Francis v CPI Graphics Ltd [2011] NSWSC 317

Supreme Court New South Wales

Medium Neutral Citation: Francis v CPI Graphics Ltd [2011] NSWSC 317 Hearing dates: 31 March, 1 April 2011 Decision date: 05 April 2011 Jurisdiction: Equity Division Before: Brereton J Decision: First defendant pay into Court to credit of proceedings the sum of $2,062,353.40 pursuant to undertaking. Catchwords: PRACTICE AND PROCEDURE - Undertakings given by party to court -defendant mortgagee gives undertaking to pay into court proceeds of sale of properties if significant risk established that may be unable to do so if required by judgment - construction of undertaking - 'significant risk' directs attention to prospective situation when judgment given - 'risk' pertains to possibility not probability - fluctuation and deterioration of net asset position of mortgagee points to significant risk - mortgagee has finance facility - holding company of mortgagee subject to acquisition by another company - acquisition may permit termination of facility arrangement - finance facility may be insufficient to meet refund payment - cross-guarantee said to reduce risk enforceable only on winding up of mortgagee - held: significant risk mortgagee may be unable to refund proceeds of sale with interest if so required by judgment.

COSTS - Special costs order sought that costs of interlocutory application be payable forthwith - general rule that such costs are not payable until the conclusion of proceedings - factors militating against application of general rule not present - no special costs order made. Legislation Cited: (NSW) Contracts Review Act 1980. (CTH) Corporations Act 2001, s 1335. Cases Cited: Bagley v Pinebelt Pty Ltd [2000] NSWSC 830. Fallas v Mourias (2006) 65 NSWLR 418. Fiduciary Ltd v Morningstar Research Pty Ltd (2002) 55 NSWLR 1. Category: Interlocutory applications Parties: Catherine Margaret Francis (first plaintiff) Robert Michael Francis (second plaintiff) CPI Graphics Limited (first defendant) Eric Baillie Francis (second defendant) Representation: Counsel: Mr B Connell (plaintiffs) Mr Studdy SC w Mr S Jacobs (first defendant) Solicitors: PMF Legal (plaintiffs) Minter Ellison (first defendant) File Number(s): 2010/ 414257