In the matter of Colorado Products Pty Limited (in prov liq) [2013] NSWSC 611

Supreme Court New South Wales

Medium Neutral Citation: In the matter of Colorado Products Pty Limited (in prov liq) [2013] NSWSC 611 Hearing dates: 17 and 23 April 2013 Decision date: 22 May 2013 Jurisdiction: Equity Division - Corporations List Before: Black J Decision: Monies held in Court to be paid out. Specified amount to be paid out of trust account. Plaintiffs to give specified security for defendants' future costs of proceedings. Defendants to be released from existing undertakings given to the Court on giving further specified undertakings. Orders made by Registrar varied to the extent that specified categories of discovery set aside. Leave granted to file Further Amended Statement of Claim. Specified orders as to costs. Catchwords: EQUITY - equitable remedies - application for freezing order under s 1324 Corporations Act 2001 (Cth) and r 25.11 Uniform Civil Procedure Rules 2005 (NSW) - plaintiffs seek order preventing defendants expending funds on living and legal expenses and ordinary course business expenses - whether risk of dissipation of assets - retrospective effect of removal of exception for legal expenses. PROCEDURE - payment into Court - order sought for payment out of funds paid into Court - whether the Court in ancillary jurisdiction may make orders for payment of monies into Court - whether circumstances justify depriving defendants of their property. PROCEDURE - judgments and orders - amending, varying and setting aside - defendants seek order granting leave to vary undertakings to the Court - whether purposes to which assets applied are legitimate - whether no other assets by which legitimate expenditures can be met. PROCEDURE - costs - security for costs - whether order should be made that the plaintiffs give security for their undertaking as to damages given to the Court. PROCEDURE - defendant applies for orders for security for costs - quantum and form of security - whether delay in application for security for costs tends against order in respect of past costs. PROCEDURE - discovery and interrogatories - discovery and inspection of documents - review sought of Registrar's decision on categories of discovery - whether categories relevant - whether categories unduly broad - whether categories unduly onerous. Legislation Cited: Civil Procedure Act 2005 (NSW) s 56 Corporations Act 2001 (Cth) ss 13.35, 285, 286, 477(2), 477(2B), 1323, 1324 Legal Profession Act 2004 (NSW) s 347 Uniform Civil Procedure Rules 2004 (NSW) rr 25.1, 25.11, 25.12, 25.14, 41.3, 41.11, 42.21,49.19 Cases Cited: - A v C (No 2) [1981] QB 961; [1981] 2 All ER 126 - Adam P Brown Male Fashion Pty Ltd v Phillip Morris Inc [1981] HCA 39; (1981)148 CLR 170 - Air Express Ltd v Ansett Transport Industries (Operations) Pty Ltd [1981] HCA 75; (1981) 146 CLR 249 - Allstate Life Insurance Co v ANZ Banking Group Ltd (1995) 134 ALR 187 - Anglo-Eastern Trust v Kermanshahchi [2002] EWHC 3152 - Ashington Capital Pty Ltd v Parissen Capital (Project X) Pty Ltd [2012] NSWSC 410 Australian Securities and Investments Commission v Krecichwost [2007] NSWSC 948; (2007) 213 FLR 314; (2007) 64 ACSR 411 Australian Securities and Investments Commission v Sigalla [2009] NSWSC 1205; (2009) 74 ACSR 710 - Bryan E Fencott & Associates Pty Ltd v Eretta Pty Ltd (1987) 16 FCR 497 - Cardile v LED Builders Pty Ltd [1999] HCA 18; (1999) 198 CLR 380 - Caruso Australia Pty Ltd v Portec (Aust) Pty Ltd (1984) 8 ACLR 818 - Clark Equipment Credit of Aust Ltd v Como Factors Pty Ltd (1988) 14 NSWLR 552 - Clout (as trustee in bankruptcy of the Estate of Dexter) v Anscor Pty Ltd [2001] FCA 174 - Cutler v Wandsworth Stadium Ltd [1945] 1 All ER 103 - Deputy Commissioner of Taxation v Bollands [2012] FCA 1050 - Dubow v Fitness First Australia Pty Ltd (No 2) [2012] NSWSC 961 - Electric Mobility Company Pty Ltd v Whiz Enterprises Pty Ltd [2006] NSWSC 580 - Empire (Aust) Nominees Pty Ltd v Vince [2000] VSC 324; (2000) 35 ACSR 167 - Frigo v Culhaci (unreported, 17 July 1998) - Goumas v McIntosh [2002] NSWSC 713 - Jackson v Sterling Industries Ltd [1987] HCA 23; (1987) 162 CLR 612 - Karl Suleman Enterprises Pty Ltd (in liq) v Pham [2010] NSWSC 886 - Liberty Industrial Pty Limited v Donald Mcarthy Trading Australia Pty Limited [2013] NSWSC 279 - Millennium Federation Pty Ltd v Bigjig Pty Ltd [2000] 1 Qd R 275 - Myers v Design Inc (International) Ltd [2003] EWHC 103 (Ch); [2003] 1 WLR 1642 - Newcastle City Council v Caverstock Group Pty Ltd [2008] NSWSC 249 - OD Transport Pty Ltd v Western Australian Government Railways Commission (1987) 13 FCR 500 - Patterson v BTR Engineering Australia Pty Ltd (1989) 18 NSWLR 319 - Re AT Air Group Pty Limited (in liq) (2012) NSWSC 1508 - Re Richstar Enterprises Pty Ltd; Australian Securities and Investments Commission v Carey (No 3) [2006] FCA 433; (2006) 232 ALR 577; 57 ACSR 307 - Sleiman v Afeich [2005] NSWSC 1063 - Szanto v Bainton [2011] NSWSC 985 - Szentessy v Woo Ran (Australia) Pty Ltd (1985) 64 ACTR 105 - The Anglo-Eastern Trust Limited, David Alliance v Kermanshahchi [2002] EWHC 3152 - Tim Barr Pty Ltd v Narui Gold Coast Pty Ltd [2009] NSWSC 563 - Tomko v Palasty (No 2) [2007] NSWCA 369; (2007) 71 NSWLR 61 Texts Cited: - P Biscoe, Freezing and Search Orders: Mareva and Anton Pillar Orders, 2nd ed, 2008 Category: Interlocutory applications Parties: HY International (Aust.) Pty Limited (First Plaintiff) Phoenix Explorer Pty Limited (Second Plaintiff) Colorado Products Pty Limited (Third Plaintiff) Clare Shu Rong Huang (First Defendant) CH Design Solutions Pty Limited (Second Defendant) Representation: Counsel: R.R. Harper SC/F. Assaf (Plaintiffs) S. Pritchard SC/D. Neggo (Defendants) Solicitors: Jackson Lalic (Plaintiffs) Macpherson & Kelley (Defendants) File Number(s): 11/214522