Sahab Holdings Pty Ltd v Tonks - [2023] NSWCA 12

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Sahab Holdings Pty Ltd v Tonks [2023] NSWCA 12
Hearing dates: 19 October 2022
Date of orders: 15 February 2023
Decision date: 15 February 2023
Before: Macfarlan JA at [1]
Meagher JA at [2]
Kirk JA at [3]
Decision:
(1) Dismiss the appeal
(2) Order the appellant to pay the respondents’ costs

Catchwords:
CORPORATIONS — Receivers and managers — Application for inquiry under s 423(1) of the Corporations Act 2001 (Cth) — Language of “prima facie case” to be avoided — Whether receivers obliged to defend proceedings against company — Leave required to compromise a claim — Whether receivers entitled to use litigation as a means to seek to renegotiate a pre-existing contractual relationship — Receivers’ approach manifested a reasonable commercial judgment in the circumstances — Appeal dismissed

Legislation Cited:
Corporations Act 2001 (Cth), s 420, s 423, s 536, s 90-10 of Sch 2
Supreme Court Act 1970 (NSW), ss 67, 68
Uniform Civil Procedure Rules, Pt 26

Cases Cited:
BL & GY International Co Ltd v Hypec Electronics Pty Ltd (2010) 79 ACSR 558; [2010] NSWSC 959
Burns Philp Investments Pty Ltd v Dickens (1993) 11 ACLC 272
Djordjevich v Rohrt [2022] VSCA 84
Hall v Poolman (2009) 75 NSWLR 99; [2009] NSWCA 64
Kanjian Holdings No 1 Pty Ltd v Kanjian; Kanjian v Kanjian(No 3) [2021] NSWSC 839
Kanjian v Kanjian (No 2) [2021] NSWSC 14
Kanjian v Kanjian [2019] NSWSC 166
Leslie v Hennessy [2001] FCA 371
Naxatu Pty Ltd v Perpetual Trustee Co Ltd (2012) 207 FCR 507; [2012] FCAFC 163
Northbourne Developments Pty Ltd v Reiby Chambers Pty Ltd (1989) 19 NSWLR 434
Re St Gregory's Armenian School (in liq) (2012) 92 ACSR 588; [2012] NSWSC 1215
Senses Northbridge Pty Ltd v Sahab Holdings Pty Ltd (No 2) [2019] NSWSC 1458
Senses Northbridge Pty Ltd v Sahab Holdings Pty Ltd (No 3) [2020] NSWSC 345
Senses Northbridge Pty Ltd v Sahab Holdings Pty Ltd [2019] NSWSC 1201

Category: Principal judgment
Parties: Sahab Holdings Pty Ltd (Appellant)
Bradley John Tonks (First Respondent)
Mark Roufeil (Second Respondent)
Representation:
Counsel:
AJL Bannon SC / MR Davis (Appellant)
R Glasson (Respondents)
Solicitors:
Kanjian & Company (Appellant)
Piper Alderman (Respondents)

File Number(s): 2022/73239
Publication restriction: Nil
Decision under appeal

Court or tribunal:

Supreme Court

Jurisdiction:

Equity – Corporations List

Citation:

In the matter of Sahab Holdings Pty Ltd [2022] NSWSC 4

Date of Decision:

17 February 2022

Before:

Rees J

File Number(s):

2021/104020

HEADNOTE

[This headnote is not to be read as part of the judgment]

The appellant, with respect to which receivers had been appointed by the Supreme Court, sought an order pursuant to s 423(1)(b) of the Corporations Act 2001 (Cth) that the Supreme Court inquire into the conduct of those receivers in relation to the receivership. The appellant’s application was rejected by the primary judge on the basis that “no prima facie case” for such an inquiry had been made out.

On appeal, the appellant focused on the receivers’ conduct in relation to defending certain litigation on behalf of the appellant. In particular, the appellant argued that the primary judge erred in suggesting that the receivers were obliged to defend the proceedings, and in finding that there was no factual basis that warranted an inquiry.

The Court (Kirk JA, Macfarlan and Meagher JJA agreeing) dismissed the appeal, holding:

(1) For an application under s 423(1)(b), the only express precondition for the discretion is that a person has complained to the Court (or ASIC) about some relevant act or omission of the controller. There is no requirement that it appears to the Court or ASIC that the complaint has foundation, but it is no doubt implicit that there must be some sufficient basis to warrant an inquiry. It is therefore better to avoid the language of “prima facie” case, as it risks setting too high a threshold. The ultimate issue is whether the Court is persuaded in all the circumstances an inquiry is warranted: at [18]-[23].

Hall v Poolman (2009) 75 NSWLR 99; [2009] NSWCA 64; Burns Philp Investments Pty Ltd v Dickens (1993) 11 ACLC 272; Leslie v Hennessy [2001] FCA 371, considered.

(2) The primary judge did not err in concluding that, in the absence of agreement or leave of the Court, the receivers were obliged to defend the proceedings. The receivers were obliged not to compromise the litigation, and so they could not simply concede it. If, however, they received legal advice advising them that the litigation could not properly be defended, their conflicting legal obligations could be resolved by seeking leave: at [96]-[100].

(3) The receivers did not act for an improper purpose insofar as they sought to use the litigation as a means to get out of a pre-existing contractual relationship. The receivers were not acting beyond the role allocated to them by the primary judge; they were not appointed solely to conduct the litigation, but to manage all property the appellant held on trust. Given that an appraisal and report found that the contractual agreement suppressed the value of trust property by a considerable amount, it was appropriate for the receivers to consider whether the situation they were dealing with on behalf of the appellants provided an opportunity to improve the position of the trusts by getting out of what they regarded as a very bad deal. The receivers also obtained legal advice stating they had an arguable defence and reasonable prospects of success in the litigation. Accordingly, the receivers’ approach manifested a reasonable commercial judgment in the circumstances [102]-[117].

Judgment

MACFARLAN JA: I agree with Kirk JA.
MEAGHER JA: I agree with Kirk JA.
KIRK JA: The appellant (Sahab) is a trustee for two trusts for members of the Kanjian family. The present proceedings are connected to a dispute between the family’s eldest son, Ken, and the remainder of the family, comprised of his parents (Sonia and Loris) and siblings (Victor, Philip and Marianne). Ken is the solicitor on record for Sahab in this appeal. I shall refer to the family members by their first names in the interests of clarity. The family dispute related to an agreement between Sahab and Senses Northbridge Pty Ltd (Senses) for the redevelopment of certain properties owned by Sahab for the two trusts. Members of the family other than Ken were opposed to that agreement.
Senses ended up commencing litigation in the Supreme Court against Sahab relating to the redevelopment agreement. The family was deadlocked in responding to the litigation. To resolve the stalemate, Lindsay J appointed the two respondents in this case – Bradley Tonks and Mark Roufeil – as receivers and managers of the assets of the two trusts with the task, in particular, of conducting the defence of the Senses litigation on behalf of Sahab. Sahab was ultimately unsuccessful in large part in that litigation.
There has been a number of litigious fronts in the battle between Ken and the other members of the Kanjian family. This appeal relates to a dispute between Sahab – at the instigation of Ken – and the two receivers. Sahab sought an order, pursuant to s 423(1)(b) of the Corporations Act 2001 (Cth), that the Supreme Court inquire into the receivers’ conduct of the receivership. Sahab wanted this inquiry to be heard concurrently with the still pending application by the receivers for the determination of their remuneration and their entitlement to recover expenses, including legal fees, from the trusts. Sahab sought that the inquiry determine the extent to which the receivers were disentitled to such payments and/or should have some or all of Sahab’s liability for Senses’ legal costs offset against their claims.
The primary judge, Rees J, rejected the application for an inquiry. Her Honour found that “no prima facie case” for such an inquiry had been made out. She indicated that she would have dismissed the application in her discretion even if such a case had been established.
Sahab now appeals that decision. Whilst the application below concerned a range of matters, the focus on appeal is just on the receivers’ conduct of the Senses proceedings.
The appeal should be dismissed with costs. Sahab has not established that an inquiry is warranted. Although I would not use the language of “prima facie case” in the way her Honour did (following some earlier authority), no error in her Honour’s conclusions has been established.
In what follows I first examine the applicable legal principles relating to ordering an inquiry of the kind sought, before summarising the factual background to the matter. I then address ground 1 of Sahab’s appeal, which alleges that the primary judge erred in suggesting that the receivers were obliged to defend the proceedings. It is then convenient to deal with grounds 2-4 of the appeal together. Those grounds complain that the primary judge erred in finding that there was no factual basis established which warranted an inquiry.

Applicable legal principles

Section 423 of the Corporations Act provides as follows:

Supervision of controller
(1) If:
(a) it appears to the Court or to ASIC that a controller of property of a corporation has not faithfully performed, or is not faithfully performing, the controller's functions or has not observed, or is not observing, a requirement of:
(i) in the case of a receiver — the order by which, or the instrument under which, the receiver was appointed; or
(ii) otherwise — an instrument under which the controller entered into possession, or took control, of that property; or
(iii) in any case — the Court; or
(iv) in any case — this Act, the regulations or the rules; or
(b) a person complains to the Court or to ASIC about an act or omission of a controller of property of a corporation in connection with performing or exercising any of the controller's functions and powers;
the Court or ASIC, as the case may be, may inquire into the matter and, where the Court or ASIC so inquires, the Court may take such action as it thinks fit.

(2) ASIC may report to the Court any matter that in its opinion is a misfeasance, neglect or omission on the part of a controller of property of a corporation and the Court may order the controller to make good any loss that the estate of the corporation has sustained thereby and may make such other order or orders as it thinks fit.
(3) The Court may at any time:
(a) require a controller of property of a corporation to answer questions about the performance or exercise of any of the controller’s functions and powers as controller; or
(b) examine a person about the performance or exercise by such a controller of any of the controller's functions and powers as controller; or
(c) direct an investigation to be made of such a controller's books.

This provision is in substantially the same terms as the former s 536 of the Act, which was addressed to supervision of liquidators. The history of s 536 is summarised by Barrett J in an appendix in BL & GY International Co Ltd v Hypec Electronics Pty Ltd (2010) 79 ACSR 558 at 577; [2010] NSWSC 959. That section was replaced from 1 March 2017 by s 90-10 of Sch 2 of the Act, which is expressed somewhat differently.
Section 423(1) authorises either the Court or ASIC to “inquire into the matter” if persuaded to do so. The “matter” in question is either: (a) an allegation that the controller has not faithfully performed, or is not faithfully performing, the controller's functions or has not observed, or is not observing, a relevant legal requirement; or, more generally, (b) a complaint about an act or omission of the controller in connection with performing/exercising any of the controller's functions and powers. The two paragraphs are alternatives; the former does not confine the latter: note Hall v Poolman (2009) 75 NSWLR 99; [2009] NSWCA 64 at [90] per Spigelman CJ, Hodgson JA and Austin J (addressing s 536). Here, Sahab seeks to invoke the latter.
The section does not spell out what powers may be exercised in conducting an inquiry, but each of the Court and ASIC draw upon the powers otherwise available to each of them: note Hall v Poolman at [96]-[97]. In either case, the possible consequence after an inquiry is that “the Court may take such action as it thinks fit”. Where the inquiry was undertaken by ASIC, some further application to the Court is then necessary to seek any such orders. Subsection (2) provides for such an application to be made where ASIC reaches the opinion that there is “a misfeasance, neglect or omission on the part of a controller”. The nature of the orders that may be made under subsection (1) would include the specific type of compensatory order contemplated by subsection (2), namely “to make good any loss that the estate of the corporation has sustained” as a result of some misfeasance, neglect or omission on the part of the controller: note BL & GY International at [30]-[36].
The powers in subsections (1) and (2) are in addition to the specific powers that the Court may exercise at any time under subsection (3): note Hall v Poolman at [106]-[108]. For court-appointed receivers, such as the respondents in this case, there are additional powers of supervision that the Supreme Court may exercise in connection with the powers granted by s 67 of the Supreme Court Act 1970 (NSW) and Pt 26 of the Uniform Civil Procedure Rules. It was not disputed here, incidentally, that s 423 applies to court-appointed receivers.
In this matter, the primary judge summarised the issue for decision as follows (citations omitted):

[110] The Court’s decision to inquire into the acts or omission of a receiver pursuant to section 423(1)(b) depends on a two-part test. First, the court must be satisfied, as a matter of fact, that the complainant has put on the necessary evidence to establish a prima facie case that there is some act or omission deserving of inquiry. …
[112] Second, and even if a prima facie case has been established, the court must consider whether it ought to exercise its discretion to order such an inquiry …

These points were made as part of a longer discussion of the relevant principles. The appellant did not challenge her Honour’s statement of the applicable principles, which is unsurprising in light of the broader context of her Honour’s discussion. Even so, it is worth recording that the statements just quoted do not quite capture the appropriate approach.
The suggestion that there is a “two-part test” has some textual foundation as regards an application made under s 423(1)(a), for which there is a precondition that it appears to the Court (or ASIC) that the controller has not faithfully performed their functions (etc). Upon such a finding, the Court has a discretion: it “may inquire into the matter” (emphasis added).
For an application under s 423(1)(b) – the power at issue here – the only express precondition for the discretion is that a person has complained to the Court (or ASIC) about some relevant act or omission of the controller: note the discussion of what this involves in Hall v Poolman at [93]-[104]. However, in contrast to s 423(1)(a), there is no requirement, for example, that it appears to the Court or ASIC that the complaint has foundation. No doubt it is implicit that there must be something sufficient in the complaint calling for an inquiry. Consideration of what is sufficient can tend to overlap with discretionary considerations, as I will address shortly.
The language of “prima facie” case in establishing the threshold goes back to the judgment of Young J in Burns Philp Investments Pty Ltd v Dickens (1993) 11 ACLC 272 at 273. In my view, even as regards s 423(1)(a), that language is better avoided. It tends to suggest that an applicant must establish that on the face of it there has likely been some misconduct of a relevant kind. Yet such an understanding would be too inflexible and would set too high a threshold. The very issue here is whether or not to conduct an inquiry, which militates against requiring a high degree of inquiring and persuasion before ordering an inquiry. Even in Young J’s judgment it is apparent that that was not what he meant, as his Honour indicated that what would satisfy the Court would depend on the circumstances.
The issue was discussed by Ryan, Dowsett and Hely JJ in Leslie v Hennessy [2001] FCA 371 at [6], determining an appeal from Drummond J (emphasis added):

The appellant disputes the correctness of that approach, saying that the requirement that there be a "prima facie case" places an unjustifiable gloss upon the section. If the expression "prima facie case for investigation" used by Drummond J … be taken to have some technical meaning, then there might be some merit in this criticism. … However, we believe that both Young J and Drummond J were describing something less formal than a prima facie case according to some evidential burden of proof. Their Honours both meant only that an applicant must show a sufficient basis for making an order, that there is something which requires inquiry. The Court then has a discretion which it must exercise. Many factors will be relevant to that exercise. They include the strength and nature of the allegations, any answers offered by the liquidator, other available remedies, the stage to which the liquidation has progressed, the likely amounts of money involved, the availability of funds to pay for any inquiry, the likely benefit to be derived from it and the legitimate "interest" of the applicant in the outcome.

The passage was substantially approved by this Court in Hall v Poolman at [58]-[59]. This Court held in that case, as regards both s 536(1)(a) and (b) (and thus the equivalent paragraphs in s 423), that what relevantly is required to enliven the discretion is that the applicant has shown that there is a sufficient basis to consider that there is something which requires inquiry: see at [59], [79] and [104]. If so, the Court’s discretion is enlivened. Exercise of that discretion will take account of all relevant circumstances, including the sorts of considerations referred to in Leslie, along with further matters identified below as to the purposes for which an inquiry may be sought.
The notion of there being a sufficient basis to warrant an inquiry both acknowledges room for uncertainty, and takes some account of the nature of what is at issue in all the circumstances. There may be uncertainty as to the facts themselves, or as to whether those facts should be characterised as involving some relevant kind of misconduct. In Hall v Poolman, for example, it appeared that the facts themselves were relatively clear (see at [44] and [82]).
As for the nature of what is at issue, the very notion of sufficiency involves some assessment of what is at stake and all the circumstances. Less might be required if there is a suggestion of serious misconduct. Yet the “strength and nature of the allegations” were, appropriately, listed by the Full Court in Leslie as matters potentially relevant to the exercise of the discretion. Thus there can be some artificiality in seeking to draw a rigid distinction between the issue of whether there is a sufficient basis to consider that there is something which requires inquiry and the question of whether the Court should order an inquiry in its discretion. The issues can be distinguished, but in many cases they will tend to overlap. The ultimate issue is whether the Court is persuaded that in all the circumstances an inquiry is warranted.
In exercising the discretion it is important to understand the role of s 423 in the statutory scheme. It is one of several provisions enabling the Court to supervise external administrators: note BL & GY at [26]. As McLelland J said of the predecessor to s 536, in a frequently quoted statement, the provision “is concerned with aspects of the conduct of liquidators which are liable to attract sanctions or control for what might broadly be described as disciplinary reasons”: Northbourne Developments Pty Ltd v Reiby Chambers Pty Ltd (1989) 19 NSWLR 434 at 438; see also Naxatu Pty Ltd v Perpetual Trustee Co Ltd (2012) 207 FCR 507; [2012] FCAFC 163 at [16] per Dowsett J. This Court approved that statement in Hall v Poolman, but added at [68] that:

Particularly with respect to the unfettered power in s 536(3), it is not appropriate to limit the power to a concept of impropriety. It extends at least to the full range of “duties” referred to in s 536(1)(a). Questions of skill and diligence, as well as questions of improper conduct or improper purpose, can give rise to “disciplinary reasons” in the sense that McLelland J was applying the concept (see, for example, the duties in ss 180, 181, 182 and 183 of the Corporations Act (Cth)).

This statement was directed “particularly” to the equivalent of s 423(3). The focus of a potential inquiry under s 423(1)(a) is necessarily given shape by the type of issue specifically identified in that paragraph. Section 423(1)(b) is not so confined, so the statement just quoted is more apposite: note Hall v Poolman at [90]. That being said, as the Court discussed in Hall v Poolman at [61]-[69], these powers involve an exercise of a supervisory role over the conduct of external administrators. So much is reinforced by the fact that s 423(1) gives the same function of inquiry to ASIC, albeit that the provision does not give ASIC a power to grant any remedy. Given the supervisory and disciplinary nature of the power of inquiry, it is generally not appropriately employed, for example, for the purpose of vindicating private legal rights: note Hall v Poolman at [76]; BL & GY at [35] and [41]; Naxatu at [22]. Nor is it appropriately used to engage in a process akin to discovery: Hall v Poolman at [69].
Also relevant to the discretion is that an inquiry is an adversarial process: BL & GY at [43]; Djordjevich v Rohrt [2022] VSCA 84 at [20]. Taking account of the potential for the court to “take such action as it thinks fit” under s 423(1), an inquiry is a form of litigation against the receiver. In general, leave of the court is required to litigate against a court-appointed administrator. That is so “because the court, while vigilant to insist that its officers and delegates are held to proper standards, in return protects its officers from spurious or vexatious litigation and preserves the integrity of the winding-up process”: Re St Gregory's Armenian School (in liq) (2012) 92 ACSR 588; [2012] NSWSC 1215 at [111] per Brereton J. There is no distinct requirement for leave as regards an inquiry, not least because the granting of leave is implicit in ordering an inquiry. Nevertheless, in deciding whether or not to order an inquiry against a court-appointed receiver, the sorts of considerations relevant to granting leave to proceed against administrators – and the need for the court to be persuaded that such a course is appropriate – can be relevant.
If the court is persuaded to order an inquiry, then it should identify the “matter” which is to be the subject of the inquiry. In other words, the scope of the inquiry should be identified: note Hall v Poolman [72].
In this case, the potential remedy that Sahab says it would seek after an inquiry relates to setting off the costs liability incurred by Sahab to Senses (as a result of the litigation) against the amounts claimed by the receivers as remuneration and reimbursement for their services. It says that the inquiry should be conducted concurrently with the hearing of the receivers’ claim for such remuneration and reimbursement. Sahab submits that it is not seeking to vindicate private rights in the sense, for example, of making a claim for damages, saying that an inquiry under s 423 is the only means available to it to seek such an offset. Sahab points out that Henry J – who determined some related proceedings – has indicated that Ken’s allegations that the receivers’ decision to defend the Senses proceedings was improper “are more appropriate for an inquiry under s 423 … rather than on a remuneration determination”: Kanjian v Kanjian (No 2) [2021] NSWSC 14 at [86], see also [81]. It may be assumed for current purposes that that conclusion was correct, and that Sahab’s offsetting object is one which falls within the potential scope of s 423.
In oral submissions Sahab also suggested that the issues it raised could affect the remuneration and reimbursement payable to the receivers by Sahab. It is not necessary to consider here whether an inquiry under s 423 is an available or appropriate means to determine such issues; again, it is convenient to assume that it is.

Factual background

The facts of the matter are recited in detail at J [2]-[106]. Leaving aside one or two criticisms made by Sahab, this recitation was not challenged. The most pertinent facts are as follows.

The trusts

Sahab was trustee of the Metropole Trust from 1984. The primary beneficiaries of that trust are Sonia and Loris, with the children or their corporate entities or superannuation funds as secondary beneficiaries. As trustee for this trust, Sahab purchased in 1984 a property in Northbridge, Sydney, comprising six shops and parking spaces (the Northbridge Village). It subsequently also purchased a valuable property in North Strathfield which was leased to Woolworths. That property features little in this litigation other than to illustrate that the Metropole Trust was asset-rich.
Sahab became trustee of the Kanjian Family Trust in 2006. Sonia was the ultimate beneficiary of this trust through a corporate unitholder, Kanjian Holdings No. 1 Pty Ltd. Sahab purchased a property for this trust which adjoined the Northbridge Village. The property was leased to a drycleaner.

Entry into the Senses agreement and consequent family disagreement

Discord arose within the Kanjian family from 2017 onwards when Ken sought to set about redeveloping the Northbridge Village and the adjoining drycleaner (the Northbridge properties). Other members of the family wanted to sell the properties. On 10 May 2018 Ken procured Sahab to enter an Agreement for Lease (Agreement) with Senses in respect of the properties. Ken and his mother Sonia, as the two directors of Sahab, signed the Agreement on its behalf. Some questions later arose about Sonia’s understanding and capacity when she did so.
Under the contract, Senses agreed to demolish the existing buildings and construct a childcare centre at the cost of at least $5.5 million. After construction, Senses and Sahab were required to enter into a lease of the centre with a total term of up to 45 years. The draft lease provided for fixed (but increasing) rental payments for the first 10 years, after which there were to be market-based rent reviews from time to time.
The redevelopment required planning approval. The Agreement required Senses to prepare a development application based on some “schematic concept architectural plans prepared by Nordon Jago Architects”. Reflecting the necessity for the owner of the land to consent to any development application, Sahab agreed to consent to the development application and to sign all documents reasonably required to be signed in this regard.
Other members of the family were most unhappy with Sahab’s entry into the Agreement, although there is evidence that the position of Sonia and Loris depended on whom they were talking to. Four days after the Agreement was entered the unitholder in the Kanjian Family Trust, Kanjian Holdings No. 1 Pty Ltd, commenced proceedings in the Supreme Court against Ken. In due course Ken filed a cross-claim in this case against that entity, his parents and siblings.
Subsequently, in August 2018 another Supreme Court proceeding was begun by Sonia and Loris against Ken alleging he had engaged in improper conduct, including with respect to the management and ownership of Sahab (the parents’ proceedings). Ken again cross-claimed against his parents.

Senses’ development application

In the meantime, according to Senses, Ken informed it on 17 May 2018 (one week after the execution of the Agreement) that Sahab did not require Senses to adhere to the Nordon Jago plans and could instead “start from scratch”. Two months after the Agreement was executed Senses presented to Ken a more extensive redevelopment. Senses later alleged that Ken raised no objections to the revised plans.
On 29 November 2018 Senses provided a development application (DA) to Sahab for its consent. Consistent with its proposal for a more extensive redevelopment, the revised plans proposed the demolition of all existing structures and the construction of a childcare centre and swim centre with car spaces. These plans, prepared by Two Form Architects, deviated substantially from the drawings referred to in the Agreement.
Ken, through his solicitors, informed the rest of his family of his intention to consent on behalf of Sahab. That led to movement on the legal battlefronts. On 14 December 2018 Lindsay J made orders restraining Ken from providing consent on behalf of Sahab. His Honour also declared that Sonia was incapable of managing her affairs and appointed the NSW Trustee as receiver and manager of her protected estate. Ken thus became the sole director of Sahab from that time and, pursuant to Sahab’s articles of association, Sahab no longer had a properly constituted board.

Commencement of the Senses proceedings and the receivers’ appointment

A few days later Senses brought legal proceedings in the Supreme Court against Sahab, seeking orders requiring it to consent to lodgement of the DA, along with damages.
On 18 February 2019 Loris filed a motion in the parents’ proceedings seeking the appointment of the present respondents as receivers and managers of Sahab in its capacity as the trustee of the two trusts until determination of those proceedings. Lindsay J made such orders on 25 February 2019: Kanjian v Kanjian [2019] NSWSC 166. In so doing his Honour observed as follows:

[1] Effective management of [Sahab] is critically impeded by a fundamental breakdown of personal relationships within the family. The critical division is between the first defendant (the eldest son of the family) on the one hand and, on the other hand, the rest of the family. …
[29] In my assessment, the only practical means of bringing order to administration of the Metropole Trust and the Kanjian Family Trust (given [Sahab's] occupation of the office of trustee in respect of both trusts) is to appoint receivers and managers to the property held on trust, and to authorise them to manage the Senses litigation.

By order 2, the respondents were appointed as receivers and managers of all the property held on trust by Sahab for the two trusts. Order 3 gave the receivers “all the powers set out in s 420 of the Corporations Act … for the purpose of managing the property” of the two trusts pending determination of the proceedings or further order. That was expressed to be “subject to order 4”, which relevantly provided as follows:

ORDER, subject to further order, that, in their conduct of the receivership of The Metropole Trust and The Kanjian Family Trust pursuant to these orders, the Receivers are:
(a) AUTHORISED to appear on behalf of [Sahab] in the [Senses] proceedings … and, in the name of Sahab … to defend any and all claims for relief made against the company … or property of the trusts by … [Senses] in those proceedings.
(b) AUTHORISED to indemnify Sahab … (from the property held on the trusts respectively known as The Metropole Trust and The Kanjian Trust) against liability for costs arising from the conduct of those proceedings in its name.
(c) DIRECTED not to make any claim for relief by way of a cross claim in those proceedings (otherwise than by way of a cross-claim against Senses …) without:
(i) the prior written consent of … [Loris, Ken and Kanjian Holdings No. 1 Pty Ltd]; and
(ii) first giving to the NSW Trustee (as receiver and manager of the protected estate of [Sonia] and as her tutor in these proceedings) not less than seven days prior written notice of an intention to do so; or
(iii) the prior leave of the Court.

(d) DIRECTED not to compromise those proceedings without:
(i) the prior written consent of [Loris, Ken and Kanjian Holdings No. 1 Pty Ltd]; and
(ii) first giving to the NSW Trustee … not less than seven days prior written notice of an intention to do so; or
(iii) the prior leave of the Court.

(e) DIRECTED not to sell, charge or otherwise dispose of any estate or interest in … the land held on the trusts … without
(i) the prior written consent of [Loris, Ken and Kanjian Holdings No. 1 Pty Ltd]; and
(ii) first giving to the NSW Trustee … not less than seven days prior written notice of an intention to do so; or ·
(iii) the prior leave of the Court.

(f) AUTHORISED and directed to apply the net income, other than any income received from Senses … derived from [the trusts], first, towards payment of the Receivers’ remuneration proportionate to the income derived; secondly, in satisfying any entitlement Sahab … may have to an indemnity against liability for costs arising from conduct of the [Senses] proceedings …; and, thirdly, [net income from the properties to be distributed to the beneficiaries of the trusts].

Order 7 reserved to all parties, and to the receivers, “liberty to apply for directions in relation to the conduct of the receivership”.

Conduct of the Senses proceedings

On 28 February 2019 Senses filed its statement of claim, which included the following allegations:

[5] On 10 July 2018, at a meeting between [Ken and Senses, Ken] was provided with plans for the premises prepared by two Form Architects, which were more detailed and differed in various respects from the Nordon Jago plans.
[6] In the period from 10 July 2018, [Sahab] raised no objection to the Two Form Architects plans for the premises and the revisions to those plans with which it was provided. …
[10] Further and to the extent that the defendant had any right to object to the contents of the development application on the ground that the Two Form Architects plans which form part of the development application differ from the Nordon Jago plans, the defendant waived that right and is estopped from relying on it, by its conduct described above, in permitting and encouraging the plaintiff to proceed with the preparation of the development application, based on the Two Form Architects plans. …

Senses did not expressly claim that the DA plans were based on the Nordon Jago plans, such that it had a simple contractual right under the Agreement to require Sahab to consent. Rather, the key legal issue in the dispute was whether or not Sahab was estopped from declining to consent to the DA based on the different Two Form plans in light of its conduct.
On 8 March 2019 Sackar J expedited the Senses proceedings and ordered Sahab to file its defence by 14 March 2019, less than a week later. The respondents complied with that order and filed a defence on behalf of Sahab.
On 19 March 2019 the solicitors for Ken wrote to Piper Alderman, the solicitors acting for Sahab on the instructions of the receivers, stating that Sahab would “lose the case” if it defended the allegations of fact contained in paragraphs 5 and 6.
On 11 June 2019 the hearing of the proceedings commenced before Sackar J, but it emerged that Senses wished to rely on conventional estoppel along with the equitable estoppel which it had pleaded. Sahab objected that this should have been specifically pleaded and had not been. Sackar J accepted that argument. His Honour permitted Senses to file an amended statement of claim, at the price of an adjournment and order to pay costs thrown away. Sahab filed an amended defence which pleaded that, even if any estoppel arose, Senses did not suffer any prejudice which was not curable by damages or equitable compensation.
On 11 July 2019 the respondents, on behalf of Sahab, amended the defence once more so as to incorporate an issue relating to the contamination of the Northbridge properties by two underground storage tanks.
On 19 July 2019 the hearing was due to resume before Sackar J, but his Honour recused himself on the day.
On 7 August 2019 the Senses proceeding was heard by Emmett AJA. His Honour handed down judgment just over a month later: Senses Northbridge Pty Ltd v Sahab Holdings Pty Ltd [2019] NSWSC 1201. His Honour found the claim based upon equitable estoppel was made out, holding that Senses was entitled to the relief in the nature of an order for specific performance. His Honour implicitly rejected the claim based upon conventional estoppel, a point he confirmed in his subsequent costs judgment. His Honour ordered that Sahab pay Senses’ costs up to 26 March 2019 (the day before Senses had made a settlement offer) on an ordinary basis, and pay costs after that date on the indemnity basis, save for costs in relation to the question of conventional estoppel: Senses Northbridge Pty Ltd v Sahab Holdings Pty Ltd (No 2) [2019] NSWSC 1458.
An application by Senses for additional damages under s 68 of the Supreme Court Act 1970 (NSW) was later dismissed: Senses Northbridge Pty Ltd v Sahab Holdings Pty Ltd (No 3) [2020] NSWSC 345.

Subsequent events

There was no appeal from the judgments of Emmett AJA. The receivership came to an end by consent on 17 December 2019.
Senses’ development application was ultimately refused by Willoughby City Council on 30 June 2020 for a number of reasons, including having insufficiently addressed issues relating to contamination of the site.
On 10 August 2020 Ken wrote to Senses, on behalf of Sahab, indicating that it was clear that Senses had decided not to pursue a project based upon the drawings submitted with the DA. He accused it of having repudiated the Agreement and he terminated the Agreement on that basis. His attempt to redevelop the Northbridge properties with Senses had thus failed.
On 12 July 2021 Henry J handed down judgment in the parents’ proceedings and the case brought by Kanjian Holdings No 1 Pty Ltd, after a long hearing: Kanjian Holdings No 1 Pty Ltd v Kanjian; Kanjian v Kanjian(No 3) [2021] NSWSC 839. As her Honour noted at [1120], each of the parties achieved some success in that case.

Assessments of the value of the Northbridge properties

An important part of the factual context is the view the receivers came to with respect to the effect of the Agreement on the value of the Northbridge properties. Mr Tonks, who took the lead as receiver, went about reviewing the insurance of the properties of the trusts not long after being appointed. As part of doing so, and in order generally to understand the value of the assets at issue in the Senses proceedings, he sought a market appraisal by Colliers International of the value of the properties.
Colliers provided the appraisal on 5 April 2019. Colliers did not charge for the “brief market appraisal”, which was not presented as a formal valuation. In the introduction Colliers stated that “[a]s mentioned throughout our discussions we are very motivated to work on the marketing of this property and genuinely believe we are in the best position to deliver a strong result for you”. The appraisal took account of the development potential of the site, and identified some comparable sales. Collins concluded that the Northbridge properties were:

worth between $8 million and $9.5 million as subject to the Senses lease; or

without the Senses lease, worth between $14.5 million and $17 million.

Thus the Colliers appraisal suggested that the proposed Senses lease would suppress the value of the Northbridge properties by between $6.5 million and $7.5 million. In effect, the Agreement was considered to deviate substantially from the highest and best use of the land.
The receivers sent the appraisal to the family members, with some commentary, as part of their second report to the trust beneficiaries on 10 May 2019. Prior to that, on 6 May 2019, a solicitor at Piper Alderman said in an email to Ken, as part of a response to an earlier communication from him, that the receivers had “obtained an appraisal of the property in the course of their appointment which reveals that [the] proposed lease to Senses has a significantly detrimental effect on the value of the property”.

In his emailed response, on 7 May 2019, Ken said:

With respect also you are not in a position to comment about the value of the property because you have no idea whatsoever of the commercial parameters governing investment decisions taken by my family … a considered and informed decision was made taking a long-term view of the project and the locality. Unless independent persons you consulted were apprised of the decision-making process adopted and criteria thereby brought to bear, they could not possible [be] in a position to appraise or understand value as we assessed it. … those from whom you are taking your advice have not fully understood how the detailed provisions of the lease will in future work to the considerable advantage of the owner of the freehold property.

Piper Alderman sent an immediate email to Ken’s solicitor saying the following:

This material is potentially quite important. So that it can be duly considered, please could you seek instructions to provide full particulars of:
•   The “commercial parameters” your client is referring to.
•   Details of the “decision-making process” he has referred to (what it involved, who was consulted, working papers, advice obtained etc.).
•   Details of the “criteria thereby brought to bear” (just a short description of the criteria will suffice in the first instance).
•   A short summary (as concise as possible, please) of “how the detailed provisions of the lease will in future work to the considerable advantage of the owner of the freehold property”.

As the primary judge noted at [56], no response is in evidence. Piper Alderman chased it up on 16 May, then 20 May, then 23 May (as discussed shortly).
A meeting was held on 16 May 2019 between the receivers, Thomas Russell of Piper Alderman, Ken and two of his siblings, and another legal representative. A filenote taken by a member of the receivers’ staff records the following:

Ken used methodology to consider value but won’t provide even when pressed by [the receivers’ solicitor] – Ken will say no more. Ken thinks its worth more than $8m … [he] refuses to explain how or what he relies on to explain why he thinks it is worth more.

On 23 May 2019 Piper Alderman wrote to Ken’s solicitors, in somewhat strident but perhaps understandably exasperated terms, which included the following:

Ken has often criticised the Receivers' decision to defend the proceedings. This has been coupled with criticism of the position taken by all of his siblings and his father, all of whom, it seems, wholly support the Receivers' decision to defend the proceedings.
Against this background, as you would expect, there have been many discussions and communications with Ken, or with you on his behalf, about why the Receivers are defending the proceedings. One of the main reasons why hinges on the following views, which appear to be shared by the Receivers, Ken’s father, and Ken’s siblings:
1. The deal done by Ken with Senses was, prima facie, a very bad deal.
2. Colliers' report dated 5 April 2019, which Ken has been given, estimate that the deal resulted in a quite shocking reduction in the value of the land – from a range of $14.5M-$17M to a range of $8M-$9M.
3. If the Receivers are victorious in the proceedings, it significantly increases the likelihood that Senses will lose interest in the site.
4. This will in turn increase the chances of remedying the damage caused by Ken's decision, and restoring the millions of dollars of value that was lost when he signed the Senses agreement. …
I have now asked you three times to explain to us how Ken's valuation methodology works, so that the Receivers can understand what he is getting at when he says that Colliers have not valued the land correctly. …
Your failure to response is getting a bit beyond a joke, Bryan. The impression created by your failure to respond is that Ken is actively trying to avoid answering these questions. This is unhelpful and obstructive. If Ken's valuation methodology is as pivotal and crucial as Ken would have us believe it is, he should be ready, willing and able to expose it, and assist us to understand his position.

Ken himself responded on 27 May 2019. He gave one reason why he thought the Colliers’ document poorly thought through, namely that it concluded the achievable value of the property was between $8.0 to $9.5 million if subject to the Agreement, but the expected construction cost of the project proposed in the DA was by itself some $9.075 million. He did not otherwise answer the questions asked by Piper Alderman about his valuation approach.
The conclusion of Colliers that the Agreement suppressed the value of the Northbridge properties received some support soon thereafter. On 5 June 2019, Loris’ solicitors provided the receivers with a valuation prepared by a valuer, Nicholas Brady, obtained for the purposes of the intra-family litigation (the Brady report). That report noted that as at July 2018, the Valuer General valued the unimproved capital value of the Northbridge properties at $9,065,000. Mr Brady valued the properties at $19 million as a development site or, assuming that the Senses lease was executed, $13 million. Thus this formal valuation supported Colliers’ conclusion that the Northbridge properties were worth substantially less if subject to the Agreement.
In the subsequent intrafamily proceedings, Henry J was not persuaded that the Agreement resulted in a significantly lower value for the Northbridge properties than should have been expected, and made some criticisms of Mr Brady’s report: Kanjian Holdings No 1 Pty Ltd v Kanjian (No 3) at [1012]-[1020]. That critique occurred after the receivership had ended.
It is apparent that the Colliers’ appraisal obtained in April 2019, then reinforced by the Brady report received in June, was pivotal to the approach taken by the receivers to the Senses litigation. They viewed the Agreement as a “very bad deal” which represented a significant failure to exploit the value of the Northbridge properties.

The receivers’ approach to the Senses proceedings

Throughout their conduct of the matter the receivers kept all family members informed of developments in the proceeding, explained their approach to the proceedings, and consulted with them from time to time. They continued to do so even after it became apparent that Ken was providing some assistance to Senses in its conduct of the proceedings. Key steps in this process, and the legal advice received by the receivers as they went along, were as follows.
A proposed defence was circulated by Piper Alderman on 12 March 2019. Ken’s solicitor was asked to raise with Piper Alderman any matters he wished to clarify by 5pm the next day. As noted above, on 8 March 2019 Sackar J had directed that the defence be filed by 14 March 2019.
On 28 March 2019 the receivers provided their first report to the beneficiaries of the two trusts. This summarised the steps taken in the litigation, enclosed a settlement offer received from Senses the day before (which is described below), and asked that those involved consider it urgently and provide their position.
The receivers provided a second report to the family on 10 May 2019. The report enclosed the Colliers appraisal and said, amongst other things:

The appraisals, whilst not formal valuations, indicate that the value of the Northbridge Properties is significantly impaired by the Senses lease. The impact on the value of the Northbridge Properties has been one of the factors considered in the current approach taken to defend the Senses lease proceedings. …
[As regards the Senses proceedings:] Based on the review by our solicitors and counsel, there are legal merits associated with the current approach to defending the proceedings and there is an arguable defence with prospects of success …
Further, if we are successful in this matter we may still be required to sign the initial Development Application. However, it is expected that this may provide a further opportunity to negotiate and/or invite Senses to make an offer on the Northbridge properties which is more representative of the “as is” appraisal …

The receivers called a meeting on 16 May 2019, in particular to discuss the funding arrangements for the litigation. At the meeting Loris’ solicitor indicated Loris did not have means to fund the defence. Victor and Philip indicated they would get back to the receivers, but subsequently declined to provide funding.
On 17 May 2019 Ken sent the receivers an email expressing concern about things said at the meeting and about the conduct of the litigation. This was one of many communications along the way in which Ken expressed his strong views that the defence of the Senses proceedings had poor prospects, that the receivers were acting irresponsibly in maintaining their defence, and that they were exposing the company to significant potential costs liabilities.
On 5 June 2019 the receivers served written submissions in the Senses proceedings prepared by the senior counsel briefed for Sahab, Marcus Pesman SC. These submissions accepted the validity of the Agreement but disputed the equitable estoppel claim.
On 10 June 2019 Piper Alderman provided the receivers with written advice on the prospects of success in the Senses proceedings. The letter indicated it was informed by discussions with Mr Pesman SC, but did not expressly attribute the conclusions reached to him. Piper Alderman advised as follows:

[20] … [I]t is arguable that the representations made by Ken Kanjian did not amount to an [equitable] estoppel. …
[24] Having regard to the evidence filed by Senses and in applying the legal principles, which are more completely set out in the submissions filed, we are satisfied that Sahab has an arguable defence to the Senses Proceedings and has reasonable prospects of success.
[25] Whilst success cannot be guaranteed, there is certainly a legal basis for resisting the relief sought.
[26] From a practical perspective and in support of the Receivers’ decision to defend the proceedings:
26.1   With the exception of Ken Kanjian, the other members of the Kanjian family did not wish to resolve the Senses Proceedings on the basis that [Sahab] sign the development application and there be no order as to costs;
26.2   If successful in the proceedings, it may be possible to negotiate further with Senses for Senses to purchase the Property or for Senses and Sahab to mutually withdraw from the [Agreement]; and
26.3   If the Senses development is to proceed in its current form and the lease were to be entered into, the value of the property would be diminished significantly.

On 3 July 2019 Piper Alderman wrote to the legal representatives of the family members to comment on the significance of Senses amending its statement of claim to add the claim based on conventional estoppel (as discussed above at [48]). The letter said (emphasis added):

Ultimately, this late amendment to the Plaintiff's pleading has placed Sahab in a much weaker position with respect to the future hearing of the matter. This development has given rise to our clients needing to reconsider the position being taken in the proceedings. Put simply, as a result of this last-minute development, our clients consider (on advice from us and from Senior Counsel, privilege over which is not waived) that there is a strong possibility that the court will conclude that Senses and Sahab (acting predominantly through Ken Kanjian) both understood that the subsequent Development Application would be progressed, and proceeded on the basis of that mutual understanding. These circumstances would not have been sufficient to enable the Plaintiff to succeed on its claim as originally pleaded. It may be sufficient to enable the Plaintiff to succeed on the new claim, as currently pleaded.
Having regard to the difficulties identified above, and the additional costs in the further hearing of the matter, our clients would like to explore the possibility of resolving the dispute with Senses. Pursuant to the orders made appointing our clients, settlement can only occur with either the consent of the parties or the leave of the Court.
Our clients have identified three possible settlement options, specifically:
1. Senses purchasing the Northbridge property from Sahab outright; or
2. The Receivers agreeing to execute the Development Application on behalf of Sahab, and each party bear their own costs of the proceedings to date; or
3. Some combination of the above.

On 18 July 2019 Piper Alderman provided a further written advice on prospects to the receivers. In it, the solicitors identified the difficulties in refuting the conventional estoppel argument introduced in Senses’ amended statement of claim, noting that they had discussed these difficulties with the receivers and counsel “on a number of occasions”. Nonetheless, Piper Alderman stated that there “continues to be an arguable defence in the Senses Proceedings, despite the amendment to the pleadings”, based on “Senses’ inability to establish all of the elements required to give rise to either a promissory estoppel or a conventional estoppel”. Although not stated expressly, there is no reason to treat this letter as departing from the view expressed on 3 July that the pleading of conventional estoppel had put Sahab in a much weaker position.
The letter also noted, as regards settlement possibilities, that Ken was adamant that the proceedings should be dismissed, whereas the other family members did not specifically agree to any of the proposals but would consider the sale of the Northbridge properties.

Settlement offers

On 27 March 2019, not long after the litigation was commenced, Senses made a Calderbank offer to Sahab to the effect that the proceedings be dismissed with no order as to costs if Sahab consented to the lodgement of the DA within seven days. The receivers forwarded the offer to the family members for their consideration. Ken, through his solicitors, informed the respondents that the offer was “extraordinarily generous” and that it should be accepted. Loris and Ken’s siblings were of the view that the offer should be rejected. The receivers rejected the offer.
On 9 July 2019 – after Senses’ claim had been amended, causing Piper Alderman to advise that the defence case had been weakened and settlement options should be explored – the receivers’ solicitor sent an email to Senses’ solicitor advising that the receivers were prepared to sell the Northbridge properties for $14 million, subject to the approval of the Court. Selling the properties to Senses was the first of the settlement possibilities raised in Piper Alderman’s letter to the family members of 3 July 2019. Senses rejected the offer on 17 July 2019, saying it was “grossly excessive”, and raising a query about the receivers’ entitlement to sell the properties.
On 5 August 2019 – two days before the hearing was listed before Emmett AJA – the receivers’ solicitors put an oral offer to Senses’ solicitor to the effect that a full contamination report be completed and included with the development application, the receivers then sign the DA on behalf of Sahab, and the proceedings be dismissed with no order as to costs. In its submissions to this Court, Sahab characterised this offer as a capitulation.
Senses rejected the receivers’ offer on 6 August, but made two, alternative counteroffers. The first was that Sahab immediately execute the DA and pay Senses’ legal costs and damages in an amount of $357,000. Other conditions related to a costs order and variation to the Agreement. The second was for the purchase of the Northbridge properties for $11 million. The latter offer was subsequently increased to $12.5 million. These offers were not accepted by the receivers.

Relations between the receivers and Ken during the Senses proceedings

Relations between Ken, the receivers and Piper Alderman became difficult soon after the receivers’ appointment on 18 February 2019. By way of brief illustration, on 31 March 2019 Ken’s solicitor wrote to the receivers suggesting that the defence filed on 14 March 2019 by the receivers was an abuse of process and arguably a contempt of court, and saying that the settlement offer made by Senses on 27 March 2019 “represents a ‘get out of gaol card’ for you (literally perhaps)”. As the primary judge observed at [47], the suggestion “that the receivers may be at risk of imprisonment by reason of their conduct as receivers was obviously most offensive”. Ken often communicated to the receivers directly, as well as doing so through his solicitor.
An ongoing theme in the communications was the receivers making requests to Ken for assistance, information and documents. Such assistance was not properly forthcoming. Ken was the only director of Sahab at the time. Without seeking to be exhaustive, his approach is illustrated by the following:

Having initially agreed on 1 March 2019 to meet with the receivers, he changed his position later that day, on the advice of his barrister, requesting that Sahab grant him a “release and indemnity in respect of any possible cross claim or cause of action which it may have against me arising out of or in connection with the matter”, or alternatively “the questioning can proceed by way of written questions which I can then consider and respond to”. The receivers, through Piper Alderman, responded reasonably on 12 March 2019 by saying that they did not propose to offer any assurance, release or indemnity but still expected Ken’s cooperation given that they had been appointed by the Court and he was an officer of the company.

In a letter dated 10 April 2019 responding to Piper Alderman, Ken, to quote the primary judge at [53], wrote “denying that he had failed to cooperate with the receivers but declining to provide the books and records beyond what he considered necessary for the administration of the three properties”. After an explanation of his position, the missive ended with this: “There is nothing more I wish to say on the subject of co-operation but I marvel at your naiveté expecting me to volunteer information to you gratuitously now knowing full well of the hostile disposition which awaits”.

As set out above at [62]-[67], he criticised the Colliers appraisal but, having said that its methodology was flawed and that it did not understand the parameters considered by his family, he did little to explain why.

Ken’s wife prepared an affidavit for the purposes of the intrafamily proceedings which, amongst other things, attached a transcript of a recording she had surreptitiously made of a conversation between Ken and his parents. This affidavit found its way to the solicitors for Senses, who indicated on 16 July 2019 that they proposed to rely on it in the Senses proceeding. Piper Alderman wrote to Senses’ solicitors on 26 July 2019, saying amongst other things:

We assume, and the inference is clearly available, that Mr Kanjian has provided the affidavit to you for use in these proceedings.
Mr Kanjian has also to our observation been conferring with you and your counsel throughout these proceedings. As you may be aware, Mr Kanjian will only confer with us on the basis of conditions unacceptable to our client. …
[Ken] is clearly in [Senses’] camp.
If Mr Kanjian is not called in your case, we will ask the Court to draw appropriate inferences.

It is reasonable to infer that Ken was indeed providing assistance to Senses for the purposes of its claim against Sahab, of which he was still a director, whilst he provided only restricted assistance to the receivers.
In a letter to Piper Alderman dated 5 August 2019 – part of a series of exchanges – Ken said as regards his cooperation that “[w]hile the threat of a cross claim on the part of the receivers hangs over me, I am advised by senior counsel that I am entitled to be circumspect in my disclosure to you”. The receivers had not brought a cross-claim, and would have needed the leave of the Court to do so pursuant to Lindsay J’s orders, but they had not ruled out seeking to do so at some stage.

The primary judge characterised the approach taken by Ken, based on this and other evidence, as failing to cooperate with the receivers: J [172]. His cooperation was limited at best, as he implicitly admits in the correspondence just quoted. Her Honour’s characterisation is fair.

Primary judgment below

Her Honour accepted Mr Tonks’ evidence that he and Mr Roufeil as receivers had conducted the receivership in a “balanced way without preferring any stakeholder or acting improperly or without care and diligence”: at [165]. Her Honour found that:

The receivers attempted to factor in the stakeholders’ competing positions as best they could, given their overarching obligation to care for the trust property. The receivers’ view was that if the Senses proceedings were defended successfully, then Senses would likely renegotiate the Agreement for Lease, with Sahab then having the opportunity to pursue more appropriate terms.

The primary judge held that there was “no evidence which point[ed] to a contrary conclusion”: at [166]. While certain pieces of correspondence sent by the receivers’ solicitors to Ken might be taken to indicate some frustration on the solicitors’ part, it did not support any finding that the receivers themselves were affected by frustration, nor that they had approached their task “in anything other than an even-handed manner”: at [166]-[167].
The primary judge concluded:

[169] I decline to grant leave for an inquiry to be conducted into the receiver’s conduct of the Senses proceedings. There is no prima facie case. The receivers were appointed by the Court to make decisions in respect of the Senses proceedings, given the irreconcilable views of Ken, on the one hand, and his family on the other. In the absence of the agreement of the family to compromise the proceedings, or the leave of the Court, the receivers were obliged to defend the Senses proceedings. In doing so, the receivers were advised by capable, experienced solicitors and senior counsel.
[170] The receivers were given careful advice which, with respect, makes perfect sense. On the basis of the material to hand, Ken had committed Sahab to a contractual arrangement which had the effect of wiping millions of dollars off the value of trust property. The receivers keenly sought information and details from Ken as to why this deal made sense. For whatever reason, Ken was not prepared to share this information. That left the receivers with the Colliers’ appraisal – later supplemented by a valuation obtained by the father – which indicated that it was in the interests of the trusts to defend the Senses proceedings if there was a proper basis to do so. Indeed, the receivers were obliged to defend the proceedings in any event given the lack of consensus amongst family members and no apparent basis – beyond Ken’s insistence – to approach the Court for leave to compromise the Senses proceedings on terms which would have committed Sahab to consenting to lodgment of the development application. The approach which the receivers took to the Senses proceedings was considered and made commercial sense. There is no prima facie case.

Her Honour indicated at [171]-[172] that if she were wrong on the prima facie case point, she would not have been minded to grant leave in any event, given two matters. First, she was not persuaded that it was warranted given the amounts of costs being disputed by Ken. Secondly, she “would be reluctant to allow Court appointed receivers to be subject to an inquiry where the agitant failed to cooperate with the receivers”.

Ground 1: whether the receivers were obliged to defend the proceedings

Ground 1 of the appeal is that the primary judge erred in saying, at [157] and [169], that in the absence of the agreement of the family to compromise the proceedings, or the leave of the court, the receivers were obliged to defend the Senses proceedings. The appellant says that, rather, the receivers “were authorised to defend the proceedings but only if there were proper reasons for so defending and if there were, there were stronger or better prospects of success than merely having an arguable defence”. To the extent this ground raises an issue about whether the receivers erred in proceeding with the litigation given the advice they received on prospects, that issue is addressed below when dealing with the other grounds.
Beyond that it is difficult to understand what point Sahab seeks to make here. Order 4 made by Lindsay J is set out above at [43]. Whilst the order does not in terms state that the receivers could not concede the case in the absence of family agreement or the leave of the Court, that is the import of order 4(d), which directs the receivers “not to compromise those proceedings” without either the prior written consent of Loris, Ken and Kanjian Holdings combined with notice to the NSW Trustee, or alternatively the prior leave of the Court. If the receivers could not compromise the litigation otherwise, then equally they could not simply concede it. Of course, if the receivers were advised or considered that the litigation could not properly be defended, then they would have conflicting legal obligations. That conflict could have been resolved simply by approaching the Court, explaining the position reached, and seeking leave to acquiesce to the relief sought.
It seems that Sahab does not really dispute this understanding of the orders, for it says in its reply submissions that if the receivers had realised that the proceeding ought not be defended, but still faced opposition from other members of the family, “they ought then to have applied to the Court for leave to compromise the proceedings”. Sahab thus seems to concede that leave of the Court would have been necessary in the circumstance outlined.
If the complaint is that her Honour overlooked the possibility of the receivers approaching the Court for leave to end the proceedings, that is inconsistent with what her Honour said in the very paragraphs complained of, where she expressly indicated that the receivers were obliged to defend proceedings in the absence of family consensus or leave (and see further J [48], [50], [84] and [170]). Nor did her Honour suggest that the receivers should defend the proceedings come what may and without considering approaching the Court. So much is implicit in her Honour’s emphasising, in one of the paragraphs criticised, that in choosing to defend the proceedings “the receivers were advised by capable, experienced solicitors and senior counsel”, and in her Honour’s discussion of the receivers’ reasons for choosing to defend the proceedings: J [169], see also [158] and [170].
Sahab suggests that the receivers should have approached the Court for directions. Order 7 made by Lindsay J gave liberty to apply for directions, but none of his Honour’s orders imposed any specific obligation on the receivers to seek directions. Rather, to quote Sahab’s own submissions, Lindsay J “was of the view that given the dispute between the parties, an independent assessment of the merits of the defence was required and that could be undertaken by the receivers”. As summarised above, the receivers brought their own judgement to bear on the conduct of the litigation, as informed by their capable legal advisers, and proceeded accordingly.
This ground is without merit.

Grounds 2-4: whether the receivers’ approach was improper or commercially sensible

A claimed improper purpose of seeking to overturn the Agreement

The primary complaint of Sahab is that the receivers acted for an improper purpose in seeking to use the Senses proceedings as a means to get out of the Agreement. The purpose was said to be improper in the sense of being extraneous to their function as receivers, “the primary purpose [of] which was … to determine whether they should defend the Senses proceedings”. Sahab submitted that the Agreement was “an asset of the company and one which ought to have been protected and preserved and not undermined or undone”. Sahab indicated in oral submissions that it was not alleging impropriety by the receivers in the sense of acting mala fide. Rather, its complaint was that they acted for an extraneous purpose and with a failure to exercise appropriate skill and diligence.
One aspect of this submission appears to be a suggestion that the receivers were acting beyond the role allocated to them by the orders made by Lindsay J. But the receivers were not appointed solely to conduct the Senses litigation. Order 2 appointed them receivers and managers of all property held by the two trusts, which included the Northbridge properties. Order 3 provided that they had all the powers set out in s 420 of the Corporations Act. That section sets out powers for the purposes of attaining the objectives for which the receiver was appointed, which powers include: (a) to enter into possession and take control of property of the corporation in accordance with the terms of the receiver’s instrument of appointment; (b) to lease property of the corporation; (h) to carry on any business of the corporation; and (k) to execute any document, bring or defend any proceedings or do any other act or thing in the name of and on behalf of the corporation. There can be no doubt that it was within the receivers’ power here to seek to vary or end a commercial agreement entered with respect to the property which they were managing.
As to whether or not the Agreement was an asset, as the primary judge noted at [168] it is apparent that the receivers regarded it as more of a liability, in light of the Colliers appraisal and subsequently the Brady report. That is not surprising given that the two documents indicated that the Agreement suppressed the value of the Northbridge properties by some $6 million to $7.5 million (see above at [59]-[70]). As receivers and managers, it was appropriate for them to consider whether the situation they were dealing with on behalf of Sahab provided an opportunity to improve the position of the trusts by getting out of what they regarded as a very bad deal.
Sahab submitted that it was not reasonable to rely on these documents as evidence of the effect of the Agreement on the value of the Northbridge properties. This submission is unpersuasive.
Sahab points out that the Colliers appraisal was not a formal valuation and was provided for free. It submits that it “was in truth a marketing pitch to secure an agency for the sale of the Northbridge properties”, and that Colliers had an incentive “to up-play the value of the properties as a raw development site and correspondingly to downplay their value as a completed childcare centre”. It can be accepted that the document was something of a marketing pitch and was not a formal valuation. That may have meant the appraisal was not as precise as might otherwise have been achieved. But it does not of itself undermine the broad conclusion that the Agreement tended to suppress the value of the properties. Colliers’ claimed incentive to reach this conclusion was not explained, but the premise appears to be that Colliers would find it easier to sell the properties for a greater amount if they were not subject to the Agreement. That premise does nothing to undermine Colliers’ conclusion; on the contrary.
Sahab characterises the Colliers appraisal as “seriously flawed”, in particular because the estimated costs of building the facilities proposed by Senses were some $9 million, which would be added to the land value, yet Colliers concluded that the value of the properties as subject to the Agreement was only some $8 million to $9.5 million. This is the point that Ken had made to the receivers at the time (see above at [67]). This point ignores the fact that the Agreement provided for Senses to have possession of the newly built site for up to 45 years. By that time, to quote Mr Tonks, “the proposed building would be a similar age as the present buildings, and may also require significant refurbishment [ie just as the present buildings did]”.
In any case, from the receivers’ perspective the Colliers appraisal was soon reinforced by the formal valuation by Mr Brady. The fact that Henry J subsequently found this unpersuasive, following cross-examination of Mr Brady, reflects the wisdom of hindsight. It also should not be forgotten that the receivers repeatedly requested Ken to explain his views on why the Agreement represented good value for the trusts but he declined to do so.
Sahab suggested that to proceed to defend the litigation when it was clear (it was said) that there were low prospects of success was inappropriately to engage in “gambling” with the assets of the trusts. That was said to be especially significant given that the trusts were income-poor, even if asset-rich. And it occurred in a context, it was said, that even if Senses lost its proceedings, it was still open to Senses to submit a development application based upon the original Nordon Jago plans, as opposed to the more extensive Two Form proposal. There was thus no guarantee that defending the Senses proceedings would achieve the objective of undermining the Agreement.
Yet the judgements made by the receivers manifest a reasonable, commercial judgment given the circumstances they faced. No sensible person litigates lightly. Here, however, it is important to recall that it was not the receivers who had started the proceedings. They were given the task of managing Sahab’s defence in circumstances where the family had reached a stalemate. Of course, regardless of the position of family members, it was always open to the receivers to reach the view that the litigation should not be continued, in which case they would have needed to approach the Court for consent to compromise or end the proceedings. The materials before this Court indicate that they were well aware of this possibility, as Sahab accepts. The fact that they obtained legal advice on the prospects of success on more than one occasion indicates that they continued to keep the position under review.
The advice from Piper Alderman, summarised above at [78]-[80], maintained that Sahab had an arguable defence and reasonable prospects of success. That advice reflected discussions with, and the draft written submissions of, Mr Pesman SC. As the primary judge said at [158], the solicitors and counsel retained by the receivers were obviously suitably qualified and experienced, and Sahab does not suggest otherwise. Furthermore, Sahab accepted in its oral submissions that it was not alleging any abuse of process or impropriety by the lawyers involved. And it was said that “there’s no criticism of Mr Pesman and the solicitors for giving the advice which they did”.
Sahab submitted that the “real issue raised in the case [was] whether the revised plans proposed by Senses were superior to the original plans and, therefore, whether it was in Sahab’s best interests that they be allowed to progress to the Council for assessment”. The submission is odd, given that the merits of the legal plans manifestly was not an issue in the legal claim made by Senses which turned, rather, upon issues of estoppel. The submission appears to accept that, in deciding whether or not to defend the proceedings, it was proper for the receivers to consider the commercial interests of Sahab. That is what they did. There was no reason to confine that consideration to whether or not the new plans were superior, as opposed to whether or not the deal was a good one at all.
It is true that there was no guarantee that Senses would be willing to negotiate about the Agreement even if it lost its litigation. So much was expressly acknowledged in the receivers’ second report to the beneficiaries dated 10 May 2019 (see above at [74]). The point was reiterated in the Piper Alderman advice of 10 June 2019 (as quoted above at [78]). But given that Senses had gone to the trouble of expending money on taking a different and more expensive approach to the development than had initially been agreed – that expenditure being the very basis of its estoppel claims – there was obvious reason to think that Senses may not wish to return to the original, smaller proposal if it lost the litigation. Hindsight tends to support that foresight because after the local council rejected the DA, Senses did not seek to pursue the project, and Sahab ended up terminating the Agreement for repudiatory breach.
Sahab suggested in its written submissions that “it is a fair inference that the receivers never had and knew that they never had a defence to Senses’ claim for equitable estoppel”. This suggestion, which was not repeated in oral submissions, is unfair and unfounded given the legal advice received by the receivers, which they had no reason to doubt, and of which Sahab makes no criticism. Moreover, the fact that Senses took the step of seeking to amend its statement of claim to add the claim based on conventional estoppel – doing so at the price of an adjournment and an order for costs thrown away – suggests that Senses itself thought that the defence to the equitable estoppel claim was not hopeless (as the primary judge pointed out at [75]). As it turned out, contrary to the view of Piper Alderman, in the view of Emmett AJA it was equitable estoppel and not conventional estoppel which was the stronger, and successful, claim. Predicting legal outcomes is commonly a matter of uncertainty.
A fair reading of the Piper Alderman advice of 10 June 2019 is that Sahab’s prospects of success, whilst reasonable (in the sense that the defence could properly be made), were not seen as especially strong. The advice said that Sahab had “an arguable defence”, and that “[w]hilst success cannot be guaranteed, there is certainly a legal basis for resisting the relief sought”. These words do not reek of confidence in winning. After conventional estoppel was pleaded, Piper Alderman spoke on 3 July 2019 of this having placed Sahab in “a much weaker position”, albeit the defence was still arguable.
There is no impropriety in maintaining a defence, or a claim, which is unlikely to succeed so long as there are reasonable prospects of success in the relevant sense. Whether or not it is prudent to do so is a matter for judgement, taking account of what is at risk and what might be gained. Here, the proceedings gave the receivers the opportunity to gain Sahab some bargaining power with Senses as regards altering or ending the Agreement, which the receivers considered on reasonable grounds to be a very bad deal. The litigation exposed Sahab to its own costs liability and a potential costs liability to Senses, amounting to some hundreds of thousands of dollars. The receivers had to weigh that potential liability against the potential benefit of being able to negotiate a way out of an Agreement which they had reason to consider suppressed the value of the Northbridge properties by many millions of dollars.
No doubt some receivers would not have made the judgement that the receivers made here. That is not the issue. There is nothing in the materials to suggest that the Court should exercise its supervisory jurisdiction under s 423 to inquire into the reasonable commercial decisions made by them in the situation with which they were faced.

The claimed inconsistency with respect to settlement offers

In oral submissions in reply Sahab submitted that “there's one incontrovertible fact on which this whole appeal can effectively be determined and … [which] commends the order of an inquiry … namely on 5 August, they offered to capitulate”. As noted above at [84], two days before the hearing before Emmett AJA the receivers made an oral offer to Senses involving a full contamination report being completed and included with the DA, the receivers consenting to the DA and the proceedings be dismissed with no order as to costs. Sahab pointed out that, apart from the point relating to the contamination report, Senses had made a similar offer on 27 March 2019 which the receivers had rejected after consultation with family members. Sahab is critical of the fact that Mr Tonks’ affidavit in the Court below offers no explanation of why this offer was made.

The submission fails to acknowledge the fact that the conventional estoppel amendment had been made in mid-June. As discussed above, Piper Alderman expressed the view in its letter of 3 July 2019 that this put Sahab’s defence in a much weaker position. That same letter recommended to family members that settlement options be explored, including by raising the issue of Senses purchasing the Northbridge properties or by agreeing to the DA on the basis that the case was dismissed without costs (see above at [79]). As noted above at [83], on 9 July 2019 Piper Alderman raised with Senses’ solicitors the possibility of exploring a sale of the properties for $14 million. That suggestion was rejected by Senses on 17 July 2019.
The offer of 5 August 2019 was made 19 days after that rejection. In the meantime a further written legal advice had been provided on 18 July 2019, and no doubt work was being done to get the case ready for hearing on 7 August.
There is thus an obvious explanation for why the receivers took a different position in August to that which they had taken in late March. Perhaps the receivers should have acted somewhat more quickly than they did after 17 July 2019. And it would have been useful if Mr Tonks had explained the reasons for acting as he did. But some possible indecisiveness is not an issue of such significance as to suggest there is a sufficient basis to consider that there is something which requires inquiry.

The claim that the receivers were not impartial

There had previously been a petrol station on the site of the Northbridge Village, which inevitably created the possibility of there being chemical contamination on the site. As noted above, on 11 July 2019 the receivers caused Sahab’s defence in the Senses proceedings to be amended to say that it was not obliged to sign the DA because the DA failed to disclose the potential existence of underground storage tanks at the site. Clause 3.2 of the Agreement provided that the development application “must include all information and documents which the Council reasonably requires to enable it to be assessed”. One of the documents Senses was proposing to provide to the local council was a “Preliminary Site Investigation”, prepared in November 2018, which stated amongst other things that there was no evidence of underground storage tanks.
Sahab submits that the respondents ought never to have allowed the issue to intrude in the proceedings, and that “the reason for doing so was to prolong the litigation and to make it more expensive and difficult for Senses”. It further submits that taking this step suggests that the receivers were not acting impartially but were acting in accordance with the wishes of other members of the Kanjian family. Sahab points out that Piper Alderman had indicated in its advice to the receivers of 10 June 2019 that a deliberate decision had been taken not to raise matters concerning potential contamination because of the prior use as a petrol station. Sahab submits that the receivers changed their mind having been asked to do so by the legal representatives of the siblings.
As regards the submission that the issue was raised so as to make the litigation less attractive to Senses, if that is correct, it would simply manifest the receivers’ strategy to seek to gain some bargaining power as against Senses for the purposes of seeking to renegotiate the Agreement. Consistently with the discussion above, that was not improper or unreasonable. As it happens, Mr Tonks gave evidence that he had broader concerns, including the possibility that the contamination may ultimately cause Senses to abandon the project mid-construction.
As regards failing to act impartially by giving into pressure from the family members, the submission ignores the fact that one of the reasons for not raising the issue earlier, according to the Piper Alderman advice on 10 June 2019, was “[t]he lack of evidence sufficient to disclose the alleged contamination and the unwillingness of any member of the Kanjian family to fund obtaining that evidence”. That position changed on 11 July when the solicitors for the siblings sent the receivers a copy of a “a Ground Penetrating Radar investigation” which indicated that there was evidence of below ground storage tanks. There was thus a rational reason for the receivers changing their position which had nothing to do with acting in a partial manner.
Further, subsequent events illustrated that it was reasonable for the receivers to have raised the point. In the hearing before Emmett AJA, Senses put on a responsive affidavit by the author of the Preliminary Site Investigation, indicating that (to quote the primary judge’s summary at [81]):

Had the author seen the Council’s historical records and the Ground Penetrating Radar investigation report, different conclusions would have been reached albeit with no material impact upon the ultimate conclusion that the site was likely suitable for the proposed development subject to confirmation of its contamination status through an appropriately designed detailed site investigation.

In the course of the hearing, Senses agreed to include with the DA a revised report concerning the need to remediate the site by reason of its previous use as a petrol station.
This issue does not provide a sufficient basis to consider that there is something which requires inquiry.

Miscellaneous complaints about the conduct of the receivers

Sahab makes various other criticisms of the manner in which the receivers conducted the litigation. First, it complains that paragraphs 5-6 of Senses statement of claim (quoted above at [45]) should have been admitted, rather than not admitted, in circumstances where the only person who knew about those allegations was Ken, and he told Piper Alderman that the allegation in paragraph 5 was correct and that in paragraph 6 was substantially correct. As the receivers point out in response, it is not clear what difference, if any, admitting these paragraphs would have made to the case. It would not, of itself, have made good Senses’ estoppel allegation.
Sahab makes a related, trivial complaint that Mr Tonks verified the defence on 12 March 2019 prior to obtaining comments from him, which comments were provided on 13 March, where the defence only had to be filed on 14 March. It is not uncommon for documents to be signed in advance of a deadline, for convenience, without thereby ruling out the possibility of change. Mr Tonks gave evidence that the decision to file the defence was not taken until after the solicitors of the family members had been given a chance to comment. As noted above, Sahab makes no suggestion that the receivers acted mala fide.
Secondly, Sahab complains that “the receivers wasted time and money and acted improperly by endeavouring to compromise the Senses proceedings by selling the Northbridge properties to Senses and, in so doing, acting concordantly with the wishes of Loris and Ken’s siblings”. The expenditure of resources in discussing and making settlement offers involving possible sale would, in the scheme of things, be trifling. Insofar as the complaint is about exceeding the role of managing the proceedings, the same answer applies as was given above in relation to being receiver and manager of the assets of the trusts, where the receivers reasonably concluded that the Agreement was a very bad deal. That conclusion also illustrates why seeking a settlement on those terms does not manifest a partiality to the wishes of Loris and the siblings.
Thirdly, Sahab “complains that the receivers wasted time and money” in procuring certain affidavits for use in the proceedings. In fact, some of the affidavits were prepared by the solicitors for other family members, meaning the costs involved for Sahab were limited. Insofar as the suggestion is that the decision to use affidavits prepared by other family members manifests partiality, there is no reason to doubt Mr Tonks’ evidence that this decision was taken independently after considering whether they supported the defence. In any case, this complaint is seeking to delve into the minutiae of forensic decisions made by the receivers and their lawyers in the conduct of contested litigation, where no allegation of impropriety is made (beyond the allegation, addressed above, that the receivers acted for an extraneous purpose).
This miscellany of minor complaints does not provide a sufficient basis to consider that there is something which requires inquiry.

Conclusion

Sahab properly accepted in its reply submissions that “a s 423 inquiry will be inappropriate where conduct complained of is the result of a bona fide exercise of discretion or commercial judgement based on principled reasoning”. As noted above, Sahab made clear it was making no allegation that the receivers acted mala fide. As regards its main argument of improper purpose, the decisions taken by the receivers were within the scope of their appointment and were an exercise of commercial judgement based on reasonable grounds in light of the information available to them at the time.
None of the other matters raised by Sahab, whether taken individually or together, suggest there are matters warranting an inquiry by the Court pursuant to its discretion under s 423(1)(b) of the Corporations Act.
Beyond the fact that no issues warranting inquiry have been identified, it is also relevant to the exercise of discretion that many of the other complaints, beyond the core complaint relating to improper purpose, manifest a tendency to nit-pick. Investigating issues to do with why the receivers did not make their 5 August offer a week or two earlier, or precisely why they pleaded the contamination issue when they did, or why particular forensic decisions were made in the course of the litigation, would involve significant expense for all concerned, not to mention the use of judicial resources. Conducting an inquiry into such matters would be disproportionate to any potential benefit to be gained by Sahab. There is some force in the receivers’ submission that the application for an inquiry is “an extension of the acrimonious family dispute that [Ken] has been involved in for many years against his siblings”.
Moreover, like the primary judge, I consider that Ken’s failure to offer the receivers proper cooperation weighs against his request that their conduct now be investigated (see the discussion above at [86]-[91]).
Ultimately, when all of these matters are considered together, Sahab has not established that in all the circumstances ordering an inquiry is warranted. The appeal should be dismissed with costs.

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Decision last updated: 15 February 2023

Medium Neutral Citation:	Sahab Holdings Pty Ltd v Tonks [2023] NSWCA 12
Hearing dates:	19 October 2022
Date of orders:	15 February 2023
Decision date:	15 February 2023
Before:	Macfarlan JA at [1] Meagher JA at [2] Kirk JA at [3]
Decision:	(1) Dismiss the appeal (2) Order the appellant to pay the respondents’ costs
Catchwords:	CORPORATIONS — Receivers and managers — Application for inquiry under s 423(1) of the Corporations Act 2001 (Cth) — Language of “prima facie case” to be avoided — Whether receivers obliged to defend proceedings against company — Leave required to compromise a claim — Whether receivers entitled to use litigation as a means to seek to renegotiate a pre-existing contractual relationship — Receivers’ approach manifested a reasonable commercial judgment in the circumstances — Appeal dismissed
Legislation Cited:	Corporations Act 2001 (Cth), s 420, s 423, s 536, s 90-10 of Sch 2 Supreme Court Act 1970 (NSW), ss 67, 68 Uniform Civil Procedure Rules, Pt 26
Cases Cited:	BL & GY International Co Ltd v Hypec Electronics Pty Ltd (2010) 79 ACSR 558; [2010] NSWSC 959 Burns Philp Investments Pty Ltd v Dickens (1993) 11 ACLC 272 Djordjevich v Rohrt [2022] VSCA 84 Hall v Poolman (2009) 75 NSWLR 99; [2009] NSWCA 64 Kanjian Holdings No 1 Pty Ltd v Kanjian; Kanjian v Kanjian(No 3) [2021] NSWSC 839 Kanjian v Kanjian (No 2) [2021] NSWSC 14 Kanjian v Kanjian [2019] NSWSC 166 Leslie v Hennessy [2001] FCA 371 Naxatu Pty Ltd v Perpetual Trustee Co Ltd (2012) 207 FCR 507; [2012] FCAFC 163 Northbourne Developments Pty Ltd v Reiby Chambers Pty Ltd (1989) 19 NSWLR 434 Re St Gregory's Armenian School (in liq) (2012) 92 ACSR 588; [2012] NSWSC 1215 Senses Northbridge Pty Ltd v Sahab Holdings Pty Ltd (No 2) [2019] NSWSC 1458 Senses Northbridge Pty Ltd v Sahab Holdings Pty Ltd (No 3) [2020] NSWSC 345 Senses Northbridge Pty Ltd v Sahab Holdings Pty Ltd [2019] NSWSC 1201
Category:	Principal judgment
Parties:	Sahab Holdings Pty Ltd (Appellant) Bradley John Tonks (First Respondent) Mark Roufeil (Second Respondent)
Representation:	Counsel: AJL Bannon SC / MR Davis (Appellant) R Glasson (Respondents) Solicitors: Kanjian & Company (Appellant) Piper Alderman (Respondents)
File Number(s):	2022/73239
Publication restriction:	Nil
Decision under appeal	Court or tribunal: Supreme Court Jurisdiction: Equity – Corporations List Citation: In the matter of Sahab Holdings Pty Ltd [2022] NSWSC 4 Date of Decision: 17 February 2022 Before: Rees J File Number(s): 2021/104020