Virgtel Limited v Zabusky
[2005] QSC 313
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- Virgtel Limited v Zabusky[2005] QSC 313
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Virgtel Limited v Zabusky[2005] QSC 313
Virgtel Limited v Zabusky[2005] QSC 313
SUPREME COURT OF QUEENSLAND
CIVIL JURISDICTION
MUIR J
No BS6547 of 2005
VIRGTEL LIMITED | Applicant |
and |
|
HARVEY ZABUSKY | First Respondent |
and |
|
AMALIA ZABUSKY | Second Respondent |
and |
|
EREZ ZABUSKY | Third Respondent |
and |
|
COMMSLOGIC PTY LTD (ACN 109 057 543) | Fourth Respondent |
and |
|
SOFTQUEST SOLUTIONS PTY LTD (ACN 057 679 599) | Fifth Respondent |
and |
|
VIRGIN TECHNOLOGIES LIMITED | Sixth Respondent |
BRISBANE
DATE 20/10/2005
ORDER AND JUDGMENT
HIS HONOUR: I order that the claim and statement of claim be filed and served by the applicant on or before 4.00 p.m. on 7 November.
…
HIS HONOUR: It seems to me desirable that proper opportunity be given to make whatever claims can properly be made in respect of the material listed in the document before me, particularly as the material was obtained pursuant to an order which has been set aside. I order in terms of the draft initialled by me. It is of course an interlocutory order and the applicant at any time can seek an alternative order.
…
HIS HONOUR: So paragraph 2 of this will be: the order made on 16 August 2005 be set aside except for paragraph 2 thereof, then renumbering, and there will be a new paragraph 5: costs of an incidental to today's hearing be reserved.
…
HIS HONOUR: The date being 20th October.
This matter came before me on 11th October. The respondents to the application by Virgtel Ltd sought to set aside orders made on 10 August 2005 extended on 16 August 2005. The basis for the application was that the 10 August 2005 order was flawed as having in it no provision to protect the respondents' rights to claim privilege against self-incrimination or for that matter legal, professional privilege. It was also a ground on the application that no proper regime as described in various recent authorities had been provided for in the order so as to give appropriate protection to the rights of the respondents in these and other respects.
In these reasons, I will refer to Virgtel as the applicant and the respondents to its application as the respondents.
In my view, the application was well founded. In the course of argument, considerable reliance was placed by Mr Logan, who appears for the respondents, on various pronouncements in Vasil v. National Australia Bank Limited (1999) NSWLR 207. In particular reference was made to a statement by Fitzgerald JA speaking in relation to a Mareva injunction that:
“A defendant against whom an order of disclosure of assets has been made whose privilege against self-incrimination will be infringed by compliance with the order according to its terms is entitled to have the order set aside.”
That approach is consistent with expressions of principle in other cases including Exagym Pty Ltd v. The Professional Gymnasium Company Pty Ltd (No 2) [1994] 2 QdR 129 and Microsoft Corporation v. Goodview Electronics Pty Ltd (1999) 26 IPR 159. All of these cases clearly identify the provision which should be included in orders of this nature. It was incumbent on the applicant for the order to refer the Judge making the order to such requirement. This area also has been the subject of extensive discussion in recent English decisions.
The setting aside of the order, however, does not necessarily mean that in appropriate circumstances a replacement order should not be made. The role of the Court is to do justice between the parties to the proceedings not to exact punishment against a transgressor even though to do so might work an injustice and deprive it valuable rights.
It was submitted that no replacement order ought be made for a number of reasons. In particular, it was submitted that the applicant had failed to make proper disclosure of various factual matters to the Court at the time of making of the earlier orders; that the applicant's case revealed by its material was weak; that there was no demonstrated risk of destruction of evidence; that there was no proceedings in Australia in which the relief could be given an aid and, finally, that, as a matter of law, the applicant could not be given the relief it sought because it was seeking to pursue a claim by way of a derivative action as shareholder in another company.
According to Mr Logan's argument, a derivative action under laws of Nigeria, which govern the subject company, can only be commenced with leave of a Nigerian Court and no such leave had been given. Another obstacle raised was the fact that the subject company was in receivership and the receiver was the appropriate person to commence proceedings.
These arguments are, no doubt, substantial but I am far from convinced that the subject company, being a foreign company, in this jurisdiction, with the assets sought to be protected located in this jurisdiction, that there is no triable issue as to the ability of the applicant to obtain relief.
The receivership, which I mentioned, is one which has served its purpose, the secured credit having been paid. The applicant is not on the register as a shareholder of the subject company and that is another matter relied on by Mr Logan. However, there is, at least, an arguable case that it ought be on the Register.
In my view, it is certainly arguable that this Court can and ought, in the circumstances raised on the affidavit material, make such orders as are necessary and appropriate to preserve the assets in dispute until such time as issues are properly joined and the case either determined by a trial or the respondents have succeeded in having the allegations raised by the applicant struck out in whole or in part.
I mention that the position in relation to Nigerian law is by no means clearly established. It is the subject of assertion and counter assertion on the material but I would think it a little surprising that entities with a presence in this jurisdiction engaged in a dispute over a property in this jurisdiction would be prevented from having a determination of rights on the merits as a result of the types of difficulties raised in Mr Logan's argument.
As for the necessity for the order there is plain evidence which, if accepted, demonstrates a risk to the assets. I need only refer to what was described in argument as “The Gateway Agreement” and the conduct by the first respondent in relation to it. There are also suspicious dealings in relation to building units upon which the applicant is able to rely.
Having regard to these matters, I set aside the orders of 10 August and 16 August and replaced them with an interim regime. Unfortunately, that regime is not going to be able to be fully finalised, it being appropriate that it await the commencement of proceedings and, in particular, the clear identification of the applicant's claims.
Now I have made that earlier order in relation to delivery of the claim and statement of claim and I otherwise order in terms of the draft initialled by me.