Case: Australian Securities &amp; Investments Commission; In the Matter of Richstar Enterprises Pty Ltd ACN 099 071 968 v Carey (No 14) [2007] FCA 310
Outcome: cited
The argument put by ASIC in relation to the s 1323 element of its application was that I should make an order under s 23 as an incident of my power to make an order under s 1323. This would be on the basis that I was satisfied that receivers could be appointed under s 1323 and could then resort to s 23 as a fallback position: see Australian Securities &amp; Investments Commission; In the Matter of Richstar Enterprises Pty Ltd ACN 099 071 968 v Carey (No 14) [2007] FCA 310. I think the preferable course here is to go directly to s 23 and the power it confers in aid of the jurisdiction invoked in these proceedings. In my opinion, at least for the purposes of making an interim order under s 23 and allowing parties further time to consider their position and also to consider the position of third parties who have not been served, there is sufficient to warrant my making an interlocutory freezing order. 7 ASIC relies largely upon evidence which it adduced before this Court in WAD 83 of 2006 in relation to Mr Carey. That evidence has been reviewed in previous judgments of the Court in WAD 83 of 2006. I do not propose again to go through that litany of transactions described in previous judgments, nor the reference to overseas dealings which were said to have been at first denied by Mr Carey and then falsified by reference to documents that were later obtained as part of the investigative process, ancillary to the proceedings in WAD 83 of 2006. It suffices to say that there is still some risk of a dissipation of assets, if there be assets, under the control of Mr Carey. I express no concluded view about that, but it is sufficient for me to identify a risk and to say that in this case an order can be structured in such a way that the balance of convenience favours making the order rather than not making it. The form of the order which is proposed largely accords with existing arrangements which have applied under the s 1323 orders made in WAD 83 of 2006. I will, however, delete the reference to the travel restraint which really only operated in the context of those orders. I think also, given what has been said about Mr Carey's capacity to either control or effectively direct or influence the disposition of assets in third party companies, that there should be some restraint imposed in relation to his capacity to do that in a way that might be adverse to the plaintiff as a potential creditor in these proceedings. 8 I am expressing no concluded view, obviously, about the merits of the proceedings themselves beyond the fact that there is, on the material which I have previously seen, an arguable case in relation to the various causes of action that are raised. I do not wish to say any more about that. I do not wish to pre-empt any judgment that might be made on complex, factual questions. 9 I propose to make an order in terms of the s 23 orders which are sought by ASIC in its interlocutory process relevant to Mr Carey and subject to certain variations. I will add to para 1, after the words, "all or any of his assets whether within or outside Australia whether held legally or beneficially by him" these words, "nor do any act by way of instruction, advice or expression of wishes to any company or third party which has the purpose or is likely to have the effect of reducing the value of any asset owned by him or under his control." Subject to that change and the deletion of the travel restraint, which is not in dispute, and other minor variations, I will make the orders sought. There will be no order as to costs. I do not require that ASIC offer an undertaking as to damages. Relevant to that consideration, is the fact that the proceeding is brought in the exercise of its statutory responsibilities and in the public interest. Liberty to apply is available at short notice in the event of any apprehension that the freezing order will result in some unexpected and unfair detriment to Mr Carey. I certify that the preceding nine (9) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice French. Associate: Dated: 7 July 2008 Counsel for the Plaintiff: Mr S Owen-Conway QC with Mr JC Vaughan and Mr DM Archibald Solicitor for the Plaintiff: Australian Government Solicitor Counsel for the Third Defendant Solicitor for the Third Defendant: Counsel for the Fourth Defendant: Solicitor for the Fourth Defendant: Mr SJ Lemonis Fairweather &amp; Lemonis Mr M De Kerloy Mony De Kerloy Date of Hearing: 30 June 2008 Date of Judgment: 30 June 2008 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2008/1021.html