C A T C H W O R D S



PRACTICE AND PROCEDURE - security for costs - appeal from interlocutory order varying an order for security for costs - whether grounds for interference with exercise of discretion of primary judge - whether any material change in circumstances since earlier order made - whether offer of personal indemnities from directors of respondent should be regarded as new facts or changed circumstances which warranted variation of security.


PRACTICE AND PROCEDURE - cross appeal against primary judge's refusal to make an order that part of the respondent's claim be heard separately and on an expedited basis - leave to cross-appeal refused.


PRACTICE AND PROCEDURE - cross appeal against order for security for costs - appeal dismissed.


House v. The King (1936) 55 CLR 499

Re the Will of F.B. Gilbert (dec.) (1946) 46 S.R. (N.S.W.) 318 Adam P. Brown Male Fashions Pty Ltd v. Philip Morris Inc (1981) 148 CLR 170

Squire v. Rogers (1979) 27 ALR 330

Harpur v. Ariadne Australia Ltd [1984] 2 Qd.R.523

Brimaud v. Honeysett Instant Print Pty Ltd (Supreme Court of New South Wales, Equity Division 19 September 1988)


DARLING HARBOURSIDE (SYDNEY) PTY LTD v. SANIRISE PTY LTD

No. NG 325 of 1993


BEAUMONT, CARR & SACKVILLE JJ

SYDNEY

17 MAY 1996


IN THE FEDERAL COURT               )

OF AUSTRALIA                                )

NEW SOUTH WALES                       )                       No. NG 325 of 1993

DISTRICT REGISTRY                       )

GENERAL DIVISION                        )


                         ON APPEAL FROM A JUDGE OF THE FEDERAL COURT


                                                            BETWEEN:     DARLING HARBOURSIDE

                                                                                   (SYDNEY) PTY LIMITED


                                                                                                           Appellant


                                                            AND:   SANIRISE PTY LTD

                                                                                   (Subject to Deed of Company

                                                                                   Arrangement)


                                                                                                           Respondent


CORAM:       Beaumont, Carr & Sackville JJ

PLACE:          Sydney

DATE:            17 May 1996


                                                        MINUTE OF ORDERS


THE COURT ORDERS THAT:


On the application for leave to appeal and to cross-appeal on the question of security for costs:


1.         Leave to appeal is granted to both parties.


2.         The appeal by Darling Harbourside (Sydney) Pty Ltd, now known as ACN 002 928 476 Pty Ltd, is allowed with costs.


3.         The appeal by Sanirise Pty Ltd is dismissed.


4.         The orders made at first instance on 15 December 1995 be set aside.


5.         The notice of motion dated 29 May 1995 filed by Sanirise Pty Ltd be dismissed.


On the application by Sanirise Pty Ltd for leave to appeal on issues other than security for costs, being the question whether the outgoings claim shgould be heard separately:


1.         Leave is refused, with costs.


            NOTE:  Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.


IN THE FEDERAL COURT OF AUSTRALIA     )

                                      )

NEW SOUTH WALES DISTRICT REGISTRY     )    No.NG 325 of 1993

                                      )

GENERAL DIVISION                      )

 

 

         ON APPEAL FROM A JUDGE OF THE FEDERAL COURT

                        OF AUSTRALIA

 

                             BETWEEN:  DARLING HARBOURSIDE (SYDNEY) PTY LIMITED

 

                                      Appellant

 

                                AND:   SANIRISE PTY LTD

                                      (Subject to Deed of Company Arrangement)

 

                                      Respondent

 

 

CORAM:   BEAUMONT, CARR & SACKVILLE JJ.   

PLACE:   SYDNEY

DATE:    17 MAY 1996

 

 

                    REASONS FOR JUDGMENT

 

BEAUMONT J.            

          I agree with Carr J. I would only add two observations. I accept that this discretion necessarily depends upon the circumstances of the particular case in hand.  But the approach taken by Davies J. has been followed in other cases, for instance, the decision of Kiefel J., considered by Cooper J. in an application for leave to appeal from her Honour's decision in Jalpalm Pty Limited v Hamilton Island Enterprises Pty Limited, unreported, 9 June 1995.  There, Cooper J. said (at 12):

 

     "The effect of her Honour's order was to determine that the interests of justice required that an order for security for costs in an amount of $25,000.00 be made and that to provide the security the applicant would have to convince its creditors of the strength and worth of its case and of the benefits which would flow to the creditors upon a successful outcome.  Such an approach is totally consistent with the decision of the Full Court in Bell Wholesale Pty Limited v Gates Export Corporation;  National Bank of New Zealand v Donald Export Trading Ltd; Pacific Acceptance Corporation Limited v Forsyth [1967] 2 NSWR 403 at 403."

 

 

I agree with the approach taken by Keifel J. and with the observations of Cooper J and it follows, of course, that I am also in agreement with the approach taken by Davies J. in this matter. 

 

       Secondly, I agree with the observations made by Carr J. and in  particular  his  reference to the decision of McLelland J. in Brimand v Honeysett Instant Print Pty. Limited.  In that case McLelland J. said (at 5):

 

      "In the present case I am dealing with an interlocutory order of a substantive nature made after a contested hearing in contemplation that it would operate until the final disposition of the proceedings.  In such a case the ordinary rule of practice is that an application to set aside, vary or discharge the order must be founded on a material change of circumstances since the original application was heard, or the discovery of new material which could not reasonably have been put before the Court on the hearing of the original application ... ."

 

 

His Honour then cites a line of authority for that proposition, with which I am in full agreement.  In my view, that proposition had direct application to the present case.

 

          It is clear that, in form and in substance, the orders made for security by Davies J. were intended to be, as
it were, a "one off" disposition, that is to say, a final disposition of that interlocutory aspect of the proceedings.

 

        For those additional reasons, I agree with what Carr J. has said and with the orders his Honour proposes.

 

          The orders of the Court then will be as follows: 

 

          On the application for leave to appeal and to cross-appeal on the question of security for costs, the Court makes these orders.  First, leave to appeal is granted to both parties; secondly, the appeal by Darling Harbourside (Sydney) Pty Limited, now known as ACN Pty Limited, is allowed with costs, but the appeal by Sanirise Pty Limited on this question is dismissed.  We order that the orders made at first instance on 15 December 1995 be set aside; and that, in lieu thereof, we order that the notice of motion dated 29 May 1995 filed by Sanirise Pty Limited be dismissed. 

 

          On the application by Sanirise Pty Limited for leave to appeal on issues other than security for costs, being the question whether the outgoings claim should be heard separately, we refuse leave, with costs.

 

                        I certify that this and the preceding two (2) pages are a true copy of the Reasons for Judgment herein of his Honour Justice Beaumont.

 

                        Associate

                        Dated:    12 June 1996

 


IN THE FEDERAL COURT               )

OF AUSTRALIA                                )

NEW SOUTH WALES                       )                       No. NG 325 of 1993

DISTRICT REGISTRY                       )

GENERAL DIVISION                        )


                         ON APPEAL FROM A JUDGE OF THE FEDERAL COURT



                                                            BETWEEN:     DARLING HARBOURSIDE

                                                                                   (SYDNEY) PTY LIMITED


                                                                                                           Appellant


                                                            AND:               SANIRISE PTY LTD

                                                                                   (Subject to Deed of Company

                                                                                   Arrangement)


                                                                                                           Respondent



CORAM:       Beaumont, Carr & Sackville JJ

PLACE:          Sydney

DATE:            17 May 1996


                                                  REASONS FOR JUDGMENT


CARR J:

                                                                  Introduction



This is a motion for leave to appeal from an interlocutory judgment of a Judge of this Court.  A cross-appeal is also proposed.


In its draft notice of appeal, the respondent to the originating application (whom I shall refer to as "Darling Harbourside" although that is no longer its name) seeks to challenge the primary judge's decision to make fairly substantial variations to an order for security for costs in its favour made exactly twelve months earlier.

 

In its cross-appeal the applicant in the originating application, Sanirise Pty Ltd ("Sanirise") would appeal against the primary judge's refusal to make an order that one
part of its claim be heard separately and on an expedited basis.  Sanirise also seeks to contend in its cross-appeal that the primary judge erred in ordering that there should be any security for costs.  At the hearing of the motion Sanirise did not oppose leave to appeal being granted to Darling Harbourside on the basis that Sanirise could, in effect, argue those portions of its cross-appeal as challenged the requirement that there be any security for costs at all.  Leave to appeal was granted on that basis.


                                                           Factual Background


The following narrative is drawn largely from the reasons for judgment of Davies J. whose order for security for costs was varied by the judgment which, leave having been granted, is under appeal. 


In late 1989 and early 1990 Sanirise became the lessee of shops and other premises at Darling Harbour.  Darling Harbourside was the lessor.


On 21 May 1993 Sanirise sued Darling Harbourside in this Court for damages alleged to have been caused by conduct in breach of s.52 of the Trade Practices Act 1974 (Cth) ("the Act").  Sanirise also claims that Darling Harbourside has breached certain terms of the leases.  One such breach alleged is that Darling Harbourside has wrongly levied Sanirise for operating expenses which were not "operating expenses" within the meaning of that expression in the leases.  There is a further allegation that Darling Harbourside wrongly calculated certain components in its ascertainment of rent.  Darling Harbourside cross-claimed for possession of the premises (it has since retaken possession), rent, other moneys due and damages.

The proceedings were listed for hearing on four days commencing on 31 August 1993 but Sanirise applied for the hearing date to be vacated.  On 20 August 1993 Wilcox J. ordered that the hearing dates be vacated.  On that occasion Sanirise gave certain undertakings to the Court.  The first was that:


                                "The applicant undertakes to the court to pay directly to the respondent on 5 September 1993 the sum of $60,522.28 and to pay directly to the respondent on the fifth day of every calendar month thereafter (until further order) the sum of $58,677.01, such payments to be made without delay, deduction or set-off, without prejudice to the rights of the respondent".


It would seem that these payments equated to Sanirise's monthly obligations as lessee. 


In turn, Darling Harbourside gave an undertaking to the Court, in effect, not to retake possession of or interfere with Sanirise's possession of the leased premises until failure on its part to comply with any of its undertakings.


The undertakings were complied with until 5 July 1994.  On that date an administrator was appointed of Sanirise under Part 5.3A of the Corporations Law ("the Law").  Sections 440C and 440D(1) of the Law prevented Darling Harbourside from enforcing its rights under the leases and from pursuing its cross-claim while that administration was in place.


Judges of this Court made orders that the operation of Sanirise's first undertaking be suspended, initially for seven days, but thereafter for the period of the administration.  On 7 July 1994 Sanirise filed a notice of motion seeking release from its undertaking.  On 9 October 1994 a deed of company arrangement was executed which brought the
administration to an end.  The suspension of the operation of the undertaking thus ceased on 10 October 1994. 


The only property dealt with by the deed of arrangement was a contingent asset described in the deed as follows:


                                "The property that is available to creditors consists of the contingent asset, namely all actual or potential legal claims by and of the company which relate to events or conduct occurring prior to the Fixed Date."

 

                [The Fixed Date was the date upon which Sanirise went into administration.]



The deed contains provisions which have the effect (via the issue of units to creditors and others) of extending a degree of priority in the distribution of whatever may be recovered in these proceedings to those who provide cash, services or other consideration to the "Deed Fund" constituted by and defined in the deed.


The administrator paid only two of the four instalments due under the terms of Sanirise's undertaking.  On 14 October 1994 Darling Harbourside took possession of the leased premises and on 14 December 1994 Davies J. ordered that Sanirise be released from its undertaking.


On the same date Davies J. dealt with an application by Darling Harbourside for security for costs.  At that stage the hearing was listed for 20 sitting days commencing on 6 March 1995.  His Honour had before him evidence from Darling Harbourside's solicitor that it had already incurred costs on a party and party basis exceeding $28,000 and that if the matter proceeded, its further costs and disbursements, on the same basis, would exceed $200,000.  No evidence to the contrary was adduced.  In fact the administrator had reported to Sanirise's creditors that its solicitors believed that costs of the preparation for trial and the trial would exceed $250,000.  One of Sanirise's directors swore an affidavit in which she attributed the company's financial position directly to actions and lack of action on the part of Darling Harbourside and its agents.  Davies J. expressed the view that this did not, of itself, constitute prima facie evidence of the matters alleged in the statement of claim or evidence that Sanirise would be likely to obtain judgment against Darling Harbourside in a significant sum.  His Honour noted that no advice of counsel to that effect had been tendered.  Rather, the administrator had reported to creditors that his solicitor, on the material reviewed by him, and as the matter presently stood, did not believe that Sanirise's prospects of recovering any significant quantum of damages exceeded fifty per cent.  The administrator also reported to creditors that there was a prospect that an order for security for costs would be made.  Davies J. expressly noted that the proceedings were not "public interest litigation" but were brought for the recovery of money and alleged breaches of duties owed by Darling Harbourside to Sanirise.  The evidence before his Honour disclosed that Sanirise had funded the litigation by obtaining the services of its legal representatives on a contingency fee basis.  His Honour referred to the provisions made in the deed of arrangement for the issue of units some of which might be issued to solicitors and counsel.  His Honour observed:


                                "The result could well be, if no order for security were made, that Sanirise could proceed with the litigation without either incurring legal costs itself or being troubled about any order as to cost(s) which may be made against it."



It appears from his Honour's reasons for judgment that Sanirise conceded before Davies J. that neither it nor its directors could provide security for costs.  The transcript of
evidence of the proceedings before Davies J (see Appeal Book page 90) shows that this concession was in terms that the directors were not in a financial position "to pay an order for security for costs". 


His Honour took into account the fact that Darling Harbourside made its application for security for costs only a short time before the matter was listed for hearing.  He did this after acknowledging the effects of the period of administration, the resumption of possession and the like.  It is worthwhile setting out his Honour's conclusions, which were as follows:


                                "In my opinion, the making of a reasonable order as to security would not be likely to stifle the litigation if it is litigation that ought to proceed.  If the creditors who are owed over $2 million are not prepared to back the litigation with funds, I would draw the conclusion that it was not litigation which should be allowed to involve Darling Harbourside in a great deal of expense or to occupy 20 days of the Court's valuable hearing time.

 

                                It would indeed be plainly unjust to Darling Harbourside to refuse to make an order for security.  Darling Harbourside would otherwise be put in the position where it would be better served by offering $200,000 in settlement of the litigation so as to avoid the cost and expense of going on.

 

                                Litigation is fairest to the persons concerned when both sides of the record are at risk of losing sums in respect of costs if litigation which should be discontinued or settled is carried on unnecessarily.

 

                                ...

 

                                In my opinion, the sum in respect of which an order for security should be made is $100,000.  In adopting this figure, I take all the factors into account including the fact that the case is listed for hearing on 6 March 1995.  I think this sum will not be likely to stifle the litigation if it is judged by the creditors to be litigation which should be pursued.  After all, the claim may amount to $5 million and the creditors are owed $2 million.  In this light, $100,000 is a very modest sum."




Sanirise was ordered to provide security for costs by 31 January 1995.  In default the application was to be stayed.  Sanirise did not comply with that order, the proceedings were stayed and the hearing listed for 6 March 1995 did not take place.


On 29 May 1995 Sanirise filed a notice of motion in which it sought three orders which have relevance to the present appeal.  The first was that the issue of liability be heard separately from any subsequent hearing or reference on the issue of damages.  The second was that Davies J's order for security for costs be varied by:


            .      requiring two named Sanirise directors to give an indemnity in respect of any order for costs which might be made against that company, being costs incurred since 14 December 1994; and


            .      reducing what might be termed the cash component of the security to $40,000, comprising $20,000 to be provided "at the time Sanirise completes its evidence (pertaining to the issue of liability only)" and a further sum of $20,000 on or before 30 days prior to the commencement of the hearing on that issue. 



The third order sought was that Sanirise's claim in an amount of $91,733.82 for overpayment of outgoings be heard separately and on an expedited basis.


Directions were made for the filing of written submissions on those matters and, as (in the end) neither party sought oral argument, Einfeld J. decided the motion on the written submissions and affidavit evidence.



His Honour refused the application for a separate hearing on liability and damages and also refused the application that the outgoings claim be heard separately.  I shall return to his Honour's reasons for so doing when I consider Sanirise's cross-appeal, below.


The learned primary judge then proceeded to consider the application for variation of Davies J's orders for security for costs.  His Honour acceded to that request, vacated the orders of 14 December 1994 in that regard and ordered that:


                         "3.  The applicant provide security for costs of the respondent in the sum of $40,000 of which $20,000 is payable on or before 15 January 1996, the remainder one month prior to the commence-ment of the hearing.

 

                         4.   The applicant cause its directors Mr Nejad and Ms Kelly to provide written guarantees, to the satisfaction of a Registrar, indemnifying the applicant against any order for costs which may be made in favour of the respondent at the hearing.

 

                         5.   The proceedings be stayed in the event these orders are not complied with."

 



                                                   The Appeal and Cross-Appeal


The manner in which an appellate court approaches a matter of this type is well-settled.  First, it must be recognised that the appeal and cross-appeal are against exercises of discretion.  House v. The King (1936) 55 CLR 499 at pp.504-505 is the traditional source of guidance in such cases.  Secondly, not only is the judgment in this matter a discretionary one, but it is on points of practice or procedure.  Sir Frederick Jordan's warning in Re the Will of F.B. Gilbert (dec.) (1946) 46 S.R. (N.S.W.) 318 at p.323 was expressly endorsed by the High Court in Adam P. Brown Male Fashions Pty Ltd v. Philip Morris Inc (1981) 148 CLR 170 at p.177.  The danger to the proper administration of
justice in transferring all exercises of discretion in interlocutory matters from a judge in chambers to an appellate court must be even more pronounced today than it was fifty years ago.  However, while a tight rein must be kept on interference, the High Court made it clear in Adam P. Brown Male Fashions that there were no rigid and exhaustive criteria operating as bars to loosening the rein on an appropriate occasion.  At first I thought that might have proved to be important in the present matter.  Otherwise, a strict reading of House v. The King might prevent us from interfering if we could see how the primary judge reached the result embodied in his order, and we could not identify any error of the four categories described in that case, but nevertheless formed the view that a substantial wrong or serious injustice has resulted from the exercise of discretion.  In that regard we are allowed the benefit of hindsight - see Deane J. in Squire v. Rogers (1979) 27 ALR 330 at p.337, with whom Forster and Brennan JJ agreed.  However, as will be seen, this problem (of identifying error of principle) did not eventuate.  It appears that Sanirise has not paid the first instalment of $20,000 provided for by the learned primary judge. The proceedings are thus stayed under the fifth of Einfeld J's orders.  Nevertheless, we heard this motion.


The Appeal

It is clear from the learned primary judge's reasons for judgment that his Honour regarded the offer of personal indemnities from Mr Nejad and Ms Kelly as a significant new fact that warranted reconsideration of the order for security.  His Honour considered that the personal indemnities were "new facts to be given significant weight" in the motion for variation of security.



It will be recalled that twelve months earlier, when the question of security for costs was before Davies J, it was common ground that neither Sanirise nor the directors of that company could provide security.  We were not taken to any evidence that was before Einfeld J. to the effect that their financial position had improved or that indemnities from them otherwise had any financial value.  There was evidence that Mr Nejad and Ms Kelly live together in rented premises at Castle Cove, that their only assets as at 30 November 1994 comprised "Home Contents and Personal Effects" to the value of $175,627, and that they had liabilities of $11,000 resulting in nett assets of $164,627.


In fairness to his Honour, he does not appear to have approached the matter on the basis that the directors' indemnities had any financial value.  Rather, the significant new fact was simply that the directors were emerging from behind the corporate veil.  His Honour said that he did not consider the fact that the indemnities had not previously been offered, when they might have been, was determinative.  I respectfully agree that such a consideration would not be determinative.  However, as a matter of policy, I would regard that as being a matter of considerable weight.  Applicants, in my view, should not be allowed to hold back what might be offered by way of security the first time around, as it were, in the hope of avoiding such liability with the expectation that if things go wrong then they can improve their offer later.  I have considerable doubt whether the tender of the directors' personal indemnities should be regarded either as new facts or changed circumstances which warranted variation of Davies J's orders.  The question of such indemnities had been before Davies J. on the basis that either they were not to be forthcoming or that they were worthless, or both.  There was no evidence, apparently,
before Einfeld J why the personal indemnities had not been offered on the previous occasion nor why it would not have been reasonable to expect them to have been offered.


In my view, as a matter of principle, before Davies J's order was varied, it should have been shown that the financial value of the personal indemnities was such as to tilt the balance in favour of reducing the cash security.  Einfeld J. expressly recognised (at p.11 of his reasons for judgment) and strongly agreed with Davies J. that if this litigation is to go ahead it would be "... by the force of the creditors, not merely by dint of the directors' passions."  There then followed this passage:


                         "Sanirise adds to its offer of personal indemnities from the directors a cash security, meaning that the creditors have demonstrated their support for pursuing the litigation by resolving that the company contribute a cash amount of security."



There was nothing to show how much the personal indemnities were worth at the time when the primary judge varied the terms of the order for security for costs.  Davies J's order had been made on the basis that those who stood to benefit if Sanirise were successful in the proceedings (i.e. the creditors and others who subscribed for units) should, to some limited extent, provide security for costs in the form of cash or guarantee in an amount of $100,000.  That protection has been taken away from Darling Harbourside without the substitution of anything which has been shown to be of any real economic value.  In some cases, the only potential beneficiaries of the litigation may be persons without means (i.e. the applicants themselves, or directors or shareholders or beneficiaries of a trust) all of whom are prepared to provide personal indemnities.  Even though the indemnities might be worthless in economic terms, their tender on occasion is sufficient to prevent the proceedings from being stayed.  See, for example Harpur v.
Ariadne Australia Ltd
[1984] 2 Qd.R.523.  That is not the present case.  In the present case there is evidence that at a meeting of Sanirise's creditors held on 3 May 1995 one creditor (Mr Ghiassi of Zarr Trading Pty Ltd) stated that he could provide the security ordered by Davies J.  In my view, what has happened in the present matter is that those who stand first in line to benefit if Sanirise is successful in these proceedings have had an already modest burden lessened by 60 per cent without anything shown to be substantial tendered in substitution.  The situation is even worse when it is realised that the terms of the order are to the effect that the indemnity is not to Darling Harbourside but to Sanirise itself, but that is only a supplementary matter.


Mr Abdul-Karim, counsel for Sanirise, submitted that one material change in circumstances since Davies J's orders were made, was the fact that Sanirise had disposed of its remaining stock, fittings and fixtures for amounts which were insufficient for it to comply with Davis J's order, or to continue funding the proceedings.  However, when the matter was before Davies J, it was common ground (see p.11 of Davies J's reasons) that Sanirise could not provide security for costs.  Einfeld J referred to the sale of these assets, but did not refer to the matter or indeed rely upon it as a material change in circumstances.  No other material change in circumstances was, in my view, put forward in submissions.  Mr Abdul-Karim asked us to have regard to what he described as "the conduct of the respondent".  However, that was not put to Einfeld J.  I have referred earlier to how Davies J. dealt with this point.  The same applies to the matter of what Mr Abdul-Karim referred to as the 15 month delay on the respondent's part in the period leading up to the hearing before Davies J.  This is not a new matter.


In my opinion, the discretion exercised by the primary judge miscarried on the matters of principle to which I have referred above.  There was no material change of circumstances proved so as to warrant variation of Davies J's orders.  The principles are discussed in an unreported decision of McLelland J. in Brimaud v. Honeysett Instant Print Pty Ltd (Supreme Court of New South Wales, Equity Division 19 September 1988).  I would grant Darling Harbourside and Sanirise leave to appeal on the matter of security for costs, allow the appeal and restore the orders made by Davies J. to their former effect.


The Cross-Appeal

I respectfully agree with the learned primary judge's decision not to order a separate hearing of the outgoings claim and for the reasons which his Honour expressed for making that decision.  As the condition precedent for the grant of leave to cross-appeal is thus not satisfied I would refuse such leave in regard to that matter.  All that remains in the cross-appeal is the challenge which Sanirise seeks to make to the decision that there should be any security for costs. I say only two things in that regard.  First, it was on Sanirise's own application that the orders were made.  Secondly, to the extent that it is sought to be raised in the cross-appeal, its submissions are subsumed in the appeal brought by Darling Harbourside.



                   I certify that this and the preceding fifteen

                   (15) pages are a true copy of the Reasons for

                   Judgment of Justice Carr.


                   Associate:


                   Date:



IN THE FEDERAL COURT OF AUSTRALIA      )

NEW SOUTH WALES DISTRICT REGISTRY    )           No. NG 325 of 1993

GENERAL DIVISION                                             )



                            ON APPEAL FROM A JUDGE OF THE FEDERAL COURT

                                                              OF AUSTRALIA

 

                                                                        BETWEEN:

 

                                                                        DARLING HARBOURSIDE (SYDNEY) PTY LIMITED


                                                                        Appellant


                                                                        AND:

 

                                                                        SANIRISE PTY LTD

                                                                        (Subject to Deed of Company Arrangement)                       

 

                                                                        Respondent


CORAM:  BEAUMONT, CARR & SACKVILLE JJ.

PLACE:     SYDNEY

DATE:       17 May 1996.

 

 

                                                  REASONS FOR JUDGMENT

 

 

SACKVILLE J:

 

I agree with the reasoning and with the conclusions both of Carr J. and of the learned presiding judge.  I agree with the orders that have been proposed.


                                    I certify that this is a true copy of the Reasons for Judgment of the Honourable Justice Sackville.


                                    Associate:


                                    Dated: 12 June, 1996





Counsel for the Appellant:                                 Mr I.E. Davidson

Solicitors for the Appellant:                               Harris & Co.


Counsel for the Respondent:                             Mr M. Abdul-Karim

Solicitors for the Respondent:                           Williams Hussain Davidson



Dates of Hearing:                     17 May 1996

Date of Judgment:                    17 May 1996