Copeland (liquidator) v Odeesh, in the matter of FBF Transport Pty Ltd

WIGNEY J: 1 The plaintiff, Mr Brendan Copeland (Liquidator) is the liquidator of FBF Transport Pty Ltd. FBF was wound up in insolvency by order of the Supreme Court of Victoria on 21 August 2024. It previously carried on a transport business. The defendant, Mr Alfredo Odeesh, is the company's sole director, secretary and shareholder. The Liquidator has, for some time, been endeavouring to obtain possession of various motor vehicles that he considers are owned by FBF. The interlocutory application currently before the Court is the Liquidator's most recent attempt to recover those vehicles. 2 The background to this application may conveniently be found in the judgment of Stewart J in Copeland (liquidator) v Odeesh, in the matter of FBF Transport Pty Ltd (in liq) [2024] FCA 1136 (the Warrant Judgment). For present purposes, it suffices to note the following events. 3 On 26 September 2024, the Court ordered that the District Registrar issue a warrant pursuant to s 530C of the Corporations Act 2001 (Cth) authorising the seizure of six motor vehicles. The Court also ordered Mr Odeesh to deliver up those vehicles to the Liquidator pursuant to r 14.11(1)(a) of the Federal Court Rules 2011. The warrant was unable to be executed and the orders made on 26 September 2024 were unable to be personally served on Mr Odeesh. 4 On 18 October 2024, the Court made a further order requiring Mr Odeesh to deliver up the vehicles. The order included a penal notice pursuant to r 41.06 of the Rules. Again, however, personal service of those orders was unable to be effected on Mr Odeesh. 5 The matter next came before me on 25 November 2024. The Liquidator applied for a further delivery up order together with an order for substituted service on Mr Odeesh. As events transpired, however, counsel appeared for Mr Odeesh at the hearing on 25 November 2024. It was accordingly unnecessary for the Liquidator to pursue the application for substituted service. I made further orders for the delivery up by the defendant of four motor vehicles: a Volvo FH16 Prime Mover, a Freighter Trailers Trailer, a Mercedes Benz CLA250 and a Scania R560. For reasons it is unnecessary to detail, the order sought by the Liquidator, and made by the Court, did not refer to the other two vehicles that had been included in the warrant and earlier delivery up orders. The order made by me required Mr Odeesh to deliver-up the four vehicles referred to in the order to the premises referred to in the order by no later than 4.30 pm on 29 November 2024. 6 There could be no doubt that Mr Odeesh was well aware that the Liquidator had been endeavouring to recover the vehicles. In the Warrant Judgment, Stewart J referred to the fact that the Liquidator and his solicitors had received telephone calls and emails from several firms of solicitors who purported to act for Mr Odeesh, but that nothing had come of those communications. Justice Stewart concluded (at [7]) that the communications represented a "persistent pattern of non-cooperation and evasion" from which his Honour inferred that Mr Odeesh was "engaging in a concerted campaign to delay [the Liquidator's] investigations and repossession of the vehicles". The evidence before me indicates that the pattern of non-cooperation continued after the Warrant Judgment and continues to this day. I have no doubt that Mr Odeesh has been aware, from at least mid-November, but most likely earlier, that he has been the subject of orders of the Court requiring him to deliver up the relevant motor vehicles. He was certainly aware of the delivery-up order that I made on 25 November 2024, as were his legal advisers. 7 Mr Odeesh did not comply with the delivery-up order made on 25 November 2024. He did not deliver-up the vehicles on or before 4.30 pm on 29 November 2024. The evidence adduced by the Liquidator indicated that the Volvo Prime Mover FH16 was delivered-up to the address nominated in the orders on the morning of 3 December 2024. The solicitor who appeared for Mr Odeesh at the hearing on 4 December 2024 indicated that he had been instructed that the Freighter Trailers Trailer and the Scania R560 had since been returned. The Liquidator was not, however, able to confirm that to be the case and there was no evidence to suggest that it was in fact the case. 8 If a person fails to comply with an order of the Court that the person is bound to comply with, a party may apply to the Court for, among other things, an order for the committal of the person: r 41.08(1)(a) of the Rules. Failure to comply with the Court's orders may also constitute contempt. Where a party alleges that a contempt has been committed by a person in connection with a proceeding in the Court, a party may for that person to be punished for the alleged contempt: r 42.11 of the Rules. Despite the evidence which indicates that Mr Odeesh has failed to comply with the Court's orders, the Liquidator has not, at least at this stage, either applied for the committal of Mr Odeesh, or applied for Mr Odeesh to be punished in respect of any alleged contempt. Rather, the Liquidator has applied for an order requiring Mr Odeesh to attend Court to be examined in relation to his non-compliance with the Court's orders, as well as an order requiring the production of specified documents. 9 The Liquidator contends that the Court has power to order Mr Odeesh to appear for examination in respect of his non-compliance with the Court's orders pursuant to r 41.10(1) of the Rules, which provides as follows: 41.10 Execution generally (1) A party who wants to enforce a judgment or order of the Court may apply to the Court to make an order, to issue any writ, or to take any other step that can be taken in the Supreme Court of the State or Territory in which the judgment or order has been made as if the judgment or order was a judgment or order of that Supreme Court. 10 The Liquidator contends that the examination order that he seeks is a "step that can be taken" in the Supreme Court of New South Wales. He points in that regard to s 108 of the Civil Procedure Act 2005 (NSW) which relevantly provides as follows: 108 Order for examination (1) The court may, subject to and in accordance with the uniform rules, make an order requiring a person bound by a judgment or order - (a) to attend the court to be orally examined as to any material question, or (b) to produce any document or thing that is in his or her possession and that relates to a material question. (2) An order under this section with respect to a person that is a corporation - (a) may be addressed to any officer or former officer of the corporation, and (b) binds any such officer or former officer as if he or she were the person bound by the judgment or order. (3) Without limiting subsection (1), the uniform rules may require the judgment creditor under a judgment debt to have attempted to obtain information as to the judgment debtor's financial circumstances (whether by means of a notice requiring the judgment debtor to supply such information or otherwise) before the judgment creditor may apply for an order under this section. (4) (Repealed) (5) For the purposes of this section, the material questions in relation to a judgment or order are - (a) to the extent to which it requires the person bound by it to pay money - (i) questions as to whether any and, if so, what debts are owing to that person, and (ii) questions as to whether that person has any and, if so, what other property or other means of satisfying the judgment or order, and (b) to the extent to which it does not require the person bound by it to pay money, such questions concerning or in aid of the enforcement or satisfaction of the judgment or order as may be specified in the order under this section. 11 The applicable "uniform rules" to which reference is made in s 108(1) of the Civil Procedure Act are to be found in Part 38 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR), which relevantly provides: 38.2 Application for order for examination (1) An application for an order for examination with respect to the enforcement of a judgment or order must be supported by an affidavit as to the following matters - (a) that the judgment or order remains unsatisfied, … 38.3 Orders for examination (2) An order for examination must specify the time, date and place at which the person bound by the judgment or order is required to attend for examination. (3) An order for examination must be served on the person bound by the judgment or order at least 14 days before the day on which he or she is required to attend for examination. 38.4 Venue of examination (1) Subject to this rule, the examination of a person in respect of a judgment or order is to be conducted at the same venue as that where the judgment or order was entered. 38.5 Examination under an order for examination under rule 38.3 (1) Unless the court orders otherwise, examination of a person under an order for examination is to be conducted by the person on whose application the order was made. 12 The Liquidator helpfully drew the Court's attention to a judgment of Williams J in the Supreme Court of New South Wales in which her Honour made examination orders pursuant to s 108 of the Civil Procedure Act and Pt 38 of the UCPR in circumstances that were very similar to the circumstances of this case: Xpress Fuel Australia Pty Ltd (Receivers and Managers Appointed) (Administrator Appointed) [2023] NSWSC 692. In that judgment, Williams J referred to an earlier judgment of Austin J in Austress Freyssinet v Kowalski [2007] NSWSC 1105 in which his Honour observed (at [22]) that s 108 of the Civil Procedure Act: …gives the court a discretion to allow any questions "concerning or in aid of enforcement or satisfaction of the judgment or order". In my view the language of the section is inherently available to be used in aid of enforcement of an injunctive order, in circumstances where the evidence, while not establishing failure to comply with the order, points to circumstances raising a question about compliance that reasonably warrants investigation. 13 The issue in Kowalski, was whether the defendant had complied with an injunction which, among other things, prevented him from retaining shares in a specified company. The evidence indicated that the defendant had transferred his shares in that company to his accountant, but it was unclear whether the transfer had led to the accountant holding the shares on trust for the defendant, which may have breached the injunction. In that context, Austin J observed (at [31]) that s 108 provided a useful function in circumstances where the limited information available to a plaintiff is arguably insufficient for the plaintiff to conclude that the defendant was in contempt of the orders. His Honour continued: It would be an unsatisfactory situation if, in such a case, the person with the benefit of the orders had no other remedy than to commit to an immediate application for punishment for contempt. It is in my view reasonable for a party in the position of the plaintiffs to employ the examination and production procedure with a view to clarifying whether the transfer has led to a resulting trust or the presumption of resulting trust has been rebutted by further facts. 14 As can be seen, the key point is that an examination order under s 108 of the Civil Procedure Act may be appropriate where there remains an element of uncertainty about whether the defendant's failure to comply with an order might constitute a contempt. It may be reasonable, in those circumstances, for the plaintiff to be permitted to examine the defendant about the non-compliance, rather than immediately having to resort to an application for contempt. In my view, this is such a case. 15 Mr Odeesh opposed the making of the orders sought by the Liquidator. He did not contend that the Court did not have the power to make the orders. Rather, he submitted, in effect, that the Court should not exercise its discretion to make the orders because he was now taking reasonable (albeit belated) steps to abide by the orders. That was an apparent reference to the recent delivery-up of the Volvo Prime Mover FH16, albeit that the delivery of that vehicle occurred after the date specified in the orders. It may also have been a reference to the supposed, though unverified, delivery up of the Freighter Trailers Trailer and Scania R560. 16 The difficulty with that submission is that, even if the Freighter Trailers Trailer and Scania R560 have since been delivered up, as Mr Odeesh, through his solicitor, suggested, there remains the delivery-up of the Mercedes Benz CLA250. There was no evidence that Mr Odeesh had in fact returned that vehicle. Mr Odeesh suggested, through his solicitor, that he was unable to deliver-up that vehicle because he had traded it in for another vehicle. That suggestion was unsupported by any evidence and was devoid of any meaningful detail, such as when and to whom the vehicle had been traded. 17 Even putting the absence of evidence concerning Mr Odeesh's claim about the Mercedes Benz CLA250 to one side, that claim, if anything, provides support for the making of the orders sought by the Liquidator. In my view, it is entirely reasonable for the Liquidator to employ the procedure in s 108 of the Civil Procedure Act to examine Mr Odeesh about his apparent claim that he no longer possesses the Mercedes Benz CLA250. Among other things, it would be reasonable for the Liquidator to elicit information from Mr Odeesh concerning his supposed disposal of that vehicle. Contrary to the submissions advanced on Mr Odeesh's behalf, there is utility in making the orders sought by the Liquidator. 18 I am satisfied that the Court has power to make the orders sought by the Liquidator pursuant to r 41.10(1) of the Rules and s 108 of the Civil Procedure Act. I am also satisfied that the Liquidator's application satisfies the applicable procedural requirements in Part 38 of the UCPR, though it will be necessary to make an order abridging the time for service of the examination order pursuant to r 38.3(3) of the UCPR. I am not satisfied that the submissions advanced on behalf of Mr Odeesh provide a sound basis for not exercising the Court's discretion to make the orders sought by the Liquidator. The fact remains that Mr Odeesh has not complied with the Court's orders and has demonstrated a willingness and disposition to frustrate and delay the Liquidator's attempts to recover the vehicles. As I have already indicated, in my view it is entirely reasonable for the Liquidator to employ the procedure in s 108 of the Civil Procedure Act in the circumstances of this case. 19 I will accordingly make the orders sought by the Liquidator in the interlocutory application dated 2 December 2024. 20 I should perhaps note that if Mr Odeesh in the meantime decides to cooperate with the Liquidator and either returns the remaining vehicle or vehicles, or provides the Liquidator with sufficient information about his prior dealings with those vehicles, the Liquidator might decide not to proceed with the examination. That would be a matter for the Liquidator. Mr Odeesh's conduct and attitude to date, however, provides little cause for optimism in that regard. 21 The orders sought by the Liquidator include an order that Mr Odeesh pay the Liquidator's costs of and incidental to the interlocutory application and the examination. In my view, that costs order is appropriate. I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Wigney.