Snell v Glatis - [2020] NSWCA 78

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Snell v Glatis [2020] NSWCA 78
Hearing dates: 20 April 2020
Date of orders: 24 April 2020
Decision date: 24 April 2020
Before: Basten JA
Decision:
(1)   Stay the enforcement of orders (4) and (7)-(14) made by Rees J on 27 November 2019 until the determination of the appeal, subject to the following conditions:
(a)   the first appellant not remove from Australia or dispose of, deal with or diminish the value of, any assets owned by him in Australia without the prior written consent of the respondents, except for the purposes of:
(i)   paying ordinary living expenses;
(ii)   paying reasonable legal expenses;
(iii)   paying reasonable medical expenses.

(2)   The costs of the motion be the respondents’ costs in the appeal.
(3)   Each party have liberty to apply to vary these orders on three days’ notice.
Catchwords: PRACTICE AND PROCEDURE – stay of judgment pending appeal – capacity of appellant to pay debt –net worth in illiquid form – liquidation of personal assets during COVID-19 pandemic – short delay pending hearing of appeal – creditor a US citizen – stay of buy-out orders – conditions of stay
Category: Procedural and other rulings
Parties:
Keith Eddy Snell (First Appellant)
Owen Francis Cully (Second Appellant)
Scientific Management Associates Pty Ltd (Third Appellant)
Scientific Management Associates (Australia) Pty Ltd (Fourth Appellant)
Scientific Management Associates (Victoria) Pty Ltd (Fifth Appellant)
Scientific Management Associates (Operations) Pty Ltd (Sixth Appellant)
Christopher Glatis (First Respondent)
Glatis Family Limited Partnership (Second Respondent)
Representation:
Counsel:
Mr A Fernon (Appellants)
Mr N J Kidd SC / Mr J Foley (First Respondent)
Solicitors:
Chamberlains Law Firm (Appellants)
Dentons Australia Ltd (Respondents)

File Number(s): 2019/401280
Decision under appeal

Court or tribunal:

Supreme Court

Jurisdiction:

Equity – Corporations List

Citation:

[2019] NSWSC 1643

Date of Decision:

27 November 2019

Before:

Rees J

File Number(s):

2016/183457

Judgment

BASTEN JA: The appellants in this matter include Keith Eddy Snell (first appellant) and four companies he controls (third-sixth appellants). (The second appellant played no part in the present application.) The appellants filed a notice of motion on 2 April 2020 seeking a stay of orders made in the Equity Division, pending determination of the appeal. The appeal has been listed for hearing on 25 June 2020.
In order to understand the scope of the proposed stay, it is necessary first to summarise the orders made by the trial judge, Rees J, on 27 November 2019. Order (1) was a declaration that the affairs of four companies under the control of the first appellant had been and were being conducted in an oppressive manner which was unfairly prejudicial to the plaintiffs, Mr Glatis and his family partnership (the respondents).
Order (2) was not an order, but a notation that the fifth defendant, known as SMA (Vic), had consent to an order to pay the second plaintiff an amount of $620,101. An affidavit of Darren Booth, filed for the respondents, stated that that amount was paid.
Order…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Snell v Glatis

Details

AGLC: Snell v Glatis [2020] NSWCA 78
Case: [2020] NSWCA 78
Decision Date: 24 April 2020

CaseChat Overview and Summary

In *Snell v Glatis*, the appellants sought a stay of enforcement of certain orders made by Rees J on 27 November 2019, pending the determination of their appeal. The dispute concerned the capacity of the first appellant to satisfy a debt, given that his net worth was largely illiquid and he had liquidated personal assets during the COVID-19 pandemic. The respondents, who were US citizens, opposed the stay of buy-out orders.

The primary legal issue before the court was whether to grant a stay of judgment pending appeal, and if so, upon what conditions. This involved considering the appellant's financial position, particularly the illiquid nature of his assets and the impact of recent economic conditions, as well as the potential prejudice to the respondents. The court also had to determine appropriate conditions to ensure the respondents' interests were protected pending the appeal.

Basten JA granted the stay of enforcement of orders (4) and (7)-(14) made by Rees J. The court reasoned that a stay was warranted given the short delay anticipated before the appeal hearing and the appellant's demonstrable illiquidity, exacerbated by the pandemic. However, the stay was made conditional upon the first appellant not removing from Australia or disposing of, dealing with, or diminishing the value of any Australian assets without the respondents' prior written consent, save for ordinary living, legal, and medical expenses. The costs of the motion were ordered to be the respondents’ costs in the appeal, with liberty to apply to vary the orders.

Orders

Orders of the court

(1) Stay the enforcement of orders (4) and (7)-(14) made by Rees J on 27 November 2019 until the determination of the appeal, subject to the following conditions:

(a) the first appellant not remove from Australia or dispose of, deal with or diminish the value of, any assets owned by him in Australia without the prior written consent of the respondents, except for the purposes of:

(i) paying ordinary living expenses;

(ii) paying reasonable legal expenses;

(iii) paying reasonable medical expenses.

(2) The costs of the motion be the respondents’ costs in the appeal.

(3) Each party have liberty to apply to vary these orders on three days’ notice.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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Medium Neutral Citation:	Snell v Glatis [2020] NSWCA 78
Hearing dates:	20 April 2020
Date of orders:	24 April 2020
Decision date:	24 April 2020
Before:	Basten JA
Decision:	(1) Stay the enforcement of orders (4) and (7)-(14) made by Rees J on 27 November 2019 until the determination of the appeal, subject to the following conditions: (a) the first appellant not remove from Australia or dispose of, deal with or diminish the value of, any assets owned by him in Australia without the prior written consent of the respondents, except for the purposes of: (i) paying ordinary living expenses; (ii) paying reasonable legal expenses; (iii) paying reasonable medical expenses. (2) The costs of the motion be the respondents’ costs in the appeal. (3) Each party have liberty to apply to vary these orders on three days’ notice.
Catchwords:	PRACTICE AND PROCEDURE – stay of judgment pending appeal – capacity of appellant to pay debt –net worth in illiquid form – liquidation of personal assets during COVID-19 pandemic – short delay pending hearing of appeal – creditor a US citizen – stay of buy-out orders – conditions of stay
Category:	Procedural and other rulings
Parties:	Keith Eddy Snell (First Appellant) Owen Francis Cully (Second Appellant) Scientific Management Associates Pty Ltd (Third Appellant) Scientific Management Associates (Australia) Pty Ltd (Fourth Appellant) Scientific Management Associates (Victoria) Pty Ltd (Fifth Appellant) Scientific Management Associates (Operations) Pty Ltd (Sixth Appellant) Christopher Glatis (First Respondent) Glatis Family Limited Partnership (Second Respondent)
Representation:	Counsel: Mr A Fernon (Appellants) Mr N J Kidd SC / Mr J Foley (First Respondent) Solicitors: Chamberlains Law Firm (Appellants) Dentons Australia Ltd (Respondents)
File Number(s):	2019/401280
Decision under appeal	Court or tribunal: Supreme Court Jurisdiction: Equity – Corporations List Citation: [2019] NSWSC 1643 Date of Decision: 27 November 2019 Before: Rees J File Number(s): 2016/183457