In the matter of Wan Ze Property Development (Aust) Pty Ltd (No 2) [2012] NSWSC 821

Judgment 1I delivered judgment in this matter on 24 May 2012: [2012] NSWSC 722. I directed the parties to submit agreed Short Minutes of Order to give effect to the judgment, if agreement could be reached between them, or otherwise to submit the respective orders for which they contended and short submissions in respect of any differences between them. It appears that agreement has been reached between the parties as to the majority of the orders to be made, and short submissions were lodged by both parties as to the orders which were in dispute. I deal with those orders which were in dispute between the parties in this judgment. 2Orders 1-7, 10 and 12 are agreed between the parties. Although the Defendants indicated their consent to the orders contained in paragraphs 4 and 6 of the draft orders, I consider those orders can only be properly made as against the Third Defendant ("YCJ") in respect of a single payment as to which I found (in paragraph 39 of my judgment) a contravention of directors, duty and breach of fiduciary duty in respect of YCJ, being a payment made on 20 December 2010. 3The Plaintiffs seek, in paragraphs 8-9 of the draft orders, orders that the First Defendant ("KQR") and the Second Defendant ("PX"), jointly and severally, pay to the Second Plaintiff, Wan Ze Property Development (Aust) Pty Limited ("Company") the sum of $2,364,995.70 and that the Third Defendant ("YCJ"), jointly and severally with KQR and PX, pay to the Company the sum of $10,000. The Defendants contend that: "Payment of the amount so ordered ought to be qualified to the extent and at a time when the liquidator is of the opinion that the payments into the company are warranted." I do not accept this submission. Orders should be made which give effect to the relief to which the Company is entitled in accordance with my judgment and a liquidator appointed to the Company may take such steps to enforce the judgment as he or she considers appropriate. 4I held, in paragraph 46 of my judgment that the claim for an order that KQR and PX, jointly and severally, pay to the Company the amount of $2,364,995.70 was established, on the basis that the relevant payments were made in breach of directors' duty or breach of fiduciary duty, without the Company's authority and not for a proper purpose. The order in paragraph 8 of the draft orders reflects that finding and should be made on that basis. I held in paragraph 48 of my judgment that the order sought against YCJ should be made on the same basis as the corresponding orders against KQR and PX. The order in paragraph 9 of the draft orders reflects that finding and should be made on that basis. 5Orders 11 and 13 of the draft orders provide for PX and YCJ to take all such steps as are necessary to transfer title in Units 20 and 16 in the relevant development respectively to the Company and, failing compliance, direct the Registrar to execute all documents on behalf of PX and YCJ required to effect such a transfer. The Defendants contend that the transfer of the property should be effected at the direction of the liquidator at the relevant time. I held, in paragraph 56 of my judgment, that the Plaintiffs are entitled to orders that PX and YCJ respectively do all things necessary to transfer title to the units to the Company and I should accordingly make these orders. 6Order 14 in the draft orders provides for payment of interest at the prescribed rate on the amounts referred to in orders 8 and 9 above from 31 December 2010 to the date of judgment. The Defendants submit that the judgment refers to the Plaintiffs' ability to submit a proof of debt with the liquidator. While that is correct, so far as the position of claims by the First and Third Plaintiffs against the Company is concerned, the Company is entitled to interest on the amount of the monetary judgments which are to be made in its favour. However, such interest should run from the later of 31 December 2010 or the date on which the relevant payment was made by made by the Company. 7Orders 15 and 16 of the draft orders provide for the winding up of the Company and the appointment of a liquidator. The Defendants submit that the substance of those orders is not disputed by them, but note that a winding up application in respect of the Company has been made by the Australian Taxation Office in reliance on a statutory demand and is returnable in the Federal Court of Australia. I consider that this Court should make orders to give effect to its judgment, noting that the outcome of the application of the Australian Taxation Office and the time which will be taken to determine it is presently unknown. Accordingly, I will make those orders. 8Order 17 of the draft orders deals with the costs of the proceedings and is not disputed in substance. That order should be made, as the Defendants contend, on the basis that costs should be as agreed or as assessed. 9Accordingly, I make the following orders and declarations: