New South Wales Supreme Court CITATION : Wexford Pty Ltd v Praveen Meckraj Doolub & Ors [2008] NSWSC 1035 HEARING DATE(S) : 9/09/08 - 11/09/08, 15/09/08, 18/09/08, 26/09/08 JUDGMENT DATE : 29 September 2008 JURISDICTION : Equity Division Commercial List JUDGMENT OF : Einstein J DECISION : The Court orders that Order 1.6 (a) of the orders entered on 15 March 2007 be varied by substituting the following order in its place: (a) paying reasonable legal expenses on any legal matter and reasonable legal expenses of defending this matter up to $160,000. CATCHWORDS : Mareva injunction - Freezing orders - Bankrupt - Trustee - Orders in personam - Reasonable legal expenses CATEGORY : Procedural and other rulings Wexford Pty Ltd (Plaintiff) PARTIES : Praveen Meckraj Doolub (First Defendant) Niteen Meckraj Doolub (Second Defendant) FILE NUMBER(S) : SC 50010/07 COUNSEL : Mr R Newlinds SC, Ms A Horvath (Plaintiff) Mr A Street SC, Mr D Villa (First and Second Defendants) SOLICITORS : Jackson Lalic Lawyers (Plaintiff) Middletons (First and Second Defendants) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION COMMERCIAL LIST Einstein J Monday 29 September 2008 50010/07 Wexford Pty Ltd v Praveen Meckraj Doolub & Ors JUDGMENT The current position 1 It is unnecessary to repeat the reasons for the principal judgment [2008] NSWSC or the further judgment [dealing with ancillary matters delivered on 18 September 2008 and making a number of orders following the finding that the first and second defendants have been guilty of the contempt of court charged]. The claim for the discharge of certain of the freezing orders 2 Currently Mr Street SC has submitted on behalf of the first defendant that orders 1.3, 1.4 and 1.5 of the Court's orders made on 15 March 2007 should be vacated in light of the facts: i. that upon the acceptance of a debtor's petition filed by the first defendant the rights of any secured creditor would be converted from a right to recover as against the bankrupt to a right to lodge a proof of debt; ii. that judgment was entered against any first defendant on 29th February 2008. 3 Mr Johnson appeared for the trustee as a matter of courtesy in order to assist the court. He commented that orders 1.3 and 1.4 were appropriate to be discharged. He made no comment either way in relation to order 1.5. 4 In my view none of three orders are appropriate to presently be discharged. They were orders made in personam. They did not and do not give the plaintiff any priority or interest in the assets which were frozen. They were orders made in the due administration of this Court's jurisdiction. 5 If and when the trustee applies for those orders to be discharged, such an application will require to be made formally and will be dealt with on its merits. The further amended notice of motion pursued by the second defendant 6 The second defendant by further amended notice of motion filed on 26 September 2008 seeks: i. an order that order 1.6 (a) entered on 15 March 2007 be varied by deleting the words "up to $50,000": or in the alternative; ii. an order that order 1.6 (a) entered on 15 March 2007 be varied by deleting the words "up to $50,000" and inserting the words "up to $350,000". 7 This application follows the filing of evidence to the effect that the contempt charged has been purged by the causing by Middleton's, of the amount of $88,927.09, to be transferred on 19 September 2008 from Middleton's Office Account to Middleton's Trust Account in the name of the first and second defendants. 8 In his affidavit of 10 July 2008 Mr Whyoon gave evidence that as at 9 July 2008 there was an amount of $10,446.00 in unbilled fees and disbursements recorded in the Middleton's Account system in respect of this matter. His estimate was that the second defendant would incur additional costs for the remainder of the proceedings in the vicinity of $200,000.00. As at the hearing of the application to vary the above described orders, there was present in the trust account the sum of $115,276.12. 9 The principled exercise of the relevant discretion is to order that Order 1.6 (a) of the orders entered on 15 March 2007 be varied by substituting the following order in its place: (a) paying reasonable legal expenses on any legal matter and reasonable legal expenses of defending this matter up to $160,000. 10 Whether or not on some occasion in the future a further application is made for a further variation of this order must abide the merits of such application. **************** 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.