1. The application for a stay is made under rr 64.39 and 66.16 of the Supreme Court (General Civil Procedure) Rules 2015 (the 'Rules'). The principles relating to such an application are well established and not in dispute.[9] As was said by Whelan and Kaye JJA in Loftus v Australia and New Zealand Banking Group Ltd:[10]

Prima facie, a successful party is entitled to the benefit of the judgment obtained below. Accordingly, an applicant for a stay is required to demonstrate special or exceptional circumstances to remove the case from the general rule that an appeal, and an application for leave to appeal, do not operate, of themselves, as a stay. In particular, special circumstances may be found to exist where the applicant is able to demonstrate that there is a real risk that it will not be possible to restore the applicant substantially to his or her former position if the judgment against the applicant is executed before the conclusion of the appeal.

In order to justify the grant of a stay, an applicant should also demonstrate that there is at least an arguable ground of appeal. However, ordinarily, the court does not have before it sufficient materials to consider, in detail, the merits of the grounds of appeal relied on in the application for leave to appeal. In such a case, unless there is no arguable ground of appeal, or the appeal is not bona fide, the court ordinarily will focus on matters relevant to the enforcement of the judgment, rather than matters that are relevant to its validity or correctness.[11]

Stay and expedition applications: discussion and conclusions

1. This is not the occasion on which to make any considered appraisal of the merits of the applicant's proposed appeal. It is sufficient for us to say that, having considered all of the material, we are of the view that the proper construction of cl 2.2.1, the question of whether the applicant was in breach of the clause, and the respondent's entitlement to terminate the contract of sale in the manner it did are arguable. Put shortly, we accept that the applicant's proposed grounds of appeal are sufficiently arguable to justify staying the trial judge's primary orders, if the failure to grant a stay would deprive the applicant of the ability to obtain the primary relief it seeks in this proceeding.
2. There are a number of contestable issues between the parties, including the prospect of the applicant obtaining any order for specific performance. The freezing order in force in the months leading up to the trial, and currently still in force, preserved the subject matter of the litigation so that the applicant's claim for specific performance was not rendered inutile by the respondent disposing of the property to a third party. We are persuaded that the possible loss of the applicant's ability to seek specific performance if the stay sought by it is not granted constitutes special or exceptional circumstances sufficient to enliven the jurisdiction to grant a stay.
3. Balancing the competing considerations in this case, we think that justice is best served by the continued operation of the freezing order (upon each of the undertakings given by the applicant to obtain that order) pending the resolution of the proceeding in this Court, and that the application for leave to appeal (and any appeal) should be expedited as far as reasonably possible. To that end, we propose to grant the application for a stay pending the resolution of the application for leave to appeal and any appeal, and to order that the matter be given such priority as the Registrar considers appropriate, in the expectation that the application for leave to appeal and appeal will be listed for hearing in this Court in February 2023.

(1) The stay ordered in paragraph 5 of the orders of Gorton J made 10 October 2022 is hereby extended until the determination of the application for leave to appeal and any appeal, or further order.[12]

(2) The application for leave to appeal and any appeal is to be fixed for hearing with such priority as the Registrar is reasonably able to afford the matter.

(3) By 4:00 pm on 4 November 2022, the applicant provide the Associate Judge who is the Senior Master, by payment into Court or in another form acceptable to the Associate Judge who is the Senior Master, security for the respondent's costs of the application for leave to appeal and any appeal in the sum of $45,000.

(4) Liberty to apply.

[2] Subsequently varied by Incerti J on 18 June 2020.

[3] This was preceded by an ex parte freezing order made on 7 May 2020.

[4] Castaway Avenue Pty Ltd v CSC1957 Investments Pty Ltd [2022] VSC 547 ('Reasons').

[5] Gorton J considered that the deed and the contract of sale formed a single agreement, and that non-compliance with cl 2.2.1 of the deed constituted a breach of an essential term of that agreement: Reasons, [39]-[42].

[6] Sworn 23 October 2022. For completeness, we note that Mr Gulabovski swore a second affidavit on

[7] Specifically, a letter from the respondent's solicitor to the applicant's solicitor dated 4 October 2022, and an affidavit sworn by the sole director of the respondent on 5 October 2022.

[8] The likelihood of the property declining (and continuing to decline) in value, 'in the near and foreseeable future' was deposed to in an affidavit relied upon by the respondent and sworn by Paul Harrison, the managing partner of Nelson Alexander, Ascot Vale and Flemington Real Estate Agents.

[9] See generally Maher v Commonwealth Bank of Australia [2008] VSCA 122, [20]-[27] (Dodds-Streeton JA, Redlich JA agreeing at [1]); Cross Country Realty Victoria Pty Ltd v Ubertas 350 William Street Pty Ltd [2015] VSCA 347, [79]-[90] (Kyrou and McLeish JJA); Michos v Eastbrooke Medical Centre Pty Ltd [2019] VSCA 140, [29] (Kyrou and T Forrest JJA); Amcor Ltd v Barnes [2020] VSCA 57, [10] (Ferguson CJ and Beach JA) ('Amcor'); Yuanda Vic Pty Ltd v Fascade Designs International Pty Ltd [2020] VSCA 269, [23]-[26] (McLeish, Niall and Sifris JJA) ('Yuanda'); V601 Developments Pty Ltd v Probuild Constructions (Aust) Pty Ltd [2022] VSCA 77, [36] (Sifris and Macaulay JJA).

[10] [2016] VSCA 114, [7]-[8], cited with approval in Yuanda [2020] VSCA 269, [25] (McLeish, Niall and Sifris JJA).

[11] Citations omitted. See also Amcor [2020] VSCA 57, [10] (Ferguson CJ and Beach JA).

[12] For completeness, we note that, while the stay order we will make results in the continuation of the undertakings set out in the freezing order, the stay order will also be made upon the undertakings given by Mr Gulabovski (set out in paragraph 11of his second affidavit) that, in the event that the respondent is not successful, Mr Gulabovski will pay any adverse costs order made in favour of the respondent, and also pay any damages that may be incurred by the respondent in respect of the stay.