FERGUSON v EAKIN and ORS [1997] NSWCA 106

FERGUSON v EAKIN

SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

MEAGHER, POWELL and COLE JJA 12 August 1997, 27 August 1997

[1997] NSWCA 106

DEBTOR restrained by court order from dealing with monies — monies held by solicitor — solicitor paid monies to third party — creditor sued solicitors in conversion and for monies had and received.

HELD each claim failed — nature of claim in conversion discussed — nature and effect of a Mareva order considered.

Meagher JA I agree with Cole JA.

Powell JA The facts which have given rise to this appeal are set out in the Judgment which is to be delivered by Cole JA, which Judgment I have read in draft, and need not be repeated by me.

That statement of facts, in my view, makes it clear that the proceedings were completely misconceived, the reasons for that view - which are basic - being two:

1. even if - contrary to the fact - the moneys standing to the credit of the interest bearing account were to be regarded as being held for the Appellant beneficially, the Respondent's later dealing with those moneys could not, and did not, in law, amount to a conversion of them;

2. as O5 which was made by Herron DCJ on 24 September 1993 - upon which Order the Appellant sough to found his claim that those moneys were, at the relevant time, held for him beneficially - could not, and did not, in law, confer upon the Appellant any beneficial interest in those moneys, it could not be said that those moneys were had and received by the Respondents to the use of the Appellant.

So far as the first of these reasons is concerned, it is sufficient to record that the debt which is represented by a credit in a bank account, not being a chattel, but being a chose in action, cannot, in law, be the subject of a claim for conversation.

The reliance placed by the Appellant upon the Order made by Herron DCJ - whether alone or in conjunction with the earlier Orders made by Conomos DCJ and Twigg DCJ - is based upon a fundamental misapprehension as to the effect of "Mareva" - type orders, whether made prior to, or on. or after, and in aid of, judgment.