Servcorp Limited v Vinesh Pillay

[2019] NSWSC 339

Supreme Court

New South Wales

Medium Neutral Citation:	Servcorp Limited & Anor v Vinesh Pillay [2019] NSWSC 339
Hearing dates:	28 March 2019
Date of orders:	28 March 2019
Decision date:	28 March 2019
Jurisdiction:	Equity
Before:	Henry J
Decision:	(1) Summary judgment for the plaintiffs against the defendant in the amount of NZD $808,454.17 pursuant to r 13.1 of the Uniform Civil Procedure Rules 2005 (NSW). (2) Interest pursuant to s 100 of the Civil Procedure Act 2005 (NSW). (3)   The defendant to pay costs of the first and second plaintiff of the motion and of the proceeding.
Catchwords:	CIVIL PROCEDURE – summary disposal – judgment for plaintiff – where defendant misappropriated funds belonging to the plaintiffs – where defendant undertook suspicious Google searches including “what to do if you think you will be caught for imbezlement [sic] in Australia” – where no appearance by defendant and no defence
Legislation Cited:	Civil Procedure Act 2005 (NSW) s 100 Uniform Civil Procedure Rules 2005 (NSW) r 13.1
Cases Cited:	General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125; [1964] HCA 69 Sakellis v Vourlos [2018] NSWSC 1928 Shaw v State of New South Wales [2012] NSWCA 102 Singh v Varinder Kaur (1985) 61 ALR 720 Spencer v Commonwealth [2010] HCA 28
Category:	Procedural and other rulings
Parties:	Servcorp Limited (First Plaintiff) Servcorp NZ Limited (Second Plaintiff) Vinesh Pillay (Defendant)
Representation:	Counsel: A Vincent (First and Second Plaintiff)   Solicitors: HWL Ebsworth (First and Second Plaintiff)
File Number(s):	2018/374541

Judgment – Ex tempore (revised)

1. In this matter, the plaintiffs, Servcorp Limited and Servcorp NZ Limited, move on a notice of motion seeking summary judgment against the defendant, Vinesh Pillay, in the amount of $797,886.52, or alternatively NZD $808,454.17, pursuant to r 13.1 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR).

2. In 2018, the defendant had been employed by the first plaintiff as a financial accountant. He was responsible for presenting invoices issued to the plaintiffs by third party suppliers to signatories of the plaintiffs to obtain approval for those invoices to be paid out.

3. In late November 2018, the chief financial officer of the first plaintiff was contacted by ANZ New Zealand (ANZ NZ) to alert him to some suspicious payments that had been made over an eight month period to an unidentified account from an ANZ NZ bank account held by the plaintiffs to an unidentified account.

4. That call led to an internal investigation by the plaintiffs, which by 3 December 2018, had identified 16 separate payments totalling NZD $808,454.17 having been made from the plaintiff’s ANZ NZ bank account to a Westpac New Zealand bank account in the name of the defendant. It also identified this had come about as a result of the defendant improperly:

1. presenting valid tax invoices issued by the second plaintiff by third party suppliers to signatories of the second plaintiff for approval;

2. directing or otherwise causing payment of the valid tax invoices to be made into the defendant's Westpac New Zealand account, in some cases by manipulating tax invoices and directions for payment by replacing the existing bank details with his own Westpac New Zealand bank details; and

3. manipulating the general ledger maintained on behalf of the second plaintiff, often by not entering the relevant payment into the general ledger so as to cover any trace of the double payment when the tax invoices were validly paid.

5. The investigation later identified that, on 22 and 23 November 2018, the defendant had undertaken searches on Google of a suspicious nature, including some relating to “800K fraud jail time”, “Binesh Pillay larceny as clerk with Zurich Insurance 1996” and “what to do if you think you will be caught for imbezlement [sic] in Australia”. This led to a suspicion that the defendant had used, or was using, the alias “Binesh” Pillay, in addition to using his name Vinesh Pillay.

6. As a result of these findings, these proceedings were commenced against the defendant and freezing orders were made on 5 December 2018. Similar action was taken by the second plaintiff in the High Court of New Zealand in relation to the defendant's assets there. Counsel for the plaintiffs has confirmed that if summary judgment is given in these proceedings, judgment will not be sought in the New Zealand proceedings and they will be discontinued.

7. The plaintiffs have also reported the matter to the New South Wales Police.

8. The defendant's whereabouts are currently unknown. He did not return to work after the weekend of 3 to 4 December 2018, having attended the office of the first plaintiff on Saturday 3 December 2018 late at night for what appears to have been for no valid reason. His employment with the first plaintiff has now been terminated. The plaintiff's solicitors have identified that a “Binesh Pillay” departed Sydney on a flight to Fiji on 5 January 2019, and as at 25 February 2019, he has not returned to Australia.

9. All of the funds of the plaintiffs which were transferred into the defendant's Westpac NZ bank account have been traced to a Bankwest account in Australia in the name of the defendant. These moneys have been withdrawn by him through cash withdrawals and other transfers, and it appears that there are no funds left.

10. In order to succeed in its application for summary judgment under r 13.1 of the UCPR, the plaintiffs must adduce evidence:

1. establishing the facts justifying the claim for relief;

2. that in their belief, the defendant has no defence to the claim, or part of the claim; and

3. showing that there is no real issue to be tried.

11. It is accepted by the plaintiffs that this is a high bar.

12. It is also accepted that the power to summarily determine proceedings must be exercised with exceptional caution and with a high degree of certainty about the ultimate outcome of the proceedings: see Spencer v Commonwealth [2010] HCA 28 at [53] and [55]; see also French CJ and Gummow J at [24].

13. Generally, the Court will not deny a party a contested merits hearing unless the absence of a cause of action or defence is clearly demonstrated by the party applying for the order: General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125; [1964] HCA 69; Singh v Varinder Kaur (1985) 61 ALR 720 at 722.

14. In summarily terminating proceedings, the Court must be satisfied that the relevant cause of action or defence is:

1. so obviously untenable that it cannot possibly succeed, is manifestly groundless, or is so manifestly faulty that it does not admit of argument;

2. one where the court is satisfied cannot succeed;

3. one where under no possibility could there be a good cause of action or defence; or

4. one which would involve useless expense.

15. In Sakellis v Vourlos [2018] NSWSC 1928, Davies J held (citing Shaw v State of New South Wales [2012] NSWCA 102):

“The question is... whether the claims in question are so obviously untenable or groundless that there is a 'high degree of certainty' that they will fail if allowed to go to trial; and whether this is one of the 'clearest of cases' in which the court may accordingly intervene to prevent the claims being litigated.”

16. In the present case, there is no defence to strike out and no appearance has been made by the defendant, notwithstanding he has been served personally and notified of these proceedings by email on multiple occasions. No response to those emails has been received. It appears clear that he does not intend to defend the proceedings.

17. Based on the evidence before the Court and the submissions made, I am satisfied that there is evidence justifying the claim, that there is no real defence to it and no real issue to be tried. The facts are clear. The defendant wrongfully and fraudulently diverted funds of the plaintiffs into his own personal account and now appears to have absconded.

18. There is a question as to whether judgment should be given in the name of both the first and second plaintiffs, the debt being duly owed to the second plaintiff.

19. The first plaintiff agrees to be liable to the second plaintiff for the money lost by the second plaintiff by the conduct of the first plaintiff's employee, and thus makes a claim for judgment as well as the second plaintiff. In those circumstances, I am satisfied that it is appropriate for the judgment to be made in the name of both plaintiffs.

20. Accordingly, I make orders in accordance with the orders sought in the notice of motion as follows:

1. Summary judgment for the plaintiffs against the defendant in the amount of NZD $808,454.17 pursuant to r 13.1 of the Uniform Civil Procedure Rules 2005 (NSW).

2. Interest pursuant to s 100 of the Civil Procedure Act 2005 (NSW).

3. The defendant to pay costs of the first and second plaintiff of the motion and of the proceeding.

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Decision last updated: 29 March 2019