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Catchwords: CIVIL PROCEDURE – Court of Appeal – application for stay – Burgandy Royale test – limited stay granted
APPEAL — Security provided in form of bank guarantees — order that guarantees be released – limited stay of order

Legislation Cited: Civil Procedure Act 2005 (NSW)
Building and Construction Industry Security of Payment Act 1999 (NSW)

Cases Cited: Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (No.1) (1986) 161 CLR 681
Martinus Rail Pty Ltd v Qube RE Services (No.2) Pty Ltd [2025] NSWCA 49

Texts Cited: None

Category: Procedural rulings

Parties: Qube RE Services (No.2) Pty Ltd (applicant)
Martinus Rail Pty Ltd (respondent)

Representation: Counsel:
Mr Boyle with Mr Harvey (applicant)
Mr Robertson SC (respondent)
Solicitors:
King & Wood Mallesons (applicant)
Maddocks Lawyers (respondent)

File Number(s): 2024/00386902
2024/00386888
2024/00362269

Publication restriction: None

EX TEMPORE JUDGMENT (REVISED)

[Amended in accordance with the principles in Bar-Mordecai v Rotman [2000] NSWCA 123 at [194**]**]

1. On the morning of 2 April 2025, the Court handed down reasons in Martinus Rail Pty Ltd v Qube RE Services (No.2) Pty Ltd [2025] NSWCA 49. In what follows familiarity with that judgment is assumed.

2. In accordance with the Court’s usual practice, the parties had been notified that judgment was being handed down at 9.30 this morning and that it was unnecessary from the Court’s point of view for representatives to attend as the judgment would be published and emailed to the parties electronically immediately after being delivered. On the handing down of the judgment, Mr Robertson SC appeared for Martinus, and there was no appearance for Qube.

3. At some time in the afternoon of 2 April 2025, whilst I was sitting in the Court of Criminal Appeal, a notice of motion was filed on behalf of Qube. The motion seeks an order pursuant to s 67 or s 135(2) of the Civil Procedure Act 2005 (NSW), or in the Court’s inherent jurisdiction, staying the execution of the orders entered this morning in the three proceedings. Also sought was an order varying order 7 of the orders made on 26 September 2024, as varied by order 6, such that the appellant, Martinus, be prohibited from taking any further action to enforce the judgment until 5pm on 7 April 2025.

4. The matter was listed before me urgently at 4.30pm this afternoon. Mr Robertson SC appeared again for Martinus, and Mr Boyle, together with Mr Harvey, appeared for Qube. An affidavit, sworn 2 April 2024, of Matthew Carr was read by Qube without objection. Mr Robertson, for Martinus, made it clear that any stay, even for a period of a few days, was opposed.

5. Mr Robertson made the point that no grounds were properly identified in Mr Carr’s affidavit or in Mr Boyle’s submissions establishing a likelihood that the test in Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (No.1) (1986) 161 CLR 681 would be satisfied. Further, Mr Robertson submitted that there was insufficient evidence of the balance of convenience sufficient to justify a stay, even for a few days. This was because there was no evidence that his client would not be able to make restitution if the judgment of this Court was set aside by the High Court.

6. I have concluded, despite the apparent strength of Mr Robertson’s submissions, that this is a case where I should, for a few days, provide a limited stay. The Court had been proceeding on the understanding that the guarantees referred to in the orders made on 26 September 2024 and varied on 15 November 2024 would, as a result of its orders, immediately be made available to Martinus. That has proved not to be the case as the Registry have taken the view that a specific further order should be made requiring release of the guarantees.

7. I have determined that it is in the interests of justice that I make an order giving effect to the Court’s reasons published this morning to release the guarantees to Martinus. I will shortly announce that order.

8. I am also, however, persuaded that I should stay that order until 4pm on Tuesday, 8 April 2025, for the purposes of permitting Mr Boyle and his client to obtain the advice of senior counsel about a possible application for special leave to appeal and to identify how it is that Qube says that the Burgundy Royale test has been satisfied.

9. I made it clear that in so doing, I was not intending to invite applications on behalf of Qube to obtain further documentary evidence, for example, by issuing notices to produce.

10. As I have said, there is much force in what Mr Robertson has said in the context of the Building and Construction Industry Security of Payment Act 1999 (NSW) and the stringencies of the extraordinary jurisdiction identified in Burgundy Royale. Nevertheless, I propose to give Qube an opportunity for a few days to consider whether to make a considered application for a stay pending seeking special leave to appeal to the High Court.

11. Finally, there is an issue not dealt with by the orders of the Court, being monies paid into Court, essentially constituting interest payable to Martinus. Mr Robertson submitted a form of order, which I propose to make shortly, and Mr Boyle very sensibly and helpfully did not require a formal motion and accepted that such an order should be made conformably with the reasons of the Court.

12. Accordingly, for these reasons, I make the following orders:

13. Order that the guarantees referred to in order 6 made on 26 September 2024 (as varied by order 5 made on 15 November 2024) in proceedings 2024/286961 be released by the Registrar of the Court of Appeal to any one of Martinus’ legal representatives, Mr Stulic or Mr Ware.

14. Upon condition that Qube pays into Court the amount of $135,542.08 by 4pm Thursday 3 April 2025 and upon Qube giving the usual undertaking as to damages, the Court orders a stay of order 1 until 4pm Tuesday 8 April 2025.

15. The amounts paid into court by Qube as contemplated by order 1 of the orders made on 5 September 2024 in proceedings 2024/278984, order 1 of the orders made on 6 September 2024 in proceedings 2024/278963 and by order 7(b) of the orders made on 26 September 2024 in proceedings 2024/00286961 be paid out by the Court at the direction of Martinus’ legal representatives, Mr Stulic or Mr Ware.

16. If Qube seeks an extension of the stay the subject of order 2 (or any differently formulated stay):

(a) By 2pm on Monday 7 April 2025, Qube file and serve a notice of motion seeking that relief together with such evidence as Qube wishes to rely on in support of that notice of motion, together with written submissions not exceeding five pages. (b) By 4pm on Tuesday 8 April 2025, Martinus file and serve the evidence on the motion it wishes to file together with submissions not exceeding five pages. (c) The matter will be addressed by the Court on the papers as soon as possible after 8 April 2025.

Addendum

13. On 7 April 2025, Qube’s solicitors notified my chambers that no application of the kind contemplated by order 4 of 2 April 2025 would be made. Following email communications between the parties it was eventually common ground that I should make the following additional orders, which orders were made on 7 April 2025:

14. The stay the subject of order 2 made on 2 April 2025 is lifted forthwith.

15. The sum of $135,542.08 paid into court by Qube be paid out by the Court as follows:

(a) the sum of $118,599.32 paid out at the direction of Martinus’ legal representatives, Mr Stulic or Mr Ware; and (b) the sum of $16,942.76 paid out at the direction of Qube’s legal representatives, Mr Carr or Ms Kleinau.

3. Qube pay Martinus’ costs of the application made on 2 April 2025 including any costs incurred in relation to the contingent motion the subject of order 4 of the orders made on 2 April 2025.

**********

Amendments

08 April 2025

Order (3) amended pursuant to r 36.17 of the Uniform Civil Procedure Rules 2005 (the “slip” rule) to replace "that" with "the".

08 April 2025

Order (3) amended pursuant to r 36.17 of the Uniform Civil Procedure Rules 2005 (the “slip” rule) to replace "that" with "of".

17 April 2025

Addendum - Order (2)(a) made on 7 April 2025 amended pursuant to r 36.17 of the Uniform Civil Procedure Rules 2005 (the "slip" rule) to $118,599.32