Reches Pty Limited v Tadiran Limited [2001] FCA 1486

FEDERAL COURT OF AUSTRALIA

Reches Pty Limited v Tadiran Limited [2001] FCA 1486

CONTEMPT – penalty for breach of undertaking to the Court – where contemnors believed other party not intending to rely on the undertaking – where contemnors insolvent.

RECHES pTY LIMITED V TADIRAN LIMITED NG 606 OF 1996

MOORE J 24 OCTOBER 2001 SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NG 606 OF 1996

BETWEEN: Reches Pty Limited

APPLICANT

AND: Tadiran Limited

RESPONDENT

JUDGE: MOORE J

DATE OF ORDER: 24 OCTOBER 2001

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. Save for the orders made on 11 April 2001, the application otherwise be dismissed. 2. Mr Isaac Reches and Mrs Yael Reches be jointly and severally liable to pay the costs of the Registrar of prosecuting the contempt proceedings. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NG 606 OF 1996

BETWEEN: Reches Pty Limited

APPLICANT

AND: Tadiran Limited

RESPONDENT

JUDGE: MOORE J

DATE: 24 OCTOBER 2001

PLACE: SYDNEY

REASONS FOR JUDGMENT

Introduction 1 On 11 April 2001 I gave judgment in this matter and declared that Mr Isaac and Mrs Yael Reches had committed a contempt of court. No orders as to penalty were made. Rather the matter was stood over until 27 April 2001 to enable the parties to make submissions on penalty. This occurred on 27 April and 19 July 2001 (Mrs Reches was overseas on the first occasion).

Background 2 The Reches committed a contempt by breaching an undertaking to the Court. The undertaking was given on 16 July 1998 and accepted by the Court on 20 July 1998. The Reches breached it by removing from unit 12/442 Edgecliff Road, Edgecliff, New South Wales property listed in the schedule to the bill of sale attached to the undertaking. The undertaking was intended to establish a mechanism for the Reches to provide $120,000 as security for costs in the action of Reches Pty Ltd against Tadiran Ltd ("Tadiran'"). The circumstances in which that undertaking was given and subsequently breached are detailed in the reasons for judgment of 11 April 2001: [2001] FCA 415. 3 The evidence led by both parties at a hearing on 3 April 2001 was relied on, in so far as it was relevant, both in relation to the question of whether the Reches had breached the undertaking and, in the event it was found they had, in relation to the question of penalty. Further evidence was adduced by Mr Reches in an affidavit sworn by him on 23 April 2001 on which he was cross-examined on 27 April 2001and by Mrs Reches in an affidavit sworn by her on 10 July 2001 on which she was cross-examined on 19 July 2001.