Cassaniti v Katavic

Background to the appellants' motion

1. By notice of motion filed 5 October 2022, the respondents sought orders, relevantly, that:

• Antalija Developments be discharged from an undertaking proffered during the hearing in the proceedings below (to the effect that Antalija Developments would not use the assets of the Antalija Unit Trust to pay legal fees without a court order) (the undertaking).
• the sum of $199,319.65 or such other sum as the Court deems appropriate from the funds held for Antalija Developments as trustee for the Antalija Unit Trust, be paid out of court and into the trust account of Kamy Saeedi Law and used only by the second respondent to pay its reasonable legal costs of defending the appeal.

1. After a hearing on 7 November 2022, Macfarlan JA made orders on 10 November 2022, which included relevantly orders 2 and 3 set out below: (2) To the extent that the second respondent is restrained by the undertaking, proffered during the hearing in the Court below, from using funds paid into Court to pay its reasonable legal costs of defending the appeal proceedings, order that the second respondent be released from that undertaking. (3) Order that the funds held in Court for Antalija Developments No 4 Pty Ltd, as trustee for the Antalija Unit Trust, be paid out of Court to the trustee, in such amounts as the trustee states to the Registrar of the Court that it considers necessary and appropriate for payment of its reasonable legal costs of the appeal proceedings.
2. His Honour gave the following reasons at [17]-[18] for making those orders: [17] In his principal judgment of 2 May 2022, Robb J concluded that the plaintiffs in the proceedings before him, who included Ms Morvillo, "appear[ed] to have misled Kunc J on the grounds that they put forward [matters] ex parte that persuaded his Honour to make the asset preservation orders". In consequence, and as a result of the respondents' success on the matters that were determined by his Honour on 2 May 2022, his Honour discharged the orders on 15 June 2022. [18] It should follow that funds paid into Court pursuant to the asset preservation orders (presently totalling $1,022,846.70) would be paid out to the Antalija Unit Trust but Antalija Developments does not seek a general order to that effect at this stage. Instead, it seeks a more limited order permitting it to use those funds, and any other assets of the Antalija Unit Trust, for the purpose of payment of its reasonable legal fees of the proceedings. It seeks such an order because in the course of the hearing at first instance, when the asset preservation orders were on foot, it gave an undertaking that it would not use any of the funds of the Unit Trust for that purpose unless and until authorised by the Court. There is no reason now to hold the Trust to that undertaking. Accordingly, I propose to make appropriate orders as sought by the respondents but I point out that they are made in recognition of the absence of any reason having been established before me for imposing or retaining a relevant restriction. It does not involve an expression of this Court's view, one way or the other, as to whether any particular expenditure, or the use of the Trust funds for payment of the trustee's legal costs of the proceedings, is authorised or justified.