FEDERAL COURT OF AUSTRALIA

Citrus Queensland Pty Ltd v Sunstate Orchards Pty Ltd (No 9) [2008] FCA 1617

CITRUS QUEENSLAND PTY LTD (ACN 110 885 359), PETER MICHAEL TRACY and SUNSTATE CITRUS PTY LTD (ACN 112 847 560) (SUBJECT TO DEED OF COMPANY ARRANGEMENT) v SUNSTATE ORCHARDS PTY LTD (ACN 095 659 733), ANDREW COLIN STRAHLEY and DAVID BREED

QUD 400 of 2005

COLLIER J

29 OCTOBER 2008

BRISBANE

THE COURT ORDERS THAT:

1.                  The sum of $40,239.06 deposited by Barimornie Pastoral Pty Ltd ABN 32 077 732 828 trading as Ray White Rural (Qld) by letter dated 22 December 2005 together with any accretions be paid to the first respondent to the proceeding.

2.                  The payment referred to in paragraph 1 hereof be made by making payment to the trust account of the solicitors for the first respondent, McCullough Robertson Lawyers and the funds be held on that trust account until further order or coming into effect of orders 3 or 4 hereof.

3.                  In the event that the first applicant to the proceeding does not file and serve a notice of appeal on or before 4.00 pm on 7 November 2008, the monies held pursuant to order 2 hereof be paid to the first respondent to the proceeding.

4.                  In the event that the first applicant to the proceeding does not file on or before 4.00 pm on 14 November 2008 a notice of motion seeking a stay of the judgment or orders of the court made in respect to the cross-claim the monies held pursuant to order 2 hereof be paid to the first respondent to the proceeding.

5.                  Otherwise liberty to apply on three days prior written notice.

6.                  The parties’ costs of the notice of motion be reserved.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

REASONS FOR JUDGMENT

1                     On 5 September 2008 I delivered primary judgment in these proceedings, dismissing the application of the applicants and finding for the first respondent on its cross-claim including as to damages. On that date I ordered that pursuant to O 52 r 15(1)(a) Federal Court rules, time for filing and service of any notice of appeal from orders contained in the judgment handed down on 5 September 2008 be extended to 21 days after delivery of the reasons for judgment as to costs.

2                     On 17 October 2008 I delivered judgment as to costs in this matter, and ordered that, with the exception of a number of costs referrable to interlocutory hearings, the costs of the first and second respondents be paid by the applicants.

3                     The applicants have indicated in their submissions and the affidavit of Mr Peter Michael Tracy filed 28 October 2008 that they intend to appeal the judgment of 5 September 2008. Order 52 r 15(1)(a) allows 21 days after judgment for a notice of appeal to be filed and served. The applicants therefore have until 7 November 2008 to file and serve a notice of appeal from the primary judgment. This is not in dispute in this case.

4                     As part of the cross-claim in this proceeding the first respondent sought damages against the first applicant for breach of the Packing Shed Agreement (as pleaded in para 37 and para 38 of the Defence to the Further Amended Statement of Claim and Cross-Claim filed 5 June 2007). The sum of $40,000 was paid by Barimornie Pastoral Pty Ltd trading as Ray White Rural as a stakeholder under the Packing Shed Agreement. Paragraph 51 of the Defence to the Further Amended Statement of Claim and Cross-Claim alleged that, by letter of 26 September 2005, the first respondent pursuant to cl 13 of the Packing Shed Agreement elected to terminate the Packing Shed Agreement and declare the deposit forfeit. In finding for the first respondent on the cross-claim against the first applicant, it follows that the sum of $40,000 plus interest, a sum currently of $40,239.06, should now be paid to the first respondent.

5                     The sum of $40,239.06 was paid into court by Ray White Rural on 29 December 2005. I note a letter from the Federal Court Registry confirming funds held and deposited moneys to that effect, and I also note the affidavit of Mr Peter William Stokes sworn 20 October 2008 to that effect.

6                     It is not in dispute that the relevant moneys have been paid into court. Nor is it in dispute that, in accordance with the terms of my judgment of 5 September 2008, the first respondent is entitled to receive this money.

7                     The first applicant, however, has submitted that, in view of its intention to file a notice of appeal against my primary judgment, it would be appropriate that no order be made releasing the deposit until the appeal is resolved. No notice of appeal has been lodged to date.

8                     I accept the submission of Mr McQuade that the case of the first applicant in opposing the payment of money is akin to seeking a stay, and indeed this was to some extent conceded by Mr Lynch this morning when Mr Lynch agreed that the principles applicable in this case were similar to those in respect of a stay application. To the extent that the sum of $40,239.06 is a portion of the first respondent’s fruits of proceedings, the first applicant is required to establish why the first respondent should not be paid this sum as soon as possible.

9                     Mr McQuade referred me to two decisions where matters relevant to exercise of discretion to grant a stay were considered, namely Starborne Holdings Pty Ltd v Radferry Pty Ltd (unreported, Cooper J, Federal Court, 21 May 1998) and Cook’s Construction Pty Ltd v Stork Food Systems Australasia Pty Ltd [2008] QCA 322. In particular I note comments of Keane JA at [12] in Cook’s Construction where his Honour recognised the principle that “judgments of the trial division should not be treated as merely provisional, and that a successful party in litigation is entitled to the fruits of its judgment”. I consider this principle applicable in the circumstances of the notice of motion before me.

10                  Following submissions this morning it appeared that there was some common ground between the parties as to possible draft orders to submit to the Court for consideration. I adjourned the Court for a short time and the parties have now returned with draft orders which are acceptable to both. The orders are such that the moneys constituting the deposit, namely $40,239.06, together with any accretions should be paid to the solicitors for the first respondent, McCullough Robertson Lawyers. Whether or not McCullough Robertson should pay those moneys on to the first respondent will be subject to the first applicant filing a notice of appeal and subsequently seeking a stay of the judgment or orders of the Court made in relation to the cross-claim within specified time periods. In my view, these draft orders make sense in the circumstances.

11                  I also propose to order that the costs of the notice of motion be reserved. If no appeal and no stay are filed, the matter should be returned to Court and the first respondent’s costs be its costs in the notice of motion. However, if a notice of appeal and an application for a stay are filed the costs of this notice of motion should be the costs in the appeal.

Associate:

Dated:         5 November 2008