Supreme Court New South Wales Medium Neutral Citation: Al Maha Pty Ltd v Bechara [2022] NSWSC 1709 Hearing dates: 1 December 2022 Date of orders: 1 December 2022 Decision date: 01 December 2022 Jurisdiction: Equity - Duty List Before: Meek J Decision: Freezing orders declined; ex parte interlocutory injunction granted Catchwords: CIVIL PROCEDURE — Application for freezing orders arising out of joint venture arrangement between the plaintiffs or second plaintiff and the deceased husband of the first defendant relating to various properties — Claim that the deceased sold the property without knowledge or permission of plaintiffs — Following discovery of the sale an arrangement was reached for a reconciliation and payments to the plaintiffs were made in April 2019 — Plaintiffs commenced proceedings in July 2021 and subsequently seek to obtain information in relation to entitlements — Plaintiffs recently obtain information regarding the joint venture funds and claim their alleged entitlements are more substantial than previously thought and claim that the first defendant has sought to dissipate monies by transfer from one bank account to another account CIVIL PROCEDURE — Claim for freezing orders declined — Injunctive relief granted CIVIL PROCEDURE — Subpoenas — Issue of a specific subpoena permitted to facilitate determination of utility of further relief Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW) Category: Procedural rulings Parties: Al Maha Pty Ltd (First Plaintiff / First Applicant) Antoine Bechara (Second Plaintiff / Second Applicant) Natasha Bechara in her capacity as Administrator of the Estate of the Late Raymond Bechara (First Defendant / First Respondent) Broughton Road Investments Pty Ltd (Second Defendant / Second Respondent) Representation: Counsel: J Knackstredt (Plaintiffs / Applicants) No appearance (First Defendant / First Respondent) No appearance (Second Defendant / Second Respondent) Solicitors: McLachlan Thorpe Partners (Plaintiffs / Applicants) No appearance (First Defendant / First Respondent) No appearance (Second Defendant / Second Respondent) File Number(s): 2021/193624 EX TEMPORE JUDGMENT (REVISED) 1. The application before the Court is an ex parte application by the plaintiffs for various orders, substantively, a freezing order in respect of the assets of the first defendant in existing proceedings between the parties. 2. In the proceedings, the plaintiffs allege that there was a joint venture arrangement between Al Maha Pty Ltd (Al Maha) or alternatively Antoine Bechara (Antoine) and Raymond Bechara (the deceased), concerning the development of properties in Sydney. The first defendant, Natasha, is the widow of the deceased and the administrator of his estate. 3. The deceased died on or about 28 March 2020 (albeit a date in April 2020 was referred to in submissions). 4. Natasha was appointed as sole director and secretary of the second defendant Broughton Road Investments Pty Ltd (the Company). 5. Antoine is the sole director of Al Maha. 6. In early 2013, there were discussions between Antoine and the deceased regarding development of a property described as the "Broughton Road property". 7. That property was seemingly purchased and then developed and sold, with the proceeds distributed by the Company. 8. A further joint venture was proposed in relation to property described as the "Wentworth Road property". 9. In April 2016, the Company became registered as a proprietor of that property but later that year there were discussions to the effect that the development would not be able to proceed as planned. 10. Subsequently, in December 2018, the Company sold the Wentworth Road property to an entity HCOA (Australia) Pty Ltd without the knowledge or permission of Antoine or Al Maha. In February 2019, Antoine became aware that the Wentworth Road property had sold for $3.45 million. 11. On 28 February 2019, Antoine met with the deceased and discussed what had occurred. 12. His case is that it was agreed with the deceased that an accountant would prepare a reconciliation. There was some delay in doing that but on or about 1 April 2019, following some delay by the accountant in preparing the reconciliation, the deceased and Antoine met and agreed that a capital expense contribution provided by Al Maha would be repaid immediately, with profit share to be paid thereafter. 13. Following that alleged agreement, the deceased caused the Company to make payments to Al Maha effectively in the sum of just under $240,000 being amounts received on 12 and 23 April 2019. 14. The plaintiffs contend that no reconciliation was ever provided by the deceased and no further payment was made. 15. Subsequently, the deceased became ill and, as noted, passed away in late March 2020. 16. The plaintiffs commenced these proceedings on 6 July 2021. 17. There has been a process of exchange of pleadings since that time. 18. The latest reiteration of the pleadings appears to have occurred with the filing on 21 October 2022 of a further amended statement of claim (FASOC). The defendants have not filed or served a defence to that document notwithstanding orders requiring them to do so. 19. Since May 2022, the plaintiffs have sought (by issue of notices to produce, correspondence with the solicitors for the defendants and issue of subpoenas) to obtain certain information in relation to the claims and their entitlement to an accounting in respect of the joint venture. 20. Materials produced on subpoena show that a sum of approximately $625,322 was held in an NAB account as at 27 April 2021 and was withdrawn by bank cheque. 21. I have been taken to materials in an exhibit to the affidavit of Tarrek Naji (the plaintiffs' solicitor) sworn 1 December 2022 which show the withdrawal of that sum, a withdrawal slip indicating that the sum was paid to Natasha, and a cheque for that amount. 22. Subsequent information has revealed that, as at 23 April 2019, relatively contemporaneous with the timing of the payments I have referred to earlier, the Company held cash at bank in the amount of approximately $973,000. 23. In mid-late October 2022, the plaintiffs' solicitor, Mr Naji, became aware that Natasha had commenced two other sets of proceedings in the Supreme Court against siblings of the deceased. 24. Subsequently, following further correspondence with the solicitors for the defendants and having obtained access to documentation produced by Bendigo Bank, it appears that amounts were deposited into a Bendigo Bank account (first account) on 27 April 2021 in the sum of approximately $1,067,326. 25. There was correspondence between the solicitors including a letter from the plaintiffs' solicitors to the defendants' solicitors (dated 7 November 2022) reciting relevant history and seeking, inter alia, repayment of an amount equal to the funds, personal expenses, interest and costs in the sum then described as being $905,243 to the Company's bank account. A form of suggested undertaking was provided under cover of that letter. 26. On 10 November 2022, the defendants' solicitors responded to the letter but in substance: 1. rebuffed the request and claimed that the plaintiffs had no interest in the deceased's estate other than the alleged interest asserted in the FASOC which was stated to be not admitted; and 2. noted that the plaintiffs had not claimed or alleged an interest in the properties forming the subject matter of the proceedings. 1. Of some note is the fact that on 9 November 2022, the day before that responsive letter was sent and two days after the request, materials produced by the Bendigo Bank reveal that the sum of $1 million was transferred out of the first account and into another account in the name of the first defendant. 2. The materials before the Court indicate that, at least as at 17 November 2022, those funds remained in that account. 3. There has, as I understand it, been no further correspondence between the respective solicitors since that time. Since then, the plaintiffs have prepared the claim made in this Court for the freezing orders which I am asked to make today. 4. I have been provided with the affidavit of Mr Naji sworn 1 December 2022, the exhibit to that affidavit, draft proposed orders and both written and oral submissions by Mr Knackstredt. 5. I expressed some degree of concern regarding what appear to be, at least on one view, a leisurely prosecution of rights by the plaintiffs since April 2019. 6. There was some degree of debate between myself and Mr Knackstredt regarding that which will be evident from the transcript. 7. Mr Knackstredt sought to explain and contextualise what, at first blush, appears to be a leisurely pace by which the plaintiffs have proceeded, and having heard what he has said in that regard I am prepared to accept that, at least in April 2019, without making any definitive finding about the matter, there is some force in his submissions. 8. There is, at the moment, a distinct lack of clarity as to what may be the ultimate monetary figure that the plaintiffs claim to be entitled to in the proceedings. 9. The affidavit of Mr Naji in paragraph 58 sets out at least a calculation of the amount sought under a freezing order totalling approximately $911,908. 10. At this stage, I am not persuaded that it is appropriate to make a freezing order or at least not in the terms sought by the plaintiffs. 11. Nonetheless, it does seem to me that there is at least a prima facie case in relation to the claims regarding the joint venture and entitlement to monies. 12. Part of the difficulty for the plaintiffs, at least at this stage, as pressed by Mr Knackstredt, is that much of the information regarding the accounting is essentially in the hands of the defendants and the plaintiffs have not really had adequate opportunity (other than by correspondence, use of Court processes by issuance of notices to produce and subpoenas) to probe the extent of the claims. 13. There is some concern that is urged by Mr Knackstredt on the part of the plaintiffs that the transfer of the funds to another account gives rise to some degree of suspicion as to the defendants', or more particularly, the first defendant's intention with respect to those monies. 14. It may be that there is a benign explanation in relation to it. 15. However, in a context where the transfer has occurred within two days of a letter requesting an undertaking, at least on one view, there is some degree of concern about those monies which the evidence suggests, at least part thereof, are properly claimable as Company monies. 16. In saying that, I am not making any determination that that is definitely the case, rather, I am indicating simply that there is evidence supportive of that. 17. The balance of convenience to my mind does favour some immediate restraint in respect of the use of those monies, at least until a time, which ought to be relatively short, so that the first defendant can have an opportunity to come before the Court and address the claims for relief. 18. Mr Knackstredt has informed me that the plaintiffs give the usual undertaking as to damages. 19. [Discussion regarding orders]. 20. The Court: 1. Upon the undertaking of Tarrek Naji, solicitor for the plaintiff, to pay the applicable filing fee, grants leave to the Plaintiffs to file in Court the Notice of Motion dated 1 December 2022 (the Notice of Motion) in the form initialled by me dated and placed with the papers. 2. Orders that the Notice of Motion be made returnable instanter. 3. Grants leave to file in Court the affidavit of Tarrek Naji sworn 1 December 2022 and exhibit TN-1 to that affidavit in the form initialled by me dated and placed with the papers. 4. Orders pursuant to rule 1.12 and/or rule 18.4 of the Uniform Civil Procedure Rules (NSW) (UCPR) that the time for service on the Defendants of this Notice of Motion, the affidavit and exhibit referred to in prayer 3 above and a copy of these orders to 5.00pm on 1 December 2022. 5. Orders that the service of Court's Orders, this Notice of Motion, the affidavit and exhibit referred to in prayer 3 above, subject to any further order to be effected on the Defendants by way of: 1. sending an electronic copy to the email address of the solicitor on the record for the Defendants as noted in the notice of change of solicitor filed on 24 November 2022, being wmaccallum@rk.com.au; and 2. delivering a hard copy of the Court's orders and the Documents to the offices of Russell Kennedy Lawyers, Level 6, 75 Elizabeth Street, Sydney NSW 2000. 1. Upon the Plaintiffs giving the usual undertaking as to damages, pursuant to Rules 25.11, 25.12, and/or 25.14 of the UCPR, and/or the inherent jurisdiction of the Court, that the First Defendant be restrained up to an including 5:00pm on Tuesday, 6 December 2022 from dealing with the funds in Bendigo Bank in the name of the First Defendant being: BSB: 633-000 account number 198183956 bearing Customer/Ledger Number 0026751545/2502 (the Account) or otherwise transacting on that account. 2. Orders that costs be reserved. 3. Grants liberty to apply to any party on short notice to the Equity Duty Judge including liberty to the First Defendant to seek to discharge these orders on such short notice to the Plaintiffs. 4. Orders that these Orders are to be entered forthwith. 5. Grants leave to the Plaintiffs to issue a subpoena to Bendigo Bank to produce an account statement or listing of account transactions in respect of the Account in order 7 for dealings from 9 November 2022 up to and including 1 December 2022. 6. Directs that the subpoena be returnable in the Subpoena List on Monday, 5 December 2022. 7. Orders that such subpoena may be served by email. 8. Abridges the time for service for such subpoena until 5pm today, 1 December 2022. 9. Directs that the Notice of Motion be listed before the Equity Duty Judge at 10:00am on Tuesday, 6 December 2022. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 14 December 2022