Bonnyview Pty Ltd & Ors v David Deane & Associates Pty Ltd [2005] QCA 386

1 [2005] QCA 386 COURT OF APPEAL JERRARD JA Appeal No 11354 of 2004 BONNYVIEW PTY LTD (ACN 087 181 575) and DONNYVIEW PTY LTD (ACN 087 181 557) and RAVENSVIEW PTY LTD (ACN 087 181 48) Appellants and DAVID DEANE & ASSOCIATES PTY LTD (ACN 101 105 549) Respondent BRISBANE ..DATE 19/10/2005 JUDGMENT -- 1 of 6 -- 2 MR R A PERRY SC (instructed by Lynch and Company) for the applicant MR P J DAVIS (instructed by McInnes Wilson Lawyers) for the respondent JERRARD JA: This has been the hearing of an application filed on 29 September 2005 for an order staying enforcement of the judgment of Her Honour, Judge Dick delivered on 25 November 2004 until the hearing and determination by the High Court of Australia of the appellants' application for special leave to appeal from the decision of this Court delivered on 5 August 2005, which latter decision dismissed an appeal against the decision of Judge Dick. The three directors of the respondent company have offered undertakings to this Court through their counsel in the following terms: "David Deane, Elizabeth Deane and Belinda Johnston, by their counsel, undertake to the Court that in the event that (a) the application for stay is refused and (b) the judgment debt is paid by the appellants to the respondent and (c) the High Court of Australia sets aside the judgment made in the District Court in favour of the respondent then they will within seven days of the judgment of the High Court cause the respondent to repay the judgment debt to the appellants." The respondent company's solicitors had earlier advised the appellants' solicitors by letter dated 28 September 2005 that those three directors held substantial assets and were prepared to guarantee repayment of the judgment debt to the appellants if it was paid to the respondent by the appellants or any of them and if the High Court allowed the appeal. -- 2 of 6 -- 3 The respondent's solicitors asked the appellants' solicitors for a deed of guarantee acceptable to the appellants. No form of guarantee was submitted and until very recently, the appellants' solicitors had not asked for any description or list of the assets of the individual directors which that respondent's solicitors had described as substantial. However, on 17 October, the appellants' solicitors wrote to the respondent's solicitors correctly observing that in order for the offer of the guarantee to be efficacious, it was necessary for the directors to provide a verified statement of assets and liabilities and inviting the respondent's solicitors to provide those. That resulted in an affidavit filed in this Court on 18 October in this application in which the respondent's solicitor engaged in the matter swore on the basis of information and belief that the directors, David Deane and Elizabeth Deane held as joint tenants a residence at Ascot valued at approximately $700,000 which was unencumbered and further that those two directors held as joint tenants, a property at Mooloolaba said to be worth approximately one and a-half million dollars with a mortgage in the approximate sum of $500,000. There is no information as to the asset worth of the third director. The fact that those three guarantees were offered and the terms of the undertaking offered to this Court are each -- 3 of 6 -- 4 relevant to the exercise of the Court's discretion whether or not to grant the requested stay. It is common ground between the parties that this Court has jurisdiction to hear the stay application and that it is the appropriate forum for it. It is also common ground that the fact that the application for special leave may be arguable is not of itself sufficient grounds for a stay and further, that the onus is on the applicant for a stay order to establish that particular case is one in which it should be granted. The appellants' written submissions contend that the fact that the directors of the respondent company have offered guarantees demonstrates a tacit acceptance by the respondent company that such guarantees are appropriate and this written submission also observes to the effect that the offering of these guarantees: "Necessarily raises the question as to the worth of those guarantees." That written submission observes that the correspondence communicating the offer of the guarantee provided no more than a mere assertion that the directors held substantial assets but that omission has been corrected to some degree by the affidavit to which I have just referred. -- 4 of 6 -- 5 Further, the observation in the written submission is accurate enough but the appellants had taken no steps until very recently to investigate the extent of those assets and whether they were encumbered and the position now is that there is no reason which is shown by any material before me for thinking that the respondent's solicitors would not have promptly provided accurate information had those matters been asked for earlier. Nor is there any reason for not accepting the material deposed to on the basis of information and belief in the affidavit by the respondent's solicitor. The result is that there are no grounds for the view that the appellants have no reasonable prospects of recovering moneys paid pursuant to the judgment should it be overturned by the High Court and, therefore, no grounds for the view that the appellants success if that happens would be nugatory. That is, there are no grounds demonstrated for considering that there is any real risk that it will not be possible for the appellants if successful to be restored substantially to their former position if the judgment against them is executed. Those are weighty considerations telling against the grant of a stay. There is also the consideration that a basic principle of litigation is that the successful party is entitled to the fruits of its success. -- 5 of 6 -- 6 Of less significance on an application, is any attempt to judge the prospect of the appellants' success on an application for special leave or on any appeal if the application be granted. In this matter, it is actually impossible to assess those prospects on the material before me because the grounds of the application say only that the learned appeal judges erred in finding a conclusion essential to the judgment. The ground of appeal challenges that conclusion reached in the judgment of this Court dismissing the appeal but gives no reasons as to why the conclusion is wrong. In the circumstances, I consider that the appropriate order is that the stay be dismissed upon the undertaking that is given by the respondents. The order of the Court will be: Upon the undertaking quoted in these reasons for judgment from David Deane, Elizabeth Deane and Belinda Johnston by their counsel which is accepted, the application for a stay is dismissed. ... JERRARD JA: I order that the appellants pay the respondent's costs of the application to be assessed on the standard basis. ----- -- 6 of 6 --