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JUDGMENT – EX TEMPORE (REVISED)

1. The hearing before me today is to deal with consequential orders following my decision on 28 April 2026 in Homebuilding Pty Ltd v Litigation Fund WCX Pty Ltd [2026] NSWSC 423.

2. As foreshadowed in that judgment, I have received a proposed form of order from the plaintiffs for the appointment of a receiver for the sale of the property (using the same defined terms as appeared in my principal judgment).

3. The active defendants, although they were given an opportunity to put forward an alternative form of orders, did not put forward any alternative form of orders. Rather, the first defendant on 8 May emailed my chambers copying the active parties with the following:

The First Defendant does not consent to the orders proposed by the plaintiff. Whatever form the Court's orders take, the First Defendant seeks the orders be stayed for 28 days to allow it to commence an appeal and if commenced stay to continue until the appeal is finally determined.

4. On the same date, the second defendant emailed my associate copying the active parties with the following:

I do not consent to the orders proposed by the plaintiff.

I ask that the orders to be made be stayed for 28 days to allow an appeal to be lodged and continued if lodged.

5. The defendants did not appear when the matter was called today. I was satisfied that the defendants had notice of the hearing, and proceeded with the hearing in their absence.

6. Three issues arose for consideration before me:

7. the form of orders proposed by the plaintiffs for declaratory relief and for the appointment of a receiver;

8. the question of a stay of my orders pending the foreshadowed appeal; and

9. the question of costs of these proceedings.

Form of Orders Proposed

7. Subject to making minor cosmetic changes which I have raised with plaintiff's counsel, I propose to make the orders that have been proposed by the plaintiffs, save that I do not propose to make the proposed orders 3 and 4. Proposed orders 3 and 4 as sought by the plaintiffs were as follows:

3. The Second and Third Defendant, must, within 21 days of the date of these orders:

(a) vacate and surrender to the Receiver vacant possession of the Property;

(b) surrender to the Receiver all keys to all buildings and improvements on the Property; and

(c) remove, or cause to be removed, all motor vehicles, rubbish and other chattels or personal property from the Property.

4. If the Second and Third Defendant:

(a) fails to comply with paragraph 3(a), paragraph 3 is to take effect as an order for possession of land; and

(b) fails to comply with paragraph 3(c), the Receiver is empowered to remove and dispose of any and all personal property on the Property as he sees fit and such items are deemed to be abandoned by the Second and Third Defendant.

8. The reason I do not make those orders is because that may be a matter for the receiver. I do not know whether the receiver will seek orders in those terms or in different terms, or whether the receiver may not consider he needs such orders at all. I do not propose to make orders 3 and 4 today, but for the avoidance of doubt I make it clear, that is without prejudice to the possibility that such orders or similar orders may be made in the future.

Stay

9. The starting position is that while I have an informal application for a stay, the defendants have not appeared before the Court to articulate the basis for the stay. Nevertheless, the plaintiffs indicated that they would not oppose a stay on strict terms. There is considerable force in the plaintiffs' position because any stay that I would grant would only be for a short term anyway to allow the matter to be considered further by the Court of Appeal.

10. Accordingly, in light of the emails seeking a stay and the plaintiff's creditable non-opposition, I propose to grant a stay but on strict terms that require the matter to be brought promptly before the Court of Appeal.

Costs

11. The plaintiff seeks costs of the proceedings on an indemnity basis, excluding the plaintiff's costs of the notice of motion filed on 9 February 2026 and the hearing on 10 February 2026. The reason for the carveout is that the notice of motion on 9 February 2026 and the hearing on 10 February 2026 were necessitated by the deregistration of the first plaintiff and the need to allow time for the first plaintiff to be reregistered before a final hearing could proceed.

12. The application for indemnity costs was advanced on two grounds: the first was that these proceedings were brought by the plaintiffs to enforce costs judgments; and that the defendants effectively forced the plaintiffs to bring these proceedings to obtain something that they are entitled to, that is, payment of their costs in other proceedings. Second, the plaintiffs pointed out that the defendants in the proceedings before me did not explain why they continually refused to pay the costs that were due.

13. While I recognise that there is some force in these submissions, the difficulty with this is that the defendants were faced with particular prayers for relief and they responded to those prayers. A number of those prayers were abandoned, not pressed or changed significantly over the course of these proceedings.

14. The first plaintiff undoubtedly enjoyed substantial success. However, the claim for the appointment of trustees for sale as framed in the amended summons could not succeed, and multiple hearings were necessitated in part because of the position taken by the plaintiffs and the need to refine their case (including following the deregistration and need to re-register the first plaintiff). Moreover, a significant part of their evidence went to the costs payable to the second plaintiff, as I have indicated in my principal judgment, whereas a basis has not been shown for those costs to be secured by the equitable charge.

15. In those circumstances, I do not consider it appropriate in my discretion to accede to the plaintiff’s application for costs on an indemnity basis nor do I consider it appropriate to order that the second plaintiff have his costs. The second plaintiff did not himself, as matters eventually turned out, claim entitlement to any particular relief and an important reason why the second plaintiff needed to be present was to incur the costs associated with the need to reregister the first plaintiff.

16. When I take all of those matters into account, rather than carving out particular kinds of expense, it seems to me the preferable course is to take a broad-brush approach, and to order that the first plaintiff should have the majority (but not all) of its costs assessed on the ordinary basis. In the circumstances, I consider that the first and second defendants should be ordered to pay 70% of the first plaintiff's costs of the proceedings as agreed or assessed on the ordinary basis.

17. Accordingly, I make the following orders:

18. Declare that the First Plaintiff holds a charge over the real property situated at and known as 39 Empire Street, Haberfield NSW, folio identifier 10/1247934, which charge secures all money owing by the Second and Third Defendants to the First Plaintiff pursuant to clause 27 of the residential building contract between the First Plaintiff and the Second and Third Defendants dated 1 September 2017.

19. Until further order, Mr Michael Gregory Jones of Jones Partners, Suite 3.03, Level 3, 45 Clarence Street Sydney in the State of New South Wales, be appointed as a receiver (the Receiver) of the real property registered in the name of the Second and Third Defendants, located at 39 Empire Street, Haberfield in the State of New South Wales having folio identifier 10/1247934 (the Property), without security.

20. The Receiver has, with respect to the Property, the following powers:

(a) to collect, get in and receive the Property; (b) to obtain a valuation of the Property; (c) to insure the Property; (d) to repair, renew, maintain, or otherwise preserve the Property; (e) to sell the Property; (f) to appoint a solicitor, accountant, or other professionally qualified person to assist the Receiver; (g) to appoint an agent to do any business that the Receiver is unable to do, or that is unreasonable to expect the Receiver to do in person; (h) to apply for any enforcement or consequential orders with respect to the possession of and control of the Property; (i) to refer to the Court any question affecting the sale of the Property; and (j) to execute any document or do any other act or thing in connection with the powers referred to in orders 6(a) to 6(i) above.

4. The preceding powers will not extend to the letting or encumbering of the Property without prior leave of the Court or consent of the owner of the Property.
5. The Receiver be remunerated for his services and those of his partners and employees, calculated at the rates, set out in Annexure B of the Affidavit of Michael Gregory Jones affirmed on 4 May 2026, out of the assets of the receivership.
6. The proceeds of sale of the Property to be paid in the following order:

(a) Firstly, in adjustment of council rates, contributions, levies, water rates, taxes, and other outgoings with respect to the Property; (b) Secondly, in payment of all costs and expenses relating to the sale of the Property, including real estate agent’s commission, auctioneer fees, and marketing costs with respect to the sale of the Property; (c) Thirdly, in payment of all costs, expenses, and disbursements of the solicitor or conveyancer engaged with respect to the sale of the Property; (d) Fourthly, in payment of the Receiver’s remuneration and all reasonable costs, expenses, and disbursements incurred by the Receiver with respect to their appointment; and (e) Lastly, the remainder of the proceeds of sale to be paid into Court.

7. Order that the First and Second Defendants pay 70% of the First Plaintiff’s costs of the proceedings as agreed or assessed on the ordinary basis.
8. Stay order 1 made on 28 April 2026 and orders 1 to 7 made today until 5.00pm Monday 25 May 2026.
9. If by 5.00pm on Monday 25 May 2026 the Defendants, or any of them, file and serve:

(a) notice of appeal or summons seeking leave to appeal; and (b) application to Court of Appeal for a further stay

then the stay made today is to be extended to 5.00pm on 1 June 2026 subject to any further orders of this Court or of the Court of Appeal.

10. Liberty to restore the matter in writing on 48 hours’ notice.

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