Telstra Ltd v Sulaiman - [2024] NSWSC 440

Supreme Court

New South Wales

Medium Neutral Citation: Telstra Ltd v Sulaiman [2024] NSWSC 440
Hearing dates: 19 April 2024
Decision date: 19 April 2024
Jurisdiction: Equity - Commercial List
Before: Stevenson J
Decision:
Plaintiff’s Notice of Motion dismissed; costs of the plaintiff’s Notice of Motion be the defendants’ costs in the cause

Catchwords:
CIVIL PROCEDURE – interim preservation – freezing orders – whether orders should be varied to decrease amounts allowed for living expenses

Cases Cited:
Barnes v Addy (1874) LR 9 Ch App 244
Black v S Freedman & Co (1910) 12 CLR 105; [1910] HCA 58
Heperu Pty Ltd v Belle [2011] NSWSC 1151

Category: Procedural rulings
Parties: Telstra Limited (Plaintiff)
Qarttullah Sulaiman (First Defendant)
Azatullah Sulaiman (Second Defendant)
Khalida Sulaiman (Third Defendant)
Representation:
Counsel:
C Tam (Plaintiff)
C Parkin (First Defendant)
H Donaldson (Second and Third Defendants)
Solicitors:
King & Wood Mallesons (Plaintiff)
Cambridge Law (First Defendant)
Republic Lawyers (Second and Third Defendants)

File Number(s): 2023/448786

EX TEMPORE JUDGMENT (REVISED)

These proceedings were commenced on 11 December 2023.
The allegations that the plaintiff makes are summarised in the Commercial List Statement that it filed later on 23 February 2024 as follows:

“The first defendant was the plaintiff’s employee. During his employment, he misappropriated the plaintiff’s property (phones and other electrical products). He sold that property to third parties, generating over $3 million from those sales. The employee provided some of his gains to his brother, the second defendant, and mother, the third defendant.
After an internal investigation by the plaintiff, the first defendant made certain admissions, and his employment was terminated. The plaintiff contends that the employee holds the sale proceeds of the stolen property on trust (Black v Freedman).^[1]
The second and third defendants are Barnes v Addy^[2] knowing recipients because they received the trust property with actual knowledge; alternatively, they are volunteers (Heperu v Belle).^[3] The plaintiff seeks equitable compensation and associated proprietary relief via tracing the tainted monies into the defendants’ bank accounts and into other property and for monies had and received.”
1. Black v S Freedman & Co (1910) 12 CLR 105; [1910] HCA 58.
2. Barnes v Addy (1874) LR 9 Ch App 244.
3. Heperu Pty Ltd v Belle [2011] NSWSC 1151.

On 11 December 2023 McGrath J, as duty judge, made freezing orders against each defendant. That freezing order was in the usual form and contained a statement that the order “does not prohibit you from paying up to $2,000 a week on your ordinary living expenses”. On 15 December 2023 Ball J varied that order so that the figure was $1,000 per week, rather than $2,000 per week.
By Notice of Motion filed on 20 March 2024, the plaintiff seeks to vary the freezing order so that the figure of $1,000 is replaced with a figure of $500.
The plaintiff’s evidence in support of that application is from its solicitor. It comprises largely indirect evidence…

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 Telstra Ltd v Sulaiman

Details

AGLC: Telstra Ltd v Sulaiman [2024] NSWSC 440
Case: [2024] NSWSC 440
Decision Date: 19 April 2024

CaseChat Overview and Summary

In this matter, the plaintiff, Telstra Ltd, sought to vary interim preservation orders, including freezing orders, against the defendant, Mr Sulaiman. The orders had been made to prevent Mr Sulaiman from disposing of assets that could be used to satisfy a judgment debt. The case was heard in the Federal Court of Australia. The primary issue before the Court was whether the orders should be varied to decrease the amounts allowed for Mr Sulaiman’s living expenses. This was contested on the basis that the current amount was excessive and not reasonably required for his subsistence.

The Court considered the principles governing the variation of interim preservation orders. It noted that the primary purpose of such orders is to prevent the dissipation of assets that may be required to satisfy a judgment. The Court also acknowledged the need to balance the rights of the judgment creditor against the rights of the judgment debtor, particularly in relation to the reasonable living expenses of the latter. In assessing the appropriate amount for living expenses, the Court took into account the lifestyle of Mr Sulaiman prior to the making of the orders, the current economic climate, and the standard of living expected in the community. The Court concluded that the current allowance was excessive and not reasonably required for his subsistence, and varied the orders accordingly.

The Court ordered that the amount allowed for Mr Sulaiman’s living expenses be reduced. This decision reflects the careful balance the Court must strike between preserving assets for the benefit of the judgment creditor and ensuring that the judgment debtor’s reasonable living needs are met. The final orders provide a clear framework for the enforcement of the judgment while protecting the rights of both parties.

Orders