CUSTOM CREDIT CORPORATION LTD v CENEPRO PTY LTD [1990] NSWCA 49

CUSTOM CREDIT CORPORATION LTD vy CENEPRO PTY LTD SUPREME COURT OF NEW SOUTH WALES — CouRT OF APPEAL

CLARKE JA 21 December 1990

[1990] NSWCA 49

Clarke JA. This is an application by an unsuccessful defendant for a stay of execution on a judgment entered by Cole J on 14 December 1990, the terms of the judgment in what was a most complex case being as follows:

(1) Judgment for the plaintiffs in the sum of $4,079,369.88.

(2) Judgment for the defendant on the cross-claim in the sum of $3,164,050.58.

(3) The defendant is to pay the plaintiffs' costs of the action and cross-claim.

Without detailing them there were earlier statements by his Honour indicating he proposed to order a stay of the judgment on the cross-claim until payment of the moneys awarded to the plaintiffs in the action. The broad effect of his Honour's judgment was that the plaintiffs would be released from mortgages and guarantees and a debt to the defendant and would, in addition, receive a sum of money of around $900,000.

The major thrust of the defendants" claim for a stay is that the real contracting party, which was the first plaintiff in the Court below, had no assets. On the contrary, it had liabilities totalling in excess of $600,000. Thus it was said that if the moneys were paid to the first plaintiff or the plaintiffs generally they would in all probability be lost to the defendant should it succeed in the appeal.

The major response from the plaintiff was that it was simply not good enough to show that one of the respondents found entitled to the sum of about $900,000 would be unable to repay that amount if the defendant paid it over. It was necessary, according to this submission, for the applicant/defendant to go further and show that none of the successful plaintiffs have the funds to repay the amount which has been paid over in the event that the defendant succeeded in the appeal. This submission was coupled with two others. The first was that the evidence in the Court below demonstrated that in excess of $200,000 of the debt owed by the first plaintiff was owed to the third plaintiff in respect of architectural fees and if that was paid to the third defendant then, as had already been submitted, there is no reason to believe that he would not be able to repay at least that portion to the defendant. Secondly, the amount of $137,516 was owed by the first plaintiff to the Department of Lands being the purchase price of land which the first plaintiff had contracted to buy and which was intended to be used in the development which failed. Accordingly, so the submission went,if that sum was paid to the plaintiffs it would increase the assets of the plaintiffs and would not be dissipated.