Aldora Holdings Pty Ltd v Vitarni Pty Ltd [2007] NSWSC 636

New South Wales Supreme Court

CITATION : Aldora Holdings Pty Ltd v Vitarni Pty Ltd [2007] NSWSC 636

HEARING DATE(S) : 13 June 2007

JUDGMENT DATE : 13 June 2007

JURISDICTION : Equity

JUDGMENT OF : Hamilton J

DECISION : Monetary judgment and declaratory relief in favour of cross claimants against second cross defendant.

CATCHWORDS : PROCEDURE [748] - Miscellaneous procedure - Declarations - Appropriate form of relief - Discretion of court - Other cases.

Aldora Holdings Pty Limited (P & XD2) Vitarni Pty Limited (D1 & XC2) PARTIES : Michael Angel Sanchez (D2 & XC1) Robert Yazbek (XD1) Hyhonie Holdings Pty Limited (XD3)

FILE NUMBER(S) : SC 1570/02

COUNSEL : No appearances (P & XDs) N J Kidd (Ds & XCs)

No representation (P & XD2) SOLICITORS : W Lawyers (XDs 1 &3) Levitt Robinson (Ds & XCs)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

HAMILTON J

WEDNESDAY, 13 JUNE 2007

1570/02 ALDORA HOLDINGS PTY LIMITED v VITARNI PTY LIMITED & ANOR JUDGMENT 1 HIS HONOUR: What is before me this morning is a cross claim by the defendants in these proceedings against one of three cross defendants, Aldora Holdings Pty Ltd ("Aldora"). The claim against the defendants has already been disposed of. Furthermore, the cross claim by the defendants against two of the three cross defendants, namely, Robert Yazbek and Hyhonie Pty Ltd, has been settled, leaving only the claim against the second cross defendant, Aldora, to be pursued. At the relevant times the controller of Aldora was Robert Yazbek, the first cross defendant, but he has been bankrupt since the middle of 2002. Aldora is not, however, in liquidation or administration and its director is Robert Yazbek's stepmother, Georgette Yazbek. 2 On the last occasion when the matter was before me, Mrs Yazbek applied for an adjournment to obtain legal advice or representation and the matter was adjourned in her presence until today. However, today she has not appeared, nor has anyone else appeared to represent Aldora. 3 The cross claimants' case encompasses two claims. The first is for sums of money said to be owing by Aldora, among others, under an agreement between Robert Yazbek and the second defendant and first cross claimant, Michael Sanchez, in relation to various joint ventures between them and their associated companies. On the evidence, this agreement was made orally in about 1991 and was to the effect that both sides would have to contribute money to the various joint ventures between them and to pay money to creditors of the ventures, including money payable under guarantees given to creditors. It was further agreed that both Mr Sanchez and Mr Yazbek and all their various companies involved in any of the joint ventures should be liable to contribute moneys paid to creditors of the joint ventures proportionately to their holdings in those joint ventures and if, one side made contributions beyond its obligation, the other would repay any excess contribution so made. This was on the basis that the individuals and all their companies involved were jointly and severally liable to repay those excess amounts. 4 Carefully prepared evidence shows that Mr Sanchez and those associated with him made excess contributions to the joint ventures and their creditors totalling $1,886,957.37 and judgment in this sum is sought against Aldora as one of the Yazbek companies that was involved in one or more of the joint ventures and thus falls within the terms of the agreement which I have recorded. In the circumstances I find that the cross claimants should have judgment against Aldora in that sum. 5 The other claim that is made relates to a subsequent agreement made in 1998 ("the 1998 agreement"). The 1998 agreement, if it were operative, would alter the proportions in which various of the joint ventures were held by the two sides. The 1998 agreement is evidenced by a document, Ex C. However, the evidence clearly shows that there was an oral agreement that that agreement should not become operative until the Yazbek interests had paid to the Sanchez interests all excess contributions made by the Sanchez interests to or on behalf of the joint ventures. No such payment was ever made and in my view the 1998 agreement never became operative. Furthermore, in light of the fact that the obligation to contribute had never been met, in about September 2000 Mr Sanchez orally terminated the inoperative 1998 agreement. 6 I find that the evidence clearly establishes the facts set out in [5] above and the cross claimants seek declaratory relief to the effect that the 1998 agreement is not operative. They are entitled in my view to appropriate declaratory relief. 7 There is no reason why the second cross defendant should not be ordered to pay the cross claimants' costs of the cross claim. 8 There will be orders in accordance with short minutes initialled by me and placed with the papers.