Campbell v Warranooke Pastoral Pty Ltd [2025] VSC 727

(a) The insurance proceeds which it had received did not belong to the company, but neither did they belong entirely to Janette;

(b) On its analysis, Janette was entitled to 50% of the insurance proceeds, on the basis that her interest in the land and building was derived from her half share as a tenant in common with Peter;

(c) Accordingly, Peter's estate was entitled to the remaining 50% of the insurance proceeds derived from the loss of the building; and

(d) Janette was entitled to a proportion of the insurance proceeds as they relate to the contents of the building, possibly 100% on the premise that all of the contents of the building were jointly owned by her and Peter, and that as his survivor, she would be entitled to his interest. That said, it remained unclear for the time being whether any third party had a claim over any of the contents of the house.

1. Warranooke had made an open offer before the resumption of the hearing before me to:

(a) Pay the sum of $435,851.65 to Janette in satisfaction of her share of the insurance proceeds in relation to the loss of the building; and

(b) Place the sum of $216,707.00 into a trust account pending determination of the ownership of the contents of the building.

1. In fact, Ross had attempted to effect the transfer of the $435,851.65 to Janette by attending the bank to make those arrangements, but was unable to do so while the freezing order remained in place in its current form.
2. Janette rejected the offer. Janette maintains that she is entitled to the whole of the proceeds of the insurance claim. Janette said that while she maintains her claim to the whole of the insurance proceeds, she would be prepared to compromise on that claim if Warranooke agreed to pay to the estate, or at least put into the trust account of the estate's solicitors, an amount equal to that which Warranooke now agrees is owed to the estate.
3. Though this proposal was originally misunderstood as an attempt by Janette to speak on behalf of Peter's estate without authority, or in some other way, advance a de facto application for a freezing order on the basis of a claim which might be made by a third party (i.e. the estate). Janette reiterated that she was entitled to payment of the full amount of the insurance funds in her own right, and that her proposal was in the nature of a compromise, without prejudice to her substantive claim to the whole amount.
4. Warranooke rejected Janette's proposal. Warranooke undertook to pay what it regards as Janette's share of the insurance proceeds related to the building, and to place in a trust account those funds related to the contents of the building pending determination on the proportion of their distribution. Warranooke otherwise submitted that:

(a) Janette did not have a good arguable case for recovery of the full amount; and

(b) There is no claim made by the estate at this time, and if one were to be made, Warranooke would have a set off claim against the estate in any event;

(c) Even assuming Janette's claim to the whole amount of the insurance proceeds were arguable, the amount remaining in dispute is considerably less than originally thought (given the amounts that Warranooke intends to pay to Janette), and it is now clear that there is insufficient evidence of unjustified dissipation.

1. Warranooke says that the Warranooke Farm Trust had made a number of beneficiary loans to Peter in his life time (to the value of $989,937) for which Peter's estate remains liable. Warranooke says that it is also entitled to the repayment of beneficiary loans from Janette (in the amount of $1,017,406). It says that any claim by Peter's estate for its share of the insurance proceeds would be met by a claim against the estate for repayment of the loans. No claim has yet been made by Warranooke for repayment of the loans, or by Peter's estate for the payment of the insurance proceeds to which it is entitled. Warranooke says that Janette's application for a freezing order was made in her own right, and not on behalf of Peter's estate, and should be dealt with as such.
2. Before me, Janette maintained that, taking recent developments into account, the freezing order should be maintained but modified, so as to reduce the amount frozen to a sum equivalent to the share that Warranooke says is owed to Peter's estate. She presses that application on the basis that she maintains she is entitled to be paid the full amount of the proceeds, and not on behalf Peter's estate.

1. The Court can make a freezing order where the applicant has a good arguable case on an accrued or prospective cause of action that is justiciable in the Court under r 37A.05(1)(b)(i), (3) of the Supreme Court (General Civil Procedure) Rules 2025 (Vic).
2. The relevant principles were helpfully summarised by J Forrest J in Zhen v Mo & Ors:[2]

First, that a freezing order, by its very nature, is a drastic remedy and a court must exercise a high degree of caution before taking a step which will interfere with a party's capacity to deal with his or her assets.[3]

Second, the order is not designed to provide security for the applicant's claim.[4] It is solely directed to preserving assets from being dissipated, thereby frustrating the court process.[5]

Third, the applicant bears the onus both in satisfying the Court that the order should be continued and in satisfying the Court as to the amount which is to be the subject of the order.

Fourth, that an order can only be made on the basis of admissible evidence which supports the contentions made by the party seeking the order. Speculation and guesswork is no substitute for either the facts or inferences properly drawn from proved facts.[6]

Fifth, that before such an order can be made it is necessary that the applicant establish -

(a) an arguable case against the [respondent];[7] and

(b) that there is a danger that the prospective judgment will be wholly or partly unsatisfied as a result of the [respondent's] actions in either removing the assets or disposing or dealing with them so as to diminish their value.[8]

Sixth, the balance of convenience must favour the granting of the freezing order.[9]

Seventh, that there is no set process determining the exact nature of an order. The order will be framed according to the circumstances of the case.[10]

Eighth, the applicant must establish with some precision the value of prospective judgment. The order should not unnecessarily tie up a party's assets and property.[11]

Finally, there may be discretionary considerations which militate against the granting of a freezing order, such as delay in bringing the application on before the court or a lack of candour in the materials placed before the court.[12]

1. Having now had the benefit of careful and detailed submissions from all parties and further evidence, I am not satisfied that the freezing order I made on 16 October 2025 should continue.
2. The onus rests with Janette to establish that the freezing order should be continued.
3. Janette's claim that she is entitled to the whole of the proceeds confronts two significant hurdles.
4. First, on the face of it, her claim confronts s 49 of the Insurance Contracts Act 1984 (Cth) and the indemnity principle which underpins that provision. As a tenant in common in equal shares with Peter, Janette's interest in the Northern Homestead appears, at least prima facie, to be limited to 50% of the value of the building or the claim. Counsel for Janette did not regard this as a necessary impediment to Janette's claim to be entitled to the whole amount of the insurance proceeds. I was encouraged not to attempt to examine whether Janette's claim could or would succeed, and that her position could be pleaded in due course. I was advised that the detail of Janette's claim would be made clear in the pleading. Notwithstanding that Warranooke's position had been made clear in correspondence on 12 November 2025, Janette did not elaborate upon the way in which her claim to the whole of the insurance proceeds could be advanced.
5. The material originally supporting Janette's ex parte application against Warranooke was originally framed as a claim that Warranooke was acting as Janette's agent. The evidence supporting that claim was limited to the fact that the premium payments were made by Janette. There was and remains no particulars of other evidence (whether conversations or documents) which support the claim as originally framed by Janette. Neither is there any evidence before me as to the arrangements as between Janette and Peter, or Janette and Warranooke, which might otherwise displace the operation of the indemnity principle.
6. I was not taken to any authority or given any satisfactory explanation as to how, or on what basis Janette's claim for the whole amount could be made good. On an application for a freezing order, the onus rests with the applicant to establish that it has a good and arguable case on admissible evidence. At best I am left to speculate as to what might support Janette's claim to the whole of the insurance proceeds.
7. Second, given the current position of Warranooke, it is clear that even if Janette does have a claim for the whole of the proceeds of the insurance claim, the amount outstanding is significantly less than originally sought.
8. At the hearing on 16 October 2025, it was thought that the sum required to satisfy a judgment of this Court would exceed $1.3M and would, as a proportion of the value of the plant, equipment and livestock, represent a significant sum potentially beyond the capacity of Warranooke to meet. The significantly lower sum which, on Janette's best case, might be awarded by the Court represents an amount more easily covered by Warranooke's assets (including the value of plant, equipment and livestock - the indicative value of which was supported by Ross's evidence).
9. Finally, on the totality of the evidence now before me, I do not regard there to be a risk of dissipation of the kind which would militate in favour of continuing the order. It is true that Warranooke has made payments from the account into which the insurance proceeds were initially deposited. That alone is not sufficient to establish the kind of dissipation which would justify the grant of a freezing order. Warranooke's use of the funds cannot be characterised as unjustified dissipation.
10. In Holyoake v Candy,[13] Nugee J said at [46]:

Moreover, there is force in the proposition that if the Defendants were really of a mind to dissipate their assets they might have taken the necessary steps already, and the fact that they have not suggests that the risk is not a real one.

1. In Riley McKay Pty Ltd v McKay[14] the Court (Street CJ, Hope JA and Rogers AJA) stated:

The basis of jurisdiction is founded on the risk that the defendant will so deal with his assets that he will stultify and render ineffective any judgment given by the Court in the plaintiff's action, and thus impair the jurisdiction of the Court and render it impotent properly and effectively to administer justice in New South Wales. As has appeared, the jurisdiction to grant the injunction is not to be exercised simply to preclude a debtor from dealing with his assets, and in particular to prevent him from using them to pay his debts in the ordinary course of business.

1. Warranooke was aware of Janette's claim or interest in the insurance proceeds for more than a year before the application for a freezing order was made. Over the entirety of that period, Ross has been in complete control of those funds. Ross and Warranooke could have taken aggressive steps to spend or otherwise dissipate all of the insurance funds over that time, but have not. It is, in those circumstances, difficult to draw the inference that it was Ross' or the company's intention to stultify or render ineffective any judgment given by this Court.
2. Janette points in particular to payments totalling $73,000 (of a total of $309,000) transferred to RPAC as evidence from which an inference can be drawn that there is unjustified dissipation. The explanation for these transactions given by Ross is that he farms his own sheep along with the sheep owned by Warranooke. He says that there are often shared expenses which require levelling up, and that the payments to RPAC represent Warranooke's share of expenses incurred by RPAC. This category of expense is not new. Warranooke points to transactions of a similar kind (but greater in amount) which are recorded in the cash trial balances of the farm's accounts going back to 2023 - well before the insurance proceeds had been paid to Warranooke. It says that those transactions are nothing out of the ordinary. Janette complains that these recent transactions are not accompanied by any detail. That may be so, but they are not transactions from which I am prepared to draw an inference that they are directed to frustrating the jurisdiction of this Court. The transactions which occurred recently appear to be consistent with the historical transactions made before Janette's claim became known by Warranooke. The evidence is consistent with the use of funds in the ordinary course of the farm's business operations.
3. Warranooke may be criticised for failing to respond in a timely way to the queries and demands of Janette. Janette might also be critical of Warranooke for using the insurance proceeds at all, given that it now admits that it is not entitled to those funds. In my view this criticism must be tempered by Warranooke's circumstances in two important respects.
4. First, in determining whether an applicant has a good arguable case, the Court must take into account whether a respondent to a freezing order application has a good defence to the claim made by the applicant. Warranooke says that while it has no legal claim to the insurance proceeds, it is separately entitled to the return of loans made by Warranooke to others who are entitled to claim the insurance proceeds which Warranooke is presently holding. In those circumstances, the strength of the claim made by those entitled to the insurance proceeds must be balanced against the difficulty which they may encounter in recovering those proceeds in any proceeding.
5. Second, it is important to remember the overarching purpose of a freezing order. In Goumas v McIntosh,[15] Barrett J said at [27]:

[T]he sole purpose is to prevent illegitimate dissipation of assets that will otherwise be available to meet any judgment. I say "illegitimate" dissipation to emphasise that to deny access to funds needed for ordinary living purposes or the fund the conduct of the very litigation the integrity of which the order is designed to protect goes beyond the proper protective province of the jurisdiction and causes the order sought to be a means of exerting pressure foreign to the underlying purpose.

1. Ross' evidence, which cannot be ignored, is that Warranooke's financial position is not without complexity and risk, which arises from a combination of its debt servicing obligations and the seasonal fluctuations commonly affecting farming. In all the circumstances, preventing Warranooke from accessing presently available funds is not justified.
2. Even if Janette's claim for the whole amount of the insurance proceeds were to succeed, and even if she were to defeat Warranooke's claim for the repayment of loans to her, Warranooke is still likely to have sufficient assets to honour the judgment in Janette's favour. But importantly, even if that were not the case, it is likely that the absence of available assets will be as a result of Warranooke having to meet normal operating expenses, rather than because of any unjustified dissipation of assets which would warrant the making or continuation of a freezing order.
3. For all of these reasons, I made orders discharging the freezing order on Warranooke's undertaking that it pay the amounts which it had openly offered to pay.
4. I indicated at the hearing of this matter that I would hear the parties on costs after they had each had an opportunity to consider these brief reasons. I will make orders that the parties provide written submissions (not exceeding five pages) within seven days. Upon receipt of the further written submissions, I will consider whether the matter can be dealt with on the papers, or whether a further hearing on the question of costs is necessary.

[1] Harman v Secretary of State for the Home Department [1983] 1 AC 280.

[2] [2008] VSC 300.

[3] Cardile v LED Builders Pty Limited (1998) 198 CLR 380, [51]; Practice Note 3 of 2006.

[4] Jackson v Sterling Industries [1987] HCA 23; (1987) 162 CLR 612, 621, 625.

[5] Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (No 3) (1998) 195 CLR 1, [73].

[6] Hartwell Trent (Aust) Pty Ltd v Tefal Societe Anonyme [1968] VicRp 1; [1968] VR 3, 13.

[7] Glenwood Management Group Pty Ltd v Mayo [1991] VicRp 45; [1991] 2 VR 49, 49.

[8] R. 37A.02(1) Under the general law the plaintiff must establish that there is a real risk of assets being disposed of: Cardile [122].

[9] Consolidated Constructions Pty Ltd v Bellenville Pty Ltd [2002] FCA 1513.

[10] Jackson v Sterling Industries [1987] HCA 23; (1987) 162 CLR 612, 621.

[13] [2018] Ch 297.

[14] [1982] 1 NSWLR 264 at 276.

[15] [2002] NSWSC 713.