mixed. On Kea's solicitors undertaking to hold $100,000 in trust as security for Kea's undertaking as to damages, paragraphs 2 to 4 of the 26 April 2023 orders were set aside, and the $10,000 security paid...
Key principles
For relief under ss 25 and 26 of the Trans-Tasman Proceedings Act 2010 (Cth), the Queensland court must decide whether to make its own order by applying s 26, the Queensland...
When an anti-suit or anti-enforcement injunction is sought under s 26(1)(b)(ii), the court must consider whether Queensland is a clearly inappropriate forum: [83]-[85].
A respondent seeking to set aside an ex parte order for material non-disclosure bears the onus of establishing non-disclosure. Materiality turns on whether the omitted matter was...
On a Voth analysis, the focus is whether continuation of the local proceeding would be seriously and unfairly burdensome, prejudicial or damaging, or productive of serious and...
Issues before the court
Whether the April ex parte orders should be set aside for material non-disclosure.
Whether the Queensland proceeding was vexatious or oppressive, or Queensland a clearly inappropriate forum.
Plain English Summary
The Queensland Supreme Court left the main anti-enforcement injunctions in place while the dispute about the alleged forged agreement and conspiracy remained unresolved. It found that Kea had adequately disclosed the relevant matters when it first sought urgent orders, that Queensland was not clearly the wrong forum, and that the evidence raised an arguable fraud case. The court did not decide whether the agreement was forged or whether Wikeley was liable. It removed the separate residence, curfew and security conditions made on 26 April because they were no longer justified. The contempt application and the wider Queensland proceeding were not permanently stayed.
AI-generated legal information, not legal advice. Zoe can make mistakes. Check the cited source, and for advice about your situation consult a qualified Australian lawyer.
Deep Dive
2,407 words · generated 02/10/2026
What happened
In Kea Investments Ltd v Wikeley (No 2) [2023] QSC 215, Cooper J considered an amended application by Kenneth Wikeley to set aside interim orders made against him and to permanently stay both a contempt application and the Queensland proceeding. The dispute arose from a Kentucky default judgment obtained by Wikeley Family Trustee Ltd (WFTL) against Kea Investments Ltd, a British Virgin Islands company, for US$123.75 million plus interest and costs [3], [25]-[27].
Whether the interlocutory anti-enforcement injunctions should continue.
Whether the contempt application and the proceeding should be permanently stayed as an abuse of process.
Cited legislation
3 cited instruments linked from this judgment.
Kea said the judgment rested on a fabricated Coal Funding and JV Investment Agreement. On its face, the agreement required Kea to provide at least US$75 million over eight years, pay a royalty of US$1.5 million annually for 20 years, and accept substantial indemnity and guarantee obligations [20]-[23]. Kea alleged that the document and Kentucky litigation were part of a conspiracy involving Wikeley and Eric Watson. These were allegations, not findings of final liability.
Kea first pursued relief in New Zealand. It began proceedings there on 31 October 2022, seeking, among other remedies, damages for tortious conspiracy and permanent injunctive relief against enforcement of the Kentucky judgment [37]-[43]. New Zealand interim anti-enforcement orders followed [44]-[49]. Kea then sought urgent Queensland relief after learning that WFTL had purported to assign the judgment and agreement to Wikeley Inc, and that Wikeley Inc had filed motions in Kentucky seeking substitution as plaintiff, discovery and an anti-suit injunction against Kea's New Zealand case [50]-[56].
On 12 April 2023, the Queensland court made ex parte orders under ss 25 and 26 of the Trans-Tasman Proceedings Act 2010 (Cth) (TTPA). Among other things, Wikeley was restrained from taking steps to enforce the judgment and was required to surrender his passports [3]. Following a later hearing, orders made on 21 April continued injunctions and restricted Wikeley from leaving Australia [9]. Further orders on 26 April imposed residence, curfew and security conditions after Wikeley had not initially surrendered his passports and an arrest warrant had been issued [9]-[11].
Wikeley challenged the orders on several grounds. He argued that Kea had failed to make full disclosure at the ex parte hearing, Queensland was a clearly inappropriate forum, comity precluded the relief, and the injunctions were not justified on the merits. He also sought permanent stays of the contempt application and proceeding [12]-[13].
Cooper J dismissed most of the amended application. The anti-enforcement injunctions remained, subject to Kea's solicitors holding $100,000 as security for Kea's undertaking as to damages. But paragraphs 2 to 4 of the 26 April orders were set aside, and the $10,000 security paid under those orders was to be returned to Wikeley [291]. Costs were reserved [292].
Why the court decided this way
The court first addressed the distinct positions of the different orders and the applicable onus. Wikeley bore the onus of establishing material non-disclosure in seeking to set aside the ex parte orders. For the 21 April orders, however, Cooper J treated Kea as bearing the substantive burden of justifying their continuation. Although those orders had been made after an inter partes hearing date, Wikeley had not then been heard on whether the ex parte relief should continue, and the orders expressly contemplated an application to vary or set them aside [72]-[77].
The disclosure challenge failed. An ex parte applicant must place material facts and the other party's case before the court, not merely leave the court to assemble the opposing position from exhibits [86]-[90]. But the question was whether the omitted information was material, rather than whether every potentially relevant point had been expressly argued.
Cooper J found that the court had been adequately alerted to the clearly inappropriate forum requirement and to the legal principles governing anti-suit and anti-enforcement injunctions [93]-[102]. It had also been informed of the dates relevant to Kea's delay and of its efforts in Kentucky to set aside the judgment and challenge subpoenas [103]-[114]. While some affidavits supporting Wikeley's account of the Coal Agreement had not been specifically brought to the judge's attention, their general or hearsay nature meant they were not likely to affect the assessment of whether Kea had an arguable fraud and conspiracy case [122]-[130]. Other alleged omissions, including Wikeley's claimed enforcement expenses, were not adequately substantiated to be material [134]-[138]. The urgency created by the pending Kentucky motions was relevant to the court's assessment of what it was reasonable to expect Kea to put before the court [116]-[118].
The forum question was governed by the Voth test. The court asked whether the Queensland proceeding would be oppressive or vexatious in the required sense, focusing on the inappropriateness of the local forum rather than whether another court might be more appropriate [154]-[157]. Cooper J considered comity, the likely applicable law, Kea's earlier Kentucky steps, its purpose in bringing proceedings, and the effects on Wikeley Inc [158]-[228].
The alleged fraud was central to both forum and comity. The court accepted that anti-enforcement injunctions require caution and are rare, since they can interfere indirectly with the foreign court's processes [159]-[176]. However, it treated fraud as a recognised exceptional circumstance. The evidence raised an arguable case that the Coal Agreement was fabricated, including apparent commercial improbabilities, the absence of contemporaneous records and inconsistencies in Wikeley's accounts about signing [189]. The court also considered evidence about Kea's records, the absence of demands for performance over many years, and statements from people involved with Kea [189].
The alleged Queensland connection mattered. Wikeley was in Queensland when he swore evidence used in Kentucky and when he executed the purported assignment of the judgment and agreement to Wikeley Inc [193]-[194]. It was at least arguable that he had lived in Queensland while taking further steps in the alleged conspiracy [196]-[202]. The court concluded that this supported subject-matter jurisdiction and meant Queensland was not clearly inappropriate, even though Kentucky law might govern the tortious conspiracy claim [204]-[209].
The balance of convenience also favoured continuing the main injunctions. The court found a serious question to be tried as to both fabrication and conspiracy [189]-[192], and considered the risk of harm if enforcement continued [263]. Although the $100,000 security would not fully protect against the potential financial consequences of delaying enforcement of such a large judgment, the balance had to be assessed in the unusual context: Wikeley was already restrained by New Zealand orders, and there was evidence he had acted contrary to those orders [267]-[269]. The court therefore required the security but did not treat its amount as decisive [271], [279].
The court declined to stay the contempt application because the argument depended on setting aside the orders said to have been breached, and those orders were not set aside [151]-[152]. It declined the permanent stay of the proceeding because oppression, abuse of process and inappropriate forum had not been established [285]-[290]. By contrast, the 26 April residence, curfew and security conditions were no longer necessary. The arrest warrant had been vacated, Wikeley was represented, and there was no evidence of later breaches. The no-departure order was considered sufficient for the relevant purposes [283]-[284].
Before and after state of the law
The judgment did not purport to alter the governing tests for forum non conveniens, ex parte disclosure or interlocutory injunctions. It applied established principles to an unusual transnational dispute.
For ex parte relief, the established duty remained one of full and frank disclosure. The judgment emphasised that materiality is assessed by the court and depends on whether information could affect the decision, not simply whether the information existed somewhere in a large bundle [86]-[90], [122]-[130]. The practical context, including urgency, informed the application of that duty [116]-[118].
For the TTPA, Cooper J explained that an Australian court considering interim relief in support of New Zealand proceedings must make its own decision under s 26. It cannot simply reproduce the foreign order or adopt the foreign court's findings. The Queensland court must apply Queensland law and make findings from admissible evidence before it [78]-[82], [260]-[261]. The court also held that the clearly inappropriate forum inquiry is relevant when an anti-suit or anti-enforcement injunction is sought under s 26(1)(b)(ii) [83]-[85].
The judgment applied the Voth formulation and clarified its use where local and foreign proceedings share facts but raise different issues. The question is whether the local proceeding is oppressive or vexatious having regard to the controversy as a whole, rather than whether the local forum is the best forum for every issue [154]-[157]. The court also distinguished mere parallel litigation from oppressive duplication, noting that the existence of proceedings in different countries is not alone enough [156]-[157].
On anti-enforcement relief, the court reaffirmed caution because such orders can affect the practical operation of foreign judgments. It did not treat comity as an absolute prohibition. Its application of the fraud exception, and its consideration of a sufficient connection between the respondent and Queensland, show how the recognised exception may be relevant at an interlocutory stage, before a final finding that fraud occurred [176]-[193]. The holding was limited: the court found an arguable case and a sufficient basis for interlocutory relief, not that the alleged fraud was proved.
Finally, the judgment confirmed that an undertaking as to damages is important but forms part of the overall balance of convenience. It is not a separate preliminary requirement that determines the application in isolation [245]-[252]. Here, the undertaking's practical worth weighed against relief, but other circumstances altered its relative significance [267]-[271].
Key passages with plain-English translation
At [81], Cooper J accepted that the Queensland court had to decide for itself whether relief was justified, rather than enforce or adopt New Zealand orders. In plain English, the TTPA supported a fresh Queensland decision, not automatic recognition of an interim injunction.
At [85], the court said the clearly inappropriate forum question was distinct from jurisdiction and expediency. In plain English, having power to hear a matter does not answer whether the court should restrain proceedings or enforcement in an international setting.
At [189], the judge found an arguable case that the Coal Agreement was fabricated, relying on the evidence then before the court. “Arguable” meant the claim crossed an interlocutory threshold, not that the court had finally decided the document was forged.
At [223], the judge rejected the argument that the proceeding was necessarily oppressive because it sought to restrain enforcement abroad. The key context was that Kea alleged continued fraud and the Kentucky court had not yet assessed the merits of that allegation.
At [252], the court said the adequacy of an undertaking is considered within the whole balance of convenience. In plain English, a weak or uncertain undertaking matters, but does not automatically defeat an injunction.
At [271], the court concluded that the balance favoured continuing the paragraph 3 injunctions. That conclusion was specific to the evidence and procedural circumstances, including the New Zealand orders and the alleged breach of them.
What fact patterns trigger this precedent
The judgment is most relevant to applications for interim anti-enforcement relief where a party alleges that a foreign judgment was procured by fraud, and where the foreign court has not considered the substance of that allegation. It is also relevant where relief is sought under ss 25 and 26 of the TTPA in support of an existing New Zealand proceeding, because it explains that an Australian court must conduct its own statutory and legal analysis [78]-[85].
The forum analysis may assist where proceedings in several countries involve overlapping facts but different causes of action or remedies. The court's focus was the controversy as a whole, and whether the local proceeding added something beyond a duplicative attempt to relitigate the same dispute [154]-[157], [210]-[217].
The decision is also pertinent where a respondent argues that earlier participation in foreign proceedings waived or undermined a later request for an injunction. Cooper J found that Kea's attempts to set aside the default judgment and challenge subpoenas did not, in the circumstances, amount to participation that barred its request for relief [107]-[118], [269].
It is not a general ruling that alleged fraud automatically justifies a worldwide injunction. The court considered an arguable evidentiary case, a Queensland connection to the respondent's conduct, the lack of a Kentucky merits determination, potential harm, comity, delay, and the undertaking as a whole [176]-[193], [242]-[271]. Different evidence or procedural developments could affect those factors.
How later courts have treated it
The judgment text is dated 4 October 2023 and does not identify subsequent cases applying, following, distinguishing or overturning Kea Investments Ltd v Wikeley (No 2). The available material therefore does not establish how later courts have treated this decision. The cited authorities discussed by Cooper J are prior authorities, not later treatment of this judgment.
The judgment itself identifies the earlier related Queensland decision, Kea Investments Ltd v Wikeley [2023] QSC 79, as the decision that made the initial orders [3] n 1. It also discusses the New Zealand proceedings and the Kentucky and United States bankruptcy proceedings as part of the factual and procedural context [45]-[63]. Those are related proceedings, not subsequent appellate review of the reasoning in this case.
Still-open questions
The court did not decide whether the Coal Agreement was forged, whether Wikeley or others committed tortious conspiracy, or whether Kea would obtain permanent anti-enforcement relief. Its findings at [189]-[192] were interlocutory assessments of an arguable case.
The court also left open whether the Kentucky default judgment had to be set aside before Kea could maintain the damages component of its conspiracy claim. It considered Cabassi, Schepis and Cachia, but said those authorities might support a summary dismissal or stay of that damages claim. It identified factual and procedural distinctions, including that the Kentucky judgment was a default judgment and the foreign court had not addressed the fraud merits [234]-[241].
The likely application of Kentucky law to the tort claim was not resolved beyond the forum analysis. Cooper J considered Kentucky the apparent place where the cause of action arose, but held that the application of foreign law did not alone make Queensland clearly inappropriate [204]-[209].
The judgment also left the eventual effect of the United States bankruptcy proceedings, the stayed Kentucky substitution motions and the Kentucky appeal dependent on later developments [60]-[62]. Its interlocutory conclusion reflected the position as presented at the August 2023 hearing.
This is general legal information, not legal advice. Zoe can make mistakes. Before acting on this, relying on it, or using any draft, have a qualified Australian lawyer check it.
Catchwords
PRIVATE INTERNATIONAL LAW – RESTRAINT OF PROCEEDINGS – OF LOCALPROCEEDINGS: CLEARLY INAPPROPRIATE FORUM – GENERALLY– where theapplicant is a company incorporated in the British Virgin Islands – wherea court in the United States issueda default judgment in respect of anagreement the applicant contends is a forgery – where the applicant hascommenced proceedingsin a court in New Zealand against the respondent seekingrelief with respect to the default judgment in the United States and damagesfortortious conspiracy – where the applicant obtained interim andinterlocutory injunctive relief in New Zealand restrainingthe respondent fromenforcing the default judgment – where the respondent has taken steps tocontravene and avoid the effectof the orders made in New Zealand – wherethe applicant applied to the Supreme Court of Queensland for interim injunctivereliefagainst the respondent and orders were made – whether the ordersinvolved a breach of comity – whether the proceedingis oppressive orvexatious – whether the Supreme Court of Queensland is a clearlyinappropriate forumPRIVATE INTERNATIONAL LAW – RESTRAINT OF PROCEEDINGS – OFFOREIGN PROCEEDINGS: ANTI SUIT INJUNCTIONS – TO PROTECTJURISDICTION OFCOURT AND ITS PROCESSES – whether there is a serious question to be tried– whether the balance of conveniencefavours the grant of an interlocutoryinjunction or the continuation of the anti-enforcement injunctive reliefPROCEDURE – JUDGMENTS AND ORDERS – AMENDING, VARYING ANDSETTING ASIDE JUDGMENTS AND ORDERS – EX PARTE ORDERS ANDJUDGMENTS –where orders were made pursuant to ss 25 and 26 of the Trans-TasmanProceedings Act 2010 (Cth) following an ex parte hearing –whether the applicant failed to make full disclosure to the court of the correctlegal principles, material factsand defences which the respondent submits wereavailable to him – whether the applicant failed to comply with itsobligationof disclosure at the ex parte hearing – whether the ordersshould be set asidePROCEDURE – STATE AND TERRITORY COURTS: JURISDICTION, POWERS ANDGENERALLY – INHERENT AND GENERAL STATUTORY POWERS –TO STAY ORDISMISS ORDERS OR PROCEEDINGS GENERALLY – where the applicant filed anapplication seeking that the respondent befound to have committed a contempt ofcourt by failing to comply with orders – where a warrant was issued forthe respondent’sarrest given his apparent non-compliance with orders– where the respondent subsequently delivered his passports to the custodyof the court in compliance with the orders and the arrest warrant was vacated– whether the further prosecution of the contemptapplication would amountto an abuse of process – whether the contempt application should bepermanently stayed – wherethe applicant sought relief from courts in theBritish Virgin Islands, United States, New Zealand and Australia uponsubstantiallythe same fraud argument – whether the further conduct of theproceeding would be unjustifiably oppressive – whether thefurther conductof the proceeding amounts to an abuse of process – whether the proceedingshould be permanently stayedCriminal Code Act 1899 (Qld) sch 1, s 408C(1) and s488(1)Trans-Tasman Proceedings Act 2010 (Cth), s 25, s26Uniform Civil Procedure Rules 1999 (Qld), r 264Active Leisure (Sports) Pty Ltd v Sportsman’s Australia Ltd[1991] 1 Qd R 301, citedADM Asia-Pacific Trading Pte Ltd v PT BudiSemesta Satria [2017] 1 Lloyd’s Rep 1, citedAir Express Ltd vAnsett Transport Industries (Operations) Pty Ltd [1981] HCA 75(1981) 146 CLR 249,citedAirbus Industrie GIE v Patel [1998] UKHL 12[1999] 1 AC 119 (HL),citedAustralian Securities and Investments Commission v Wiggins[1998] FCA 1727(1998) 90 FCR 314, citedBank St Petersburg OJSC v Arkhangelsky [2014] EWCA Civ 593[2014]1 WLR 4360, consideredBensons Funds Management Pty Ltd v Body In BalanceChiropractic Pty Ltd [2015] VSC 280, citedBrags Electric Pty Ltdtrading as Inscope Building Technologies v Steven Mark Gregory [2010] NSWSC1205, consideredBrimaud v Honeysett Instant Print Pty Ltd [1988] 217ALR 44, citedBrink’s-MAT Ltd v Elcombe [1988] 3 All ER 188,consideredCabassi v Vila [1940] HCA 41(1940) 64 CLR 130, citedCachia vWestpac Financial Services Ltd [2005] NSWCA 239, citedCarron Iron Cov Maclaren [1855] EngR 700(1855) 5 H.L.C. 416, citedCentral Petroleum Ltd vGeoscience Resource Recovery LLC [2017] QSC 223[2018] 2 Qd R 371, citedCoomeraResort Pty Ltd v Kolback Securities Ltd [2004] 1 Qd R 1, citedCSR Ltdv Cigna Insurance Australia Ltd (1997) 189 CLR 345, consideredDavis vTurning Properties Pty Ltd [2005] NSWSC 742(2005) 222 ALR 676, citedDow Jones &Co Inc v Gutnick (2002) 210 CLR 575, citedEcobank Transnational Inc vTanoh [2015] EWCA Civ 1309[2016] 1 WLR 2231, consideredED&F Man (Sugar) Ltd vHaryanto (No 2) [1991] 1 Lloyd’s Rep 429, consideredEllermanLines Ltd v Read [1928] 2 KB 144, consideredENRC Marketing AG v OJSC“Magnitogorsk Metallurgical Kombinat” [2011] FCA 1371(2011) 285 ALR 444,citedEnvironment East Gippsland Inc v VicForests (No 2) [2009] VSC421, citedEssar Shipping Ltd v Bank of China Ltd (The Kishore) [2016]1 Lloyd’s Rep 427, citedFinancial Integrity Group Pty Ltd v Farmer(No 3) [2014] ACTSC 75, citedFirst Netcom Pty Ltd v Telstra CorpLtd [2000] FCA 1269(2000) 101 FCR 77, citedFitz Jersey Pty Ltd v Atlas ConstructionGroup Pty Ltd [2017] NSWCA 53(2017) 94 NSWLR 606, citedGlenn v Watson [2018]EWHC 2016 (Ch), relatedGraham v Campbell [1878] UKLawRpCh 13(1878) 7 Ch D 490,citedHeartwood Architectural Timber & Joinery Pty Ltd v RedchipLawyers [2009] QSC 195[2009] 2 Qd R 499, consideredHenry v Henry [1996] HCA 51(1996) 185 CLR571, citedHotline Communications Ltd v Hinkley (1999) 44 IPR 445,consideredJ Aron & Co v Newmont Yandal Operations Pty Ltd [2003] NSWSC 835(2003)47 ACSR 243, citedKea Investments Ltd v Wikeley [2023] QSC 79,relatedKea Investments Ltd v Wikeley Family Trustee Ltd & Ors(High Court of New Zealand, Auckland Registry, CIV-2022-404-2086),relatedKea Investments Ltd v Wikeley Family Trustee Ltd [2022] NZHC2881, relatedKea Investments Ltd v Wikeley Family Trustee Ltd [2023]NZHC 2407, relatedKea Investments Ltd v Wikeley Family Trustee Ltd[2023] NZHC 466, relatedLord Portarlington v Soulby [1834] EngR 6333 Myl. &K. 104, citedMackellar Mining Equipment Pty Ltd v Thornton [2019] QCA 77(2019) 367ALR 171, citedMackinnon v Donaldson, Lufkin & Jenrette SecuritiesCorp [1986] Ch 482, citedMasri v Consolidated ContractorsInternational (UK) Ltd (No 2) [2008] EWCA Civ 303[2009] QB 450, citedMasri vConsolidated Contractors International (UK) Ltd (No 3) [2008] EWCA Civ 285[2009] QB 503,citedMoubarak by his tutor Coorey v Holt [2019] NSWCA 102(2019) 100 NSWLR 218,citedNicols (as trustee of the bankrupt estate of Manietta) vManietta [2022] FCA 39, consideredOceanic Sun Line Special ShippingCo Inc v Fay [1988] HCA 32(1988) 165 CLR 197, citedRegie Nationale des UsinesRenault SA v Zhang [2002] HCA 10(2002) 210 CLR 491, citedRolleston Coal HoldingsPty Ltd v ICRA Rolleston Pty Ltd [2020] QSC 331, citedSAS InstituteInc v Worldwide Programming Ltd [2020] EWCA Civ 599, consideredSavcorPty Ltd v Cathodic Protection International APS [2005] VSCA 213(2005) 12 VR 639,consideredSchepis v Esanda Finance Corp Ltd [2007] QCA 263,consideredSigma Pharmaceuticals (Australia) Pty Ltd v Wyeth [2018] FCA 1556(2018)136 IPR 8, citedSociete Eram Shipping Co Ltd v Cie Internationale deNavigation [2004] 1 AC 260, citedSpiliada Maritime Corp v CansulexLtd [1986] UKHL 10[1987] AC 460, citedSun Travels & Tours Pvt Ltd v HiltonInternational Manage (Maldives) Pvt Ltd [2019] SGCA 10,consideredTalacko v Talacko (No 2) [2009] VSC 444(2009) 25 VR 613,citedThomas A Edison Ltd v Bullock [1912] HCA 72(1912) 15 CLR 679,consideredTrina Solar (US) Inc v Jasmin Solar Pty Ltd [2017] FCAFC 6(2017) 247 FCR1, citedTrust Company (PTAL) Limited (Trustee for the LM ManagedPerformance Fund), Re Drake v Drake [2014] FCA 1445, citedVoth vManildra Flour Mills Pty Ltd [1990] HCA 55(1990) 171 CLR 538, consideredWalter RauNeusser Oel Und Fett AG v Cross Pacific Trading Pty Ltd [2005] FCA 955,citedWarringah Shire Council v Industrial Acceptance Corp (New SouthWales Supreme Court, McLelland J, 22 November 1979), consideredWikeleyFamily Trustee Ltd v Kea Investments Ltd (Commonwealth of Kentucky, FayetteCircuit Court, 9th Division, Civil Action No. 21-CI-02508),relatedWillmot v State of Queensland [2022] QSC 167,citedWillmot v State of Queensland [2023] QCA 102, cited
Judgment (400 paragraphs)
[1]
PRIVATE INTERNATIONAL LAW - RESTRAINT OF PROCEEDINGS - OF LOCAL PROCEEDINGS: CLEARLY INAPPROPRIATE FORUM - GENERALLY - where the applicant is a company incorporated in the British Virgin Islands - where a court in the United States issued a default judgment in respect of an agreement the applicant contends is a forgery - where the applicant has commenced proceedings in a court in New Zealand against the respondent seeking relief with respect to the default judgment in the United States and damages for tortious conspiracy - where the applicant obtained interim and interlocutory injunctive relief in New Zealand restraining the respondent from enforcing the default judgment - where the respondent has taken steps to contravene and avoid the effect of the orders made in New Zealand - where the applicant applied to the Supreme Court of Queensland for interim injunctive relief against the respondent and orders were made - whether the orders involved a breach of comity - whether the proceeding is oppressive or vexatious - whether the Supreme Court of Queensland is a clearly inappropriate forum
[2]
PRIVATE INTERNATIONAL LAW - RESTRAINT OF PROCEEDINGS - OF FOREIGN PROCEEDINGS: ANTI SUIT INJUNCTIONS - TO PROTECT JURISDICTION OF COURT AND ITS PROCESSES - whether there is a serious question to be tried - whether the balance of convenience favours the grant of an interlocutory injunction or the continuation of the anti-enforcement injunctive relief
[3]
PROCEDURE - JUDGMENTS AND ORDERS - AMENDING, VARYING AND SETTING ASIDE JUDGMENTS AND ORDERS - EX PARTE ORDERS AND JUDGMENTS - where orders were made pursuant to ss 25 and 26 of the Trans-Tasman Proceedings Act 2010 (Cth) following an ex parte hearing - whether the applicant failed to make full disclosure to the court of the correct legal principles, material facts and defences which the respondent submits were available to him - whether the applicant failed to comply with its obligation of disclosure at the ex parte hearing - whether the orders should be set aside
[4]
PROCEDURE - STATE AND TERRITORY COURTS: JURISDICTION, POWERS AND GENERALLY - INHERENT AND GENERAL STATUTORY POWERS - TO STAY OR DISMISS ORDERS OR PROCEEDINGS GENERALLY - where the applicant filed an application seeking that the respondent be found to have committed a contempt of court by failing to comply with orders - where a warrant was issued for the respondent's arrest given his apparent non-compliance with orders - where the respondent subsequently delivered his passports to the custody of the court in compliance with the orders and the arrest warrant was vacated - whether the further prosecution of the contempt application would amount to an abuse of process - whether the contempt application should be permanently stayed - where the applicant sought relief from courts in the British Virgin Islands, United States, New Zealand and Australia upon substantially the same fraud argument - whether the further conduct of the proceeding would be unjustifiably oppressive - whether the further conduct of the proceeding amounts to an abuse of process - whether the proceeding should be permanently stayed
[5]
Criminal Code Act 1899 (Qld) sch 1, s 408C(1) and s 488(1)
G J Gibson KC, with P K O'Higgins and B W Wacker, for the applicant
[74]
D B O'Sullivan KC, with A J Schriiffer, for the respondent
[75]
[1] The applicant, Kea Investments Ltd (Kea), is a company incorporated in the British Virgin Islands (BVI) and controlled by Sir Owen Glenn.
[2] The respondent, Mr Wikeley, is a company director and businessman presently residing in Queensland and the sole director and shareholder of Wikeley Family Trustee Ltd (WFTL), a company incorporated in New Zealand.
[3] On 12 April 2023, this court heard an application brought ex parte by Kea (12 April hearing). At the conclusion of that hearing, I made orders pursuant to ss 25 and 26 of the Trans-Tasman Proceedings Act 2010 (Cth) (TTPA) granting interim relief against Mr Wikeley (12 April orders).[1] Those orders required that, among other things, Mr Wikeley:
[76]
(a) refrain from taking, or from causing corporate entities he controlled to take, any steps to enforce a default judgment granted by the Fayette Circuit Court in Kentucky in the United States (Kentucky Court) in favour of WFTL against Kea for US$123.75 million plus interest and costs (default judgment);[2]
(b) cause Wikeley Inc, the second of the corporate entities he controlled, to withdraw, adjourn or seek a continuation of motions pending in the Kentucky proceeding concerning the default judgment;
(c) not leave Australia, and deliver up his passports into the custody of the court.
[77]
[4] As contemplated by ss 25 and 26 of the TTPA, the 12 April orders were made in support of a civil proceeding commenced by Kea in New Zealand against Mr Wikeley, WFTL and another defendant, Mr Eric Watson.[3]
[5] The 12 April orders were expressed to have effect up to and including 21 April 2023, on which date there was to be an inter partes hearing to determine whether they should be continued on an interlocutory basis.
[6] On 13 April 2023, I revised the 12 April 2023 orders (13 April orders). The nature of that revision has no real significance to the present application, however the 13 April orders replaced the previous orders as the operative orders binding Mr Wikeley.
[7] On 14 April 2023, orders were made dispensing with the requirement for personal service on Mr Wikeley and for substituted service. The effect of this was that the 13 April orders and other court documents were deemed to have been served on Mr Wikeley that day.
[8] On 20 April 2023, Kea filed an application seeking that Mr Wikeley be found to have committed a contempt of court by failing to comply with the requirements of the 13 April orders (contempt application).
[9] On the return of the 13 April orders on 21 April 2023 (21 April hearing), Mr Wikeley was represented by a solicitor. At that hearing, the court:
[78]
(a) refused an application by Mr Wikeley for an adjournment of the inter partes hearing;
(b) made orders continuing the 13 April orders until 28 days after the final determination of the New Zealand proceeding or earlier order (21 April orders);
(c) issued a warrant for Mr Wikeley's arrest, given his apparent non-compliance with parts of the 13 April orders, including the requirement that he surrender his passports.
[79]
[10] On 26 April 2023, Mr Wikeley delivered his passports into the custody of the court. On that day, Mr Wikeley appeared before the court by counsel, instructed by new solicitors (26 April hearing). In response to an application by Kea to execute the arrest warrant, Mr Wikeley offered conditions in lieu of making orders for his immediate arrest. The court made orders, consistent with the conditions offered by Mr Wikeley, that he provide security for his appearance at the hearing of the contempt application and that he reside at a specified address and be subject to a curfew (26 April orders).
[11] On 3 May 2023, upon application by Mr Wikeley, the court vacated the arrest warrant and set aside the order for the issue of that warrant.
[12] The court subsequently made directions for Mr Wikeley to file any application he wished to make to set aside each of the 12 April orders, the 13 April orders, the 21 April orders and the 26 April orders. Mr Wikeley filed an application on 7 June 2023 and an amended application on 15 June 2023. By the amended application, Mr Wikeley not only seeks to set aside the existing court orders but also seeks to have the contempt application and Kea's proceeding in this court permanently stayed. This judgment addresses Mr Wikeley's amended application.
[13] Mr Wikeley submits that:
[80]
(a) the 12 April orders and the 13 April orders should be set aside on the basis that, at the 12 April hearing, Kea did not comply with its obligation of utmost good faith because it failed to make full disclosure to the court of:
(i) the correct legal principles which apply on applications for relief of the type obtained by Kea;
(ii) material facts which were relevant to the court's consideration whether to grant the interim injunctive relief;
(iii) defences which Mr Wikeley submits were available to him and which ought to have precluded the grant of the interim injunctive relief;
(b) the 21 April orders should be set aside on the basis that:
(i) Queensland is a clearly inappropriate forum in the sense that the proceeding brought by Kea in this jurisdiction is vexatious or oppressive;
(ii) on the merits of Kea's application, the court ought to have refused to grant the injunctive relief sought;
(c) the 26 April orders should be set aside because the occasion for the making of those orders only arose because of the 12 April orders and the 13 April orders and, in circumstances where those earlier orders should be set aside, the later consequential orders should also be set aside;
(d) the contempt application should be permanently stayed as an abuse of process because, if the 13 April orders are set aside for material non-disclosure, it would be an abuse of process, in the sense of bringing the administration of justice into disrepute among right thinking people, if Kea were to be permitted to invoke the court's processes to punish Mr Wikeley for contempt of that order;
(e) the proceeding should be permanently stayed as an abuse of process because Kea's use of the court's procedures is unjustifiably oppressive to Mr Wikeley.
[81]
[14] For the reasons that follow, I have concluded that:
[82]
(a) the application to set aside the 12 April orders and the 13 April orders must be dismissed because I am not satisfied that Kea failed to comply with its obligation of disclosure at the 12 April hearing;
(b) the application to permanently stay the contempt application must be dismissed because, in circumstances where the 12 April orders and the 13 April orders have not been set aside, I am not satisfied that the further prosecution of the contempt application would amount to an abuse of process;
(c) upon the application of Kea's solicitors to hold the sum of $100,000 in their trust account as security for Kea's undertaking as to damages, the application to set aside the 21 April orders will be dismissed because I am satisfied in the circumstances of this proceeding that it is appropriate for those orders to remain in effect;
(d) paragraphs 2 to 4 of the orders made on 26 April 2023 are to be set aside because I am satisfied that, in the present circumstances, the conditions of residence, curfew and security set out in those paragraphs are no longer justified;
(e) the application to permanently stay the proceeding must be dismissed because, having regard to the conclusions I have reached in addressing the continuing operation of the 21 April orders, I am not satisfied that the further conduct of the proceeding would be unjustifiably oppressive to Mr Wikeley and does not amount to an abuse of process.
[83]
[15] Kea contends that it is the victim of a major and ongoing fraudulent conspiracy, and that Mr Wikeley is at the heart of the fraud.
[16] The conspiracy is said to have arisen from a dispute between Sir Owen Glenn and Mr Watson concerning Kea's participation in an investment called Project Spartan. On 31 July 2018, the High Court of England and Wales found that Kea and Sir Owen Glenn had been fraudulently induced to participate in that investment at a cost of £129 million.[4] Mr Watson was found to be the architect of the fraud. Kea's director at the relevant time, Mr Peter Dickson, was found to have breached his fiduciary duties to the company.
[17] Kea asserts that the Coal Funding and JV Investment Agreement (Coal Agreement), which WFTL relied on to obtain the default judgment in the Kentucky Court, is a forgery, or at least is unenforceable. It maintains that the purpose of the Kentucky proceeding brought by WFTL is to frustrate Kea's enforcement of the English judgment against Mr Watson, to force disclosure of Kea's confidential financial information and to extract value from Kea.
[84]
[18] The Coal Agreement purports to be an agreement between Mr Wikeley, as trustee for the Wikeley Family Trust, and Kea. On its face, it was executed by Mr Wikeley and by Mr Dickson, Kea's then director, on 23 October 2012 with both signatures having been witnessed by Mr Watson.
[19] The recitals record that Kea and Mr Wikeley had agreed to enter into a joint venture for the purpose of investing in coal and other energy projects identified by Mr Wikeley. They refer to various prospective investments, including a coal project in Kentucky.
[20] Under the terms of the Coal Agreement, Kea was obliged to provide a minimum capital amount of US$75 million over 8 years to the joint venture to fund the proposed investments. Those capital payments were to be made by way of 20-year loans at an interest rate of 3%. The loans were to be repaid once investments were sold or placed in listed corporate vehicles. Kea would receive 60% of the joint venture profits. No security was to be provided for the loans.
[21] Although the wording of the Coal Agreement is far from clear, it appears that Kea also agreed to pay a royalty of US$1.5 million per year for a period of 20 years to Mr Wikeley "irrespective as to whether production has commenced or not, or if for any reason investment has been delayed".
[22] Under the terms of the Coal Agreement, Kea also:
[85]
(a) indemnified Mr Wikeley for any losses and lost profits if it failed to provide a minimum capital amount of $US75 million;
(b) guaranteed its performance of all its obligations under the agreement, including the capital funding commitment and the royalty payment, in all circumstances including negligence by Mr Wikeley;
(c) in the event it failed to provide the minimum capital amount, indemnified Mr Wikeley for the greater of 25% of the estimated profits from the proposed investments - in one place said to be US$375 million and in another place said to be £375 million - or 25% of the actual profits earned by third parties from the projects identified by Mr Wikeley for investment (if capable of determination).
[86]
[23] The Coal Agreement also contained a jurisdiction clause which provided:
[87]
"The parties have agreed that the jurisdiction shall be the USA. The contract will be governed by the laws in Lexington, Kentucky and any applicable Federal law."
[88]
The commencement of the Kentucky proceeding and the grant of default judgment
[89]
[24] Mr Wikeley incorporated WFTL on 23 July 2021, apparently to replace him as trustee of the Wikeley Family Trust.
[25] On 19 August 2021, WFTL commenced the Kentucky proceeding. In its first amended complaint filed with the Kentucky Court on 3 December 2021, WFTL pleaded the Coal Agreement and alleged that Kea had breached the terms of that agreement by failing to provide the minimum capital amount of US$75 million and failing to pay the royalty of US$1.5 million per year. WFTL claimed to have suffered loss and damage of more than US$123.75 million.[5]
[26] On 6 December 2021, WFTL effected service of the Kentucky proceeding on Kea at its registered office, being the offices of its registered agent Icaza, Gonzalez-Ruiz & Aleman (BVI) Trust Ltd in Tortola, BVI. Due to oversight on the part of its agent, the Kentucky proceeding was not passed on to Kea.
[27] Kea did not enter an appearance in the Kentucky proceeding or file an answer to WFTL's complaint. On 28 January 2022, WFTL filed a motion for default judgment in the Kentucky proceeding. On 31 January 2022, the Kentucky Court granted the default judgment in favour of WFTL.
[90]
[28] On 28 June 2022, WFTL served a statutory demand on Kea by its registered agent in the BVI. That demand claimed a debt arising under the default judgment of more than US$136 million including interest and costs.
[29] The statutory demand was passed on to Kea and its English solicitors on 29 June 2022. Kea contends that this was the first notice it received of either the default judgment or the Coal Agreement. Kea asserts that the Coal Agreement, and the claims made under it, are fabrications constructed by Mr Wikeley and Mr Watson to defraud Kea.
[30] On 12 July 2022, Kea applied to set aside the statutory demand on the basis that there was a genuine dispute as to whether the debt was owed. Kea stated its intention to apply to have the default judgment set aside and its belief, based on information provided by its Kentucky counsel, that there was a legal basis to set aside the default judgment because, among other arguments, Kea never entered into the Coal Agreement.
[91]
Kea's attempts to set aside the default judgment and quash subpoenas
[92]
[31] On 21 July 2022, Kea filed a motion in the Kentucky proceeding to set aside the default judgment. That motion recorded that Kea entered a limited appearance in the Kentucky proceeding for the purpose of contesting the jurisdiction of the Kentucky Court. In submissions filed in support of that motion, Kea stated that there was significant evidence showing that the Coal Agreement was "a falsehood" and "fraudulent or otherwise fake" and, for that reason, the Kentucky Court did not have personal jurisdiction over Kea. Further, Kea sought to have the default judgment set aside under the relevant procedural rules in Kentucky on grounds which included fraud.
[32] On 18 October 2022, the Kentucky Court denied Kea's motion to set aside the default judgment, finding that because Kea was properly served it was not necessary for the court to determine whether Kea had a meritorious defence to WFTL's claim.
[33] On 21 October 2022, Kea filed a motion in the Kentucky proceeding to alter, amend or vacate the decision of the Kentucky Court to deny the motion to set aside the default judgment. In support of that motion, Kea again made submissions that the Coal Agreement is a fraud. That motion was heard by the Kentucky Court on 28 October 2022. During that hearing, counsel representing Kea accepted that the Kentucky proceeding had been validly served on Kea and that the default judgment was regularly entered.
[34] On 9 November 2022, the Kentucky Court denied Kea's motion to alter, amend or vacate its earlier decision. In reaching that decision the Kentucky Court did not consider the merits of Kea's fraud defence.
[35] On the same day, Kea filed an appeal in the Kentucky proceeding (Kentucky appeal). Kea's arguments on the Kentucky appeal include a submission that the default judgment should be set aside because of fraud.
[36] In the period Kea was taking steps to have the default judgment set aside it also filed a motion in the Kentucky proceeding to quash subpoenas issued by WFTL to numerous banks. Those subpoenas sought broad categories of documents relating to Kea, Sir Owen Glenn and other entities going back to January 2012. In support of its motion to quash the subpoenas, Kea repeated its argument that the Coal Agreement is a fraud. Kea also relied on that argument in support of a motion it filed in the Supreme Court of the State of New York to quash subpoenas which WFTL caused to be issued in that state.
[93]
[37] Kea commenced the New Zealand proceeding on 31 October 2022.
[38] In the statement of claim filed in the New Zealand proceeding, Kea has pleaded the following background facts in support of its claim of fraudulent conspiracy:
[94]
(a) the dispute between Sir Owen Glenn and Mr Watson and the litigation concerning Project Spartan;
(b) Mr Wikeley's incorporation of WFTL and the course of the Kentucky proceeding;
(c) that Mr Watson provided assistance to WFTL in its conduct of the Kentucky proceeding, including by providing documents extracted from the trial bundle used in the Project Spartan litigation;
(d) conduct by Mr Rizwan Hussain, said to be a known fraudster acting in concert with Mr Watson, which included:
(i) an attempt to take control of Kea by purporting to replace its directors and to settle the Kentucky proceeding for the sum of US$100 million;
(ii) writing to the Kentucky Court and purporting to withdraw Kea's motion to set aside the default judgment;
(iii) bringing proceedings in the High Court of England and Wales in Kea's name against Sir Owen Glenn and Kea's lawyers in England and the BVI;
(e) Kea's efforts to strike out the proceedings instituted by Mr Hussain;
(f) that WFTL's Kentucky lawyers filed a notice of settlement agreement in the Kentucky proceeding following the purported settlement effected by Mr Hussain.
[95]
[39] As to the default judgment, Kea has pleaded:
[96]
(a) that the Coal Agreement is a forgery and was not signed by Mr Dickson on behalf of Kea;
(b) alternatively, if Mr Dickson did sign the Coal Agreement, its terms were so uncommercial that Mr Dickson could not have believed in good faith that entering into that agreement was in the best interests of Kea and thereby breached his duties as a director, and that Mr Wikeley and Mr Watson were aware of this at the time the Coal Agreement was signed;
(c) the default judgment was procured by fraud because:
(i) WFTL, by Mr Wikeley, knew the Coal Agreement to be a forgery or knew that it had no legitimate claims against Kea;
(ii) there was a fraud on the Kentucky Court because the default judgment involved misleading the Kentucky Court.
[97]
[40] Based on the foregoing matters, Kea has pleaded a cause of action for tortious conspiracy on the basis that WFTL and Mr Wikeley have acted in combination with the intention of injuring Kea by unlawful means by:
[98]
(a) making claims against Kea under the Coal Agreement in circumstances where WFTL, by Mr Wikeley, knew it had no legitimate claims under that agreement;
(b) procuring the default judgment by fraud;
(c) attempting to enforce the default judgment;
(d) accepting the purported settlement sought to be effected by Mr Hussain.
[99]
[41] Kea has further pleaded that WFTL and Mr Wikeley are acting in combination with Mr Watson to further the interests of Mr Watson, as well as the interests of WFTL and Mr Wikeley. The purpose of the conspiracy is alleged to include:
[100]
(a) to cause loss to Kea by pursuing fraudulent claims under the Coal Agreement;
(b) to take control of Kea for the purpose of fraudulently obtaining its assets;
(c) assisting Mr Watson in continuing to avoid his obligations to Kea under the English judgment, including by disabling Kea from enforcing that judgment by having it placed into liquidation;
(d) illegitimately obtaining Kea's confidential information and using that information to defraud or otherwise damage Kea;
(e) to divert Kea's attention and resources to investigating and responding to their conduct.
[101]
[42] The relief Kea has sought on its claim for tortious conspiracy by unlawful means includes:
[102]
(a) damages in an unspecified amount for the costs which Kea has incurred by investigating and responding to the defendants' unlawful conduct;
(b) a permanent injunction restraining the defendants from:
(i) seeking to enforce the default judgment anywhere in the world, including by issuing subpoenas, issuing interrogatories, seeking discovery or otherwise seeking disclosure of information concerning Kea;
(ii) taking any further steps to enforce or otherwise rely on the Coal Agreement.
[103]
[43] Kea has also pleaded a second cause of action against WFTL and Mr Wikeley for declarations that the default judgment was obtained by fraud and is not entitled to recognition or enforcement in New Zealand.
[44] When it commenced the New Zealand proceeding, Kea filed an interlocutory application for an anti-enforcement injunction. That application was brought on an ex parte basis.
[45] On 4 November 2022, Gault J made orders ex parte,[6] which included:
[104]
(a) an anti-enforcement injunction in respect of the default judgment in the Kentucky proceeding;
(b) an order prohibiting the defendants from selling, assigning or otherwise transferring any interest any of them may have under or in connection with the Coal Agreement or the default judgment in the Kentucky proceeding.
[105]
[46] On 10 November 2022, WFTL and Mr Wikeley filed:
[106]
(a) an appearance in the New Zealand proceeding under protest to jurisdiction on the ground that New Zealand is not the appropriate forum to hear the matters raised in that proceeding; and
(b) an application under protest as to jurisdiction seeking to have the interim orders set aside and the New Zealand proceeding dismissed on grounds of want of jurisdiction and forum non conveniens.
[107]
[47] The interim orders were varied and extended with the consent of WFTL and Mr Wikeley on 11 November 2022.
[48] The application by WFTL and Mr Wikeley seeking to have the interim orders set aside and the New Zealand proceeding dismissed was heard on 12 December 2022. The interim orders, including the anti-enforcement injunction, were continued on that date.
[49] On 10 March 2023, Gault J dismissed the application by WFTL and Mr Wikeley challenging jurisdiction and the interim orders were continued on an interlocutory basis.[7]
[50] Kea subsequently became aware that WFTL had purported to assign the default judgment and its rights under the Coal Agreement to Wikeley Inc. Wikeley Inc was incorporated in Kentucky on 28 March 2023. The articles of incorporation of Wikeley Inc records Mr Wikeley as having incorporated the company. The assignments of WFTL's rights to Wikeley Inc were executed on 30 March 2023.
[51] Mr Wikeley executed the assignment of the default judgment on behalf of WFTL. He executed the deed of assignment of the Coal Agreement as director of WFTL, as assignor, and as director of Wikeley Inc, as assignee. Mr Wikeley executed those assignment documents in Queensland, as evidenced by his signatures having been witnessed by a Queensland justice of the peace.
[52] WFTL served notices of the assignments on Kea's agent in the BVI on 3 April 2023.
[53] On 4 April 2023, Wikeley Inc filed a motion in the Kentucky proceeding to be substituted as plaintiff in place of WFTL (substitution motion). The substitution motion attached two further motions which Wikeley Inc sought to have heard upon its substitution as plaintiff. The first was a motion to compel Kea to provide responses to post-action discovery requests (discovery motion). The second was a motion for an anti-suit injunction restraining Kea from continuing to prosecute the New Zealand proceeding (anti-suit injunction motion).
[54] On 6 April 2023, Kea filed an ex parte application for further interim relief, including:
[108]
(a) orders that Mr Wikeley:
(i) not permit Wikeley Inc to take any steps to enforce or otherwise act on the assignments, the substitution motion, the discovery motion or the anti-suit injunction motion;
(ii) cause Wikeley Inc to withdraw the substitution motion, the discovery motion and the anti-suit injunction motion;
(b) the appointment of interim liquidators to WFTL.
[109]
[55] Gault J granted the interim relief sought by Kea. The minute of order dated 6 April 2023 recorded that Gault J was satisfied that Mr Wikeley was likely to have failed to comply with duties relating to WFTL by, apparently, acting in breach of the existing interim orders in purporting to assign the Coal Agreement and the default judgment in breach of Mr Wikeley's duty to exercise his powers as a director of WFTL for a proper purpose.
[56] Kea brought its application for interim relief under the TTPA in this court after it became aware of the purported assignment of the Coal Agreement and the default judgment in the Kentucky proceeding, and in circumstances where the substitution motion was listed for hearing in the Kentucky Court on 14 April 2023.
[110]
Events since the making of the 12 April orders and the 13 April orders
[111]
[57] On 14 April 2023, the Kentucky Court adjourned the hearing of the substitution motion until 21 April 2023.
[58] On 20 April 2023, the interim liquidators of WFTL filed a petition in the United States Bankruptcy Court for the Eastern District of Kentucky (US Bankruptcy Court) for recognition of the interim liquidation of WFTL as a foreign main proceeding under Chapter 15 of the United States Bankruptcy Code, as well as an emergency motion for provisional relief.
[59] On 21 April 2023:
[112]
(a) on the resumed hearing of the substitution motion in the Kentucky proceeding, Wikeley Inc informed the Kentucky Court that it would file a parallel motion for substitution in the Kentucky appeal;
(b) in light of that indication, the Kentucky Court deferred ruling on the substitution motion until a ruling had been given on the parallel motion in the Kentucky appeal;
(c) Wikeley Inc filed its motion for substitution in the Kentucky appeal;
(d) the US Bankruptcy Court made orders on the emergency motion by the interim liquidators staying any execution against WFTL's assets in the United States.
[113]
[60] On 25 May 2023, the US Bankruptcy Court recognised the interim liquidation of WFTL as a foreign main proceeding under Chapter 15 of the United States Bankruptcy Code. Wikeley Inc has appealed that recognition order.[8] The evidence on this application does not reveal whether that appeal has been heard.
[61] On the material before me, it appears that the effect of the grant of provisional relief and the making of the recognition order by the US Bankruptcy Court is that the substitution motions in the Kentucky proceeding and in the Kentucky appeal are now stayed.
[62] On 26 May 2023, an order was made that the Kentucky appeal be held in abeyance for 90 days. During submissions on the present application, I was informed that the Kentucky appeal is effectively in abeyance pending resolution of the US Bankruptcy proceeding.
[63] In the New Zealand proceeding, Mr Wikeley applied for leave to appeal against the decision to dismiss his application challenging jurisdiction. That application for leave to appeal was heard by Gault J on 13 July 2023 and dismissed on 31 August 2023.[9]
[114]
[64] Mr Wikeley submitted that, although he is the moving party on the present application, it is for Kea, as the party who obtained the 12 April orders, the 13 April orders and the 21 April orders, to show that there is a sufficient basis to justify the making of those orders.
[65] Kea submitted that, in circumstances where the 12 April orders and the 13 April orders made ex parte were replaced by the 21 April orders made inter partes, and Mr Wikeley did not submit at the 21 April hearing or the 26 April hearing that the orders made ex parte should not be continued on an interlocutory basis, it no longer carries an onus of justifying the continuation of the ex parte orders. On that basis, Kea says, Mr Wikeley bears the onus of satisfying the court that the orders he seeks should be made.
[66] Before turning to consider the authorities referred to in the parties' submissions, it is important to note the different bases upon which Mr Wikeley relies in seeking to set aside the various orders. As already noted at [13](a) above, his challenge to the 12 April orders and the 13 April orders made ex parte is based on material non-disclosure by Kea when it applied for those orders. Mr Wikeley accepts, however, that a finding of non-disclosure would not provide a basis to set aside the 21 April orders made inter partes. It is for that reason that he seeks to have the 21 April orders set aside on[10]he merits.10
[67] It is also relevant to note that, in opposing Mr Wikeley's application for an adjournment of the 21 April hearing, Kea made submissions that, because the orders it sought to have made on an interlocutory basis would expressly provide for their continuation until the determination of the New Zealand proceeding "or earlier order" and that the parties had liberty to apply, it was open to Mr Wikeley to bring an application to vary or set aside the interlocutory orders at any stage.[11] I accepted those submissions when I dismissed Mr Wikeley's adjournment application and made the 21 April orders. The effect of the way the 21 April hearing was conducted is that, prior to argument on the present application, Mr Wikeley had not been heard on the question whether the orders should continue.
[115]
"However, where the parties agree upon the manner in which an application for interlocutory relief is to be disposed of and relief is granted pursuant to that agreement, whether by way of injunction or the acceptance by the Court of an undertaking, without any contest, any subsequent application for the variation of that relief must be approached on the basis of what justice requires as between the parties."
[116]
and said in respect of the phrase "until further order of the Court":[16]
[117]
"In the absence of any countervailing circumstances and of any reference to the final hearing of the proceedings, I take this phrase to express the mutual contemplation by the parties that at some time pending the final hearing of the proceedings the question of whether the second defendant should continue to be restrained from selling or completing any contract of sale of its land might properly be submitted for determination by the Court, such determination to supersede the agreed undertakings.
[118]
In these circumstances, although in a technical sense the second defendant as the moving party has the onus of showing that the orders it seeks should be made, the question is in substance, whether the plaintiffs are entitled on ordinary principles to interlocutory relief restraining the second defendant from selling or completing any contract for the sale of its land."
[119]
[70] In Brimaud, McLelland J (as his Honour then was) referred to the issue again by reference to the earlier statement in Warringah:[17]
[120]
"Not all kinds of interlocutory orders attract the same considerations. For present purposes one may put to one side orders of a merely procedural nature (as to which see for example Wilkshire & Coffey v Commonwealth(1976) 9 ALR 325) and injunctions (or undertakings) made or given by agreement and without contest 'until further order' (as to which see for example Warringah Shire Council v Industrial Acceptance Corp (unreported, SC(NSW), McLelland J, 22 November 1979)."
[121]
[71] In Nicols, Cheeseman J referred to the statements in Warringah and Brimaud extracted above before addressing the facts of that case:[18]
[122]
"The parties did not lead any evidence against which I can assess the 'nature and quality of the consent underpinning' the orders made in the present case. The chronology exposed by the Court record reveals that at the same time as the freezing orders were made by consent, timetabling orders were also made by consent for the inter partes hearing in respect of the ex parte orders to be vacated and for the service of any draft statement of claim. There has been no hearing on the merits. The examinations of Mr and Mrs Manietta were in train at the time the consent orders were made having commenced on 11 August 2020 and continued on 12, 13 and 25 August 2020. Viewed in this context and in the absence of any evidence as to what led to the consent orders being entered I would readily infer the parties being otherwise occupied in respect of the examinations and progressing the pleadings in the substantive proceedings agreed to put off the inter partes contest in respect of the freezing orders to a later time should it be necessary to agitate it. For these reasons, while in the technical sense, described by McLelland J, the respondents as moving party, bear the onus on the discharge application, as a matter of substance it is for the Trustee to justify the freezing orders. I am satisfied that justice requires this approach as between the parties."
[123]
[72] Kea submitted that the principles were correctly stated by Brereton J (as his Honour then was) in Brags Electric Pty Ltd trading as Inscope Building Technologies v Steven Mark Gregory:[19]
[124]
"An ex parte order is always a provisional one. Ordinarily, in the case of an ex parte injunction when the matter returns before the court, the applicant bears the onus of showing that there is a sufficient case to justify the continuation of the ex parte order on an interlocutory basis. But that does not involve an application to set aside the original ex parte order: the question in such circumstances is usually not whether the original order should be set aside, but whether it should be continued for a further period of time. Although it is true that even where an ex parte order is made 'until further order', the plaintiff still bears the onus of showing that it should be continued, that is really no more than a reflection that the practical convenience of sometimes making such orders until further order does not involve any reversal of where the onus lies. Where, however, a respondent applies to set aside an ex parte order on the basis that there has been a material non-disclosure, it will then bear an onus of showing that there has been a non-disclosure."
[125]
[73] I accept that this statement from Brags applies to Mr Wikeley's application to set aside the 12 April orders and the 13 April orders for material non-disclosure. Mr Wikeley bears the onus of showing that there has been a non-disclosure.
[74] As to the 21 April orders, this case differs from the authorities referred to by Mr Wikeley because the 12 April orders and the 13 April orders were not continued by consent. Nevertheless, I take the view that as matter of substance it is for Kea to justify the continuation of the 21 April orders. That is because of the way that the 21 April hearing proceeded, the fact that by use of the words "or earlier order" the 21 April orders contemplated Mr Wikeley challenging those orders at a later time and that, consequently, the 21 April orders were made without contest and without Mr Wikeley being heard on the question whether the ex parte orders should be continued.
[75] The matters upon which Kea bears the onus in seeking to establish a basis for the continuation of the 21 April orders on the merits are:[20]
[126]
(a) whether this court is a clearly inappropriate forum according to the principles in Voth v Manildra Flour Mills Pty Ltd,[21]
(b) whether there is a serious question to be tried; and, if so
(c) whether the balance of convenience favours the grant of an interlocutory injunction.
[127]
[76] In the course of argument, Mr Wikeley submitted that, at the stage of considering the issue of a serious question to be tried, the relevant inquiry for this court is whether there is a serious question to be tried that a permanent anti-enforcement injunction would be granted in the circumstances of the present proceeding. I accept that submission.
[77] As to Mr Wikeley's application to set aside the 26 April orders, those orders were made after a contested hearing during which Mr Wikeley made submissions through counsel, and in fact were made following the offer of conditions by his counsel, in response to an application for execution of the arrest warrant. Accordingly, there is no basis to conclude that, as a matter of substance, it is for Kea to justify the continuation of the 26 April orders. Mr Wikeley bears the onus of satisfying the court that the 26 April orders should be set aside. Likewise, Mr Wikeley, as the moving party, bears the onus on his application to permanently stay the contempt application and to permanently stay this proceeding.
[128]
[78] Section 26 of the TTPA imposes three conditions which must be met before the court's discretion to grant interim relief is engaged:
[129]
(a) pursuant to s 26(1)(a), the court must consider it appropriate to grant the interim relief in support of the New Zealand proceeding;
(b) pursuant to s 26(1)(b)(i), the court must be satisfied that, if a proceeding similar to the New Zealand proceeding had been commenced in the court, it would have had power to grant the interim relief in that similar proceeding;
(c) pursuant to s 26(1)(b)(ii), the court must also be satisfied that it would have granted the interim relief in that similar proceeding.
[130]
[79] I accept Mr Wikeley's submission that in the circumstances of this case the hypothetical "similar proceeding" referred to in s 26(1)(b)(i) and (ii) would comprise:
[131]
(a) a proceeding for final relief in a similar form as was filed in the New Zealand proceeding on 31 October 2022 seeking relief which includes a permanent anti-enforcement injunction in similar terms as sought in the New Zealand proceeding (see [42](b) above);
(b) an application for interim and interlocutory relief in a similar form to that filed in the New Zealand proceeding on 31 October 2022;
(c) an application for further interim and interlocutory relief in a similar form to that filed in the New Zealand proceeding on 6 April 2023.
[132]
[80] The inquiry as to whether there is a serious question to be tried that a permanent anti-enforcement injunction would be granted must be undertaken by reference to this hypothetical similar proceeding. It was common ground in the argument before me that the counterfactual questions posed by ss 26(1)(b)(i) and (ii) are to be answered by applying the law of Queensland to the facts as established by the evidence before me on the hearing of the present application.
[81] Kea did not challenge Mr Wikeley's submission that, in circumstances where interim relief has been granted in the New Zealand proceeding and similar interim relief is then sought in this court, ss 25 and 26 of the TTPA do not contemplate or permit this court simply enforcing, in Australia, an interim order made in New Zealand or adopting the findings made by the New Zealand court. I accept Mr Wikeley's submission that this court must:
[133]
(a) consider whether to make its own order and, in doing so, apply the terms of s 26;
(b) satisfy itself of the legal principles that apply to an application for interim relief in Queensland and apply those principles;
(c) make its own findings of fact based on admissible evidence filed in this proceeding.
[134]
[82] Kea also accepted that submissions Mr Wikeley made about considerations of comity are relevant to the court's consideration whether to grant interim relief under s 26 of the TTPA. There was discussion during the hearing of the application as to whether those matters ought be considered as part of the enquiry under s 26(1)(a) - whether the court considers it appropriate to give the interim relief in support of the New Zealand proceeding - or as part of the enquiry under s 26(1)(b): whether the court would have had power to give, and would have given, the interim relief in a similar proceeding brought in this court. Ultimately, I do not think anything turns on the resolution of that issue. In circumstances where the parties are agreed that those matters must be taken into account at some point when the court considers whether to grant interim relief under s 26 then I do not need to say anything further about it.
[83] There was an issue whether the question of clearly inappropriate forum, as understood in Voth,[22] arises for determination on an application for interim relief under ss 25 and 26 of the TTPA.
[84] Kea submitted that the question does not arise for consideration in the context of such an application. That submission was based on the legislative history of s 26. Kea relied upon the repeal of s 26(2) from the TTPA and the explanation for that repeal. The repealed subsection had provided that an Australian court may refuse to give the interim relief if it considered that it had no jurisdiction, apart from s 26, in relation to the subject matter of the New Zealand proceeding and for that reason it would be inexpedient to give the interim relief. That was said to be unnecessary because the Australian court would already have considered issues of jurisdiction and expediency when assessing whether it is appropriate to grant relief under s 26(1)(a).[23]
[85] I do not accept Kea's submission. The question whether an Australian court is a clearly appropriate forum is different to issues of jurisdiction and expediency. Where the interim relief sought under ss 25 and 26 of the TTPA is an anti-suit injunction or an anti-enforcement injunction, the condition imposed by s 26(1)(b)(ii) - that, if a proceeding similar to the New Zealand proceeding had been commenced, the Australian court would have given the interim relief - must involve a consideration of the question whether the Australian court is a clearly inappropriate forum.
[135]
The obligation to make disclosure on an ex parte hearing
[136]
[86] In Thomas A Edison Ltd v Bullock,[24] Isaacs J described the duty of a party seeking ex parte orders in the following terms:[25]
[137]
"... it is the duty of a party asking for an injunction ex parte to bring under the notice of the Court all facts material to the determination of his right to that injunction, and it is no excuse for him to say that he was not aware of the importance. Uberrima fides is required, and the party inducing the Court to act in the absence of the other party, fails in his obligation unless he supplies the place of the absent party to the extent of bringing forward all of the material facts which that party would presumably have brought forward in his defence to that application. Unless that is done, the implied condition upon which the Court acts informing its judgment is unfulfilled and the order so obtained must almost invariably fall."
[138]
[87] The obligation of disclosure was further explained by Alsop J (as his Honour then was) in Walter Rau Neusser Oel Und Fett AG v Cross Pacific Trading Pty Ltd:[26]
[139]
"That does not mean stating matters obliquely, including documents in voluminous exhibits, and merely not mis-stating the position. It means squarely putting the other side's case, if there is one, by coherently expressing the known facts in a way such that the Court can understand, in the urgent context in which the application is brought forward, what might be said against the making of the orders. It is not for the Court to search out, organise and bring together what can be said on the respondents' behalf. That is the responsibility of the applicant, through its representatives."
[140]
[88] The question of what constitutes a material fact was considered in Savcor Pty Ltd v Cathodic Protection International APS:[27]
[141]
"The obligation is to disclose all material facts. What is a material fact is a matter which is relevant to the court's determination. To be material, it would have to be a matter of substance in the decision making process.
[142]
In Brink's Mat Ltd v Elcombe, Ralph Gibson LJ conveniently summarised the principles. His Lordship noted that 'the material facts are those which it is material for the judge to know in dealing with the application as made: materiality is to be decided by the court and not by the assessment of the applicant or his legal advisers.' His Lordship observed that the applicant must make proper enquiries before making an application. If a material non-disclosure is established the court would be astute to ensure that the plaintiff obtaining an ex parte order without full disclosure is deprived of any advantage he may have derived, and further that whether a fact not disclosed 'is of sufficient materiality to justify or require immediate discharge of the order without examination of the merits depends on the importance of the facts to the issues which were to be decided by the judge on the application.' His Lordship pointed out that the innocence or otherwise of the non-disclosure and the failure to understand its relevance are important factors to take into account."
[143]
[89] In Re South Downs Packers Pty Ltd,[28] a decision of the Full Court of this court, the same question was succinctly answered as follows:[29]
[144]
"A non-disclosure will not be material unless it be likely to influence the court in acceding to the application."
[145]
[90] In Brink's-MAT Ltd v Elcombe,[30] Slade LJ observed:[31]
[146]
"The principle is, I think, a thoroughly healthy one. It serves the important purposes of encouraging persons who are making ex parte applications to the court diligently to observe their duty to make full disclosure of all material facts and to deter them from failure to observe this duty, whether through deliberate lack of candour or innocent lack of due care.
[147]
Nevertheless, the nature of the principle, as I see it, is essentially penal and in its application the practical realities of any case before the court cannot be overlooked. By their very nature, ex parte applications usually necessitate the giving and taking of instructions and the preparation of the requisite drafts in some haste. Particularly in heavy commercial cases, the borderline between material facts and non-material facts may be a somewhat uncertain one. While in no way discounting the heavy duty of candour and care which falls on persons making ex parte applications, I do not think the application of the principle should be carried to extreme lengths. In one or two other recent cases coming before this court, I have suspected signs of a growing tendency on the part of some litigants against whom ex parte injunctions have been granted, or of their legal advisers, to rush to the R v Kensington Income Tax Comrs principle as a tabula in naufragio, alleging material non-disclosure on sometimes rather slender grounds, as representing substantially the only hope of obtaining the discharge of injunctions in cases where there is little hope of doing so on the substantial merits of the case or on the balance of convenience."
[148]
[91] That statement was referred to with approval by Basten JA, with whom Beazley ACJ and Leeming JA agreed, in Fitz Jersey Pty Ltd v Atlas Construction Group Pty Ltd.[32]
[149]
Was there adequate disclosure at the 12 April hearing?
[150]
[92] With those principles in mind, I turn to consider whether Kea failed to adequately disclose any of the matters which Mr Wikeley relies on in his application to set aside the 12 April orders and the 13 April orders.
[151]
Whether this court is a clearly inappropriate forum
[152]
[93] Where an anti-suit injunction is sought in the exercise of the court's equitable jurisdiction, the court is required to consider whether it is appropriate - in the Voth sense that it is not clearly inappropriate - for it to determine the matters in issue. If the court decides that it is clearly an inappropriate forum then the occasion for considering whether or not to grant an anti-suit injunction will not arise.[33]
[94] Mr Wikeley submitted that Kea failed to draw this requirement to the court's attention at the 12 April hearing. He contended that the effect of this non-disclosure was that Kea did not ask the court to make a finding that it was not a clearly inappropriate forum before considering whether to make the 12 April orders.
[95] These submissions relied upon part of Kea's outline for the 12 April hearing (12 April outline)[34] where, under the heading "Jurisdiction", it cited paragraph 47 of the 2022 NZ Judgment. In that paragraph, Gault J accepted that New Zealand appeared to be the appropriate forum for Kea's claims and set out reasons for that conclusion. His Honour then noted that the New Zealand court may grant urgent interim relief before service has been effected on overseas parties, and before any protest to jurisdiction - including any question about appropriate forum - has been determined.[35]
[96] Mr Wikeley submitted that, in considering issues about appropriate forum, the New Zealand courts apply principles set out in Spiliada Maritime Corp v Cansulex Ltd,[36] which were rejected by the High Court in Voth.
[97] I do not accept that, by its reference to paragraph 47 of the 2022 NZ Judgment, Kea failed to disclose the requirement that this court consider whether it was a clearly inappropriate forum. Mr Wikeley's submissions ignore earlier parts of the 12 April outline which specifically refer to both CSR and Mackellar, the authorities which set out the requirement.[37] In particular, paragraph 33 of the 12 April outline referenced paragraphs 29 to 33 of Mackellar in which the Court of Appeal stated the requirement.
[153]
The principles relating to anti-suit injunctions and anti-enforcement injunctions
[154]
[99] Mr Wikeley submitted that Kea failed to identify the correct principles for an anti-suit injunction or an anti-enforcement injunction because the 12 April outline referred to the approach taken in the 2022 NZ Judgment and the described that approach as "an orthodox approach".[38] That approach involved the New Zealand court considering the following five matters: (i) whether it had personal jurisdiction over the defendants; (ii) whether there was a serious question to be tried; (iii) whether further steps by the respondents to the application to enforce the default judgment would be oppressive or vexatious; (iv) whether Kea had delayed; and (v) whether the balance of convenience and overall justice favoured the granting of interim relief.
[100] Instead, Mr Wikeley argued, the principles which Kea ought to have identified as applying to an application for an anti-suit injunction and an anti-enforcement injunction are those set out in detail in his written submissions on the present application.[39]
[101] The difficulty with Mr Wikeley's submission is that it fails to take account of other parts of the 12 April outline where the principles which apply to anti-suit injunctions and anti-enforcement injunctions were addressed.[40] The 12 April outline directed this court to a discussion in the 2022 NZ Judgment of principles which immediately preceded his Honour's description of the approach taken in determining the application for interim relief in the New Zealand proceeding.[41] Gault J's discussion included reference to CSR and numerous English decisions which have also been applied in Australia.
[102] Although the discussion of the relevant principles in the 12 April outline and, by reference, in the 2022 NZ Judgment, is not as detailed as that set out in Mr Wikeley's written submissions on the present application, I consider that, given the urgency attending the 12 April hearing, Kea provided adequate disclosure of the principles which apply to an application for an anti-suit injunction or an anti-enforcement injunction.
[155]
[103] Mr Wikeley submitted that Kea failed to inform the court that there was a four-month delay between 29 June 2022, when Kea alleges that it became aware of the default judgment in the Kentucky proceeding, and when it commenced the New Zealand proceeding on 31 October 2022.
[104] I do not accept that submission. When making the 12 April orders, the court was aware that Kea:
[156]
(a) received the statutory demand seeking to enforce the default judgment on 29 June 2022;[42]
(b) commenced the New Zealand proceeding on 31 October 2022.[43]
[157]
[105] Nonetheless, Mr Wikeley submitted it was not sufficient to raise the issue of delay in what he described as an indirect way simply by referring to the dates mentioned above. He argued that Kea was required, and failed, to squarely raise the issue of delay and inform the court that there was an argument available to Mr Wikeley that Kea had delayed.
[106] Again, I do not accept that Kea failed to properly disclose material facts. The 12 April outline identified delay as a relevant consideration.[44] It is true that Kea went on to submit that there had been no relevant delay.[45] That submission referred to the discussion of delay in the 2022 NZ Judgment where Gault J addressed Kea's explanation for the time between receipt of the statutory demand and the commencement of the New Zealand proceeding.[46] In my view, Kea's submissions adequately informed the court that unexplained delay in that regard would be a factor weighing against the grant of the interim relief.
[158]
[107] Mr Wikeley submitted that Kea failed to adequately inform the court of five matters concerning its conduct prior to the commencement of the New Zealand proceeding. The significance of those matters, on Mr Wikeley's submission, is that a party's entitlement to relief in the form of an anti-suit injunction or an anti-enforcement injunction may be lost in circumstances where the party participates in foreign proceedings to such an extent as to waive its rights to seek to restrain those proceedings.
[108] The five matters Mr Wikeley relied on were:
[159]
(a) that on 12 July 2022, Kea filed an application in the BVI to set aside the statutory demand on the basis that it would apply to the Kentucky Court to set aside the default judgment and it believed the default judgment would be set aside;
(b) the extent of the steps that Kea had taken in the Kentucky proceeding since 21 July 2022 to set aside the default judgment on the ground that it was procured by a fraudulent conspiracy, and which relied on substantially the same facts raised in the New Zealand proceeding;
(c) that Kea only commenced the New Zealand proceeding after it had first relied upon substantially the same facts before the Kentucky Court but failed to obtain the relief it sought from the Kentucky Court;
(d) that Kea was continuing to prosecute the Kentucky appeal, relying on substantially the same facts raised in the New Zealand proceeding;
(e) the extent of the steps Kea had taken to prevent enforcement of the default judgment in courts in the BVI and the United States, relying on substantially the same facts raised in the New Zealand proceeding.
[160]
[109] As to the first matter, the court was made aware that Kea had filed an application on 12 July 2022 to set aside the statutory demand in the BVI.[47] It is true that the court was not made aware of the stated basis for that application but, in circumstances where it is conduct - in the form of participation in foreign proceedings - which is said to be relevant, I do not consider that to be a material non-disclosure in the sense discussed in Savcor and South Downs Packers (see [88] and [89] above).
[110] As to the second and third matters, the court was made aware that, before it commenced the New Zealand proceeding, Kea:
[161]
(a) filed a motion on 21 July 2022 in the Kentucky proceeding to set aside the default judgment, but that the motion had been denied on 18 October 2022 and the Kentucky Court had determined that it did not have to, and would not, consider Kea's fraud arguments;[48]
(b) filed a motion on 21 October 2022 in the Kentucky proceeding seeking to have the Kentucky Court amend, alter or vary its earlier denial of the motion to set aside the default judgment and that the Kentucky Court had indicated that it would deny that further motion.[49]
[162]
[111] As to the fourth matter, the court was made aware that Kea had filed the Kentucky appeal against the denial of its motion to set aside the default judgment and the denial of its motion to alter, amend or vacate and that this appeal was ongoing.[50]
[112] As to the fifth matter, in addition to the facts identified in [109] to [111] above, the court was made aware that Kea was taking steps, by reference to its fraud argument, to pause subpoenas and interrogatories served on banks in Kentucky, [51]w York and New Jersey.51
[113] Having regard to the facts set out above, I do not accept Mr Wikeley's submission that Kea failed to adequately inform the court of steps it had taken in Kentucky and in the BVI before it commenced the New Zealand proceeding.
[114] Nor do I accept Mr Wikeley's submission that Kea was required to raise an argument that, by taking the steps identified above, it had engaged in conduct that was inconsistent with an entitlement to obtain an anti-suit injunction or an anti-enforcement injunction. In seeking to have the default judgment set aside, Kea sought only to have the Kentucky Court accept that its assertions of fraud meant it had a meritorious defence. It did not seek to have the Kentucky Court finally determine the fraud issue. I do not consider this to constitute participation in the Kentucky proceeding to such an extent as to waive its rights to seek to restrain Mr Wikeley from taking steps to enforce the default judgment.
[115] As to Mr Wikeley's submission that Kea had notice of these potential defences because he had raised them in his application to have the interim orders set aside in the New Zealand proceeding (see [46] to [49] above), the 12 April outline drew the court's attention to the fact that Mr Wikeley had raised challenges of jurisdiction and forum in the New Zealand proceeding and referred the court to the 2023 NZ Judgment in which those challe[52]es had been dismissed.52 I am not persuaded that Kea's conduct in not going further at the 12 April hearing to explain the legal significance which Mr Wikeley now attributes to Kea's involvement in the Kentucky proceeding amounts to material non-disclosure.
[163]
Evidence tending to suggest that the default judgment was not obtained by fraud
[164]
[119] Mr Wikeley submitted that Kea failed to comply with its duty to disclose material facts by not informing the court of the following five matters:
[165]
(a) at the hearing of its motion to alter, amend or vacate on 28 October 2022, Kea conceded that the default judgment was properly entered and the Kentucky Court made a finding to this effect;
(b) that, in circumstances where Kea had been validly served with the Kentucky proceeding on 6 December 2021, and 7 weeks had elapsed between the date of service and entry of default judgment on 31 January 2022, there was an argument that the default judgment was not obtained by fraud, because Kea was afforded an opportunity to come before the Kentucky Court and bring forward its defence that the Coal Agreement is a fabrication;
(c) Kea had identified no motive for Mr Wikeley to engage in the fraud alleged against him, and the material before the court did not identify a motive;
(d) Mr Wikeley affirmed an affidavit in the New Zealand proceeding deposing to the genuineness of the Coal Agreement;
(e) two other persons swore affidavits in the New Zealand proceeding providing some corroboration for the evidence of Mr Wikeley that the Coal Agreement was created in 2012, and not a recent fabrication, as Kea alleged.
[166]
[120] I do not consider the first two of these matters to be material in the sense of being likely to influence the court in acceding to the application,[59] or being a matter of substance in the decision-making process.[60] Kea's submission that there was a serious question to be tried as to the existence of a tortious conspiracy rested, in large part, on the argument that the Coal Agreement was a fabrication used to obtain the default judgment as part of the alleged conspiracy. Neither the regular entry of the default judgment after Kea had been effectively served with the Kentucky proceeding and failed to appear, nor the fact that Kea had the opportunity to bring forward its fraud defence but failed to do so after effective service, could alter the conclusion that - if Kea were to succeed on its argument that the Coal Agreement is a fabrication - WFTL has obtained the default judgment by fraud.
[121] Nor do I consider the failure to identify a motive on Mr Wikeley's part to be a material non-disclosure. The quantum of the default judgment in favour of WFTL and Mr Wikeley's interest in WFTL would seem to provide sufficient motive in any event.
[122] As to the evidence of Mr Wikeley and others filed in the New Zealand proceeding, Kea points to the fact that these affidavits were exhibited to an affidavit read at the 12 April hearing,[61] and were addressed in the 2023 NZ Judgment which was provided to the court.[62] However, during the 12 April hearing, the court's attention was not drawn specifically to the relevant affidavits or to the parts of the 2023 NZ Judgment which referred to those affidavits. In this respect, Kea's reliance upon oral submissions at the 12 April hearing which referred to Mr Wikeley's evidence, and Gault J's treatment of that evidence, is misplaced.[63] Those submissions were directed to paragraph 15 of the 2022 NZ Judgment, which was delivered before the relevant affidavits were filed in the New Zealand proceeding, and addressed evidence filed by Mr Wikeley in the Kentucky proceeding. On that basis, I do not accept that the court's attention was drawn to the affidavits filed in the New Zealand proceeding.
[123] Determining whether this amounts to a failure to disclose material facts requires consideration of the content of the relevant affidavits.
[167]
"9. The coal mining projects all needed substantial capital expenditure. Most were either reclamation projects or were undeveloped. Part of my role was finding the necessary investment funding. It was in that context that I made contact with Eric Watson by phone from Kentucky regarding funding coal projects that I was working on. That contact lead [sic] to the coal funding agreement with Kea.
[168]
The agreement was drafted by me personally in Kentucky, signed by me in New York and given to Eric to arrange execution by Kea. I received a signed copy in Kentucky.
While based in Kentucky, I searched and identified projects in Kentucky and other states which I referred to Eric for funding by Kea."
[169]
[125] I am not persuaded that this evidence was material in the sense of being likely to influence the court in acceding to the application,[65] or being a matter of substance in the decision-making process.[66] These brief and general statements do not address the negotiation, drafting, execution and performance of the Coal Agreement in a manner which would materially bear upon the court's consideration whether there was a serious question to be tried in the hypothetical similar proceeding as to Kea's claim of tortious conspiracy. Importantly, Mr Wikeley's affidavit provided no evidence of the execution of the Coal Agreement by Kea or the circumstances in which such execution is said to have occurred. Those matters are critical to the assessment of the genuineness or otherwise of the Coal Agreement and, more broadly, the strength or otherwise of Kea's claim of tortious conspiracy.
[126] The affidavits of Mr Branham and Mr Snyder which are said to corroborate the evidence of Mr Wikeley take the matter no further.
[127] Mr Branham deposed to Mr Wikeley having told him about:
[170]
(a) Mr Watson and Kea providing financing for their joint coal project; and
(b) a contract which Mr Wikeley had signed in 2012 with Kea to provide funding for coal projects.
[171]
[128] Mr Snyder was Mr Branham's attorney in Kentucky. He deposed to statements made by Mr Wikeley about the involvement of Mr Watson with Sir Owen Glenn, Mr Dickson and Kea, from which he assumed that relationship would be a source of funding for the coal projects to be undertaken by Mr Wikeley and Mr Branham.
[129] I am not persuaded that hearsay evidence in such brief and general terms would have had a material bearing upon the court's consideration whether there was a serious question to be tried.
[130] Accordingly, although Kea did not draw the court's attention to these affidavits at the 12 April hearing, I am not satisfied that this amounted to a material non-disclosure on the application for ex parte relief.
[172]
Facts surrounding service of the Kentucky proceeding
[173]
[131] Mr Wikeley submitted that Kea failed to disclose that there was evidence tending to suggest that the Kentucky proceeding did not come to Kea's attention because of its corporate structure and the fault of its agent, not by reason of misconduct on the part of WFTL or Mr Wikeley.
[132] I do not accept that submission. At the 12 April hearing, Kea's counsel made submissions about its agent having received the Kentucky proceeding but not having passed it on to Kea.[67] Kea has never suggested to this court that it was prevented from becoming aware of the Kentucky proceeding by misconduct on the part of WFTL or Mr Wikeley.
[133] I do not accept Mr Wikeley's further submission that Kea was required to inform the court that the facts explaining its failure to appear after service of the Kentucky proceeding weighed against the grant of the interim relief it sought. Mr Wikeley argued that those facts tended to suggest that Kea's case that the default judgment was procured by fraud was in substance "a contention that Kea had a good defence to the claim that it has not brought before the Kentucky Court because of its own fault, coupled with the unwillingness of the Kentucky Court to relieve Kea of the consequences of that fault." For the reasons already given in [120] above, I do not consider those matters to be material to the consideration of the application for ex parte relief.
[174]
[134] Mr Wikeley submitted that Kea failed to bring to the court's attention evidence that he had incurred costs of approximately $100,000 pursuing enforcement of the default judgment. That evidence is contained in an affidavit Mr Wikeley swore in the Kentucky proceeding on 27 July 2022, apparently in response to Kea's motion to set aside the default judgment. The affidavit was included in the material read at the 12 April hearing,[68] but it was not drawn to the court's attention.
[135] In his affidavit in the Kentucky proceeding, Mr Wikeley deposed:[69]
[175]
"15. Since the entry of the Default Judgment on January 31, 2022, and after the running of the 30 day appeal period, I have incurred over $100,000 in expenses pursuing enforcement of the Judgment and searching for hidden assets of Kea and its shareholders."
[176]
[136] Mr Wikeley did not provide any further information about what the expenses related to, when they were paid, or to whom they were paid. He did not provide any documentation evidencing the expenses or the fact that he had paid such expenses. That somewhat surprising lack of detailed information is relevant because WFTL also asserted, in submissions filed in the Kentucky proceeding in response to Kea's motion to set aside the default judgment, that it engaged the forensic accountants who undertook the task of identifying the assets of Kea and Sir Owen Glenn.[70]
[137] In circumstances where Kea's application for interim relief was premised upon Mr Wikeley's alleged involvement in a major and ongoing fraudulent conspiracy, I am not persuaded that Mr Wikeley's bare statement as to having incurred expenses in the stated amount was material in the sense of being likely to influence the court in acceding to the application,[71] or being a matter of substance in the decision-making process.[72] That is because, even if all relevant statements concerning the expenses incurred after entry of the default judgment were brought to the court's attention, there would have been significant uncertainty as to what expenses were incurred and which entity incurred those expenses. That is, even if the evidence in Mr Wikeley's affidavit had been brought to the court's attention, that evidence would not have provided the court with any real confidence that expenses of more than $100,000 had in fact been incurred or that Mr Wikeley had met those expenses.
[138] Accordingly, although Kea did not draw the court's attention to this evidence at the 12 April hearing, I am not satisfied that this amounted to a material non-disclosure on the application for ex parte relief.
[177]
[139] Mr Wikeley submitted that Kea failed to draw the court's attention to two defences available to him:
[178]
(a) that the causes of action relied on by Kea do not support the claim for an anti-enforcement injunction; and
(b) that it would be a serious breach of comity to indirectly restrain Wikeley Inc - a foreign corporation - in respect of the proceeding in the Kentucky Court.
[179]
[140] I accept that Kea did not draw these potential defences to the court's attention at the 12 April hearing. It will be necessary to address the merits of the suggested defences later in these reasons. However, for the reasons already addressed at [115] to [118] above, I am not persuaded that, in the circumstances of urgency in which Kea brought i[73]ex parte application,73 its conduct in failing to draw these potential defences to the court's attention amounted to a material non-disclosure.
[180]
Adequacy of the undertaking as to damages offered by Kea
[181]
[141] Mr Wikeley submitted that Kea failed to provide appropriate assistance to the court at the 12 April hearing by not identifying: that it was a company registered in the BVI;[74] that, although it was within its power to do so, it had not provided evidence of its assets and where those assets were located; that the court should decline to make the orders sought on an ex parte basis where no security for the undertaking had been offered.
[142] These submissions were premised upon Mr Wikeley's articulation of the following principles concerning the capacity of a foreign applicant to meet an undertaking as to damages:
[182]
(a) a foreign applicant bears the onus of proving its capacity to meet an undertaking as to damages;[75] and
(b) where a foreign applicant does not have assets within the jurisdiction, the court may order that applicant to provide security for its undertaking as to damages.[76]
[183]
[143] In the passage from Hotline Communications which Mr Wikeley relies upon, Warren J (as her Honour then was) stated:[77]
[184]
"... There is no evidence whatsoever as to the financial position of the second to sixth plaintiffs. So far as all of the plaintiffs are concerned there is no evidence of any assets within the State of Victoria that can be looked to in the event that any undertaking as to damages is called upon. The English authorities state the position clearly that a foreign plaintiff bears an onus to produce specific evidence as to its capacity to meet an undertaking for damages if called upon to do so."
[185]
[144] The concluding words of that passage suggest that the onus on a foreign applicant to prove its capacity to meet an undertaking as to damages arises once the respondent calls upon it to do so. Further, Warren J rejected a submission that the ex parte orders granted in Hotline Communications ought to have been discharged because of non-disclosure of the fact that the applicant for relief was a foreign corporation and that the judge who made the ex parte orders was not taken to a line of authority indicating that in such circumstances a financial security should be extracted from an applicant seeking an interlocutory injunction.[78]
[145] Mr Wikeley also relied upon the following passage from the judgment of Applegarth J in Heartwood Architectural Timber & Joinery Pty Ltd v Redchip Lawyers:[79]
[186]
"An applicant's ability to meet its undertaking as to damages is a material matter. A failure to disclose financial information which casts doubt on the applicant's ability to meet its undertaking as to damages is a material non-disclosure which will lead to the discharge of an ex parte order. Such financial information is relevant to whether the Court should accept an undertaking as to damages in the absence of security."
[187]
[146] Heartwood involved an ex parte application for a freezing order. The solicitor acting for the party that obtained the freezing order deliberately omitted from the draft orders provided to the court the undertaking to provide security to support the undertaking as to damages which was contained in the proforma order set out as an appendix to the practice direction which dealt with freezing orders. At the hearing of the application for the freezing order, counsel inadvertently stated that the draft orders followed the proforma. The solicitor did not correct that misstatement. As a result, the freezing order which was made did not include the undertaking to provide security.
[147] The evidence in Heartwood established that the solicitor had been told that his client did not want to get a bank guarantee because its financial position was "tight".[80] The reference in the passage extracted above to "financial information which casts doubt on the applicant's ability to meet its undertaking as to damages" should be understood in that context. That passage should not be taken as indicating that an applicant for ex parte injunctive relief will invariably be required to disclose information concerning its ability to meeting its undertaking as to damages. That is clear from the paragraph which immediately follows the passage extracted above, where Applegarth J stated:[81]
[188]
"Whilst there is a duty to disclose financial information which casts doubt on the applicant's ability to meet its undertaking as to damages, an applicant seeking an ex parte freezing order may not invariably be required to disclose information concerning its ability to honour an undertaking as to damages. In French v Chapple Hodgson CJ in Eq observed:
[189]
'There might, in my opinion, be cases where a plaintiff seeking ex parte relief, or even defended interlocutory relief, should as a matter of candour disclose problems about the plaintiff's ability to honour an undertaking as to damages. However, I do not believe that this is something that needs to be done generally, and I am not satisfied that this is a case where disclosure by this plaintiff of his financial position was required as a matter of candour. It is true that the plaintiff has very substantial liabilities, and it is true that there is not satisfactory evidence as to the value of the plaintiff's assets, but the material presently available suggests that those assets are substantial and are significantly in excess of liabilities.'
[190]
In many cases, for instance those in which substantial public companies are applicants, no issue will arise concerning the worth of the applicant's undertaking as to damages, and in such cases the omission of an undertaking to provide security can easily be justified. If, however, information casts doubt on the applicant's ability to meet its undertaking as to damages then disclosure of that information would be required and a failure to disclose it would be a material non-disclosure."
[191]
[148] I am not ultimately persuaded that Kea's conduct in not disclosing information as to its financial position and in not drawing the matters referred to in [141] above to the court's attention at the 12 April hearing was a material non-disclosure.
[149] It is relevant that, although Kea had provided an undertaking as to damages in the New Zealand proceeding and Mr Wikeley sought to set aside the interim orders granted by the New Zealand court, he did not challenge the adequacy of Kea's undertaking as to damages. In those circumstances, it is difficult to see that Kea had been called upon to provide evidence as to its capacity to meet the undertaking as to damages proffered in this proceeding. Expressed another way, it is difficult to see why, in fairly raising matters at the 12 April hearing that could be said on Mr Wikeley's behalf, Kea was required to raise the adequacy of its undertaking as to damages when Mr Wikeley had not done so when he had the opportunity in the New Zealand proceeding.
[192]
Should the 12 April orders and the 13 April orders be set aside?
[193]
[150] Mr Wikeley's application to set aside the 12 April orders and the 13 April orders was based upon Kea having failed to comply with its disclosure obligations at the 12 April hearing. For the reasons set out above, I am not persuaded that Kea failed to comply with its obligations in that regard. Accordingly, that part of Mr Wikeley's application must be dismissed.
[194]
Should the contempt application be permanently stayed?
[195]
[151] Mr Wikeley applied to have the contempt application permanently stayed as an abuse of process because, on his submissions, the further prosecution of that application would serve to bring the administration of justice into disrepute and involve an abuse of process of the court. That argument depended upon the court finding that the 12 April orders and the 13 April orders (which Mr Wikeley is alleged to have contravened) should be set aside.[82]
[152] In circumstances where I have not dismissed Mr Wikeley's application to set aside the 12 April orders and the 13 April orders, I am not satisfied that the further prosecution of the contempt application would amount to an abuse of process. On that basis, the application for a permanent stay of the contempt application must also be dismissed.
[196]
[153] Mr Wikeley submitted that the 21 April orders should be set aside because, on an assessment of the merits, the application for interim injunctive relief filed on 11 April 2023 should have been dismissed. That submission was advanced on two bases:
[197]
(a) upon application of the test prescribed by Voth, Queensland is a clearly inappropriate forum in the sense that the proceeding brought here is oppressive or vexatious;
(b) having regard to the relevant principles, the circumstances of this case do not support the grant of anti-enforcement injunctions of the kind sought by Kea.
[198]
[154] A local court will be a clearly inappropriate forum for a proceeding if the continuation of that proceeding would be productive of injustice because it would be oppressive (in the sense of "seriously and unfairly burdensome, prejudicial or damaging") or vexatious (in the sense of "productive of serious and unjustified trouble and harassment") to the defendant to that proceeding.[83] The focus of the enquiry must be upon the inappropriateness of the local court, not the appropriateness or comparative appropriateness of the foreign court.[84]
"It is prima facie vexatious and oppressive, in the strict sense of those terms, to commence a second or subsequent action in the courts of this country if an action is already pending with respect to the matter in issue. And although there are cases in which it has been held that it is not prima facie vexatious, in the strict sense of that word, to bring proceedings in different countries, the problems which arise if the identical issue or the same controversy is to be litigated in different countries which have jurisdiction with respect to the matter are such, in our view, that, prima facie, the continuation of one or the other should be seen as vexatious or oppressive within the Voth sense of those words.
[200]
It does not follow that, because one or other of the proceedings is prima facie vexatious or oppressive within the Voth sense of those words, the local proceedings should be stayed. However, it does follow that the fact that there are or, even, that there may be simultaneous proceedings in different countries with respect to the same controversy is highly relevant to the question whether the local proceedings are oppressive in the sense of 'seriously and unfairly burdensome, prejudicial or damaging', or, vexatious, in the sense of 'productive of serious and unjustified trouble and harassment'. And it also follows that courts should strive, to the extent that Voth permits, to avoid that situation."
[201]
[156] However, in CSR, the majority observed, by reference to earlier authorities, that the mere co-existence of proceedings in different countries does not constitute vexation or oppression.[86] Those observations were expressed in terms which considered whether the foreign proceedings were oppressive or vexatious. Vexation and oppression would exist only if "there is nothing which can be gained by them over and above what may be gained in local proceedings".[87] There seems to be no reason in principle why the same is not true of a local proceeding: it should not be viewed as oppressive or vexatious unless there is nothing which can be gained by that local proceeding over and above what may be gained in the foreign proceeding.
[157] Where the local and foreign proceedings arise out of the same sub-stratum of fact but involve different issues, the question is not whether the local court is a clearly inappropriate forum for the litigation of the issues involved in the local proceeding. The correct question is whether, having regard to the controversy as a whole, the local proceeding is oppressive or vexatious in the Voth sense of those terms.[88]
[158] In support of his submission that the proceeding in this court is oppressive or vexatious, Mr Wikeley relied upon five matters: (i) considerations of comity; (ii) the law of the tort which the court must apply; (iii) the steps Kea took in Kentucky before it commenced this proceeding; (iv) Kea's purpose in bringing this proceeding; and (v) the effect of the anti-enforcement orders on Wikeley Inc.
[202]
[159] In CSR, the majority acknowledged that although an injunction which restrains proceedings in a foreign court operates in personam, "it nevertheless interferes with the processes of the foreign court and may well be perceived as a breach of comity by that court".[89] The majority then stated that the power to grant such injunctions should be exercised with caution having regard to the explanation of the concept of comity given by the Supreme Court of the United States:[90]
[203]
"'Comity' in the legal sense, is neither a matter of absolute obligation, on the one hand, nor of mere courtesy and good will, upon the other. But it is the recognition which one nation allows within its territory to the legislative, executive or judicial acts of another nation, having due regard both to international duty and convenience, and to the rights of its own citizens or of other persons who are under the protection of its laws."
[204]
[160] Mr Wikeley submitted that the making of the 21 April orders involved a breach of comity because:
[205]
(a) the issue of the validity of the default judgment is properly a matter for the courts in Kentucky; and
(b) in so far as the orders prevent enforcement of the default judgment in the United States, they indirectly interfere with the execution in Kentucky of the judgment which the Kentucky Court has given and can expect to be obeyed.
[206]
[161] That submission relied upon the following passage from Ecobank Transnational Inc v Tanoh:[91]
[207]
"In the case of anti-enforcement injunctions there are further considerations which underpin the need for caution expressed in the cases. First, an order precluding enforcement in countries outside [the local jurisdiction] will, if obeyed, in effect preclude the consideration by the courts of those countries as to whether they should recognise or enforce the judgment in question. That is a matter which it is, intrinsically, for the relevant court to decide according to its applicable law. Moreover, in so far as the order prevents enforcement in the country of the court which gave the judgment it is, indirectly, an interference with the execution in its own country of the judgment which the court has given and can expect to be obeyed."
[208]
[162] In Sun Travels & Tours Pvt Ltd v Hilton International Manage (Maldives) Pvt Ltd,[92] the Singapore Court of Appeals adopted the passage from Ecobank extracted above, before stating:[93]
[209]
"... because an anti-enforcement injunction proscribes the enforcement of a foreign judgment on pain of contempt proceedings in the jurisdiction where the injunction is granted, granting an anti-enforcement injunction is comparable to nullifying the foreign judgment or stripping the judgment of any legal effect when only the foreign court can set aside or vary its own judgments. This extends far beyond the non-recognition and non-enforcement of a foreign judgment in the local jurisdiction which is, in any event, within the local court's purview."
[210]
[163] Mr Wikeley also relied upon the proposition that as a general rule, before an anti-suit injunction can be properly granted to restrain a person from pursuing proceedings in a foreign jurisdiction, comity requires that the local forum should have "a sufficient interest in, or connection with" the matter in question to justify the indirect interference with the foreign court which such an injunction entails.[94] This raises the distinction between "personal jurisdiction" (who can be brought before the court) and "subject matter jurisdiction" (to what extent the court can claim to regulate the conduct of those persons).[95]
[164] In Masri v Consolidated Contractors International (UK) Ltd (No 2),[96] Lawrence Collins LJ stated:
[211]
"Consequently the mere fact that an order is in personam and is directed towards someone who is subject to the personal jurisdiction of the [local court] does not exclude the possibility that the making of the order would be contrary to international law or comity, and outside the subject matter jurisdiction of the [local court]."
[212]
[165] As illustrations of the relevant principles, Mr Wikeley referred to two cases where courts refused to extend the operation of anti-enforcement injunctions to the jurisdiction in which the judgment was given.
[166] The first was ED&F Man (Sugar) Ltd v Haryanto (No 2).[97] That case involved agreements for the sale of sugar by ED&F Man to Mr Haryanto, an Indonesian citizen. The agreements each provided that English law was to govern and disputes were to be referred to arbitration in London. Disputes under the agreements were referred to arbitrations. Shortly thereafter, Mr Haryanto brought an action in England seeking a declaration that he was not bound by the agreements and an injunction restraining ED&F Man from pursuing the arbitration. That action was dismissed, as was Mr Haryanto's appeal. That action did not raise any issue as of illegality. On his appeal, Mr Haryanto applied for leave to raise the issue of illegality but his application was refused. Mr Haryanto then commenced a second action in England seeking a declaration that the agreements were unenforceable or void as being illegal and contrary to English public policy. ED&F Man then commenced its own action seeking a declaration that Mr Haryanto was estopped from contending that the agreements were unenforceable or void as being illegal or contrary to public policy. The parties subsequently entered into a settlement agreement in respect of the arbitration and the proceedings then on foot. By that settlement, Mr Haryanto agreed to pay ED&F Man specified amounts on specified dates. Mr Haryanto failed to pay a number of instalments due under the settlement agreement and ED&F Man demanded payment of the whole settlement amount.
[167] After his failure to pay instalments due under the settlement agreement, Mr Haryanto commenced an action in Indonesia seeking annulment of the disputed agreements. ED&F Man commenced its own action in Indonesia seeking recovery of the debt owed by Mr Haryanto under the settlement agreement. The Indonesian court held that the disputed agreements were illegal as having been entered into for a purpose that was illegal under Indonesian law and being subversive of Indonesian public policy. It also held that because the settlement agreement arose from the disputed agreements it was also illegal as being against the public policy.
[213]
"In my view it would be wrong for this Court to grant an injunction which is designed to take effect inside Indonesia and which would interfere or purport to interfere with the judgment of a court of competent jurisdiction inside that country."
[214]
[170] Neill LJ then went on to consider whether an injunction should be granted to prevent Mr Haryanto relying upon the Indonesian judgment either to bring or defend proceedings in third countries, concluding that there was not a satisfactory basis to make such an order.[99]
[171] The second case identified by Mr Wikeley was SAS. In that case an English court had declined to enforce a judgment obtained by SAS in North Carolina because, in circumstances where the underlying dispute had already been litigated in England, that foreign judgment was held to be an abuse of process. SAS later obtained an order from a California court enforcing the North Carolina judgment by compelling the assignment of certain debts owed by customers of Worldwide Programming to SAS. Worldwide Programming applied in England for an interim anti-suit injunction.
[172] The English court granted an anti-enforcement injunction which operated to prevent SAS from obtaining an assignment of debts owed by customers of Worldwide Programming located in the United Kingdom, as well as debts owed by customers in third countries where those customers' contract with Worldwide Programming provided for arbitration in England or for the exclusive jurisdiction of the English court (such debts being held to be situated in the United Kingdom).
[173] However, the court refused to extend the anti-enforcement injunction to inhibit enforcement of the North Carlina judgment against debts owed to Worldwide Programming by customers located in the United States, or by customers in third countries who did not contract on terms providing for arbitration in England or for the exclusive jurisdiction of the English court (such debts being situated in the third countries).
[174] As to the debts due from customers in the United States, Males LJ stated:[100]
[215]
"... There is no good reason why the English court should seek to prevent SAS from enforcing the North Carolina judgment against United States assets of WPL by whatever procedures are available to SAS under United States law. To do so would itself represent an exorbitant exercise of jurisdiction by the English court, contrary to principles of comity, and it is no surprise that the United States courts have taken exception to this aspect of the injunction.
[216]
... There is no justification for the English court to interfere with enforcement of the North Carolina judgment against assets in the United States. ..."
[217]
[175] As to the debts due from customers in third countries who did not contract on terms providing for arbitration in England or for the exclusive jurisdiction of the English court, Males LJ held that the English court would not have a sufficient interest to intervene to restrain an order of the California court compelling such customers to assign debts owed to World Programming to SAS.[101]
[176] Based on the statements of principle set out in the authorities relied upon by Mr Wikeley, I accept that the circumstances in which an anti-enforcement injunction will be granted are rare and that exceptional circumstances must exist which warrant such an injunction.[102]
[177] While this is an accurate statement of the general position, I am not persuaded that it operates to preclude the grant of relief in the circumstances of this case. That is because the most commonly cited example justifying the grant of an anti-enforcement injunction is where a foreign judgment has been procured by fraud.[103]
[178]Ellerman Lines Ltd v Read[104] was such a case. The defendants had contracted to salvage the plaintiffs' ship. The salvage vessel was under the command of one of the defendants, Mr Landi, who was a naturalised British subject. The salvage form contained an arbitration clause and a clause stipulating that the salvage contractor would not arrest or detain the salved property unless there was an attempt to remove it before security for the salvage contractor's claim had been provided. The salvaged ship was taken to Constantinople. The plaintiffs arranged for security to be provided and communicated this to Mr Landi. Notwithstanding this, Mr Landi caused the salvaged ship to be arrested at Constantinople under a process of the Turkish court in a salvage suit instituted by him. The master of the salvaged ship appeared before the Turkish court and sought the release of the ship on the ground of the salvage agreement and the security which had been provided. In response, Mr Landi fraudulently claimed on oath that he had not authorised his solicitors to accept the security offered by the plaintiffs. As a result, the master of the salvaged ship withdrew from the proceeding before the Turkish court. Mr Landi's suit was heard in the master's absence and the Turkish court delivered judgment in favour of Mr Landi. The plaintiffs brought an action in England claiming damages for breach of the salvage agreement, a declaration that the Turkish judgment was void as against the plaintiffs and their property, and an injunction restraining the defendants from taking any steps to enforce the Turkish judgment against the salvaged ship or any other property of the plaintiffs. An interim injunction was made restraining the defendants from taking steps to enforce the Turkish judgment until trial.
[218]
"Here we have an English contract, considerable portions of which were to be performed in England, entered into by a naturalized British subject; that naturalized British subject is proved to have broken that contract and by fraud obtained a foreign judgment which he proposes to enforce against the property of the other contracting party. He has been properly served with the writ in this action and is a party to the proceedings. In such a case, as I understand the decisions, the English Courts have always professed, and asserted, their power to act. They do not, of course, grant an injunction restraining the foreign Court from acting; they have no power to do that; but they can grant an injunction restraining a British subject who is fraudulently breaking his contract, and who is a party to proceedings before them, from making an application to a foreign Court for the purpose of reaping the fruits of his fraudulent breach of contract."
[219]
[181] After reviewing statements of principle in two authorities,[106] Scrutton LJ concluded that the English courts have "jurisdiction to restrain a person who is subject to the English jurisdiction from taking proceedings in a foreign Court in breach of contract and in fraud".[107] His Lordship then rejected a submission that the English courts have no power, after a foreign court has given judgment, to grant an injunction restraining the person who has obtained that judgment from seeking to enforce it, stating:[108]
[220]
"If there is no authority for this it is time that we made one, for I cannot conceive that if an English Court finds a British subject taking proceedings in breach of his contract in a foreign Court, supporting those proceedings, and obtaining a judgment, by fraudulent lies, it is powerless to interfere to restrain him from seeking to enforce that judgment. I am quite clear that such an injunction can be and in this case ought to be granted in the terms asked for in the statement of claim."
[221]
[182] Atkin LJ reached the same conclusion stating:[109]
[222]
"The principle upon which an English Court acts in granting injunctions is not that it seeks to assume jurisdiction over the foreign Court, or that it arrogates to itself some superiority which entitles it to dictate to the foreign Court, or that it seeks to criticize the foreign Court or its procedure; the English Court has regard to the personal attitude of the person who has obtained the foreign judgment. If the English Court finds that a person subject to its jurisdiction has committed a breach of covenant, or has acted in breach of some fiduciary duty or has in any way violated the principles of equity and conscience, and that it would be inequitable on his part to seek to enforce a judgment obtained in breach of such obligations, it will restrain him, not by issuing an edict to the foreign Court, but by saying that he is in conscience bound not to enforce that judgment."
[223]
[183] His Lordship held that the injunction sought by the plaintiffs should be granted "restraining the defendants from reaping any advantage from the judgment obtained in Turkey ... by a gross fraud".[110]
[184] Eve J was also satisfied that jurisdiction to make the anti-enforcement judgment existed, stating:[111]
[224]
"So far as the jurisdiction is concerned, the power of the Court to grant such an injunction as is now claimed has been established by a long line of authorities ... . I can see no logical reason to suppose that it ceases to be exercisable as soon as a judgment has been pronounced by the foreign tribunal. No doubt the jurisdiction is to be exercised with caution, but if ever there was a case calling for its exercise, this is the one. The foreign proceedings here were instituted and prosecuted in clear breach of contract, and the judgment was ultimately obtained by a deliberate and flagrant misrepresentation."
[225]
[185] Ellerman Lines was applied more recently in Bank St Petersburg OJSC v Arkhangelsky.[112] In that case the defendants controlled a group of companies called the Oslo Marine Group (OMG) which owed substantial debts to the plaintiff bank and which owned part of the port of St Petersburg referred to as the Western Terminal. The defendants asserted that the bank agreed to restructure OMG's debts, not to demand repayment before the end of a six-month moratorium, not to interfere in OMG's day-to-day commercial activities, not to dispose of the defendants' shareholdings which were pledged in support of the loans and to return the pledged shareholdings once specified loans were repaid. They further alleged that, in breach of contract, the bank demanded instant repayment, replaced the management of OMG companies and transferred the shareholdings to special purpose vehicles controlled by the bank or its chairman. They alleged that loan agreements and guarantees under which the bank claimed sums were due were forgeries. The bank obtained judgments in Russia in pursuance of these (on the defendants' case) wrongful activities. It then sought to enforce those judgments in France and Bulgaria. The defendants brought claims against the bank and related parties in the BVI and Cyprus for conspiracy, deceit and duress or intimidation. There were jurisdictional difficulties with those claims. The parties then entered an exclusive jurisdiction agreement which provided that the English court would have exclusive jurisdiction to determine the disputes between them.
[186] The defendants brought an application for an interim injunction preventing the bank from enforcing the Russian judgments anywhere in the world. That application was refused at first instance on the basis that such an injunction would infringe the sovereignty of the states where enforcement was taking place. That decision was reversed on appeal.
[187] On the question of comity, Longmore LJ observed that to grant an interim injunction in support of the English proceedings (which would decide the merits of the parties' disputes) would not be an unwarranted interference in the process of either the French or Bulgarian courts where enforcement processes had been commenced. It was the bank which was required to temporarily cease continuation of enforcement proceedings and not to initiate new ones. Such an order would affect the bank, not the foreign courts.
[226]
"Mr Marshall was correct to say that [Ellerman Lines] was a stronger case but only to the extent there that the English trial had already taken place so that there was a finding that the Turkish judgment had been procured by fraud. Here the trial has not yet taken place and the allegations of fraud are only allegations. But an interim injunction had been granted in Ellerman's case to protect the position pending trial .... So here it seems to me that an injunction against continuing existing enforcement proceedings or initiating new enforcement proceedings should be granted."
[227]
[189] Based on the evidence read by Kea on this application (which included all the evidence read in the New Zealand proceeding) I am satisfied there is an arguable case that the Coal Agreement is a fabrication. I note that:
[228]
(a) it seems inherently unlikely that a party in Kea's position would agree to the terms of the Coal Agreement which impose all of the risk of the asserted joint venture arrangement on Kea;
(b) there is no evidence of the "financial models and analysis" which is referred to in the background section of the Coal Agreement as having been provided to Kea for the purpose of due diligence, nor any evidence of the "feasibility study" which is referred to in the background section of the Coal Agreement as having been undertaken by Kea and its (unidentified) "advisors";
(c) there is evidence that:
(i) on 23 October 2012, the date on which Mr Dickson and Mr Wikeley apparently signed the Coal Agreement, as witnessed by Mr Watson, Mr Dickson was in Paris;
(ii) a detailed package of documents was prepared for a meeting in Paris on 23 October 2012 between Mr Dickson and Mr Watson, but those documents make no mention of the Coal Agreement;
(d) Mr Wikeley has given two different accounts to the Kentucky Court about how and when the Coal Agreement was signed:
(i) the complaint which commenced the Kentucky proceeding alleged (in paragraph 2 of the general allegations) that "On October 23, 2012, Peter Dickson, as a director of Kea, was presented with a Coal Funding and JV Investment Agreement (the 'Agreement') by Kenneth Wikeley, as Trustee for the Wikeley Family Trust, related to a coal investment in Kentucky" and (in paragraph 5) that "On October 23, 2012, Peter Dickson, acting on behalf of Kea, executed the Agreement committing Kea to provide capital to fund the coal operations, to provide a percentage of gross profits, and to provide guaranteed royalties, all as outlined in the signed agreement attached as Exhibit A";
(ii) in his affidavit filed later in the Kentucky proceeding, Mr Wikeley asserted that he signed the Coal Agreement on 26 September 2012 in New York in the presence of Mr Watson; that Mr Watson told him he would have Mr Dickson sign the agreement the following month when he was due to meet Mr Dickson in Paris; and that he was informed by Mr Watson on 23 October 2012 that Mr Dickson had signed the agreement;
(e) Mr Wikeley has not sought to explain that inconsistency;
[229]
[190] I am also satisfied that Kea has established an arguable case that Mr Wikeley has engaged in a tortious conspiracy against Kea. That action would require that the following elements be proved:[115]
[230]
(a) an agreement between, or combination of, two or more persons;
(b) the commission of or threat of an unlawful act;
(c) an intention to injure the plaintiff; and
(d) damage resulting from the threats or unlawful acts.
[231]
[191] If the evidence adduced by Kea is ultimately accepted then it will have established:
[232]
(a) Mr Wikeley acted in combination with at least Mr Watson in fabricating the Coal Agreement and in the prosecution of the Kentucky proceeding based upon that agreement;
(b) those parties' use of the fabricated document to procure a financial benefit under the default judgment to which they are not entitled amounted to the use of unlawful means;[116]
(c) those parties' attempts to enforce the default judgment was directed to Kea, and it must be inferred intended to injure Kea;
(d) Kea has suffered loss in seeking to respond to the fraudulent conspiracy, including the costs of seeking to have the default judgment set aside and to restrain the enforcement of that judgment.
[233]
[192] In those circumstances, Kea's proceeding would come within the fraud exception to the principles of comity discussed above.
[193] It is true that Kea's proceeding against Mr Wikeley does not have as strong a connection to the local jurisdiction as existed in Ellerman Lines (where the defendant was a British subject) or Bank St Petersburg (where the parties entered into an exclusive jurisdiction agreement to have their dispute resolved by the English courts). Nevertheless, I consider that there is sufficient connection to Queensland in circumstances where Mr Wikeley has taken steps to secure the benefits of the default judgment while he has resided in this jurisdiction.
[194] There is evidence that, while he resided in Queensland, Mr Wikeley swore an affidavit which was filed in the Kentucky proceeding in opposition to Kea's motion to set aside the default judgment. He was also in Queensland when he executed the purported assignment of the default judgment from WFTL to Wikeley Inc, apparently in contravention of the orders made in the New Zealand proceeding.
[195] The evidence is not as clear as to whether Mr Wikeley was in Queensland at earlier times when he took relevant steps.
[196] For example, a company extract for WFTL prepared on 26 October 2022 records:[117]
[234]
(a) the incorporation date of WFTL as 23 July 2021;
(b) the sole director and shareholder of WFTL as being Mr Wikeley;
(c) Mr Wikeley's address as being 22 Bora Place, Ningi, Queensland.
[235]
[197] It is not clear, however, whether Mr Wikeley was residing at that address when he caused WFTL to be incorporated and for it to replace him as the trustee of the Wikeley Family Trust.
[198] Mr Wikeley's own evidence as to his residence at different times is expressed in vague terms.
[199] In the affidavit he filed in the New Zealand proceeding on 23 November 2022 (see [122] to [125] above), he stated that: at that time he was living at his sister's house at Ningi; his permanent home is in Mykolaiv, Ukraine; he had been unable to return to Ukraine because of the COVID-19 pandemic and the war.
[200] In an affidavit filed in this proceeding on 26 April 2023,[118] Mr Wikeley stated: until 2019, when COVID-19 prevented international travel, his address was Apartment 49, 8 Levineska Street, Nikolaev, Ukraine; he resided permanently in Ukraine between 2007 and 2013; he then resided between Ukraine, the United States and Australia until 2019 when COVID-19 caused borders in Australia and internationally to close; since 2019 he has been diagnosed with a number of medical conditions which have prevented him from travelling internationally.
[201] Although Mr Wikeley does not say so in terms, it is at least arguable based on this evidence that he has resided at the Ningi address from late 2019 or early 2020 when borders in Australia and internationally were closed due to COVID-19. If that is established then Mr Wikeley will have been present in Queensland when he took all relevant steps in seeking to obtain the benefit of the default judgment, namely:
[236]
(a) the incorporation of WFTL and its substitution as trustee of the Wikeley Family Trust less than a month before the commencement of the Kentucky proceeding;
(b) providing instructions to WFTL's lawyers in Kentucky (as WFTL's sole director) to commence the Kentucky proceeding;
(c) providing instructions for the Kentucky proceeding to be served on Kea's registered office in the BVI;
(d) providing instructions to WFTL's lawyers in Kentucky for entry of the default judgment;
(e) providing instructions to WFTL's lawyers in the BVI to serve the statutory demand on Kea in reliance upon the default judgment;
(f) providing instructions to WFTL's lawyers in Kentucky to resist Kea's efforts to have the default judgment set aside;
(g) providing instructions to WFTL's lawyers in various jurisdictions to apply for the issue of subpoenas to financial institutions with the aim of identifying assets from which the default judgment might be satisfied;
(h) executing the assignment of the default judgment from WFTL to Wikeley Inc.
[237]
[202] On this basis, if Kea were to ultimately succeed in its claim that the default judgment was obtained in reliance upon a fabricated agreement, then Mr Wikeley would properly be described as a person subject to the jurisdiction of this court who, in obtaining the default judgment, has acted in a way that violates the principles of equity and conscience.[119] That is sufficient in my view to satisfy the requirement that the court not only have personal jurisdiction over Mr Wikeley, but that it have subject matter jurisdiction over the issues raised by Kea's proceeding.
[203] For these reasons, I am not persuaded that this court is a clearly inappropriate forum by reasons of considerations of comity.
[238]
The law to be applied in determining Kea's claim against Mr Wikeley
[239]
[204] In deciding whether the local forum is clearly inappropriate, the extent to which the law of that forum is applicable in resolving the rights and liabilities of the parties is a material consideration.[120] If it is fairly arguable that the substantive law of the local forum will apply in the determination of the rights and liabilities of the parties then the local forum should not be seen as an inappropriate forum.[121]
[205] The law to be applied in determining a claim for a tort such as conspiracy, including claims involving a foreign tort, is the law of the place of the wrong (lex loci delicti).[122] The place of the wrong is determined by ascertaining the place of "the act on the part of the defendant which gives the plaintiff his cause of complaint" or, expressed slightly differently, by looking back over the series of relevant events and asking "where in substance did this cause of action arise?"[123]
[206] Mr Wikeley submitted that the law to be applied to Kea's claim of tortious conspiracy is the law of Kentucky as that is where most of the conduct alleged to comprise the conspiracy occurred, including the making of claims by WFTL under the Coal Agreement and the procuring of the default judgment.
[207] Despite Mr Wikeley's presence in Queensland at the time he took steps which (on Kea's case) were in furtherance of the tortious conspiracy, I find it difficult to conclude that Queensland is the place of the wrong such that Queensland law applies to Kea's claim.[124] It does seem to me that, in substance, Kea's claim arose in Kentucky where the default judgment was obtained. That is the principal act on the part of the defendants which gives rise to Kea's complaint. If that is accepted, the law of Kentucky would apply to the determination of Kea's claim for final relief in the hypothetical similar proceeding this court.
[208] Although this is a material consideration, it is not decisive. An Australian court cannot be a clearly inappropriate forum simply because it would be required to apply foreign law.[125] Mr Wikeley's conduct in Queensland and his amenability to the jurisdiction of this court are relevant considerations, as is the question whether he would be amenable to the jurisdiction of the Kentucky Court. Having regard to the expert opinion of Professor Silberman filed in the New Zealand proceeding and read on this application, it is unclear whether the Kentucky Court would have jurisdiction over Mr Wikeley in relation to Kea's claim. Mr Wikeley is not a party to the Kentucky proceeding.
[240]
[210] Mr Wikeley submitted that this court is a clearly inappropriate forum because Kea has already litigated the question whether the default judgment was procured by fraud in the Kentucky Court and is currently litigating that question in the Kentucky appeal.
[211] Expert evidence of Professor Bermann filed by Mr Wikeley in the New Zealand proceeding and read on this application was to the effect that courts in Kentucky will consider actions or motions based on fraud or forgery in the procurement of a contract on which a civil claim is based, even after default judgment has been entered.[128] Professor Silberman agreed with that statement of the legal position, however noted that it did not appear that the principles were applied by the Kentucky Court when it considered the motion to set aside the default judgment.[129]
[212] The Kentucky Court did not consider the merits of Kea's fraud argument in dismissing the motion to set aside the default judgment and the motion to alter, vary or amend that earlier decision. Although the evidence of Professors Bermann and Silberman suggests that the Kentucky Court of Appeal should set aside the default judgment to permit a consideration of the merits of the fraud argument, that appeal is presently stayed. This means that, as matters presently stand, there has been no consideration in the Kentucky proceeding of the question whether the default judgment was procured by fraud.
[213] In these circumstances, I am not persuaded that Kea's reliance upon its fraud allegations as a basis for seeking to have the default judgment set aside in Kentucky means that this court is a clearly inappropriate forum.
[214] Mr Wikeley also submitted that it is oppressive and vexatious for Kea to rely on the same arguments in seeking to set aside the default judgment in Kentucky as it does to claim relief against him in the New Zealand proceeding and in this court.
[215] This submission relies upon the passage from Henry extracted at [155] above. That passage refers to a situation where "the identical issue or the same controversy is to be litigated in different countries which have jurisdiction with respect to the ma[130]r."130
[241]
Kea's purpose in bringing the New Zealand proceeding
[242]
[218] Mr Wikeley submitted that the New Zealand proceeding and the proceeding in this court are oppressive and vexatious in the Voth sense because Kea's dominant purpose in commencing those proceedings was to prevent WTFL from pursuing remedies available to it in Kentucky (enforcement of the default judgment, including by issuing subpoenas to financial institutions) which were not available to it in this jurisdiction. He argued that WFTL could not have sought relief in a claim under the Coal Agreement in New Zealand or in Queensland because: neither jurisdiction was an appropriate forum for WFTL to bring such a claim; when WFTL commenced its claim, Kea had not submitted to the jurisdiction of New Zealand or Queensland; and, the jurisdiction clause in the Coal Agreement (see [23] above).
[219] This aspect of Mr Wikeley's submissions relies upon the statement of the majority in CSR that:[132]
[243]
"Proceedings which are brought for the dominant purpose of preventing another party from pursuing remedies available in the courts of another country and not available in this country are 'seriously and unfairly ... prejudicial [and] damaging'. They are, thus, oppressive in the Voth sense of that word."
[244]
[220] CSR was not a case in which the foreign proceeding was alleged to be based upon a fabricated document, or part of tortious conspiracy to injure the party which has commenced the local proceeding.
[221] In the unusual circumstances of this case, Kea's purpose in commencing the New Zealand proceeding is to seek interim and final relief arising from its claim that Mr Wikeley has been involved in a tortious conspiracy to cause injury to it. Its purpose in commencing the proceeding in this court is to seek interim relief in support of the New Zealand proceeding.
[222] Part of the relief which Kea has sought and obtained on an interlocutory basis in both courts, and which it seeks on a final basis in the New Zealand proceeding, is injunctive relief which, if complied with, will have the effect of preventing Mr Wikeley, WFTL and Wikeley Inc from taking steps to enforce the default judgment. But Kea's purpose in seeking such relief is not to prevent the judgment creditor from pursuing remedies to which it is legitimately entitled in Kentucky. Kea's purpose is to prevent the judgment creditor from pursuing remedies in Kentucky, or any other jurisdiction, to which (on Kea's case) it has no entitlement because the default judgment is based on a fabricated document.
[223] I cannot accept that a proceeding brought to restrain the continued perpetration of a fraud, in a foreign jurisdiction where the courts have not yet considered the merits of the fraud argument, is oppressive or vexatious in the sense those words are used in Voth, CSR or Henry.
[224] I am not persuaded that Kea's purpose in bringing the New Zealand proceeding, or the proceeding in this court, means that this court is a clearly inappropriate forum.
[245]
The effect of the anti-enforcement orders on Wikeley Inc
[246]
[225] Mr Wikeley submitted that it is a serious breach of comity for this court to make orders which indirectly control Wikeley Inc, a foreign corporation, in proceedings before a foreign court. This submission was based on an assertion that, by making orders which positively required Mr Wikeley to cause Wikeley Inc to take steps in the Kentucky proceeding (withdraw, adjourn or seek a continuance of the substitution motion, the discovery motion and the anti-suit injunction motion), this court made an order in personam in respect of Wikeley Inc when the court did not have personal jurisdiction over that company.
[226] I accept that when orders were made against Mr Wikeley, this court did not have personal jurisdiction over Wikeley Inc. However, I do not accept that, by making orders against Mr Wikeley, this court made an order in personam in respect of Wikeley Inc. Those orders did not bind Wikeley Inc. So much is clear from Mr Wikeley's evidence in the affidavit he filed in this proceeding on 26 April 2023,[133] where he explains that, because he had been removed as president of Wikeley Inc and replaced by Mr Branham, he was unable to comply with the orders concerning the company. If that evidence is accepted, then the orders made by this court have no effect upon Wikeley Inc.
[227] In any event, having regard to the earlier conclusion that Kea's claim of tortious conspiracy is arguable, Mr Wikeley's submissions about comity in relation to Wikeley Inc do not address the fraud exception discussed earlier in these reasons. If Kea were to ultimately succeed in its claim, the purported assignment of the default judgment from WFTL to Wikeley Inc and the attempt to substitute Wikeley Inc as judgment creditor in the Kentucky proceeding would likely be characterised as steps taken in furtherance of the conspiracy.
[228] In those circumstances, I am not persuaded that the effect of the court's orders upon Wikeley Inc mean that this court is a clearly inappropriate forum.
[247]
Conclusion as to whether this court is a clearly inappropriate forum
[248]
[229] I am not persuaded that, having regard to the controversy as a whole, the proceeding Kea has commenced in this court is vexatious or oppressive in the Voth sense or that any of the matters raised by Mr Wikeley mean that this court is a clearly inappropriate forum for Kea's claim for interlocutory and final injunctive relief.
[230] To the contrary, I am satisfied that Queensland is not a clearly inappropriate forum having regard to: (i) Mr Wikeley's presence in Queensland when he took steps to obtain and subsequently enforce the default judgment as part of (on Kea's case) the tortious conspiracy against it; (ii) the resulting conclusion (see [193] to [202] above) that this court has subject matter jurisdiction over the issues raised by Kea's proceeding; and (iii) Mr Wikeley's amenability to the jurisdiction of this court such that orders made against him are likely to be effective in preserving the status quo pending the determination of Kea's claim of tortious conspiracy.
[249]
Was it inappropriate to make a world-wide anti-enforcement injunction?
[250]
[231] As already noted, having concluded that this court is not a clearly inappropriate forum, in deciding whether to continue the injunctions made in paragraph 3 of the 21 April orders I must consider:[134]
[251]
(a) whether there is a serious question to be tried; and, if so
(b) whether the balance of convenience favours the grant of an interlocutory injunction.
[252]
Serious question to be tried (paragraph 3 of the 21 April orders)
[253]
[232] Having concluded that Kea has established an arguable case that the Coal Agreement is a fabrication (see [189] above) and that Mr Wikeley has engaged in a tortious conspiracy (see [190] to [191] above), I am also satisfied that there is a serious question to be tried that a permanent anti-enforcement injunction would be granted in the circumstances of the present proceeding. I do not consider that the potential defences referred to in [139] above preclude such a conclusion.
[233] Mr Wikeley submitted that the declaration sought by Kea in the New Zealand proceeding - that the default judgment was procured by fraud - does not support the claim for an anti-enforcement injunction. Having regard to the decisions in Ellerman Lines and Bank St Petersburg discussed above, it is arguable that Kea's claim for this declaration can support an anti-enforcement injunction which operates outside the local forum. I do not accept that, in the circumstances of this case, injunctive relief could only ever be directed to attempts to enforce the default judgment in Australia (or in New Zealand in respect of the interim relief granted in the New Zealand proceeding).
[234] In addressing Kea's claim of tortious conspiracy by unlawful means, Mr Wikeley referred to authorities which, on his submission, establish that as long as the default judgment remains in force, Kea is prevented from contending that the judgment was procured by fraud: see Cabassi v Vila,[135]Schepis v Esanda Finance Corp Ltd,[136] and Cachia v Westpac Financial Services Ltd.[137]
[235] On the basis of these authorities, Mr Wikeley submitted that a claim by a judgment debtor seeking damages for conspiracy on the basis that the judgment had been procured by fraud would be struck out as disclosing no cause of action or stayed as an abuse of process. On this argument, unless the Kentucky Court sets aside the default judgment, Kea cannot contend that the judgment was procured by fraud as a basis for seeking relief.
[254]
"The first is from the judgment of Wells J., speaking for the court in Dunlap v. Glidden: - 'The plaintiff cannot recover upon the ground alleged of false testimony given by some of the defendants. For an action will not lie against a witness for giving false testimony in another case. If the judgment was obtained, as is contended, by fraud and perjury, the plaintiff has ample remedy by law. The court which rendered the judgment, upon proof of these allegations, would be bound to grant a new trial, so that, upon a further investigation, justice might be done. The witnesses, if guilty, might be indicted for perjury, and so might all those be indicted who had unlawfully conspired together to deprive the plaintiff of his rights, and their conviction would afford most convincing evidence that a review of the action should take place.' The second I have chosen from the judgment of Allen J., speaking for the court in Stevens v. Rowe: - 'A party cast in a judgment in a suit at law cannot maintain an action against the adverse party for suborning a witness, whose false testimony tended to produce the judgment; nor for the adverse party's fraud and false swearing, so long as the judgment remains in force. A proceeding of this kind is an attempt to re-examine the merits of a judgment in a collateral suit between the same parties. Reasons of public policy and uniform authority forbid the attacking and impeachment of a judgment in this way. The plaintiff's only remedy is an equitable proceeding to set aside the judgment, or a petition for a new trial under the statute. An action by the defeated party cannot, for equally good reasons, be maintained against a witness or witnesses for giving false testimony in favour of his opponent. Public policy and the safe administration of justice require that witnesses, who are a necessary part of the judicial machinery, be privileged against any restraint, excepting that imposed by the penalty for perjury. Though not a party to the former suit and judgment, the merits of that judgment cannot be re-examined by a trial of the witness' testimony in a suit against him. The procedure, if permitted, would encourage and multiply vexatious suits, and lead to interminable litigation'."
[255]
[238] Starke J[139] and Williams J[140] also stated that the appellant's action could not succeed unless the earlier judgment was set aside.
[239] Schepis also involved a claim for damages arising from an allegation of a conspiracy to fabricate evidence. In dismissing an appeal from a decision to give summary judgment in favour of the defendants, Holmes JA (as her Honour was then) stated:[141]
[256]
"[15] The learned judge's view that the action could not succeed as long as the New South Wales Local Court judgment stood is well supported by authority. In Cabassi v Vila, Rich ACJ adopted American authority to the effect that a party could not maintain an action against his opponent for suborning a witness whose false testimony produced a judgment or for fraud as long as the judgment remained in force, because such a proceeding was 'an attempt to re-examine the merits of a judgment in a collateral suit between the same parties'. A judgment could not be impeached in such a way for reasons of public policy and the plaintiff's only remedy was a proceeding to set aside the judgment or petition for a new trial. Starke J agreed with the proposition that such an action could not succeed until the initial judgment was set aside. Williams J noted that at the time the statement of claim in that case was filed there was a binding judgment in existence and until it was rescinded it could not be impugned by civil proceedings other than proceedings directly challenging its validity. As with actions for malicious prosecution, the plaintiff had to be able to allege in his statement of claim that the proceedings had terminated in his favour; the cause of action had to be complete at the date of issue of the writ.
[257]
[16] It follows that it cannot avail the appellants to say that the judgment might later be set aside; and in any event, there is nothing referred to which would suggest that any proceedings that might produce that result are on foot. Even if a judgment obtained by collusion may in theory be regarded as a nullity, it will still be necessary to prove the alleged collusion in separate proceedings: see the observations of Debelle J in Emanuel Management Pty Ltd (in liq) v Fosters Brewing Group Ltd.
[258]
[17] More recently, the Court of Appeal in New South Wales in Cachia v Westpac Financial Services Ltd upheld summary dismissal of proceedings in which the claimant had sought damages on the basis that a Federal Court judgment was procured by fraud. That claimant, like the appellants here, asserted that the judicial officer at first instance was mistaken in supposing that he was attacking the Federal Court decision. Hodgson JA noted the difficulty with the submission: damages could not be obtained on the basis that the claimant had lost his Federal Court cause of action or ought not to have been ordered to pay costs without having the Federal Court decision set aside, because until that had occurred the decision conclusively established that the cause of action had no value and that the costs order was properly made. In order to claim damages on the basis that a previous judgment had been obtained by fraud it was necessary to apply to have it set aside. In Markisic v Department of Community Services of New South Wales the Court of Appeal adopted that reasoning, observing the claimant could not seek damages for a loss authorised by extant orders of another Court."
[259]
[240] These cases all concerned claims for damages caused by a judgment having been obtained through fraud. To the extent that Kea claims damages for tortious conspiracy arising from the procurement of the default judgment by fraud, it appears they may provide a basis for Mr Wikeley to seek to have that part of the claim summarily dismissed or stayed.[142] It seems to me that such an application would be complicated by the facts that, unlike these authorities: (i) Kea's claim concerns a judgment allegedly procured by fraud in a foreign jurisdiction; (ii) the judgment impugned as having been obtained fraudulently is a judgment given in default of appearance and not one given on the merits after a trial; and (iii) to date at least, the foreign court has refused to consider the merits of the fraud allegation when it refused to set aside the default judgment.
[241] I am not persuaded, however, that these authorities compel the conclusion that Kea's claim of tortious conspiracy cannot support a permanent anti-enforcement judgment in circumstances where the default judgment has not been set aside in Kentucky. The grant of anti-enforcement injunctions in Ellerman Lines and Bank St Petersburg, discussed above, suggests otherwise. On this application I do not need to reach a concluded view about this. It is sufficient that I am satisfied that the question is arguable.
[260]
Balance of convenience (paragraph 3 of the 21 April orders)
[261]
[242] It remains to consider whether the balance of convenience favours the continuation of the anti-enforcement injunctions made in paragraph 3 of the 21 April orders.
[243] Broadly stated the principle is that the balance of convenience will favour the granting of an injunction where it is otherwise just in all the circumstances.[143]
[244] Mr Wikeley submitted that the circumstances of this case do not support making anti-enforcement injunctions of the kind sought by Kea and granted by the court. He relied on the following matters in support of that submission: (i) Kea's failure to offer an adequate undertaking as to damages; (ii) Kea's past disentitling conduct consisting of delay before commencing the New Zealand proceeding and steps taken in Kentucky before the commencement of that proceeding; (iii) Kea's conduct in bringing the Kentucky appeal against the refusal to set aside the default judgment; and (iv) that the grant of the anti-enforcement injunction was contrary to principles of comity.
[262]
[245] At the 12 April hearing, Kea offered the usual undertaking as to damages. That is an undertaking to pay to a person (whether or not a party to the proceeding) who is affected by the order an amount the court decides should be paid for damages the person may sustain because of the order.[144] That usual undertaking as to damages continued to apply when the 21 April orders were made.[145]
[246] The purpose of requiring that a party seeking an interlocutory injunction provide such an undertaking is to attempt to ensure that a respondent who is subject to the injunction will receive compensation for any loss suffered by reason of the grant of the injunction if it appears that the applicant was not entitled to obtain it.[146] The undertaking is, in effect, the price of the injunction.[147] For this reason, the worth or otherwise of an undertaking offered by an applicant for an interlocutory injunction is an important factor to be weighed in the exercise of the discretion to grant such relief.[148]
[247] I have referred earlier in this judgment to Mr Wikeley's submission that, in the absence of evidence as to Kea's financial position and the location of its assets, security should be required to support the undertaking. That submission is based on the observation of Warren J (as her Honour was then) in Hotline Communications that security is normally required in such circumstances.[149]
[248] Mr Wikeley also submitted that the quantum of security should reflect the principles that: (i) the worth of Kea's undertaking is to be assessed on the premise that it would be called upon in the event that Kea's claim of tortious conspiracy fails with the result that the judgment creditor has been wrongly held out from enforcing the default judgment;[150] and (ii) that damage sustained by reason of an injunction can include loss from being held out of funds in which case the measure of compensation is an award of interest on the unrecovered amount.[151] Mr Wikeley submitted that post-judgment interest on the default judgment is accruing at the rate of $30,000 per day and $950,000 per month.
[263]
Delay prior to commencement of the New Zealand proceeding
[264]
[253] Delay by a party in applying for an anti-suit injunction or an anti-enforcement injunction will ordinarily be a factor weighing against the grant of such relief,[159] and the time a party takes to challenge the jurisdiction of the foreign court before seeking injunctive relief from the local court can be taken into account in assessing whether relief should be refused as a matter of discretion because of delay.[160]
[254] This is because there is a connection between delay and considerations of comity.[161] A lack of promptness will increase the danger than anti-suit injunctions and anti-enforcement injunctions, although they are granted against a party and are not directed to the foreign court, will nevertheless be seen as inappropriately interfering with the jurisdiction of the foreign court.[162] The tenor of modern authorities is that an applicant wishing to seek such relief should act promptly and not adopt an attitude of waiting to see what the foreign court decides.[163] It is generally not appropriate to permit an applicant to have "two bites at the cherry" by resisting the foreign proceedings and then, if the challenge failed, seek an anti-enforcement judgment.[164] The grant of relief by the local court in those circumstances will mean that the costs of the foreign proceeding and the resources of the foreign court will have been wasted.[165]
[255] However, as the previous discussion of considerations of comity in determining whether this court is a clearly inappropriate forum makes clear (see [160] to [188] above), these statements of general principle must be understood and applied in circumstances where fraud has been recognised as an exception which diminishes the force[166] such considerations.166
[256] Ultimately, the effect of Kea's conduct in taking steps in the Kentucky proceeding before seeking anti-enforcement injunctions in the New Zealand proceeding is a matter which must be taken into account in the overall assessment of the balance of convenience.
[265]
[257] As I have sought to explain in addressing Mr Wikeley's submission that this court is a clearly inappropriate forum (see [210] to [224] above), the court's consideration of the effect of Kea's conduct in the Kentucky proceeding as part of the assessment of the balance of convenience must have regard to the following contextual matters:
[266]
(a) Kea has demonstrated an arguable case that the default judgment has been obtained by fraud and that the steps sought to be taken to enforce that default judgment form part of a tortious conspiracy between Mr Wikeley and others to injure Kea; and
(b) the Kentucky Court has not yet considered the merits of Kea's fraud argument.
[267]
[258] Mr Wikeley's submissions on the relevance of principles of comity have already been considered in addressing the question of clearly inappropriate forum (see [159] to [203] and [225] to [228] above).
[259] In addition to the matters considered there, Mr Wikeley submitted that this court was persuaded to make orders which replicated those made by Gault J in the New Zealand proceeding because doing so would allow those orders to be practically enforced.[167] On Mr Wikeley's submissions, this was an error because it misunderstood or misstated the scope and purpose of the TTPA.
[260] As I have already indicated at [81] above, I accept that s 26 of the TTPA does not empower an Australian court to simply replicate injunctive orders granted by a New Zealand court in order to secure compliance with the New Zealand orders without the Australian court being satisfied that the requirements of the section are met in the circumstances of the application. This was, however, not the basis upon which the orders were made in the present proceeding.
[261] Mr Wikeley accepted that the application for relief under s 26 of the TTPA is to be decided on the footing that there is evidence that he breached orders made in the New Zealand proceeding.[168] Both the existence of those New Zealand orders, and the evidence that Mr Wikeley had breached them, were relevant to, and were considered by this court with reference to, the requirements under s 26 of the TTPA that: (i) this court considered it appropriate to grant the relief in support of the New Zealand proceeding; and (ii) this court would have granted the interim relief if a proceeding similar to the New Zealand proceeding had been commenced in this court.[169] That consideration did not involve simply granting relief which replicated the New Zealand orders, in order to ensure effective compliance with those orders, without being satisfied that the orders were appropriate having regard to the facts before the court and the relevant legal principles.
[268]
Consideration of the balance of convenience (paragraph 3 of the 21 April orders)
[269]
[263] The factors that weigh in favour of the continuation of the injunctions made in paragraph 3 of the 21 April orders are:
[270]
(a) the evidence which establishes an arguable case that the default judgment was obtained using a fabricated document, and that the procuring of that judgment and steps taken subsequently to enforce it have been taken pursuant to a tortious conspiracy between Mr Wikeley and others to injure Kea;
(b) the potential for harm to be caused to Kea by the continued perpetration of the alleged tortious conspiracy.
[271]
[264] The assessment of the potential for harm to be caused to Kea must have regard to evidence of Mr Wikeley's present ability (through Wikeley Inc) to take further steps directed towards enforcement of the default judgment. In this regard, Mr Wikeley referred to:
[272]
(a) the order made in the New Zealand proceeding which appointed interim liquidators to WFTL and expressly stated that Mr Wikeley had ceased to have any powers, functions or duties as director of WFTL other than those required or permitted by New Zealand statutory provisions governing company liquidations;
(b) evidence that the interim liquidators of WFTL sought and, on 25 May 2023, obtained, recognition by the US Bankruptcy Court of the interim liquidation of WFTL as a foreign main proceeding under Chapter 15 of the United States Bankruptcy Code, and the effect of this recognition and the provisional relief granted by the US Bankruptcy Court in staying the hearing of the substitution motion in the Kentucky courts and any further attempts at enforcement against the assets of WFTL (see [58] to [[170]](2023_215.html#_Ref146
(c) Mr Wikeley's evidence that he was told by his former attorney in Kentucky that he is no longer in control of Wikeley Inc because the shareholders of that company (Mr Wikeley's sons) had removed him as president of the company and replaced him with Mr Branham.[171]
[273]
[265] The first two of these matters support the submission that Mr Wikeley's ability to pursue the substitution motion, and thereby continue to pursue enforcement of the default judgment by Wikeley Inc, is now constrained by orders of the US Bankruptcy Court.
[266] However, the injunctions in paragraph 3 of the 21 April orders extend beyond a restraint on Mr Wikeley causing WFTL or Wikeley Inc from taking steps in existing proceedings. They act to restrain him from taking any steps himself, or causing any other person (not only WFTL or Wikeley Inc) from taking any steps, based on: the Coal Agreement; the default judgment; the statutory demand; the purported assignment of the Coal Agreement; the purported assignment of the default judgment; any notices of the purported assignments; and any subpoenas issued based upon the Coal Agreement or the default judgment. Given the evidence that Mr Wikeley breached the orders made in the New Zealand proceeding by causing the purported assignment of the Coal Agreement and the default judgment from WFTL to Wikeley Inc, I am satisfied that there is continued utility in maintaining the injunctions in paragraph 3 of the 21 April orders notwithstanding the constraints now imposed by the orders of the US Bankruptcy Court.
[267] As to the question of the sufficiency of Kea's undertaking as to damages, the conclusion at [249] above weighs against the further continuation of the injunctions. However, the importance of this in the overall balance must be considered in the unusual circumstances of this case: (i) Kea has established an arguable case that the default judgment is based upon a fabricated agreement; (ii) the anti-enforcement injunctions granted by this court have been made on an application for relief under s 26 of the TTPA in support of the New Zealand proceeding; (iii) Mr Wikeley was already subject to anti-enforcement injunctions in similar terms made in the New Zealand proceeding; (iv) consequently, a refusal by this court to grant the interlocutory injunctions sought by Kea would not leave Mr Wikeley free to seek to enforce the default judgment (he could only take steps to enforce the default judgment by acting in contravention of the New Zealand orders); (v) there is evidence that Mr Wikeley was prepared to act in contravention of the orders of the New Zealand court; (vi) Mr Wikeley did not challenge the sufficiency of Kea's undertaking as to damages in seeking to have the orders made in the New Zealand proceeding set aside.
[274]
No departure orders (paragraph 4 of the 21 April orders)
[275]
[272] In Talacko v Talacko (No 2),[172] Habersberger J concluded that the Supreme Court of Victoria has the inherent power to make orders preventing a person from departing the jurisdiction, in an appropriate case, for the purpose of preventing the abuse of its processes or for the purpose of enhancing the administration of justice.[173] As I observed when the 12 April orders were made, I consider this court has the same power.[174]
[273] Mr Wikeley submitted that the power to restrain a person from leaving the jurisdiction, or to require a person to deliver up his or her passport, is one which should be exercised with great caution and only in a most clear case.[175]
[274] It may be readily acknowledged that restraint and caution must be exercised in relation to curtailing or interfering with a person's travel and freedom of movement.[176] Nevertheless, I remain satisfied that there is a proper basis for interfering with Mr Wikeley's travel and freedom of movement in the present circumstances.
[275] There are two justifications for continuing the no-departure orders made in paragraph 4 of the 21 April orders. The first is that such orders assist in attempting to ensure that Mr Wikeley complies with the injunctions made in paragraph 3 of the 21 April orders. The second is that the orders assist in attempting to ensure that Mr Wikeley appears at the hearing of the contempt application.
[276] As to the first justification, based on the evidence referred to at [264] above, Mr Wikeley submitted that there was no longer any need for the no-departure orders to remain in place. I do not accept that submission in circumstances where the injunctions in paragraph 3 of the 21 April orders extend beyond a restraint on Mr Wikeley causing WFTL or Wikeley Inc from taking steps in existing proceedings. The evidence of Mr Wikeley's earlier contravention of orders made in the New Zealand proceeding satisfies me that he is a person who is prepared to ignore the authority of court orders when he is not amenable to the court's powers of enforcement. On the basis of that history, I am satisfied that there is an unacceptable risk that if Mr Wikeley is permitted to leave Australia he would, upon leaving, act in contravention of the injunctions made in paragraph 3 of the 21 April orders.
[276]
[279] I am ultimately satisfied that the 21 April orders should be continued on the undertaking of Kea's solicitors to hold the sum of $100,000 in their trust account as security for Kea's undertaking as to damages (see [250] above).
[277]
[280] Mr Wikeley applied to have the 26 April orders set aside because:[177]
[278]
(a) those orders depend on the 12 April orders and the 13 April orders which, on Mr Wikeley's submissions, should be set aside;
(b) because they were made to secure his appearance at the contempt application which, on Mr Wikeley's submissions, should be permanently stayed; and
(c) it would be an abuse of the court's processes for the 26 April orders to remain in force when, on Mr Wikeley's submissions, the 12 April orders and the 13 April orders should be set aside.
[279]
[281] Each of these arguments depend upon the court finding that the 12 April orders and the 13 April orders should be set aside.
[282] In circumstances where I have dismissed Mr Wikeley's application to set aside the 12 April orders and the 13 April orders, these arguments do not provide a basis to set aside the 26 April orders.
[283] However, Mr Wikeley also submitted at the hearing of the application that the 26 April orders, which were described as imposing a limited form of house arrest, could no longer be considered necessary to secure his appearance at the hearing of the contempt application. That submission was based on the following matters:
[280]
(a) the conditions of residence, curfew and surety were offered in circumstances where Kea was pressing for the immediate execution of the warrant for Mr Wikeley's arrest, and that warrant has since been set aside;
(b) Mr Wikeley is now represented by solicitors and counsel who are conducting the proceeding in the ordinary way;
(c) there is no evidence that, since 26 April 2023, Mr Wikeley has breached any orders made by this court.
[281]
[284] I have concluded that the no-departure orders made in paragraph 4 of the 21 April orders should be continued to ensure Mr Wikeley appears at the hearing of the contempt application. Having regard to the matters identified by Mr Wikeley above, I accept there is no longer sufficient justification for the additional conditions of residence, curfew and surety imposed by the 26 April orders to attempt to ensure that outcome. Based on the present circumstances, I consider the non-departure orders in paragraph 4 of the 21 April orders to be sufficient in that regard.
[282]
[285] Mr Wikeley submitted that the proceeding should be permanently stayed because it involves an abuse of process of the court in circumstances where:
[283]
(a) Kea sought relief from courts in the BVI on the footing that Kea could, and would, seek relief from the courts in Kentucky, founded upon substantially the same fraud argument raised in the New Zealand proceeding and in this court;
(b) Kea sought relief in the Kentucky proceeding (to set aside the default judgment and to set aside subpoenas) and in courts in New York (to set aside subpoenas) founded upon substantially the same fraud argument raised in the New Zealand proceeding and in this court;
(c) Kea continues to seek relief in the Kentucky appeal from the refusal to set aside the default judgment, relying upon the same fraud argument raised in the New Zealand proceeding and in this court;
(d) this conduct was unjustifiably oppressive to Mr Wikeley and WFTL.
[284]
[286] I am not persuaded that Kea's conduct in bringing the present proceeding is unjustifiably oppressive to Mr Wikeley or WFTL such as to amount to an abuse of process. I have already explained my reasons for reaching that conclusion (see [210] to [217] and [268] above).
[287] Nor do I accept that the proceeding in this court is unjustifiably oppressive to Mr Wikeley because of:
[285]
(a) the period of four months from when Kea alleges it became aware of the default judgment in the Kentucky proceeding and its commencement of the New Zealand proceeding (for the reasons set out in [253] to [256] and [269] above) or
(b) Kea's purpose in commencing the New Zealand proceeding or the proceeding in this court (for the reasons set out in [218] to [224] above).
[286]
[288] I also do not accept that the proceeding should be stayed because Queensland is a clearly inappropriate forum (for the reasons set out in [154] to [230] above).
[289] Having regard to the conclusions I have reached in addressing Mr Wikeley's application to set aside the 21 April orders, I am not satisfied that he has discharged the burden of demonstrating a basis for a permanent stay of the proceeding, having regard to the summary of the principles governing the exercise of the court's power to grant such relief given by Bell P (as the Chief Justice of New South Wales then was) in Moubarak by his tutor Coorey v Holt.[178]
[290] The application for a permanent stay of the proceeding must be dismissed.
[287]
[291] The orders will be that, upon the undertaking of Kea's solicitors to hold the sum of $100,000 in their trust account as security for Kea's undertaking as to damages:
Paragraphs 2 to 4 of the orders made on 26 April 2023 are set aside.
The security in the amount of $10,000 paid into court in accordance with paragraphs 3 and 4 of the orders made on 26 April 2023 is to be paid out to Mr Wikeley.
The amended application filed on 15 June 2023 is otherwise dismissed.
[5] That figure was reached by adding the indemnity of US$93.75 million (25% of the estimated profits of US$375 million) and the unpaid royalty amount which was said to be more than US$30 million.
[293]
[6]Kea Investments Ltd v Wikeley Family Trustee Ltd[2022] NZHC 2881 (2022 NZ Judgment).
[294]
[7]Kea Investments Ltd v Wikeley Family Trustee Ltd[2023] NZHC 466 (2023 NZ Judgment).
[295]
[8] CFI 84, exhibit "SJB-2" at page 12 of the exhibit bundle and exhibit "SJB-3" at page 15 of the exhibit bundle.
[38] CFI 6, [38]-[39], referring to 2022 NZ Judgment, [44].
[315]
[41] CFI 6, [30] (footnote 46: referring to 2022 NZ Judgment, [36]-[42]) and [34] (footnote 57: referring to 2022 NZ Judgment, [42] and the cases cited by Gault J in footnote 25 therein).
[95]SAS, [68]-[69] citing Societe Eram Shipping Co Ltd v Cie Internationale de Navigation[2004] 1 AC 260 and Mackinnon v Donaldson, Lufkin & Jenrette Securities Corp[1986] Ch 482.
[123]Voth, 567; Dow Jones & Co Inc v Gutnick (2002) 210 CLR 575, 606 [43].
[362]
[124] It would be different if Kea's claims in its hypothetical proceeding in this court required consideration whether, as a matter of contract, it was bound by the terms of the Coal Agreement. In Central Petroleum Ltd v Geoscience Resource Recovery LLC[2017] QSC 223; [2018] 2 Qd R 371, 385-6 [44]-[49], Bowskill J (as her Honour then was) held that, having regard to the decision of the Full Federal Court in Trina Solar (US) Inc v Jasmin Solar Pty Ltd[2017] FCAFC 6; (2017) 247 FCR 1, it was fairly arguable that the issue whether a disputed contract binds the parties will be decided by the application of the law of the local forum, not the proper law of the disputed contract. However, given the causes of action which Kea has pleaded in the New Zealand proceeding those decisions do not appear to apply to Kea's claims.
[127] CFI 7 and 13 to 32 (pages 362-71 of exhibit MTD-01 to the affidavit of Mathew Thomas Deighton filed 12 April 2023, particularly at paragraphs 6 to 8 of the opinion).
[365]
[128] CFI 7 and 13 to 32 (pages 172-86 of exhibit MTD-01 to the affidavit of Mathew Thomas Deighton filed 12 April 2023, particularly paragraphs 30 to 32 of the opinion).
[366]
[129] CFI 7 and 13 to 32 (pages 362-71 of exhibit MTD-01 to the affidavit of Mathew Thomas Deighton filed 12 April 2023, particularly at paragraphs 3 to 5 of the opinion).
[367]
[131] CFI 7 and 13 to 32 (pages 362-71 of exhibit MTD-01 to the affidavit of Mathew Thomas Deighton filed 12 April 2023, particularly at paragraphs 6 to 20 of the opinion).
On Kea's solicitors undertaking to hold $100,000 in trust as security for Kea's undertaking as to damages, paragraphs 2 to 4 of the 26 April 2023 orders were set aside, and the $10,000 security paid under those paragraphs was to be paid to Wikeley. The amended application was otherwise dismissed. Costs were reserved: [291]-[292].
ex parte
[68] On the question of onus, Mr Wikeley relied on three authorities: Warringah Shire Council v Industrial Acceptance Corp;[12]Brimaud v Honeysett Instant Print Pty Ltd;[13] and Nicols (as trustee of the bankrupt estate of Manietta) v Manietta.[14] The passages referred to in his submissions addressed the situation where ex parte orders were continued by consent without a contested hearing.
[69] In Warringah, McLelland J (as his Honour then was) observed:[15]
[98] In my view, Kea adequately drew the threshold requirement to the court's attention at the 12 April hearing.
[116] The urgency with which the application for interim relief was brought in this court on 12 April 2023 - following the purported assignment of the default judgment to Wikeley Inc which precipitated Kea's application for further interim orders in the New Zealand proceeding and in advance of the hearing of the substitution motion in the Kentucky proceeding on 14 April 2023 - is relevant to this conclusion.[53]
[117] It is also important to note that Mr Wikeley did not raise the suggested defences at either the 21 April hearing, the 26 April hearing or on 3 May 2023 when his application to set aside the arrest warrant was heard. At the 26 April hearing, counsel then briefed to appear on behalf of Mr Wikeley referred to the need for time for Mr Wikeley's representatives to review the material before advancing further substantive argument.[54] At the hearing on 3 May 2023, Mr Wikeley indicated a wish to be heard on directions for the filing and listing of an application to vary or set aside the orders made against him,[55] but did not identify the grounds upon which he proposed to make such application.
[118] The first time Mr Wikeley raised the potential defences in this proceeding was in draft points of contention attached to an outline of submissions addressing directions for timetabling the hearing of his application filed on 7 June 2023.[56] That document was filed on 14 June 2023, about two months after the 12 April orders were made. Mr Wikeley has then addressed the potential defences in very detailed written submissions comprising 75 pages which were prepared and filed more than three months after the 12 April orders were made.[57] The fact that Mr Wikeley himself required two months to articulate the potential defences in this proceeding suggests it would be unfair to conclude that, by failing to expressly articulate those potential defences at the 12 April hearing, Kea did not adequately fulfil its responsibility of drawing the court's attention to matters which could be raised by Mr Wikeley in response to the application for interim relief. To require that a party in Kea's position at the 12 April hearing identify and articulate potential defences which Mr Wikeley only advanced months after the interim orders were made would be, in the words of Slade LJ in Brink's-MAT, to take the duty of care and candour on an applicant for ex parte orders to extreme lengths.[58]
[124] Mr Wikeley deposed to having lived in Kentucky between 2012 and 2015 and being involved in coal projects with Mike Branham. In that context, his evidence concerning the Coal Agreement was limited to the following paragraphs of his affidavit:[64]
[168] Following the delivery of judgment by the Indonesian court, ED&F Man sought a declaration from the English court that the settlement agreement was valid and binding upon Mr Haryanto. It also sought an injunction with extraterritorial effect to restrain Mr Haryanto from continuing to assert that the disputed agreements were illegal.
[169] At first instance the declaration was granted but the injunction was refused. This decision was upheld by the Court of Appeal. Neill LJ held that the declaration was properly granted because the English court would not recognise a foreign judgment if it was inconsistent with a previous decision of a competent English court. However, the grant of the declaration meant that no injunction operating in England was required to protect ED&F Man. As to the position in Indonesia, Neill LJ stated:[98]
[179] At first instance, the English court made a declaration that the Turkish judgment was not enforceable by the defendants in England, but held that it did not have power to grant an injunction restraining the defendants from seeking to enforce the Turkish judgement in Turkey or elsewhere outside England. The plaintiffs successfully appealed the refusal of the injunction.
[180] Scrutton LJ noted that he did not share the primary judge's doubts as to the court's power to grant the injunction with extraterritorial effect, stating:[105]
[188] In addressing a submission advanced on behalf of the bank about the exceptional nature of an anti-enforcement injunction, Longmore LJ reviewed the judgments in Ellerman Lines before stating:[114]
(f) Kea has no record of the Coal Agreement or any records relating to the Coal Agreement prior to the receipt of the statutory demand in the BVI;
(g) there is no evidence of any demand having been made upon Kea to provide funding in accordance with the terms of the Coal Agreement from the time it was apparently executed on 23 October 2012 to the commencement of the Kentucky proceeding on 19 August 2021;
(h) the evidence of Sir Owen Glenn is that:
(i) he has no recollection of any discussion concerning the projects referred in the background section of the Coal Agreement;
(ii) he was not aware of Kea having entered into the Coal Agreement, or any similar agreement under which it was required to lend money to the Wikeley Family Trust or to Mr Wikeley;
(iii) he was not aware of Kea having entered into an agreement concerning the projects referred to in the background section of the Coal Agreement;
(iv) Mr Watson never mentioned the Coal Agreement, or any similar agreement, to him and did not mention any requirement for payments from Kea under such agreement;
(v) he first became aware of the Coal Agreement, the alleged joint venture and the default judgment on 29 June 2022, after Kea's BVI agent provided a copy of the statutory demand issued in the BVI by WFTL;
(i) the evidence of Mr Andrew Munro, a representative of a professional trustee appointed in February 2013 to take control of the assets of the Corona Trust, including assets held by Kea, in proceedings in Nevis, is that:
(i) an order was made in the Nevis proceeding that required Mr Dickson, among others, to provide to the professional trustee all documents relating to companies which included Kea;
(ii) if Kea had entered into the Coal Agreement before the appointment of the professional trustee in Nevis, Mr Dickson would have been obliged to disclose it under the order in the Nevis proceeding, but he did not provide it;
(iii) Mr Munro acted as the representative of a corporate director of Kea appointed in March 2013 and, in that capacity, dealt with Mr Watson on behalf of Kea;
(iv) Mr Watson never mentioned the Coal Agreement, or any similar arrangement to him and did not mention any requirement for payments from Kea under such agreement;
(v) Mr Munro was not aware of Kea having entered into the Coal Agreement, or any similar agreement or joint venture involving the Wikeley Family Trust or Mr Wikeley or relating to the projects referred to in the Background section of the Coal Agreement;
(vi) Mr Munro first became aware of the Coal Agreement after WFTL had commenced the Kentucky proceeding.
[209] In the circumstances, I am not persuaded that the likely application of the law of Kentucky to the determination of Kea's claim means that this court is a clearly inappropriate forum.
[216] In this case, the evidence of Professor Silberman is that the Kentucky Court does not have jurisdiction over Kea in respect of the claim under the Coal Agreement.[131] As there is doubt as to whether the Kentucky Court has jurisdiction to decide the claim against Kea under the Coal Agreement, I am not persuaded that Kea's proceeding in this court is vexatious or oppressive in the Voth sense.
[217] In the circumstances, I am not persuaded that the existence of the Kentucky proceeding or the Kentucky appeal, or any of the steps Kea has taken in those proceedings, mean that this court is a clearly inappropriate forum.
[236] In Cabassi, the appellant had brought a proceeding claiming damages for assault. Evidence was given by several witnesses at the trial of that claim that the defendant had not assaulted the appellant. The claim was dismissed and an appeal from that decision was also dismissed. The appellant then brought a proceeding against three of the witnesses who had given evidence at the earlier trial, claiming that the evidence given was false and the defendants in the second proceeding had unlawfully conspired together to deceive the courts which heard the claim for assault.
[237] The High Court dismissed an appeal from a decision of the Full Court of this court ordering that judgment be entered in favour of the defendant. Rich ACJ relied on two passages from American authorities where the cause of action was conspiracy either to give false evidence or to defraud by means of false evidence:[138]
[249] During the course of the hearing, Kea offered to provide security for its undertaking in the sum of $100,000.[152] Mr Wikeley submitted that this offer of security was both "too little and too late".[153] I accept that, if Kea does not succeed on its claim for a permanent injunction restraining enforcement of the default judgment, the security now offered by Kea would do little to ensure that Mr Wikeley and his associated entities affected by the injunctions are protected against the financial harm of being held out from enforcing the default judgment.
[250] However, having regard to evidence given by Mr Wikeley as to his ability and his intention to travel overseas,[154] I consider that the sum of $100,000 would provide adequate security for compensation to which Mr Wikeley might become entitled in respect of paragraph 4 of the 21 April orders which prevents him from leaving Australia.
[251] There is no doubt that the provision of security can be required as a condition of the court acting on an undertaking as to damages given by a party who does not appear to have sufficiently disclosed a substantive basis on which to meet any liability on the undertaking in the event that it is called upon.[155] However, the exercise of the discretion must always depend on the circumstances of the case,[156] and exceptional circumstances may warrant departure from the general position that, where the worth of an undertaking is seriously in issue and the question of appropriate security is raised, the price of the granting of the injunction should include the provision of security sufficient to ensure that the party restrained will not be out of pocket if the applicant's underlying claim fails.[157]
[252] It is also important to bear in mind that, although the sufficiency of an undertaking as to damages is an important matter to be considered in assessing where the balance of convenience lies and, on the facts of a particular case, may as a matter of importance and weight be determinative of the question, it is a matter which must be considered as part of the totality of determining the balance of convenience and not as a step anterior thereto.[158]
[262] Having regard to the earlier discussion of the fraud exception in the context of considerations of comity, I do not accept Mr Wikeley's submission that orders of the kind made against him by this court could only be justified by a need to protect the integrity of the processes of this court and to ensure compliance with its own orders.
[268] In that context, I consider that the importance of the worth of the undertaking as the price of the injunction - and the sufficiency of the security offered in support of the undertaking - is greatly diminished. That is because, save in respect of the restriction upon his ability to travel outside Australia, the orders made by this court did not impose any restraint upon Mr Wikeley's conduct to which he was not already subject by reason of the New Zealand orders (but which he was prepared to contravene).
[269] As to the steps taken by Kea in the Kentucky proceeding, I have already indicated at [114] above that I am not persuaded that the extent of Kea's participation in the Kentucky proceeding means it has waived its rights to seek to restrain Mr Wikeley as it has done in the New Zealand proceeding and in this proceeding. Nor am I persuaded that Kea's application for injunctive relief is vexatious or oppressive, or is an abuse of process, in circumstances where the Kentucky Court has not yet considered the merits of Kea's fraud arguments (see [210] to [224] above).
[270] The existence of an arguable case that the default judgment was obtained using a fabricated document, and that the procuring of that judgment and steps taken subsequently to enforce it have been taken pursuant to a tortious conspiracy between Mr Wikeley and others to injure Kea, also means that Mr Wikeley's submissions on the impact of delay are substantially weakened.
[271] Weighing these various matters in the overall balance and having regard to what, in my view, can properly be described as the exceptional circumstances of the present case, I am ultimately satisfied that the balance of convenience favours the continuation of the injunctions in paragraph 3 of the 21 April orders. That is, I am satisfied that it is just in all the circumstances that those injunctions should be continued.
[277] As to the second justification, Mr Wikeley submitted that there is no evidence that he is likely to depart Australia. It is true that there is no direct evidence that Mr Wikeley has expressed an intention to, or taken steps toward, leaving Australia, however, that position is explained by Mr Wikeley having been subject to the no-departure orders made ex parte at the 12 April hearing.
[278] Even in the absence of direct evidence, I consider that there is an unacceptable risk that, if the no-departure orders are discharged, Mr Wikeley would, despite his stated intention to the contrary, leave Australia and not return as required to appear on the hearing of the contempt application. I have already explained my conclusion that Mr Wikeley is a person who is prepared to ignore the authority of court orders when he is not amenable to the court's powers of enforcement. Having reached that conclusion, I am satisfied that if the no-departure orders are discharged Mr Wikeley is likely to seek to put himself beyond the powers of enforcement of this court by leaving Australia.