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BluePoint Property Pty Ltd v Zuri Properties Pty Ltd

[2020] QSC 219

BluePoint Property Pty Ltd v Zuri Properties Pty Ltd[2020] QSC 219





BluePoint Property Pty Ltd v Zuri Properties Pty Ltd [2020] QSC 219



(first plaintiff)


(second plaintiff)



(first defendant)


(second defendant)


BS 12390 of 2017


Trial Division




19 June 2020




18 June 2020


Bond J


1. The defendants are to pay the residual proceeds of any sale of Lot 1 on SP 174199, after payment of:

(a) the secured debt of the National Australia Bank;

(b) the secured debt of QF SPV No. 2 Pty Ltd;

(c) agent’s commission to CBRE; and

(d) legal costs to Herbert Smith Freehills,

into their solicitors’ trust account to be held until the determination of this proceeding or further order.

2. The application is dismissed.

3. The plaintiffs are to pay the defendants’ costs of the application.


PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – DETENTION, INSPECTION AND PRESERVATION – FREEZING ORDERS – where the plaintiffs’ principal claim seeks specific performance of a contract such as would transfer a property of the first defendant to the plaintiffs – where the plaintiffs have applied for a freezing order restraining the first defendant from selling the property and disposing of the proceeds, and an ancillary order – where the plaintiff sought to demonstrate the risk of dissipation of assets by impugning the legitimacy of a second registered mortgage over the property – whether the plaintiffs’ contentions rose beyond mere speculation – whether the plaintiffs demonstrated a real risk of an unjustifiable disposal of assets which would frustrate court processes – whether a freezing order should be made – whether the ancillary order should be made

Uniform Civil Procedure Rules 1999 (Qld), r 260A, r 260B, r 260D

Bluepoint Property Pty Ltd  v Zuri Properties Pty Ltd [2018] QSC 86, cited

Parbery v QNI Metals Pty Ltd (2018) 127 ACSR 582; [2018] QSC 107, applied

Palmer v Parbery (2019) 136 ACSR 26; [2019] QCA 027, cited


D Savage QC, with W LeMass, for the plaintiffs

R Jackson QC, with A Psaltis, for the defendants


McBride Legal for the plaintiffs

Bartley Cohen for the defendants


  1. [1]
    The principal proceeding involves a dispute between the parties as to rights in relation to certain real property, of which the first defendant is the registered proprietor.  The property may be referred to as Lot 1.
  2. [2]
    The relief which the plaintiffs seek in the principal proceeding is set out in the sixth amended statement of claim.  Amongst other things, the plaintiffs seek:
    1. (a)
      a declaration that a relevant contract remains on foot and orders requiring specific performance such as would transfer Lot 1 to the plaintiffs;
    2. (b)
      alternatively, relief against any forfeiture of the plaintiffs’ interests under the relevant contracts;
    3. (c)
      alternatively, damages for breach of contract;
    4. (d)
      alternatively, declaratory relief, including of the existence of a constructive trust and orders for an account of profits or equitable compensation.
  3. [3]
    If the plaintiffs were confined to pecuniary relief, it appears that they assert a right to claim of the order of $7 million.
  4. [4]
    Yesterday I heard argument in respect of an application by the plaintiffs for a freezing order and an order ancillary thereto.  They rely on rules 260A, 260B and 260D of the Uniform Civil Procedure Rules 1999 (Qld), and the Court’s inherent jurisdiction.  The orders sought are those set out in the application, but it suffices to say:
    1. (a)
      the plaintiffs seek to restrain the first defendant from selling Lot 1 or further encumbering it unless the first defendant first secures the sum of $7 million in a manner satisfactory to the Registrar;
    2. (b)
      alternatively, the plaintiffs seek to restrain the first defendant from disposing of assets up to an unencumbered value of $7 million; and
    3. (c)
      by the ancillary order, the plaintiffs seek to force the first defendant to depose as to the details of its dealing with its assets between 23 November 2017 and the date of the order.
  5. [5]
    The present application is the third occasion on which the plaintiffs have tried to restrain the first defendant from exercising rights in relation to Lot 1. 
  6. [6]
    The first occasion was the interlocutory injunction application refused by Davis J in March 2018: see Bluepoint Property Pty Ltd v Zuri Properties Pty Ltd [2018] QSC 86. 
  7. [7]
    The second occasion was in May 2019 when the plaintiffs lodged caveats over Lot 1.  On 20 June 2019, the caveats were removed by a consent order after a caveat removal application was heard by Bradley J. 
  8. [8]
    This third occasion arises because, pursuant to undertakings given as part of the consent order, the first defendant has given notice of its intention to execute a contract selling Lot 1.  On the first defendant’s evidence, its principal remaining asset is Lot 1.  It now proposes to sell Lot 1, pay out two secured creditors, leaving, after deduction of selling costs, about $270,000.  The defendants have indicated their willingness to pay the amount so obtained into their solicitors’ trust account to be held until the determination of this proceeding or further order.  The first defendant has not entered into that transaction yet, but the evidence suggests that it is ready, willing and able to contract with the third party in such a way that the contract would settle and allow the payout of the secured creditors by 30 June 2020.  The payout is important to the first defendant’s relationship with its financiers. 

Relevant legal principles

  1. [9]
    The relevant law was dealt with extensively by me in Parbery v QNI Metals Pty Ltd (2018) 127 ACSR 582 at [15] to [75].  An appeal from my judgment was dismissed: see Palmer v Parbery (2019) 136 ACSR 26.  With one qualification, the law which I will apply is that stated in Parbery v QNI Metals Pty Ltd
  2. [10]
    The qualification concerns the fact that in my judgment at [32] to [34], I declined to follow the test as to the nature of the relevant risk of dissipation which had been expressed in Candy v Holyoake [2017] EWCA Civ 92.  On appeal from my decision, the Court of Appeal has explained that whilst a plaintiff seeking a freezing order does not have to show that the purpose of the defendant’s conduct is to prevent recovery of the amount of any judgment, it is nevertheless correct to regard it as necessary for the plaintiff to establish “a real risk, judged objectively, that a future judgment would not be met because of an unjustifiable dissipation of assets”, to use the language of Gloster LJ in Candy v Holyoake: see Palmer v Parbery per McMurdo JA at [55]. 
  3. [11]
    It follows from the foregoing that there are three broad considerations which must be examined in order to determine whether to make the orders sought by the plaintiffs.
  4. [12]
    First, whether the plaintiffs have a good arguable case in respect of their underlying cause of action, in the sense of a case which is more than barely capable of serious argument, and yet not necessarily one which the Court believes to have a better than 50 per cent chance of success.  This element is conceded by the defendants for present purposes. 
  5. [13]
    Second, whether there is a real risk, judged objectively, of an unjustifiable disposal of assets which would have the effect of frustrating the prospective court processes of execution and enforcement in respect of any judgment in the plaintiffs’ favour.  This element is strongly contested. 
  6. [14]
    Third, whether it is in the interests of justice that the orders be made, in particular bearing in mind that the jurisdiction must be exercised with a high degree of caution and with proper consideration for the nature of the impact on the persons affected.  This element, too, is strongly contested.
  7. [15]
    The way in which those considerations should be examined was as I set out in Parbery v QNI Metals Pty Ltd at [49]. 
  8. [16]
    It is not necessary to seek to distinguish between the two sources of jurisdiction to make orders of the nature of those sought by the plaintiffs because the broad considerations that I have identified apply to both. 

The freezing order

  1. [17]
    I turn first to the question of whether the plaintiffs can demonstrate the relevant risk of dissipation. 
  2. [18]
    What is at issue here is whether the plaintiffs have demonstrated that steps might be taken (and I interpolate that that means steps might be taken in the future) with the result that any judgment of the Court will be wholly or partially unsatisfied: see Parbery v QNI Metals Pty Ltd at [29], citing Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319. 
  3. [19]
    The only evidence that steps might be taken which might affect the ability of the plaintiffs, if successful, to have their judgment satisfied is the evidence that the first defendant proposes to take steps to sell Lot 1 and to deal with the proceeds of sale in the way I have indicated.  The evidence before me is that the whole value of Lot 1 would not be available to the plaintiffs to satisfy any judgment which they might obtain.  Mr Evans’ affidavit before me was that the value of Lot 1 had already been impaired by being subject to a registered first mortgage to National Australia Bank, which I will refer to as “NAB”, and a further second mortgage to a mortgagee I will refer to as “QF SPV”, and the first defendant has been advised by those mortgagees that their respective payout figures are $6,844,973.91 and $3,200,000.  If those figures are accepted, then the capacity of Lot 1 to contribute to the first defendant’s ability to satisfy any prospective judgment is limited to the extent of the first defendant’s remaining equity in Lot 1.  There is no risk of steps being taken which have the effect of depriving the plaintiffs of potential access to that remaining equity, because, as I have recorded, the evidence suggests that the anticipated net proceeds from the sale after deduction of the secured creditors’ payout figures and other selling costs would be $271,776.09, which the defendants would be willing to pay into their solicitors’ trust account.
  4. [20]
    The plaintiffs sought to meet that problem by impugning the entirety of the second mortgage transaction.  They sought to persuade me that the risk of dissipation lay in the making of the proposed payment to the registered second mortgagee, because that debt should not be regarded as a debt truly owed to the registered second mortgagee.  The plaintiffs suggested that there were “suspicious circumstances” regarding the second mortgage.  Unfortunately, the matters to which the plaintiffs point in their written submissions presently rise no further than speculation.  They cannot overcome the fact that the defendants’ evidence before me supports these propositions:
    1. (a)
      By the end of June 2018, the first defendant had borrowed monies from related entities in excess of $895,000.  Those entities wanted to be repaid.
    2. (b)
      Rusty Canon Pty Ltd provided a loan facility to the first defendant on terms in October 2018.  The purpose of that facility was to repay the existing intercompany loans and to cover ongoing holding costs, development costs and legal costs not being financed by NAB.
    3. (c)
      Rusty Canon assigned its rights against the first defendant to QF SPV on 31 January 2019 pursuant to an assignment deed.
    4. (d)
      By the assignment deed, the assignor and assignee agreed that the amount of the first defendant’s debt as at that day was $1,455,286.36, and the assignor acknowledged having received full consideration from the assignee for the assignment.  It should be inferred that Rusty Canon must have actually lent monies to the first defendant prior to 31 January 2019, which resulted in that debt as at the date of the assignment.
    5. (e)
      A QF SPV statement of account in respect of the loan since the date of assignment shows that outstanding amount as at 31 January 2019, 10 further advances, five partial repayments, the charging and writing-off of some interest, and a final outstanding balance as at 31 May 2020 of $3,200,000.
    6. (f)
      QF SPV is a trustee company.  Although the interests behind it were at one time interests relating to the BMI Group, which is a group of companies related to the first defendant, those interests have changed over time.  At present, the ultimate beneficial owners of the loan to the first defendant are a group of arm’s-length private investors.
  5. [21]
    I observe further in relation to the evidence of Mr Evans (on behalf of the defendants):
    1. (a)
      It is true that his evidence was expressed at a high level of generality and contained secondary evidence of the contents of documents, but no objection was taken to admissibility of that evidence.  Moreover, he swore to having had regard to the books and records of the first defendant, and his belief in the truth of them, and in what he deposed to based on his review.  He was not required for cross-examination.
    2. (b)
      Whilst the evidence does not demonstrate why the first defendant might have needed to borrow those monies from Rusty Canon and then QF SPV, or what it did with the monies once it borrowed them, there is no basis on the evidence which supports the conclusion that there is not presently a real debt owed in the amount of $3,200,000 to QF SPV, the ultimate beneficial owners of which are a group of arm’s-length private investors.
  6. [22]
    At a certain level, one can understand the plaintiffs’ suspicions which have led to this application being made.  One of the considerations which influenced Davis J to reject the interlocutory injunction sought before him on balance of convenience grounds was his conclusion that it seemed that the first defendant would be able to meet any damages claim.  There had been evidence before his Honour that the first defendant expected to make a $3.8 million profit from the eventual sale of Lot 1.  The plaintiffs had difficulty reconciling that position with the position now revealed by the evidence of Mr Evans.  Although Mr Evans makes an attempt to reconcile the two positions, his explanation does not answer all their questions.  The problem for the plaintiffs on the present application is that, if anything untoward has in fact occurred, it has already occurred. 
  7. [23]
    I am not persuaded that the plaintiffs have demonstrated that there is any relevant risk of a step being taken in the future, which might be regarded as relevantly dissipating the assets of the first defendant which might be available to meet any prospective judgment in favour of the plaintiffs.  That being so, it is not necessary to consider whether the interests of justice might have supported a freezing order being made or suggested that it should be refused.

The ancillary order

  1. [24]
    Once the decision is made that no freezing order should be made, there is no reason to make the ancillary order.  It becomes, as the defendants contend, a fishing exercise. 
  2. [25]
    It might be different if a freezing order on some other basis or in respect of some other assets or dealing of the first defendant was in prospect.  Rule 260B of the UCPR permits the Court to make an order ancillary to a prospective freezing order.  I discussed this jurisdiction in Parbery v QNI Metals Pty Ltd at [67] to [70]. 
  3. [26]
    If some or all of the suspicions which the plaintiffs had, but which they have not been able to establish to the requisite degree before me, are in fact true, then a wrong or wrongs will have been done to the first defendant by its officers.  It may have causes of action against those officers, or against others who have participated in their wrongful conduct or obtained benefits from that wrongful conduct.  But even if those causes of action exist and can properly be regarded as assets of the first defendant, there is no evidence before me that there is a risk of any dealing with them which will adversely affect their existence or their eventual availability to the plaintiffs, perhaps via insolvency processes, if they succeed in obtaining judgment against the defendants.  There is no basis for concluding that some other freezing order is in prospect. 
  4. [27]
    I conclude that there is no basis to make the ancillary order sought.


  1. [28]
    The application must be dismissed.
  2. [29]
    The first order proposed by the defendants should be made, namely:

The defendants are to pay the residual proceeds of any sale of Lot 1 on SP 174199, after payment of:

  1. (a)
    the secured debt of the National Australia Bank;
  2. (b)
    the secured debt of QF SPV No. 2 Pty Ltd;
  3. (c)
    agent’s commission to CBRE; and
  4. (d)
    legal costs to Herbert Smith Freehills,

into their solicitors’ trust account to be held until the determination of this proceeding or further order.

  1. [30]
    The other order I make is that:

The plaintiffs are to pay the defendants’ costs of the application.


Editorial Notes

  • Published Case Name:

    BluePoint Property Pty Ltd v Zuri Properties Pty Ltd

  • Shortened Case Name:

    BluePoint Property Pty Ltd v Zuri Properties Pty Ltd

  • MNC:

    [2020] QSC 219

  • Court:


  • Judge(s):

    Bond J

  • Date:

    19 Jun 2020

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

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