Rosecell Pty Ltd & Ors v JP Haines Plumbing Pty Ltd & Ors

No necessity for demand

1. Mr Notley, who appeared for JP Haines and Right Price, submitted that there was no evidence of a demand having been made against Right Price for the return of the goods purchased by it. After the hearing I was advised that the parties were agreed that on 19 April 2012 a demand had been made by the plaintiffs on Right Price for the return of the equipment. Accordingly, the question whether a prior demand was necessary in order for Right Price to succeed in its claim for conversion does not arise.
2. Nonetheless, I should say that I do not consider that in the circumstances of the present case any such demand would have been required. Conversion is an intentional dealing with goods repugnant to the plaintiffs' immediate right to possession (Penfold Wines Pty Ltd v Elliott (1946) 74 CLR 204 at 229, per Dixon J). In the present case the acts of purchase and the taking possession of the goods and the exercise of dominion over them were repugnant to the plaintiffs' right of possession. Unless the defendants acquired title to the goods through their dealings with Mr Abboud, or unless the plaintiffs are estopped from denying the validity of the purported sales to the defendants, they are liable in conversion, whether or not a demand for the return of the goods had been made by the plaintiffs.
3. Mr Notley relied on a passage in the judgment of Allsop P (as his Honour then was) in Bunnings Group Ltd v CHEP Australia Ltd [2011] NSWCA 342; (2011) 82 NSWLR 420 where his Honour said: "[117] Conversion can, of course, occur by retaining goods after a demand. The act of retention is one that is repugnant to the owner's right to possession expressed by the call for making available or return of the goods. Mere unauthorised possession of another's chattel is not a conversion of it: Clayton v Le Roy [1911] 2 KB 1031 at 1048-1050; Barclay's Mercantile Business Finance Ltd v Sibec Developments Ltd [1992] 1 WLR 1253 at 1257; Spackman v Foster (1882-1883) LR QBD 99 at 100-101. For possession or keeping to be a conversion a demand is required: Clayton v Le Roy at 1052; and General and Finance Facilities Ltd v Cooks Cars (Romford) Ltd [1963] 1 WLR 644 at 649."
4. The submission involves a misunderstanding of what Allsop P said. His Honour did not say that in every case, for there to be a conversion, a demand is required. His Honour's observations and the cases cited related only to cases where the claim of conversion was based upon mere possession or retention of goods with no other assertion of dominion over the goods inconsistent with the owner's immediate right of possession. As his Honour later said: "[124] The framing of a precise definition of the tort of conversion has been described as 'well nigh impossible': Lord Nicholls of Birkenhead in Kuwait Airways Corporation v Iraqi Airways Co (Nos 4 and 5) [2002] UKHL 19; [2002] 2 AC 883 at 1084 [39]; and see also (1879) 4 Ex D 188 at 194 per Bramwell LJ. The essential elements, or basic features, involve an intentional act or dealing with goods inconsistent with or repugnant to the rights of the owner, including possession and any right to possession. Such an act or dealing will amount to such an infringement of the possessory or proprietary rights of the owner if it is an intended act of dominion or assertion of rights over the goods: see generally Penfolds Wines Pty Ltd v Elliott (1946) 74 CLR 204 at 217-220 (per Latham CJ), 228-230 (per Dixon J, with whose statements of principle Starke J agreed at 221), 234-235 (per McTiernan J), and 239-244 (per Williams J); and Kuwait Airways at 1084 [39]-[42] (per Lord Nicholls of Birkenhead), 1104 [119] (per Lord Steyn) and 1106 [129] per Lord Hoffmann)."
5. Thus, where a person acquires goods by purchase from a person not authorised to sell them, it is the purchase and acquisition of the goods that are the acts inconsistent with the true owner's right to possession. In such a case a demand is not a requisite element of the tort. In other situations, as where the person lawfully comes into possession in circumstances which involve no exercise of dominion over the goods inconsistent with the owner's right of possession, a demand may be required.

Ostensible authority

1. Mr Notley submitted that Mr Abboud had ostensible authority to act for Rosecell in the sale of Rosecell's equipment to JP Haines. There was no dispute that the principle stated by Diplock LJ (as his Lordship then was) in Freeman & Lockyer (a Firm) v Buckhurst Park Properties (Mangal) Ltd [1964] 2 QB 480 at 503 applied. Diplock LJ said (at 503): "An 'apparent' or 'ostensible' authority, on the other hand, is a legal relationship between the principal and the contractor created by a representation, made by the principal to the contractor, intended to be and in fact acted upon by the contractor, that the agent has authority to enter on behalf of the principal into a contract of a kind within the scope of the 'apparent' authority, so as to render the principal liable to perform any obligations imposed upon him by such contract. To the relationship so created the agent is a stranger. He need not be (although he generally is) aware of the existence of the representation but he must not purport to make the agreement as principal himself. The representation, when acted upon by the contractor by entering into a contract with the agent, operates as an estoppel, preventing the principal from asserting that he is not bound by the contract. It is irrelevant whether the agent had actual authority to enter into the contract."
2. In this case it was said that Rosecell through Mr and Mrs Doughty had held out Mr Abboud as having authority to sell Rosecell's equipment. The representation was said to have been made not expressly by words, but by conduct. In Freeman & Lockyer (a Firm) v Buckhurst Park Properties (Mangal) Ltd Diplock LJ also said (at 503-504): "The representation which creates 'apparent' authority may take a variety of forms of which the commonest is representation by conduct, that is, by permitting the agent to act in some way in the conduct of the principal's business with other persons. By so doing the principal represents to anyone who becomes aware that the agent is so acting that the agent has authority to enter on behalf of the principal into contracts with other persons of the kind which an agent so acting in the conduct of his principal's business has usually 'actual' authority to enter into."
3. The defendants' pleaded case was that the representation arose because Mr Doughty and Mr Abboud represented to the world that they were jointly operating an excavation and haulage business called "GT Haulage" which was commonly known to mean "George and Trent Haulage" and a repair business under the name "GT Truck and Trailer Repairs" which was commonly known to mean "George and Trent Truck and Trailer Repairs". The defendants pleaded that they had relied upon the fact that the items of purchased equipment had colours or logos of the business "GT Haulage", Mr and Mrs Doughty allowed Mr Abboud to deal with the equipment by surrendering control of Rosecell's affairs to him, Rosecell had represented that it was an entity jointly owned and operated by Mr Doughty and Mr Abboud, and the defendants had assumed or expected that Mr Abboud was entitled to enter into contracts on behalf of Rosecell.
4. Mr Notley submitted that: "The nature of the relationship between Mr Abboud and Mr Doughty, facilitated by their web of corporate entities, meant that to the outside world they appeared to be in business or partnership together. The equipment the subject of these proceedings was used by Mr Abboud and Mr Doughty in that business or partnership and was supplied by Rosecell. This constituted a clear representation by the plaintiffs that Mr Abboud either owned the equipment the subject of these proceedings or had authority to sell that equipment on behalf of the entities that did own it." He submitted that Mr and Mrs Doughty's decision to hand control of the equipment, and of Rosecell's books and information needed to run its business, to Mr and Mrs Abboud, put Mr Abboud in the position to hold himself out as having authority to sell.
5. The fact that the vehicles had markings which Mr Haines associated with a business he had heard was a business with which Mr Abboud had something to do could not have been a representation that Mr Abboud had authority to sell the equipment.
6. JP Haines pleaded that Rosecell represented that it was an entity jointly owned and operated by Mr Doughty and Mr Abboud and that in reliance on that representation JP Haines assumed or expected that Mr Abboud was entitled to enter into contracts on behalf of Rosecell.
7. No such representation was conveyed to Mr Haines. He believed from what he was told by some truck drivers that George Abboud as well as Trent Doughty had a lot to do with GT Haulage. He knew nothing of Rosecell.
8. The alleged representation could go no further than that Mr Abboud had authority to act in the ordinary course of the business carried on by him and Mr Doughty.
9. If any such representation as pleaded were conveyed it would not have justified the assumption that Mr Abboud alone had authority to sell. Indeed, Mr Abboud's statement to Mr Haines that his partner had disappeared leaving Mr Abboud in the lurch and having to sell the machinery and equipment (which was not a representation by the plaintiffs) would not reasonably convey that Mr Abboud alone had authority to sell.
10. Leaving Mr Abboud in possession of the equipment was not a representation by conduct that he had authority to deal with it. Nor could allowing Mr and Mrs Abboud to have sole possession of the premises and access to the records of Rosecell amount to a representation that Mr Abboud had authority to sell Rosecell's equipment. Putting aside the fact that the Doughtys were acting under duress, leaving the Abbouds in possession of the company's premises, books and equipment might convey that they had authority to act for the company in the ordinary course of its business. It does not convey that they had authority to sell the company's assets otherwise than in the ordinary course of business. The sales to JP Haines and Right Price were not made, or apparently made, in the ordinary course of business.
11. Thus, leaving aside the issue of duress, it may be that Mr Abboud would have had ostensible authority to allow Rosecell's equipment to be used as part of CCA's haulage business. He may have had ostensible authority to enter into contracts for the repair or servicing of equipment. But such conduct would not convey ostensible authority to sell the equipment.

Section 26 of the Sale of Goods Act

1. Section 26(1) of the Sale of Goods Act 1923 (NSW) provides: "26 Sale by person not the owner (1) Subject to the provisions of this Act, where goods are sold by a person who is not the owner thereof and who does not sell them under the authority or with the consent of the owner, the buyer acquires no better title to the goods than the seller had, unless the owner of the goods is by the owner's conduct precluded from denying the seller's authority to sell."
2. There is a distinction between apparent ownership and apparent authority. The defendants say that Mr Abboud had apparent authority to contract on behalf of Rosecell. They would say that Tepall had apparent ownership of the goods acquired by Right Price. Section 26(1) applies to a representation or holding out of either apparent ownership or apparent authority to sell (Eastern Distributors Ltd v Goldring (Third Party) [1957] 2 QB 600 at 610-611).
3. Because the principles of ostensible authority may be regarded as a particular application of estoppel by representation (Hoare v McCarthy (1916) 22 CLR 296 at 303 per Griffiths CJ; Northside Developments Pty Limited v Registrar-General (1990) 170 CLR 146 at 200 per Dawson J; State of New South Wales v Lepore [2003] HCA 4; (2003) 212 CLR 511 at [108] per Gaudron J; Di Bello v De Costi Seafoods (Holdings) Pty Ltd [2005] NSWCA 267 at [24] per Brownie AJA, Santow and Bryson JJA agreeing) my conclusion that Mr Abboud did not have ostensible authority to contract on behalf of Rosecell should indicate that no different result would arise under s 26 unless some different principles of estoppel can be relied on.
4. The defendants relied upon the Doughtys' silence as giving rise to an estoppel under s 26, that is, their failure to notify authorities that they had been dispossessed of the companies' assets by force and the threat of force and that Mrs Doughty had been compelled to provide all passwords and business documents to enable the Abbouds to carry on the companies' businesses or dispose of their assets. This is an estoppel by omission. Such an omission can give rise to an estoppel where there is a duty to speak or act. That is so because where the owner of goods owes a duty to a person or class of persons to speak or act but fails to do so, the purchaser may assume that no fact that ought to have been disclosed exists or that there is nothing untoward in the transaction, and may act accordingly. As Brooking J said in Beneficial Finance Corporation Limited v National Mutual Royal Bank (Unreported, Supreme Court of Victoria, 8 September 1988) (BC8802455 at 33): "… 'Estoppel by negligence' does not constitute a separate category, that is to say, it is not possible for a party to be estopped by his negligence. What estops him is a representation which has the necessary effect on the other party. The significance of negligence is that, there being no express or implied representation, the failure to say or do something, in breach of a legal duty to say or do something, can be regarded by the law as the making of a representation. …"
5. (See also KR Handley, Estoppel by Conduct and Election, Thomson Sweet & Maxwell 2006 ed at [3-008] and G Spencer Bower & AKT Turner Estoppel by Representation, Butterworths 1977 3rd ed at [55] and [73]-[75]).
6. In Thomas Australia Wholesale Vehicle Trading Co Pty Ltd v Marac Finance Australia Ltd (1985) 3 NSWLR 452 Glass and McHugh JJA held that a buyer of goods, who relied upon an owner's omission to take action that could have prevented the sale, had to demonstrate that the owner owed a duty to take such action, in order to establish that the owner was estopped from asserting his title (per Glass JA at 467, per McHugh JA at 469 ff). That was said in a context where the estoppel depended upon the existence of a duty of care. No other basis of duty arose in that case. Nor could it in this case.
7. In Thomas Australia Wholesale Vehicle Trading Co Pty Ltd v Marac Finance Australia Ltd the Court of Appeal cited with approval reasons of Lord Wilberforce in Moorgate Mercantile Co Ltd v Twitchings [1977] AC 890 at 903 where his Lordship said that the existence of a duty depended upon: "… whether, having regard to the situation in which the relevant transaction occurred, as known to both parties, a reasonable man, in the position of the 'acquirer' of the property, would expect the 'owner' acting honestly and responsibly, if he claimed any title in the property, to take steps to make that claim known to, and discoverable by, the 'acquirer' and whether, in the face of an omission to do so, the 'acquirer' could reasonably assume that no such title was claimed."
8. In Thomas Australia Wholesale Vehicle Trading Co Pty Ltd v Marac Finance Australia Ltd McHugh JA said (at 474) that: "In the formulation of Lord Wilberforce's test of duty, the words 'as known to both parties' are of critical importance. However, it is the situation in which the transaction occurred which must be known to both parties, not their actual interests or existence. The duty may be owed to the general public if the other conditions are fulfilled."
9. In Leonard v Ielasi (1987) 46 SASR 495 Johnston J said that it was not essential for the owner to be estopped that both parties have a common knowledge or understanding of the circumstances of the relevant transaction because some cases proceeded on the basis of knowledge special to the owner. Johnston J saw the requirement to have regard to the situation in which the relevant transaction occurred as known to both parties as an unnecessary confinement of the scope of the duty (at 515 ff). In the present case, on one view, that formulation could unreasonably expand the scope of the duty.
10. It is uncertain how Lord Wilberforce's test could be applied in the present case. On the one hand it could be said that the situation in which the relevant transaction occurred was not known to both parties. On the other hand it could be said that the only circumstances of which both parties had common knowledge or understanding was that Mr Abboud had possession and control of the equipment and relevant books and was in a position to hold himself out as owner of the equipment. If regard could only be had to the situation as was known to both parties in deciding whether or not the owner claiming title to the property, if acting honestly and responsibly, should take steps to make that claim known to and discoverable by the acquirer, without regard to the duress imposed on the owner of which the acquirer was ignorant, then it could be said that acting honestly and responsibly the owner should have taken steps to assert its ownership of the goods in a way which could have prevented the sale. But the passage in the speech of Lord Wilberforce in Moorgate Mercantile Co Ltd v Twitchings is not to be read as a statute. If the relevant duty is characterised as a duty of care, even in a wider sense, then one asks whether the owner acted unreasonably or carelessly. Rosecell and GT Haulage Group, through Mr and Mrs Doughty, did not act unreasonably nor carelessly. They had no choice but to allow Mr Abboud to take over their companies' businesses and assets or risk their and their family's lives.
11. Neither Johnson Matthey (Aust) Ltd v Dascorp Pty Ltd [2003] VSC 291; (2003) 9 VR 171 nor Kino v Prestige Philately Pty Ltd [2014] VSC 469 to which Mr Notley referred assists the defendants. In Johnson Matthey (Aust) Ltd v Dascorp Pty Ltd the owner of gold that was stolen by an employee was not estopped from asserting its ownership of the gold that was sold by an accomplice of the employee to a purchaser of gold bullion. Any negligence by the owner of the gold in failing to detect thefts was not in breach of a duty owed to the purchaser. In Kino v Prestige Philately Pty Ltd Mrs Kino was an executor and the sole residuary beneficiary of the estate of her husband. She was not estopped from asserting her title to stamps that had been owned by her husband which had been stolen and sold to an innocent purchaser when she had no knowledge of the dishonesty of the thief who had assisted her deceased husband in managing his stamp collection.
12. Closer in point is the decision of the Full Court of the Supreme Court of South Australia in Leonard v Ielasi. In that case the owners of a motor car allowed a Mr Christianos to have possession of a motor vehicle. When the time came for registration of the vehicle to be renewed Mr Christianos renewed the registration in his own name without the knowledge or consent of the owners. The owners learnt that he had registered the car in his own name. One of the owners told Mr Christianos that she wanted the car to be re-registered in her name, but he told her that it did not really make any difference as to ownership. She did not then have the money to pay for its re-registration. The owners permitted him to continue to drive the car, although it was registered in his name. Either an owner or hirer could register the vehicle. Mr Christianos was neither. Mr Christianos sold the vehicle to a dealer who acquired it without any knowledge that he had no title to the vehicle. Millhouse J held that, applying the test of Lord Wilberforce in Moorgate Mercantile Co Ltd v Twitchings, the owners had not acted "responsibly" in doing nothing after they found out that Mr Christianos had registered the car in his name. His Honour held that they should have done something to get the car back (at 507).
13. Johnston J said: "In my view, the decisive issue of fact is not that the owners permitted Christianos to remain in possession of the owners' vehicle which was registered in his name, but that the owners did so well knowing that Christianos had acted dishonestly in relation to this very vehicle. The owners well knew that Christianos had misrepresented his position in relation to this vehicle to the Registrar of Motor Vehicles. He was not the owner of the vehicle in the primary sense of that term (whatever that term may mean) and he was not the hirer of the vehicle. In doing so, he had acted dishonestly towards the Registrar, without any authority from the owners and dishonestly towards the owners, at least to this extent - namely, that his acts had precluded them from registering themselves as the registered owners of the vehicle, at least until they had cleared the position with the Registrar and convinced him that the registration effected by Christianos was a nullity. The owners therefore were in the position of persons who, owning this vehicle and knowing that Chrsitianos had acted without their authority and dishonestly in relation to the vehicle, knowing that his dishonesty in relation to the vehicle took the form of misrepresenting to the Registrar his relationship to the vehicle, permitted him to retain possession of the vehicle, knowing that the registration indicated that he had some interest in the vehicle which he did not. … I would find that what precludes the owners in this case from denying the authority to sell the vehicle is their conduct in allowing him to retain possession of the vehicle registered in his name after becoming aware of his dishonest dealing with the vehicle. I would so hold whether the section requires for its operation a duty or otherwise; since I would hold that this knowledge of his dishonest dealing puts them under a duty, albeit that no duty would arise on the test propounded by Lord Wilberforce. … … The duty should arise in cases where there are special facts known to the true owner, which relate to the seller, but which cannot, in the nature of things, be within the compass of the knowledge of the acquirer if the seller acts fraudulently. … In my view the owner of goods of some substantial value who permits possession of those goods to remain with a person whom the owner knows to have acted dishonestly in relation to those goods will, except in special circumstances, owe a duty of care to others who might be minded to deal with that person in relation to the goods. The duty arises on the basis of the known dishonesty of the person in relation to those goods. The duty is not negligently to mislead others into acting to their detriment in relation to the goods." (at 513-514, 515, 517)
14. In this case the owners knew that Mr Abboud had acted dishonestly in relation to the equipment of which he took possession and they permitted him to retain possession of the equipment. But even if this be sufficient to give rise to a duty of care on the principle stated by Johnston J, Mr and Mrs Doughty did not negligently mislead others into acting to their detriment. Their omission to act was not due to negligence but to duress.
15. Critical to the reasoning in Leonard v Ielasi was the fact that Mr Christianos was allowed to remain as the registered owner of a vehicle. Registration as owner was not a certificate of ownership. A hirer of a vehicle could be registered as its owner. But by becoming registered the possessor of the vehicle could hold himself out to the world as the true owner.
16. That is not the present case. By allowing Mr Abboud to remain in possession of Rosecell's and GT Haulage Group's equipment Mr and Mrs Doughty did not allow Tepall to hold itself out as the owner of the equipment, nor allow Mr Abboud to hold himself out as authorised to sell the equipment on behalf of the owner.
17. For these reasons I do not accept that Rosecell and GT Haulage Group are estopped from denying Mr Abboud's right to sell on behalf of Rosecell, nor from denying Tepall's title to sell.
18. Both Rosecell and GT Haulage Group claimed damages against both JP Haines and Right Price in respect of the goods purchased by Right Price. Rosecell's title to sue was admitted and GT Haulage Group's title to sue was established. For the reasons in para [34] I am not prepared to act on the admission in respect of the goods owned by GT Haulage Group in the absence of evidence of Rosecell's title to sue in respect of those goods.
19. JP Haines denied that it took possession of that equipment. Mr Haines was asked which company used the Mack Fleetliner. He said "it was working for Right Price or Haines Brothers: one of the two". I am not satisfied that JP Haines, as distinct from Right Price, has dealt with the goods acquired by Right Price in a way that is inconsistent with the plaintiffs' immediate right of possession.
20. Rosecell is entitled to judgment against JP Haines for $243,000 together with interest from 14 April 2008 and GT Haulage Group is entitled to damages against Right Price for $126,500 together with interest from 8 April 2008. Rosecell is entitled to damages of $2,750 against Right Price together with interest from 8 April 2008.
21. I will stand the matter over to a convenient time and I direct counsel for the plaintiffs to bring in short minutes of order supported by the appropriate calculations of interest. Prima facie, JP Haines and Right Price should be ordered to pay the plaintiffs' costs of the proceedings against them.

Claim against Antqip

1. There is no issue that Antqip took possession of a Komatsu PC450-6 Excavator, a Komatsu PC120-6 Excavator, a Mitsubishi Water Cart, and a Holden Space Cab ute. It received a letter dated 20 August 2008 from Jian Holdings (Aust) Pty Ltd signed by Mr Abboud giving information about that equipment. It bought the equipment for $330,000. The purchase price (after deduction of $10,000 as a "contra" for services provided by Antqip) was paid to Sydney Sand & Soil Pty Ltd. Mr George Abboud was the director of Sydney Sand & Soil Pty Ltd.
2. Rosecell had the right to possession of the Komatsu PC450-6 Excavator pursuant to a hire purchase agreement with the National Australia Bank. There was no evidence of Rosecell's ownership or right to possession of the other three items of equipment acquired by Antqip. Neither Rosecell nor GT Haulage Group had possession of that equipment when it was acquired by Antqip. Possession had been taken by Mr Abboud. He had no authority to give possession of that equipment to Antqip, but it is not established that Rosecell, as distinct from some other company, had the immediate right to possession of the other three items of equipment when Antqip acquired possession of it.
3. The letter from Jian Holdings (Aust) Pty Ltd to Antqip dated 20 August 2008 did not specify a separate price for each of the items of equipment referred to in the letter. That is to say, there is no evidence as to the price paid for the Komatsu PC450-6 Excavator or its value.
4. The plaintiffs have a further problem in their claim against Antqip. As noted above, there was no appearance at the hearing for Antqip. The plaintiffs' solicitors received an email from the sole director of Antqip, a Mr Tony Russell, the day before the hearing in which he said: "Please note that Antqip Pty Ltd was placed into voluntary administration last year and has subsequently had a Deed of Company Arrangement approved by creditors. It is my understanding that you or [sic] client have been [sic] informed of this and provided the necessary reports to creditors. I suggest that you communicate with the Deed Administrators Hall Chadwick in relation to this matter as it is not the companies [sic] responsibility to attend the hearing. …"
5. Mr Allen who appeared for the plaintiffs did not dispute that Antqip was subject to a deed of company arrangement. He did not suggest that leave to proceed against Antqip had been given. He submitted that Mr Russell was under the erroneous assumption that because the company entered into a deed of arrangement that that was the end of the proceedings. Antqip had not pleaded the deed of company arrangement as a defence to claim. Mr Allen submitted that the plaintiffs as the owners of the goods in question could rely on the exception provided for in s 444D(3) of the Corporations Act 2001 (Cth). Section 444D relevantly provides: "444D Effect of deed on creditors (1) A deed of company arrangement binds all creditors of the company, so far as concerns claims arising on or before the day specified in the deed under paragraph 444A(4)(i). (2) Subsection (1) does not prevent a secured creditor from realising or otherwise dealing with the security interest, except so far as: (a) the deed so provides in relation to a secured creditor who voted in favour of the resolution of creditors because of which the company executed the deed; or (b) the Court orders under subsection 444F(2). (3) Subsection (1) does not affect a right that an owner or lessor of property has in relation to that property, except so far as: (a) the deed so provides in relation to an owner or lessor of property who voted in favour of the resolution of creditors because of which the company executed the deed; or (b) the Court orders under subsection 444F(4)."
6. Section 444E of the Corporations Act relevantly provides that: "444E Protection of company's property from persons bound by deed (1) Until a deed of company arrangement terminates, this section applies to a person bound by the deed. … (3) The person cannot: (a) begin or proceed with a proceeding against the company or in relation to any of its property; or (b) begin or proceed with enforcement process in relation to property of the company; except: (c) with the leave of the Court; and (d) in accordance with such terms (if any) as the Court imposes."
7. In J & B Records Ltd v Brashs Pty Ltd (1995) 36 NSWLR 172 Hodgson J (as his Honour then was) held (at 181) that s 444D(3) does not have the effect of removing the requirement for owners or lessors to obtain the leave of the court under s 444E(3) in respect of court proceedings to enforce their rights as owners or lessors where those persons were creditors with claims arising on or before the day specified in the deed, and where those claims were associated with the property. Thus, a lessor's claim for rent is not unaffected by a DOCA by reason of s 444D(3). His Honour's reasoning was referred to with apparent approval by the Full Federal Court in Lam Soon Australia Pty Ltd v Molit (No 55) Pty Ltd (1996) 70 FCR 34 (at 41). (See also Henaford Pty Ltd v Strathfield Group Ltd [2009] NSWSC 539; (2009) 72 ACSR 240 at [19]-[23]).
8. In Henaford Pty Ltd v Strathfield Group Ltd I said (at [19]) that s 444D(3) is concerned to preserve an owner's or lessor's right to take extra-curial action in relation to property, such as by re-entering possession for non-payment of rent. It has an harmonious relationship with s 444D(2) which preserves a secured creditor's right to deal with property. No submissions were made by the plaintiffs in relation to the operation of s 444D(3). Leave to proceed against Antqip was not sought. If the plaintiffs are bound by the deed of company arrangement then the proceedings are stayed by virtue of s 444E(3)(a).
9. The deed of company arrangement was not in evidence.
10. I am not presently satisfied that the plaintiffs are entitled to proceed against Antqip. But the plaintiffs may make further submissions in relation to that question. Notice of any further application should be given not only to the director of Antqip, but also the deed administrator.
11. I stand over the proceedings to a date to be fixed in order for counsel for the plaintiffs to bring in short minutes of order consistent with these reasons to provide for judgment against JP Haines and Right Price together with a calculation of pre-judgment interest. I will then hear any further submissions from the plaintiffs in relation to their claim against Antqip and any argument concerning costs.

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