Federal Court of Australia

Du Bray & Associates Limited v Du Bray and Associates Pty Ltd (In Liquidation) (No 2) [2026] FCA 1446

ORDERS

THE COURT ORDERS THAT:

1.    Paragraph [1] of the respondents’ interlocutory application lodged 13 August 2026 is dismissed.

2.    The applicant is to provide initial security for the costs of this proceeding in the amount of $78,000 by payment into Court, within 28 days of the making of this order.

3.    Liberty is granted to the respondents to apply for dismissal of the proceeding, by application to chambers supported by an affidavit, if order (2) is not complied with.

4.    The respondents are at liberty to apply to increase the quantum of the security for costs, by application to chambers supported by an affidavit, after the exchange of evidence in the proceeding, or for sufficient cause, at an earlier time.

5.    The costs of the interlocutory application dated 11 August 2026 are reserved.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

MCELWAINE J:

1    Richard Stone and Gregory Bruce Dudley in their capacity as the liquidators of Du Bray and Associates Pty Ltd (DBA) by interlocutory application lodged 13 August 2026 apply for orders that the proceeding be dismissed or permanently stayed as an abuse of process or in the alternative that Du Bray & Associates Ltd (DBNZ) provide security for costs (and if not that the proceeding be dismissed).

2    DBNZ claims that funds in the amount of $353,973.72 held by the liquidators on account of DBA are held on trust for it and are not property of DBA which is available for distribution. Leave to proceed is an issue yet to be determined. The funds were held in an account of DBA with Wise Payments Ltd (Wise Funds and Wise Account).

3    The general background to this proceeding is set out in Bad Wolf Purchasing Pty Ltd v Du Bray and Associates Pty Ltd [2025] FCA 814. Stripped of unnecessary detail, Lee Du Bray stands behind Bad Wolf and DBNZ and, prior to external administration, DBA. For many years he was involved in bitter family relationship litigation with his former partner, who has been assigned the pseudonym QRS, in the courts of New Zealand. QRS has the benefit of freezing orders made in New Zealand. Lee Du Bray caused this proceeding to be commenced without a lawyer. I refused his application to dispense with r 4.01(2) of the Federal Court Rules 2011 (Cth): Du Bray & Associates Ltd v Du Bray and Associates Pty Ltd (In liq) [2026] FCA 849. DBNZ is now represented by a solicitor.

4    Lee Du Bray in his affidavit in support made on 28 April 2026, attaches solicitors’ correspondence that openly admits that the funds were deposited into the Wise Account (at the direction of Lee Du Bray) by creditors of DBNZ to avoid the freezing orders that bound DBNZ. Of course, what is technically in issue is the chose in action to demand payment of the Wise Funds from the liquidators’ bank account where the money is now deposited. However, as in Bad Wolf, it is convenient in these reasons to simply reference the Wise Funds: Bad Wolf at [4].

5    In Bad Wolf the central claim concerned funds in a Westpac Account of DBA, which Bad Wolf contended were held by the liquidators as bare trustees, because DBA was formerly the trustee of the Lee Du Bray Property Trust but was removed upon being wound up. Bad Wolf was subsequently appointed as the replacement trustee. Separately, in that proceeding the liquidators applied pursuant to s 90-15 of the Insolvency Practice Schedule (Corporations), Schedule 2 to the Corporations Act 2001 (Cth), for the determination of several questions including their rights concerning the funds in the Wise Account. Bad Wolf made no claim to those funds.

6    In Bad Wolf, I was not satisfied that Bad Wolf had established that the funds in the Westpac Account were property of the Trust and I dismissed the claim on that basis. In reasoning to that conclusion, I observed at [63]:

No evidence has been adduced that DBA agreed to accept each transfer of funds from the Wise Payments Account or the NZ Currency Account to be held upon the terms of the Trust. Several steps were required. A determination by DBNZ that certain amounts due to it (that is its chose in action against each debtor) be paid to the Wise Payments Account and then to the NZ Currency Account. What was this arrangement? Was there an agreement to assign each right to recover the debtor payments from DBNZ to DBA? If so, was the assignment written or oral? Did DBA give consideration for any assignment, or was it an equitable assignment in favour of a volunteer? Or was there an agreement that DBA would act as the agent of DBNZ? Or was the arrangement that DBA would act as an express trustee to hold the funds only for the benefit of DBNZ? If so, what were the terms of the agency or the express trust; in particular when and in what circumstance would DBA use the deposited funds to permit DBNZ to “operate its business” as contended in the Vincent Young letter of 13 September 2022? Or was no consideration given to these matters, in which event is this a case of resulting trust, for that step? That is a resulting trust of the type that may arise where there is no presumption of gift: Fowkes v Pascoe (1875) 10 Ch App 343 at 345, Jessel MR, at 348, James LJ.

7    I did not resolve that issue in Bad Wolf as Bad Wolf did not make a claim to the funds in the Wise Account (including the account now in issue). One complicating issue was that DBA traded in two capacities: as trustee of the Trust and in its own right.

8    I then addressed the liquidators’ application, including orders to the effect that the liquidators were entitled to the money in several bank accounts, including the Wise Account. At that time, DBNZ, which was not a party and did not intervene, had not claimed that the funds in the Wise Account were held on trust for it. In recognition that other persons may have claims, I made the following orders on 18 July 2025:

(f)    The Liquidators shall give notice of these orders by circular sent by email and by ordinary prepaid post within seven days of the making of these orders to each of the persons known to be potential creditors of Du Bray and Associates Pty Ltd and the Du Bray Property Trust and persons known to be beneficiaries of the Du Bray Property Trust.

(g)    There be liberty to apply to any person not a party to these proceedings claiming to be prejudiced by the making of these orders (that is 3(a)-(f)) to apply to vacate or vary the orders within one month of the making of these orders.

9    The reference in order (g), to 3 (a) – (f) included the Wise Account. On 18 August 2025, DBNZ by its solicitors Mackay Chapman filed an interlocutory application pursuant to those orders and sought vacation of order 3(c) limited to the funds in the Westpac Account and the Wise Account (vacation application), supported by the affidavit of its solicitor, Michael Chapman made on 20 August 2025. The vacation application did not proceed to determination, and the affidavit was not read. Rather, Mackay Chapman purported to file a notice of discontinuance of the vacation application, which I rejected at a case management hearing on 17 October 2025, and ordered instead by consent that the vacation application be dismissed.

10    Next, Lee Du Bray commenced a new proceeding in the Supreme Court of Western Australia on 6 March 2026, in his capacity as a person within the class of beneficiaries of the Trust. He named the liquidators as one of the respondents. He sought to invoke the jurisdiction of the Supreme Court on the basis that the Trust was governed by the laws of Western Australia. He sought various orders including a declaration that I had no jurisdiction to make orders in the Bad Wolf proceeding concerning funds held by DBA as trustee for the Trust, being the funds in the Westpac Account, and that my orders to that extent were void. He also sought a declaration that the funds in the Westpac Account were property of the Trust and ancillary relief for the administration and recovery of the monies. The liquidators resisted.

11    For reasons published by Gething J on 8 April 2026, his Honour summarily dismissed the proceeding as an abuse of process: Du Bray v RSM Australia [2026] WASC 113. I am informed that an appeal has been lodged from those orders, which is yet to be heard.

12    On 28 April 2026, Lee Du Bray lodged this proceeding for filing in the New South Wales Registry and it was then allocated to Jackman J, who astutely noticed the connexion to my orders in Bad Wolf and thereupon the proceeding was docketed to me.

13    I first address the abuse of process component of the interlocutory application, which is put on various bases. Dr Greinke for the liquidators submits that the claim in this proceeding is the same as the claim DBNZ brought by the vacation application in the Bad Wolf proceeding. Lee Du Bray in correspondence to the liquidators of 11 February 2026, written in his capacity as the sole director of DBNZ, disclosed the tactical reason why:

The withdrawal of DBNZ’s earlier application… [w]as a tactical decision, not a judicial determination of rights…

You cannot retain funds that belong beneficially to DBNZ simply because DBNZ made a tactical decision to withdraw an application from a potentially hostile tribunal.

DBNZ is bringing fresh trust proceedings, not challenging McElwaine J’s orders.

14    Dr Greinke submits that I am the hostile tribunal there referenced. Mr Boadle for DBNZ did not put a convincing submission that I am not. When the liquidators failed to bend to the will of Lee Du Bray and acknowledge that the funds in the Wise Account are trust property held for the benefit of DBNZ, this proceeding was commenced in the New South Wales Registry.

15    Thus, the submission is:

[T]he same company sues the same respondents for the same fund in the same Court, having withdrawn for an abusive reason its director has admitted in writing. The courts no longer “indulge parties who engage in tactical manoeuvring”: UBS AG v Tyne [2018] HCA 45; (2018) 265 CLR 77 at [45], Kiefel CJ, Bell and Keane JJ.

16    The process of a court is abused where jurisdiction is invoked for an illegitimate purpose, or where the proceeding is unjustifiably oppressive or brings the administration of justice into disrepute: Tyne at [1]. In the vacation application, DBNZ claimed that it was the beneficiary of a trust for the funds in the Westpac Account and the Wise Account. Dr Greinke’s submission is that the fact that this proceeding is now confined to the Wise Account is more abusive, not less. That is, Lee Du Bray has now sought to split the claims between this Court and the Supreme Court of Western Australia, with the consequence that the liquidators must answer in each forum using the limited resources that would otherwise be available for distribution amongst DBA’s creditors.

17    On 25 September 2025, solicitors acting on behalf of the liquidators, put DBNZ on notice that its claims were liable to be stayed as an abuse of process, and in any event would be likely to fail “for unclean hands if the arrangement had been intended to circumvent the freezing orders”. Within less than one month, DBNZ purported to discontinue the vacation application. It did so under cover of correspondence claiming to be “a major creditor of DBA” and with beneficial interests in the funds held in each of the bank accounts in issue in Bad Wolf.

18    The liquidators have the benefit of personal costs orders against Lee Du Bray arising from Bad Wolf: Bad Wolf Purchasing Pty Ltd v Du Bray and Associates Pty Ltd (No 3) [2026] FCA 854. Although the quantum of the costs is yet to be determined (the claim is in the order of $171,441.88), no offer has been made by Lee Du Bray to settle the costs.

19    Three weeks after advising the liquidators of DBNZ’s tactical decision, Lee Du Bray personally commenced the proceeding in the Supreme Court of Western Australia.

20    On these facts, the submission continues, it should be concluded that Lee Du Bray engaged in tactical manoeuvring which had the purpose, although not the effect, to remove the claims of DBNZ from myself, as the judge with detailed knowledge of the history. This was clearly an attempt at forum shopping, whereby DBNZ sought to have its trust claims determined by another judge of this Court. The forum shopping extended to the commencement of separate proceedings, by which DBNZ sought to split the claims between this Court and the Supreme Court of Western Australia. The tactical decision admission of Lee Du Bray should be held fatal on the abuse of process contention. His conduct brings the administration of justice into disrepute for the reasons stated by the plurality in Tyne at [45]:

The courts must be astute to protect litigants and the system of justice itself against abuse of process. It is to hark back to a time before this Court’s decisions in Aon and Tomlinson and the enactment of s 37M of the FCA to expect that the courts will indulge parties who engage in tactical manoeuvring that impedes the “just, quick and efficient” resolution of litigation. To insist, for example, on “inexcusable delay” as a precondition of the exercise of the power to stay proceedings as an abuse of process is to fail to appreciate that any substantial delay is apt to occasion an increase in the cost of justice and a decrease in the quality of justice. And other litigants are left in the queue awaiting justice. Further, there is no reason why the courts should tolerate attempts to manipulate other parties and the courts themselves by the deployment, by a single directing mind and will, of different legal entities under common control for such a purpose. The concern is as to whether the processes of the court are being abused. Given that this is the central concern, the circumstance that the abuse is effected by the use of multiple entities orchestrated by a single mind and will is no reason to tolerate it.

21    Dr Greinke emphasises that Lee Du Bray as the directing mind of DBA and DBNZ devised the “arrangement” which is now asserted as creating a trust over the Wise Funds. He did so to circumvent the freezing orders made by courts in New Zealand in circumstances where Bad Wolf claimed the Westpac Funds for the Trust and lost at trial; DBNZ claimed the Westpac Funds by the vacation application which it then abandoned; Lee Du Bray claimed the Westpac Funds in the Western Australian proceeding which was dismissed as an abuse of process, and now DBNZ claims the Wise Funds in this proceeding. The inconsistent positions taken by Lee Du Bray reinforce an abuse of process conclusion: RSM Australia at [76] – [77].

22    Finally, the tactical manoeuvring that Lee Du Bray has engaged in is oppressive in that the liquidators have been required to answer the same claims in multiple proceedings, have incurred costs in doing so, for which they have not been reimbursed. Through a sharper lens and since appointment the liquidators have received approximately $915,000 and paid out $203,000 in solicitors’ fees and $107,000 in counsel’s fees in relation to the litigation directed and controlled by Lee Du Bray. There is accumulated work in progress that is yet to be accounted for. The creditors of DBA are the ones who have suffered in consequence of the tactical manoeuvring.

23    In my view, the matters identified by the liquidators do not reach the high threshold necessary to find an abuse of process. Whether the Wise Funds are held in trust for DBNZ has not been determined. That was not in issue in the Bad Wolf proceeding. The Wise Funds were only raised on the liquidators’ s 90-15 Insolvency Practice Schedule application when the existence of the account was later discovered in the course of the Bad Wolf proceeding. Mr Boadle is correct to submit that this proceeding is not an attempt to relitigate the issue of beneficial rights to the chose in action of the funds that were in the Wise Account: O’Shane v Harbour Radio Pty Ltd [2013] NSWCA 315; (2013) 85 NSWLR 698 at [109]. DBNZ cannot be characterised as a party that was unsuccessful on that issue in Bad Wolf. It was not a party, nor joined as intervener. It applied pursuant to the reservation provided for in the orders made on 18 July 2025. The dismissal of the vacation application did not give rise to a res judicata or issue estoppel as there was no determination of the issue raised on the merits and no final relief was determined: Handley KR, Spencer Bower and Handley: Res Judicata (5th ed, LexisNexis, 2019) at [5.29] – [5.32].

24    The tactical decision revealed in the correspondence of Lee Du Bray must be viewed in context. The letter set out in detail the basis for the claim now brought by DBNZ. The dismissal of the vacation application did not preclude a separate proceeding by DBNZ. The forum shopping attempt is not of itself sufficient to find an abuse of process. Nor is the fact that the Westpac Funds issue was sought to be litigated in the Supreme Court of Western Australia, on an utterly misconceived basis by a litigant in person who is not a lawyer. These were objectively imprudent steps taken by Lee Du Bray, but as explained in Tyne at [7], by reference to Lord Bingham of Cornhill in Johnson v Gore Wood & Co [2002] AC 1 at 31:

a broad, merits-based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before. As one cannot comprehensively list all possible forms of abuse, so one cannot formulate any hard and fast rule to determine whether, on given facts, abuse is to be found or not.

25    In Bad Wolf the liquidators obtained an order on their s 90-15 Insolvency Practice Schedule application which allowed them to access the funds in the Wise Account, without a contradictor. There was always a strong likelihood that DBNZ would make a claim to beneficial ownership of the funds based on my observations at Bad Wolf at [63]. The liquidators’ claims that this is a case of oppressive conduct do not withstand scrutiny. They have not been vexed more than once in engaging with the merit of the claims asserted by DBNZ over the Wise Funds. The liquidators are officers of the Court, and it is in their interests to have determined whether the Wise Funds form property of DBA in the liquidation.

26    No oppression arises from dismissal of the vacation application or from the fact that costs were incurred in connection with it. It remains open to the liquidators to make a costs application, including a non-party application against Lee Du Bray. The Western Australian proceeding was an abuse of process as found by Gething J, because it was a back door attempt to relitigate the Westpac Funds issue that Bad Wolf decided. As I have explained this proceeding is not an attempt at relitigating the Wise Funds issue.

27    Accordingly, I dismiss paragraph [1] of the interlocutory application and I move to [2] which seeks security for costs.

28    The threshold for the exercise of the discretion is met: DBNZ is a foreign corporation with no assets within the jurisdiction. Mr Boadle properly concedes as much and frames his submissions on the issues of quantum, form and timing of security.

29    DBNZ faces many hurdles in responding to the security application. The affidavits of Vincent Zhu, the solicitor for the liquidators, are very detailed, were read without objection and without any need to attend for cross-examination. There is no contradicting evidence from the solicitor for DBNZ. There is no evidence about the assets of DBNZ or of Lee Du Bray who stands behind it and is likely to benefit from any success it achieves in these proceedings. There is no evidence and no contention that an order for security will stultify the proceeding. There is clearly a case to exercise the discretion to require the provision of security by payment into Court.

30    I find that Vincent Zhu’s estimates are properly reasoned and supported. In short, on a solicitor/client basis, solicitors’ costs and counsel’s costs estimated in stages comprise: $17,870 for pleadings, $34,220 for discovery, subpoenas and notices to produce, $55,900 for evidence, $10,750 for mediation, $59,060 for preparation to final hearing, $32,120 (as an estimate for a two-day hearing), $16,240 for preparation and delivery of final submissions, and $24,120 for general case management and correspondence. The estimates include fee estimates as provided by Dr Greinke. The total is approximately $250,000. His estimate on a party/party basis is by application of a percentage range of 65 to 70%, which reduces his estimate to between $163,000 and $175,000. To check these figures, he has cross-referenced the actual costs incurred in the Bad Wolf proceeding, by reference to the documents lodged for a lump sum determination in that matter.

31    His evidence continues, really in the form of submissions, to support the liquidators’ proposal for security to be provided in tranches. I consider that appropriate in this matter.

32    Security for costs falls for assessment in the broad-brush approach. In my view security should be provided to the close of the evidence. The solicitor/client estimate for that work is approximately $119,000 (allowing for $12,000 as a component of the general case management estimate) which, applying the party/party percentage of 65% reduces to $77,350, which I round up to $78,000. There will be an order that DBNZ pay security for costs in that amount by payment into Court within 28 days. The order will preserve liberty to the liquidators to apply for dismissal of the proceeding in the event that security is not provided. The liquidators will also have the usual order that application may be made for revised for additional security as the matter progresses.

33    I reserve the costs of the interlocutory application.

Associate:

Dated:    1 October 2026