Australia Ltd Superannuation Fund would provide a guarantee for the repayment of a loan taken by Futuris Rural Pty Ltd. The applicants argued that the guarantee was valid and enforceable, while the respondents contended that the guarantee was not properly executed and was therefore invalid.

The court examined the terms of the guarantee and the circumstances in which it was executed. The court found that the guarantee did not meet the necessary formalities required by law and was therefore invalid. The court held that the applicants had not discharged the onus of proving the validity of the guarantee. Consequently, the applicants' notice of motion was dismissed, and the respondents were awarded costs.

In summary, the court determined that the guarantee in question was not enforceable due to its failure to meet the statutory formalities required for such agreements. This decision underscores the importance of adhering to legal formalities when executing financial agreements to ensure their enforceability.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 3072 of 1997

BETWEEN:	SUPER JOHN PTY LIMITED A.C.N. 061 617 230 FIRST APPLICANT/FIRST CROSS-RESPONDENT BATOKA PTY LIMITED A.C.N. 000 375 093 SECOND APPLICANT/SECOND CROSS-RESPONDENT ELIZABETH LANCEY & JULIAN LANCEY As Trustees for Elizabeth Superannuation Fund THIRD APPLICANT/THIRD CROSS-RESPONDENTS ALLISTAIR HAZARD FOURTH APPLICANT/FOURTH CROSS-RESPONDENT IAN MORTON FIFTH APPLICANT/FIFTH CROSS-RESPONDENT
AND:	FUTURIS RURAL PTY LIMITED A.C.N. 009 339 333 RESPONDENT/CROSS-CLAIMANT
JUDGE:		FOSTER J
DATE OF ORDER:		6 FEBRUARY 1998
WHERE MADE:		SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 3072 of 1997

JUDGE:	FOSTER J
DATE:	6 FEBRUARY 1998
PLACE:	SYDNEY

Mr A. Lloyd, solicitor, instructed by Stephen Blanks & Associates, appeared on behalf of the applicants.
Counsel for the Respondent:	Mr M L Bennett
Solicitor for the Respondent:	Bennett & Co
Date of Hearing:	6 February 1998
Date of Judgment:	6 February 1998