Sharkey v Mayahi-Nissi

The Facts

1. The facts were not in dispute, not least because at the hearing before me (if not at the time of the subject events) transcripts of all the relevant hearings before the Court were available.

Prior to the hearing before Robb J

1. On 18 December 2014 Mr Sharkey made an application to the Court to take the evidence of four witnesses from the United State by videolink, none of whom included himself. The application was stood over to 2 February 2015 before Robb J.
2. On 23 January 2015 Mr Sharkey's then solicitor, Mr Sperber, wrote to Mr Eakin, Mr Doble and their employed solicitor with the day to day carriage of the matter, Ms Beegum, informing them that arrangements had been made for the four United States witnesses to travel to Australia on the basis that their cross-examination would be confined to one day during the trial, being Tuesday, 17 February 2015.
3. On 27 January 2015 Mr Eakin responded to Mr Sperber, including (emphasis added): Our counsel is hopeful that this cross-examination of these four witnesses can be completed in one day. However, as you are aware, it is not possible to estimate with precision the exact time required for witnesses to give evidence or to foresee all events that might impact on the scheduling of those witnesses. To suggest that our counsel has given a "commitment" to the Court that the cross-examination will be completed on Tuesday 17 February 2015 is to overstate matters. We note that your letter indicates that the overseas witnesses intend booking return flights in the afternoon of Tuesday 17 February 2015. Of course, it is a matter for those witnesses as to what travel arrangements they make but we would suggest that it might be more prudent to make arrangements to allow for greater flexibility.
4. On 30 January 2015, Mr A Fernon of Counsel, who was briefed for Mr Sharkey, emailed Robb J's chambers and the other parties (emphasis added): I am the counsel for the plaintiff in the above matter which is listed for a 5 day hearing before you on 16 February 2015. I am writing this email with the consent of the counsel for the defendant. This matter is currently listed before you on Monday 2 February at 9.30am for directions in respect of the plaintiff's application for four USA based witnesses to give their evidence by video link. This application was last before you on 19 December 2014. The plaintiff no longer seeks an order for the witnesses to give evidence by video link. They are all travelling to Australia to give their evidence in person. In discussions between the parties, it has been agreed that these witnesses will travel to Australia for the purpose of giving their evidence on Tuesday 17 February. It may be necessary to interpose them in the course of another witness's evidence. This accords with the discussion/submission made by Mr Cook before you on 19 December. Travel arrangements are being made for them to return to the US on a 2.30pm flight on Wednesday 18 February. This provides a little additional time for them to return to the US on a 2.30pm flight on Wednesday 18 February. This provides a little additional time for one or other of them to attend court in the morning of 18 February should it be necessary. It may be necessary to ask the Court to extend its sitting hours to ensure these witnesses' evidence is completed within this time frame. Given this arrangement, which has been reached in discussion with the defendant, the parties no longer require to have the directions hearing before you on 2 February. Any consequential orders that may arise from the plaintiff's application can be dealt with at the hearing. Unless the Court requires us to attend, we ask that this directions hearing be vacated. Please let us know if this is acceptable to the Court.
5. As will be seen, by the time of the hearing only three of those witnesses was required to come from the United States. However, the reduction from four to three contributed to the ensuing misunderstanding.

Monday, 16 February 2015 (Day 1 before Robb J)

1. The hearing began before Robb J on Monday, 16 February 2015. Mr D L Cook of Counsel appeared for Ms Mayahi-Nissi. Page 1 of the transcript records Mr Fernon's opening as including (emphasis added): … Mr Christopher Sharkey will be the first witness, your Honour. On speaking to Mr Cook, it's anticipated that Mr Sharkey will take approximately a day. We have three witnesses who have flown from the United States to give evidence tomorrow. Speaking to Mr Cook again, I think he anticipates that he should be able to deal with those three within an afternoon. I think he's anticipating he will take with Mr Sharkey up until about lunchtime and to the extent that he hasn't concluded with Mr Sharkey by that time, that we will then interpose the overseas witnesses and hopefully finish their evidence by Tuesday afternoon. It there's any prospect of it going over there's a little bit of time on Wednesday before they fly out of Australia at 2.30 on Wednesday, so there may be scope for some minor carry over into Wednesday. Mr Cook will then conclude with Mr Sharkey, if he hasn't already, on the Wednesday, and then we have various other witnesses.
2. Mr Eakin was in court during Mr Fernon's opening. While he was not an addressee of Mr Fernon's email of 30 January 2015 (see paragraph [18] above) it had been copied to Ms Beegum and Mr Eakin was aware of its contents. In particular, he recalled while listening to Mr Fernon's opening that the email referred to travel arrangements being made for four US based witnesses to return to the United States on a 2.30pm flight on Wednesday, 18 February 2015.
3. Mr Eakin's evidence was that he took what he heard Mr Fernon say in opening, together with his recollection of what he knew about Mr Fernon's email of 30 January 2015, to mean that Mr Sharkey was in all likelihood going to be flying out of Australia on a 2.30pm flight on Wednesday, 18 February with the three other witnesses, being his two brothers and his sister-in-law. He also thought that it was possible that Mr Sharkey might even fly out of Australia on Tuesday, 17 February 2015 if his evidence concluded earlier. Mr Eakin was cross-examined before me, but he adhered to his evidence and I accept it.
4. Mr Doble was not in Court for Mr Fernon's opening. Sometime before 1.00pm Mr Eakin spoke to Mr Doble in person or by telephone. Topics they discussed included: 1. Mr Sharkey leaving Australia; 2. If that happened, the effect that may have had on Ms Mayahi-Nissi's ability to recover damages (should she be successful on her cross-claim and estimated to be in the vicinity of $550,000 to $600,000); and 3. The possibility of obtaining an order restraining Mr Sharkey from leaving Australia unless he provided security in respect of any damages he might be ordered to pay.
5. On the afternoon of Monday, 16 February 2015 both Mr Doble and Mr Eakin made inquiries concerning the availability of counsel to advise and perhaps conduct the application for orders to restrain Mr Sharkey. Either as a result of discussions between Mr Eakin and Mr Doble that afternoon, or certainly as a result of a conference the next morning (see paragraph [25] below), they had come to the view that any application should be brought before a judge other than Robb J. This was so that his Honour would not be put in a position where it could be said he had become prejudiced by reason of any findings he might have to make in dealing with the interlocutory application. Alternative counsel was required because Mr Cook was engaged in the main proceedings before Robb J.

Tuesday, 17 February 2015 (Day 2 before Robb J)

1. Before court on the morning of Tuesday, 17 February 2015 Messrs Eakin and Doble conferred, with Mr Cook participating by telephone. They discussed the issue of making the application before a judge other than Robb J and the retainer of separate counsel. There was also discussion of the fact that Mr Sharkey had admitted in his defence to Ms Mayahi-Nissi's cross-claim that if he was successful, he would have to do equity by repaying Ms Mayahi-Nissi what she had paid to discharge a mortgage taken out to secure a loan that had been made to Mr Sharkey. That understanding correctly reflected the relevant pleadings. During the conference Mr Doble also began doing some preliminary online research about what could be done. He identified an order in the nature of a writ which was subsequently referred to by McDougall J as the writ of ne exeat colonia. Furthermore, both Messrs Eakin and Doble had been instructed that Mr Sharkey had no assets in Australia likely to be able to satisfy any judgment debt that would be owed to Ms Mayahi-Nissi.
2. At the conclusion of the conference, Mr Eakin began drafting observations to counsel while Mr Doble continued to research the matter.
3. Mr Doble's unchallenged evidence about the research he undertook was: 27. I undertook further research about what could be done to protect the defendant's position. 28. I found and either read the following cases, or a paper referring to a case, or a summary of a case: Al Nahkel for Contracting and Trading Limited v Low [1986] 1QB 235, Allied Arab Bank Limited v Hajjar & Ors [1988] 1 QB 787, Glover v Walter (1950) 80 CLR 172, Talacko v Talacko (no. 2) (2009) 25 VR 613, Cardile v LED Builders 91999) 198 CLR 380. 29. I also had regard to the Australia Act 1986 (Cth), and read rule 25.14 of the Uniform Civil Procedure Rules 2005. 30. As I read UPCR 25.14, the Supreme Court of NSW had power to make an order restraining the plaintiff from leaving the jurisdiction if certain conditions were satisfied and (speaking broadly) the Court was satisfied, having regard to all of the circumstances, that there was a danger that a prospective judgment would be wholly or partly unsatisfied because a judgment debtor had left the jurisdiction leaving no assets behind.
4. Mr Eakin then attended court between 10.00am and 12.15pm for the second day of the hearing before Robb J. He returned to his office and continued to draft the observations. At some point during the morning Ms Mayahi-Nissi gave instructions for an urgent application to be made to, as it was perceived at the time, protect her position in circumstances where her legal advisers understood from Mr Fernon's opening that there was a possibility that Mr Sharkey would return to America at 2.30pm the next day.
5. Sometime between 11.00am and midday Mr Doble received and read a copy of the transcript of the hearing before Robb J of the day before. Mr Doble's affidavit evidence before me in relation to his reading of the passage set out in paragraph [20] above was: 39. However, doing the best I can, my recollection is that I read the transcript of the opening before Robb J as meaning that there was a risk of the plaintiff leaving the jurisdiction on Wednesday afternoon. If that happened, and the defendant won the case, it may prove disastrous for her because the plaintiff had no assets in the jurisdiction (as he said in evidence and to which I refer later below). 40. Perhaps I was influenced by the fact that the plaintiff was living in the United States, would be returning there after the case and it would seem reasonable that he might like to fly with the US witnesses, as some of them are relatives of his (as I understand it). But, for the reasons given in paragraph 38 above I cannot say whether this is recollection or reconstruction. Mr Doble adhered to that evidence under cross-examination and I accept it.
6. Mr Sharkey's cross-examination began at 9.40am on Tuesday 17 February 2015. It continued all morning. The last few questions immediately before the luncheon adjournment were: Q. Your decision to move to America, is that on a permanent basis? A. No, hopefully not. It's for the duration of my current business. Q. When will that end? A. It's very - I keep telling my family within a year every year, so I'm not certain about that. Things are going well right now so I hope within a year or a maximum of two. Q. Another two years before you come back? A. Not necessarily. I really can't answer that question correctly because I just don't know. Q. What arrangements have you made to reimburse Ms Nissi for the mortgage? A. I haven't, that's why I commenced the legal proceedings to sort this matter out. Q. Are you able to pay her? FERNON: I object. HIS HONOUR: It's relevant. COOK Q. Do you have assets in Australia? A. Not of any significance.
7. At the start of the luncheon adjournment around 1.00pm either Mr Cook or Ms Beegum rang Mr Eakin to inform him of the evidence referred to in the preceding paragraph. Mr Doble received a transcript of that evidence shortly before 6.00pm that evening and read it later that evening.
8. Immediately after speaking either to Mr Cook or Mr Beegum, Mr Eakin finalised his observations and emailed them to counsel at 1.40pm. At 2.49pm that counsel emailed Mr Eakin to say that the brief had been passed to Mr Hyde. Mr Hyde had been approached by his clerk, who had said that Eakin McCaffery Cox were urgently looking for a barrister to appear in an application before the Duty Judge the following day. Mr Hyde told his clerk that he (Mr Hyde) was available to appear.
9. Having learned that the brief had been passed to Mr Hyde, Mr Eakin then left Mr Doble to instruct in relation to the application so that Mr Eakin could continue to attend to the proceedings before Robb J.
10. Insofar as those proceedings were concerned, immediately after the luncheon adjournment the three United States witnesses were interposed. They had completed giving their evidence by 3.02pm, at which time Mr Sharkey's cross-examination resumed and was quickly concluded. The proceedings were adjourned at about 3.10pm part heard to Wednesday, 18 February 2015, including for Mr Sharkey's re-examination.
11. Later that afternoon, Mr Hyde received a telephone call from Mr Doble. Mr Doble gave Mr Hyde a brief explanation of the proceedings before Robb J and the proposed application to be made the next day as the Duty Judge.
12. Also later that afternoon Mr Hyde had a short telephone conversation with Mr Cook in which the latter gave Mr Hyde a brief outline of the case before Robb J and some explanation as to why it was necessary for separate counsel to appear on the application before the Duty Judge. Mr Cook said to Mr Hyde words to the effect "The application is urgent because we understand that Mr Sharkey will return to the US tomorrow after he finishes giving evidence".
13. At about 5.16pm Mr Hyde received an email from Mr Doble attaching various documents for his brief, including two pages of observations prepared by Mr Eakin. Those observations included a statement that "Mr Sharkey will return to California immediately his evidence in the proceedings is completed. This is likely to be as early as this afternoon". (The last sentence had clearly been overtaken by events.)
14. At 8.09pm Mr Hyde sent a draft outline of submissions to Mr Doble.
15. At 10.05pm Mr Doble sent an email to Ms Beegum asking "Can I have yesterday's (Monday's) transcript as soon as possible? (Marked up with the pertinent passages) Thanks".

Wednesday, 18 February 2015 (Day 3 before Robb J)

1. At 7.49am Ms Beegum sent an email to Mr Doble, copied to Mr Eakin saying: Monday's marked-up transcript attached! Relevant bits are re Asset Protection and flying out of Australia at 2.30!
2. At 7.58am Mr Doble emailed the marked-up transcript to Mr Hyde, saying "I will have clean copies of each transcript for Court".
3. The marked-up transcript was in evidence before me. The highlighted sections included the passage from Mr Fernon's opening set out in paragraph [20] above. The other highlighted passages related to evidence given by Mr Sharkey in cross-examination on the topic of asset planning, asset protection and discretionary trusts.
4. In relation to that part of Mr Fernon's opening which is set out in paragraph [20] above, Mr Hyde's affidavit evidence before me was: 11. Sometime after receiving Mr Doble's email and leaving for court, I read the marked-up transcript, including the passage marked on page 1. I understood that passage to be a statement that Mr Sharkey and other overseas witnesses were flying out of Australia at 2.30pm on Wednesday 18 February 2015. It did not occur to me at that time that an alternate reading of that passage was that it was referring only to when the witnesses, not Mr Sharkey, were leaving Australia. Mr King did not apply for the hearing before me to be adjourned to enable Mr Hyde to be present for cross-examination. I accept Mr Hyde's evidence.
5. At 8.30am Mr Hyde emailed his draft submissions to Mr Cook, copied to Mr Doble under cover of an email saying "Attached are my written submissions. Is there anything I have omitted or overstated or something you think I should add?". He did not receive a response to that email from either Mr Cook or Mr Doble. Nor did Mr Doble suggest to Mr Hyde that there was anything in the submissions that was incorrect or required qualification when they met outside McDougall J's court at approximately 10.00am. Unbeknown to Mr Hyde, his email to Mr Cook had bounced.
6. The proceedings before Robb J recommenced at 10.00am. The re‑examination of Mr Sharkey commenced at 10.30am and was concluded within 10 minutes.
7. In the meantime, Mr Hyde appeared in the Duty List before McDougall J. His Honour heard the application later that morning.
8. The transcript of the hearing before McDougall J includes this exchange: HIS HONOUR: Why is the application not being made to Justice Robb? HYDE: For this reason your Honour. Mr Sharkey has been in the witness box yesterday, and as I am instructed, he is in there again this morning. If this application was brought before His Honour Robb J, he would be required to turn his mind perhaps precipitously to the merits of the proceedings before me. The large part of these proceedings will turn on his Honour's credit findings between Mr Sharkey and Ms Nissi and it seemed to us that it would be inappropriate to put his Honour in a position where he would in effect have to foreshadow to the parties on an application such as this whether he thought that this application was arguable and whether it met the necessary thresholds. Your Honour, before I go any further, can I file in court a notice of motion, and I have also had those instructing me prepare a Court Book and some submissions plus the pleadings and a couple of key documents together with some authorities.
9. Ms Mahayi-Nissi's notice of motion (the "Restraint Motion") sought these orders: 1. AN ORDER that this notice of motion be heard instanter and ex parte. 2. AN ORDER that until further order of the Court the Respondent be restrained from leaving Australia. 3. AN ORDER that the Respondent to the best of his ability inform the Applicant's solicitors of all his assets whether in his own name or not and whether solely or jointly owned, giving the value, location and details of all such assets. 4. AN ORDER that until further order of the Court, the Respondent surrender all of his passports of whatever country of issue to the solicitor for the Applicant or to the Court. 5. AN ORDER that the Respondent deposit into the trust account of the solicitor for the Applicant or pay into Court the sum of $547,090.00. 6. In the alternative to the relief claimed in the preceding paragraph, AN ORDER that the Respondent provide security acceptable to the Applicant to secure the payment of $547,090.00. 7. AN ORDER for short service. 8. Such further order or orders as the Court deems fit. 9. AN ORDER that the Respondent pay the Applicants costs of and incidental to this Notice of Motion.
10. McDougall J read Mr Hyde's outline of submissions. That outline included: 1. This application is brought pursuant to Rule 25.14 (4) & (6) of the UCPR for ancillary orders. The primary ancillary order sought is in the nature of a writ of ne exeat colonia UCPR Rule 25.14 (4) relevantly provides: "The court may make a freezing order or an ancillary order or both against a judgment debtor or prospective judgment debtor if the court is satisfied, having regard to all the circumstances, that there is a danger that a judgment or prospective judgment will be wholly or partly unsatisfied because any one of the following might occur: (a) The judgment debtor, or prospective judgment debtor or another person absconds…" 2. The applicant must satisfy the Court that she has a "good arguable case" on a justiciable Cause of action. The "good arguable case" criterion has been regarded as capable of being satisfied without either involving or requiring any prediction about the likely ultimate success of the claim: Ninemia Maritime Corp v Trave GmbH & Co KG [1983] 2 Lloyd's Rep 600 at 605 per Mustill J ("a good arguable case" is one which is barely more than capable of serious argument, and yet not necessarily one the judge considers would have better than a 50% chance of success"). 3. Ms Nissi (as defendant and cross claimant) and her former de facto spouse, Christopher James Sharkey (as plaintiff and, together with Sharkey Family trust, cross defendant) are presently before Robb J in case No 2013/383023 on the trial of proceedings between them concerning ownership of a property at XXXX Camperdown (the Denison Property). 4. The trial commenced on Monday, 16 February, 2015 and it is expected that evidence will be completed by Friday, 20 February 2015. Witnesses, including Mr Sharkey have travelled from California and interstate. 5. In short compass Mr Sharkey promised not to contest ownership of the Denison Property and to pay a mortgage back in exchange for Ms Nissi giving up her interest as co-owner of another property. Mr Sharkey left Australia and then failed to honour the agreement. 6. Mr Sharkey now claims he avoided the agreement 5 years later by making his present claim on the basis of illegitimate pressure and only after Ms Nissi had paid out the mortgage by a refinance of the Denison Property. 7. Mr Sharkey has lived in the USA for the last 3 years. He resides at XXXX, San Francisco. He, together with 2 of his brothers, also residents of USA, operates a software development company. 8. Mr Sharkey's cross-examination by Ms Nissi's counsel, Mr Doran Cook, commenced yesterday afternoon. It will continues (sic) today , when 3 overseas witnesses will be interposed and is expected to conclude this afternoon. 9. Mr Sharkey will return to California immediately his evidence in the proceedings is completed.. This is likely to be as early as this afternoon. (Transcript at page 1) 10. So far as Ms Nissi is aware, Mr Sharkey does not have assets in Australia likely to be able to satisfy a judgment debt Ms Nissi expects to obtain against him under her cross claim for $547,000 plus interest and costs. 11. Mr Sharkey in his pleadings in the principal case has admitted he owes substantially the whole of the money Ms Nissi claims from him in her cross claim. 12. In evidence on Tuesday 17 February 2015, just before the luncheon adjournment Mr Sharkey: a. admitted he has no assets in Australia; b. claimed to have the capacity to pay in full and judgment Ms Nissi might obtain; and c. stated he had no immediate intention of returning to Australia, and certainly not before his US businesses were better established, which would not be earlier than 2 years. … Jurisdictional basis for the orders sought 14. The Court has the power to issue a writ of ne exeat colonia in an appropriate case. It is a prerogative writ used to ensure that a person does not depart without giving security for a money claim of an equitable nature. Dixon J in Glover v Walters (1950) 80 CLR 172 said at [172]: "I do not doubt the power of this Court to issue a writ of ne exeat colonia in a proper case. It is a prerogative writ used for the purpose of preventing a subject quitting the country without giving bail or security to answer a money claim of an equitable nature. The plaintiff to obtain the writ must show that he has such an equitable claim, that the defendant is about to depart beyond the seas and either that he is doing so to avoid the jurisdiction or that the debt will be endangered or, at all events, that the remedy for its recovery will be prejudiced". 15. In Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 the majority at [39] held that: "Finally, before my judgment and in cases of an equitable debt or demand, courts of equity…may, by order in the nature of a writ of ne exeat colonia, prevent a defendant quitting the country without giving adequate bail or security. Dixon J in Glover v Walters said that the order is made where: 'real ground appears for believing that the defendant is seeking to avoid the jurisdiction or for apprehending that if the defendant is allowed to depart the plaintiff will lose his debt or be prejudiced in his remedy'." 16. In Talacko v Talacko (No2) (2009) 25 VR 613 Habsersberger J considered whether to make an order restraining a defendant from leaving the jurisdiction. At paragraphs [23] to [46] Habersberger J examined the jurisdictional basis for such an order. 17. In Beach Petroleum NL v Johnson (1992) 9 ACSR 404 at 405-6, von Doussa J held that: "It will be noted that it is not necessary for the applicants to show an active intent on the part of the respondent to defeat the applicants from recovering the judgment. It is enough if the applicants establish that, in the absence of relief, there is a danger that assets will be dealt with in a way which will prevent the applicants recovering the judgment". Why the application should be before the Duty Judge and not Robb J 18. Both counsel in opening before Justice Robb agreed that the case would depend largely on credit. In those circumstances to seek, on an interlocutory basis, the orders in the Notice of Motion will of necessity require Robb J to express a view as to: a. the likelihood of Mr Sharkey frustrating the process in the event that Ms Nissi succeeds in her claim. b. whether Ms Nissi has an arguable case. 19. Neither (a) nor (b) is desirable given the stage of the proceedings, particularly given that Ms Nissi is yet to give her evidence. Furthermore it would also be unfair to expect Mr Sharkey to deal with this application while still giving evidence. 20. In addition to the above there is also an inherent risk that if an application is made known in the absence of an appropriate order restraining Mr Sharkey, he may well take steps to depart Australia sooner than he otherwise might. … Summary 23. In summary and in accordance with the requirements that Dixon J identified in Glover it is contended that: a. Ms Nissi has an equitable claim; b. Mr Sharkey on his own evidence is about to leave the jurisdiction; and c. in those circumstances the debate will be endangered or, at all events, the remedy for its recovery will be prejudiced.
11. Mr Hyde then took McDougall J through the court book which had been provided to his Honour. The transcript of the hearing before McDougall J includes: HYDE: If I can then take your Honour through two days of transcript just to some of the key passages. That is behind Tab 9 in the court book. Firstly at line 9 to 36 on page 1. [It was common ground before me that this was an error for lines 39 to 46. These are the second paragraph of the transcript reproduced in paragraph [20] above]. This is counsel for Mr Sharkey - HIS HONOUR: Mr Fernon HYDE: - indicating the movements of his various witnesses. HIS HONOUR: Yes … Your Honour, can I say by way of confession that I received this transcript late last night and a marked up version this morning. The marked up part is those parts that I was instructed to take your Honour to. I haven't had the time to read the entirety of the transcript so there may be other passages that I ought to have drawn the court's attention to but I am simply not in a position to do that.
12. The transcript quoted in the preceding paragraph reveals one matter of considerable significance for the application before me. McDougall J is, with the greatest of respect, one of the most senior and experienced commercial judges in this Court. His Honour was taken to the relevant part of Mr Fernon's opening and did not demur from the characterisation of that opening ascribed to it in paragraph 9 of Mr Hyde's outline of submissions (see paragraph [49] above).
13. His Honour proceeded to deliver the Restraint Judgment ex tempore, which included (emphases added): 5. Ms Nissi applies ex parte before me, as Duty Judge, for an order in the nature of what used to be called a writ of ne exeat colonia. In plain English, Ms Nissi seeks an order that Mr Sharkey be restrained from leaving the country, and ancillary relief. 6. The general power to make such an order is confirmed by cases such as Glover v Walters [1950] HCA 1, (1950) 80 CLR 172 and Cardile v LED Builders (1999) 198 CLR 380. In the former case, Dixon J said (in a consideration of the power of the High Court of Australia) that the writ of ne exeat colonia "is a prerogative writ used for the purpose of preventing a subject quitting the country without giving bail or security to answer a money claim of an equitable nature". 7. His Honour emphasised that "the writ is not issued except for an equitable debt or demand". 8. The jurisdiction was affirmed, and the remarks of Dixon J cited with approbation, by the plurality (Gaudron, McHugh, Gummow and Callinan JJ) in Cardile at [39]. I will not set out that paragraph, but I do note that at [40] their Honours referred to this writ as one of the "doctrines and remedies, outside the injunction as understood in courts of equity, to protect the integrity of [the court's] processes once set in motion." 9. The modern day equivalent of the writ of ne exeat colonia was described by Habersberger J in Talacko v Talacko (No 2) (2009) 25 VR 613 at [23] and following and by von Doussa J in Beach Petroleum NL v Johnson (1992) 9 ACSR 404 at 405-406. 10. In the latter case, von Doussa J said, at the location I have referred to, that it is not necessary "to show an active intent on the part of the respondent to defeat the applicants from recovering the judgment. It is enough if the applicants establish that, in the absence of relief, there is a danger that assets will be dealt with in a way which will prevent the applicants recovering the judgment". 11. As I have said, the application is made to me although the case is currently part heard before Robb J. Mr Hyde of counsel, for Ms Nissi, submits that it would be inappropriate for Robb J to hear the application. 12. It is common ground before his Honour that a determination of the issues of fact will depend largely on his Honour's views as to the credibility of the competing witnesses. The material on which Ms Nissi relies, in this application, could be taken to suggest in effect a dishonest intention on the part of Mr Sharkey to leave the jurisdiction immediately his evidence is finished, without any intention to return at any fixed time and without leaving behind him any assets in the jurisdiction. 13. Even if that were not found to be dishonest, the very fact that the issues would be canvassed before Robb J could be thought to impinge in an adverse manner on his Honour's assessment of credibility in dealing with the issues before him. 14. For those reasons, I accept that it is appropriate, in the first instance, for the application to be made to and considered by me. … 16. Whether or not, in respect of the Court's powers under UCPR r 25.14(4), it is necessary to show that the demand is an equitable one is a question that may be left to one side. That rule authorises, among other things, the making of a freezing order or an ancillary order against a prospective judgment debtor if the Court is satisfied that the prospective judgment might be unsatisfied because that prospective judgment debtor "absconds". … 20. In those circumstances, I am satisfied that Ms Nissi has made out a good arguable case as to her equitable cause of action. Of course, that case is predicated on an event which she does not accept: namely, that Mr Sharkey should be found in equity to be the beneficial owner of the property. However, since that is the case that Mr Sharkey brings, he can hardly be heard to dispute that it is in the relevant sense a good arguable case. … 22. Mr Sharkey has been cross-examined on Monday and yesterday. I have been taken to passages in his cross-examination. It is apparent from those passages that Mr Sharkey has been engaged in the practice that he describes as "asset planning". Whether or not that is a euphemism for putting his assets beyond the reach of creditors or the Court is a matter that is open to question. 23. In any event, it is clear that Mr Sharkey, on his own admission, has been engaged in conduct that could be regarded as deceptive, with a view to putting his assets beyond the reach of his creditors. It is equally clear that Mr Sharkey, on his own admission, has engaged in conduct vis-à-vis Ms Nissi, in relation to the property itself, that could be regarded as deceptive. Specifically, it would appear, Mr Sharkey may have entered into the agreement as to the beneficial entitlements to the two properties not with the intention of honouring it but, rather, with the intention of challenging it when it suited him to do so. Finally, in this context, the transcript shows beyond doubt that, as Mr Sharkey has conceded, he no longer has any assets of relevance in Australia. 24. Thus, if Mr Sharkey succeeds in his claim, he would be entitled to the property but may not be in a position to recompense Ms Nissi for the amounts expended by her. 25. It may very well be that, in the hypothetical universe which I am considering, Ms Nissi would have an equitable lien on the property to secure repayment of that amount. However, without knowing the value of the property and the amount presently secured by the existing mortgage, I have no way of understanding whether that equitable lien (should it be made out) would be sufficient to recoup her for the amount that she has spent. 26. In those circumstances, I think it is justifiable to make the order sought. It is clear that Mr Sharkey intends to leave the country once his evidence is completed. He is said to be booked on a flight at 2.15pm today. In my view, those circumstances justify an order that he be restrained from leaving the country, and that he surrender his passports, until he makes appropriate arrangements to secure payment to Ms Nissi of the sum for which he has, as it were conditionally upon his succeeding, admitted liability. I am satisfied on the evidence that this sum is likely to be no less than $547,090. 27. For those reasons I make the following orders: (1) I note that the applicant by counsel gives to the court the usual undertaking as to damages. (2) I make orders in accordance with paragraphs 1 and 2 of the form of order initialled by me and dated today's date. (3) I stand over for further consideration the orders sought by prayers 3 to 6 of the notice of motion filed in court today. (4) I direct that the notice of motion and a copy of these orders be served by 12 noon today and I abridge the time for service accordingly. 28. I stand the matter down to 2pm today on the basis that it may be mentioned once Mr Sharkey's cross-examination and re-examination have been completed. … 30. I grant liberty for service to be effected within the precincts of the Court.
14. The formal orders giving effect to his Honour's reasons issued at 11.40am. They included: THE COURT: … (2) ORDERS THAT (i) Until further order of the Court the Respondent be restrained from leaving Australia. (ii) until further order of the Court, the Respondent surrender all of his passports of whatever country of issue to the solicitor for the Applicant or to the Court. (4) (sic) I stand over for further consideration these orders; (i) that the Respondent to the best of his ability inform the Applicant's solicitor of all his assets whether in his own name or not and whether solely or jointly owned, giving the value, location and details of all such assets. (ii) that until further order of the Court, the Respondent surrender all of his passports of whatever country of issue to the solicitor for the Applicant or to the Court; (iii) that the Respondent deposit into the trust account of the solicitor for the Applicant or pay into Court the sum of $547,090.00. (iv) that in the alternative to the relief claimed in the preceding paragraph, AN ODER that the Respondent provide security acceptable to the Applicant to secure the payment of $547,090.00. (iv) Direct that the notice of motion and a copy of these orders be served by 12:00 Noon today and I abridge the time for service accordingly. 4. Stand matter down to 2pm today on the basis that it may be mentioned once Mr Sharkey's cross-examination and re-examination have been completed. … 6. I grant liberty to effect service within the precincts of the Court.
15. Having obtained McDougall J's order at 11.40am, Mr Eakin proceeded to serve Mr Sharkey immediately with a copy of that order. That service was effected in the precincts of Robb J's court during the morning tea adjournment of the proceedings before Robb J. Mr Sharkey's case before his Honour had closed shortly before that adjournment.
16. The transcript of the proceedings before Robb J discloses that after the short adjournment Mr Fernon made an application to adjourn the proceedings, noting that Mr Sharkey had just been served with McDougall J's orders and the application before McDougall J had been stood down before his Honour until 2.00pm. Mr Cook suggested that Robb J adjourn the proceedings to 3.00pm. In acceding to that application, this exchange ensued between Robb J and Mr Cook: HIS HONOUR: I'm in two minds as to whether I should know anything about the parties to the other application. I had an inclination to think that just for the moment I should be patient and not learn anything lest in some way learning whatever it is infects or may create an appearance of affecting my capacity to impartially deal with the matters that are before me. COOK: That's our concern, your Honour. Your Honour, from our side we've got separate barristers dealing with the application, we kept it completely a separate team and everything so for us I have been trying to keep it separate because we're very alive to the concern that any comments your Honour might make in relation to that application could be perceived the wrong way by one of the parties.
17. At 12.45pm Mr Sperber emailed Mr Doble: In respect of the application made this morning, can you please advise: 1. Why the application was made without giving our client any notice or asking him to give undertakings regarding the orders sought? 2. Why the application has been made at such a late stage in proceedings, which were commenced in 2013. 3. Why no affidavit was filed? 4. Did you disclose to the court that Mr Sharkey's wife is more than six months' pregnant and is also looking after a 10 month old child on her own? 5. What other matters were put to the court in support of the application? Please reply before 2.00pm today.
18. At 2.00pm the Restraint Motion was mentioned again before McDougall J. Mr Fernon now appeared for Mr Sharkey. Mr Hyde appeared for Ms Mayahi-Nissi. Mr Fernon submitted that the Restraint Motion could be dealt with by Robb J. There was then an exchange between McDougall J and Mr Hyde: HIS HONOUR: I will stand the matter down. If you remain of the view Mr Fernon his Honour can deal with the balance of it, so far as I can tell there is no problem from Mr Hyde's perspective, so it can go to his Honour. HYDE: I had a telephone call from Mr Doran-Cook, counsel before Robb J. He indicated Robb J said he could see the sense in having separate representation and that it is not before him. HIS HONOUR: His Honour would have said that given that I had decided to hear the matter. If there is a problem it is really Mr Fernon's problem. If Mr Fernon is not concerned by it I do not see why I should be.
19. The parties then debated before his Honour some aspects of the terms of the orders that had been made. The transcript finally records: HIS HONOUR: I stand the matter down so you can take instructions on the matter generally, particularly the availability of the passport for surrender and you can, between you, decide whether you want me to deal with the matter or Robb J. As I have said, if you are not concerned, I do not see why I or Mr Hyde should be concerned. MATTER STOOD IN LIST (Counsel informed his Honour they would proceed before Robb J.) MATTER REFERRED TO ROBB J
20. The proceedings then returned to Robb J. Mr Fernon began by saying to his Honour: FERNON: This matter has been referred back to you by McDougall J. It was my submission before McDougall J, and he was quite happy to accept, that you are the appropriate judicial officer to deal with this particular application. We have been provided with what's called a court book which incorporates the pleadings in this matter together with yesterday's and the days' before transcript and various cases and have also been provided recently with some written submissions that were apparently provided to McDougall J. We're still awaiting and require the transcript of what McDougall J was told in support of the orders that were made by him this morning.
21. Mr Fernon then went on to submit to Robb J that his Honour should deal with the Restraint Motion. In doing so, Mr Fernon said (emphasis added): … Given the urgency and the substantial and serious restraint that has been imposed upon my client on an ex parte basis, it seems to be based upon various extracts of the transcript and only evidence that has already been heard before your Honour and seems to be based only on evidence that has been put before your Honour already in this matter. I understand there is no further evidence to be relied upon. Then it is inappropriate for another judge to determine the merits or otherwise of an application based on selected extracts of transcript or selected readings of transcript without the benefit of having actually sat in this courtroom, listened to the cross‑examination and heard the cross‑examination. Equally, it is inappropriate that Mr Sharkey be required or considered appropriate to have an alternative legal team to deal with this issue. One of the primary basis for that, it will be ultimately my submission that a very misleading submission was put before McDougall J based upon what is said to be something I said in opening as giving rise to a threat that there was an imminence that Mr Sharkey, Mr Christopher Sharkey, was about to leave the country and thereby avoid the jurisdiction of this Court. It was put before his Honour that Mr Sharkey was proposing to return to the United States immediately after his evidence was concluded. Of course, I said no such thing. Counsel for the applicant knows I said no such thing, but it appears that a different legal team formed a different view. Part of that forming the difference view, of course, is that they don't understand the substantive issues that are before this Court or the various discussions that have already taken place between the parties and so to enable an application that seeks such serious restraints upon my client to be heard and determined in circumstances where all of the facts that have been heard aren't before the Court and all of the facts aren't considered, and all of the background by the relevant legal counsel can't be brought to bear so that the just, quick and cheap resolution of this application is determined is something that should not be encouraged.
22. Mr Fernon then delivered up Mr Sharkey's passport to his Honour. Just before doing so, Mr Fernon made this submission (emphasis added): As I understand it, the submissions and the evidence that the applicant relies upon are before the Court. I haven't had an opportunity to consider that other than a very cursory fashion, what has been said and the various authorities to be relied upon. I require the time to review that material to consider my client's position, to obtain proper instructions from my client in relation to at the time substantive matters. This matter should be dealt with before your Honour tomorrow so that whether these orders are to continue can be dealt with as soon as possible.
23. There then followed an extensive exchange between Robb J and Mr Fernon about the desirability of Robb J dealing with the Restraint Motion. His Honour summarised the position to which he had come: HIS HONOUR: Yes. I'm not going to make my mind up now. I will adjourn in a few minutes till ten tomorrow, that will give me some time to reflect. I don't want to do anything without due consideration. I will tell you, without binding myself, but my present inclination is to think that the risks of me dealing with this matter are just too great. I don't have in mind delivering a complicated judgment on that subject tomorrow but it's unthinkable that one would take a risk that the plaintiff would have to face another trail when all his witnesses have been cross‑examined once and the defendant has in hand the transcript from that cross‑examination and to do it all again. Apart from all the other obvious reasons. My strong instinct is to think that it is highly undesirable for a part heard trial judge, particularly in the exquisite position of having heard all of one side's evidence but not the other side, to take a risk of having to make findings on an interlocutory level concerning the strength of one side's case or the other or even getting into the point of where one's hamstrung in examining the issues with counsel because one's fearful of saying something that will explode the case. The second thing to be said is on the face of it this application could have been brought earlier.
24. One of the matters which was discussed between counsel and his Honour was the potential impact on the ability of the proceedings before Robb J to be concluded within the time allotted (by Friday, 20 February 2015) if the parties were diverted by having to argue the merits of the Restraint Motion on a contested basis. That issue resulted in the following exchange just before his Honour adjourned for the day: FERNON: Can I raise one issue, your Honour, sorry to interrupt whilst your Honour is talking, but it's just been suggested to me by my instructing solicitor with instructions that my client can remain in the country and is willing to remaining in the country for another week, at least until the end of next week so if the substantive proceeding could be resolved say tomorrow and Friday and then the interlocutory applicant can be dealt with next week. I'm not sure whether that resolves, I haven't thought the issue through but I'm throwing it in whilst we're thinking about what we're doing and that may be a way of overcoming many of these difficulties. HIS HONOUR: You can tell me about that tomorrow. FERNON: Yes, I haven't thought it through but it's just a way of perhaps dealing with it. Your Honour, then we can get on with the trial, finish it and then this matter can be dealt with. COOK: If there is no immediate urgency to leave on Saturday, that's the urgency to have that dealt with before and we can finish the trial as we planned on, by Friday, at least the evidence. Maybe this separate issue could be resolved. Your Honour, can take a view as to whether you deal with it or someone else deals with it or someone else can deal with it in the course of next week. HIS HONOUR: Yes, well I can see the sense of that
25. Robb J adjourned the proceedings part heard to Thursday, 19 February 2015.
26. By email sent at 5.57pm to the Associate to Robb J and copied to the parties, Mr Fernon informed the Associate: The parties agree that the following directions should be made in relation to the interlocutory application of the defendant: 1. The applicant serve an affidavit showing her ability to meet an undertaking as to damages by 5.00pm Friday 20 February. 2. The respondents serve any affidavits by 5.00pm Monday 23 February. 3. The applicants serve any affidavits in reply by 5.00pm Tuesday 24 February. 4. The application be heard before the Duty Judge on the first available date thereafter. It is therefore proposed that the substantive proceedings continue tomorrow.
27. For the purposes of the present application, it is important to note that while those representing Mr Sharkey disputed the basis on which McDougall J's orders had been made (see, in particular, paragraph [60] above), no application was made that afternoon for the immediate discharge of the orders. The reason for that is apparent from the transcript of the proceedings before Robb J, namely that there was a real question as to whether or not his Honour should hear such an application both as a matter of principle and in circumstances where the parties accepted the practical difficulty that it would jeopardise the main proceedings being completed in the time allotted.

Thursday, 19 February 2015 (Day 4 before Robb J)

1. When the proceedings resumed before Robb J on the morning of Thursday, 19 February 2105, Mr Fernon did make an application to discharge the orders made by McDougall J on the basis of a material non-disclosure and misstatement to his Honour. Notwithstanding his email of the previous evening (see paragraph [65] above), Mr Fernon made his application on the basis of something which had only become more apparent to him that morning in relation to how his opening had been understood.
2. Mr Fernon foreshadowed that there were two bases for his application. The first was to remind his Honour of what he had said in his opening regarding the witnesses to which McDougall had been taken (see paragraph [20] above). Mr Fernon went on to submit to Robb J (emphasis added): That evidence has apparently been understood by McDougall J and the counsel and legal representatives who appeared for Ms Nissi in making this application, as justifying a basis to seek urgent ex parte relief in the form that it was obtained and to make submissions to the Court on the basis of that statement that there was a risk that Mr Sharkey was about to flee the jurisdiction and it is clear, with respect, in reading the terms of his Honour's orders that I have outlined, that his Honour placed great weight on that risk as justifying the extraordinary orders that were made. I note yesterday, your Honour, that the point that what is said there is clearly, and I think your Honour made some approval but it's not recorded in the transcript, that Mr Sharkey ‑ it was never said that Mr Sharkey would be leaving the country based upon ‑ sorry, I withdraw that. Submitted yesterday and it was never stated that Mr Sharkey would be leaving the country once his evidence had concluded, and I think your Honour gave some acknowledgment of that. That acknowledgement is not recorded in the transcript, be that as it may. Your Honour, this morning I was reminded of an email that I sent to your Honour and your Honour's associate and to Mr Cook and his instructing solicitors outlining the basis upon which these witnesses were coming and their travel arrangements and your Honour will recall that this email - and I will hand that to your Honour.
3. As the last paragraph of transcript extracted in the previous paragraph records, the second basis of the application was the non-disclosure to the Court of Mr Fernon's email of 30 January 2015 recording the arrangement that had been reached between the parties about the United States witnesses (see paragraph [18] above). In relation to this it should be noted that there is, and can be, no suggestion that Mr Hyde had been briefed or knew of that email.
4. Having heard Mr Fernon, Robb J said (emphases added): HIS HONOUR: No, that is reasonable and I don't hold you to that sort of estimate. It seems to me that the circumstances would justify Mr Sharkey making an application to have the ex parte orders set aside. For a number of reasons I do not think that application should be made before me, it should be made before McDougall J. One of the reasons, which is obvious, is that one Supreme Court judge will not set aside an order made by another Supreme Court judge. If that can be avoided there will be circumstances where it cannot be but in this case it would appear that the basis for the application depends upon what submissions were made to McDougall J and what he was told. One problem is a quirk of the system is that transcripts of duty judge's matters are not produced daily. We won't go into that, it is unfortunate for many reasons. But the fact is that the application will depend upon first what McDougall J was told, which is something that can only be conveyed to me second hand and also what significance he attributed to that information. I will only say a number of things. One is for the purpose of the transcript in this matter and to be told to McDougall J if that happens, it is absolutely clear that there was no suggestion ever that Mr Sharkey would leave this jurisdiction immediately after his cross‑examination. Special arrangements were made and the parties cooperated, as did the Court, and it was clear that three witnesses, other than Mr Sharkey, would leave Australia, if that was possible, immediately after their evidence. The second thing is I make no finding about it or observation but I can see that it is possible that what is alleged to have been said to McDougall J would have created an appearance of heightened risk that Mr Sharkey may leave the jurisdiction early which may have influenced the Court to make relevantly exceptional orders on an ex parte basis rather than give leave to serve short notice. Whether any of this information could cause the judge who made the orders to revoke any of them or to make some sort of alternative arrangement for hearing the matter I think is a matter for McDougall J.
5. Pausing for a moment in the narrative, it is the words italicised in the transcript set out in the previous paragraph which Mr King forcefully submitted created what he described as the locus poenitentiae for the respondents to the present application. The Court understands his submission to be that at that point the respondents (including Mr Hyde) should have immediately conceded that the application had been ill-founded and that the orders made by McDougall J should have there and then been revoked.
6. His Honour gave the parties the opportunity of a short adjournment for an inquiry to be made of McDougall J as to when McDougall J could hear Mr Sharkey's application to set aside the orders. After a short adjournment, the transcript records Mr Fernon telling Robb J: FERNON: Your Honour we wish to proceed before you today in relation to the substantive proceedings. My instructing solicitors will make some inquiries at McDougall J chambers probably overnight after we see how are travelling by the end of today and hopefully find a convenient time before his Honour tomorrow. Subject to that, your Honour, there were short minutes of order, I think, that were sent to your chambers, probably sent an email form. I have a hard copy form which I've put into a format of short minutes of order in accordance with what I've said. I'm asking the Court to make those orders in the meantime subject to any further orders McDougall J may make, subject to any application we may make before him, and can I just hand that up. As far as order 4 is concerned, your Honour, I've proposed that a time and a date which is taking into account my own other obligations next week is 11am or maybe even 2pm next Wednesday. Mr Jonathan Hyde, I think, was the counsel who appeared before McDougall J and I understand will still be the counsel next week in relation to that matter. Those instructions have now been provided; Mr Hyde is available on Wednesday 25 February your Honour at 11am before the Duty Judge.
7. Robb J then immediately continued to hear the main proceedings. The orders which Robb J made by consent stood over the Restraint Motion subject to any further orders McDougall J might make - of which there were none and there is no evidence that any were sought - to McDougall J on the following Wednesday, 25 February 2015. That date, as appears from the transcript in the preceding paragraph had initially been propounded to suit Mr Fernon's convenience and Mr Hyde's availability on that day was subsequently confirmed before Robb J made the orders.
8. At some point after Robb J made the orders by consent fixing Mr Sharkey's discharge application before McDougall J on the following Wednesday, but when exactly the evidence does not disclose, Ms Mayahi-Nissi instructed her lawyers to oppose McDougall J's orders being set aside.

Friday 20 February 2015 (Day 5 before Robb J)

1. On the fifth day of the hearing before Robb J, the evidence concluded. His Honour made directions for the exchange of closing submissions and adjourned the hearing to 9 March 2015.

Wednesday, 25 February 2015

1. McDougall J heard Mr Sharkey's application to discharge the ex parte orders his Honour had made on 18 February 2015. Mr Fernon appeared for Mr Sharkey and Mr Hyde appeared for Ms Mayahi-Nissi.
2. Mr Fernon's submissions raised the matters which he had foreshadowed to Robb J (see paragraph [68] above), namely the incorrect interpretation of what he (Mr Fernon) had said in his opening and the non-disclosure of the email of 30 January 2015. Mr Fernon also challenged the jurisdictional basis on which the order had been made.
3. As the argument fell out, his Honour expressed the view that it was not going to be necessary for him "to look too long at the jurisdictional basis". Mr Hyde then sought to deal with the allegation of non-disclosure and this exchange ensued: HYDE: I will have a go at that if I may. In terms of disclosure, we don't have a transcript and I can only go on my recollection of what was put to your Honour. But can I take you to paragraph 9 of the outline of written submissions that was provided. Before addressing that particular can I say this; the witnesses that were leaving at 2.15 on the Wednesday, I don't think it is in dispute that they included two of Mr Sharkey's siblings, one of them being his sister and one being his brother, I don't think there is any dispute about that - two being his brothers, one his sister. HIS HONOUR: The clear tone of paragraph 9 is that Mr Sharkey himself will be going as soon as his evidence was completed, and I referred to that at 26 of my reasons. HYDE: Yes. HIS HONOUR: It is just wrong. HYDE: That was couched in terms of that is likely to be as early. As I recall the submissions that I put to your Honour, and again I don't have the benefit of a transcript, but there was some qualification which was to the effect that we weren't certain that he would be on that flight. HIS HONOUR: You did say that but you said that the risk that he might be on it was why the application was being made as a matter of urgency. HYDE: That's right, so there is no doubt, and it is not in dispute, that my friend has put on record that according to him Mr Sharkey is to depart on the Saturday. Those instructing me had a concern that he would leave - picking up from my submissions - as early as this afternoon, that being Wednesday at 2.15, predicated on, in part, the opening of Mr Fernon at page 1 of the transcript that I took your Honour to, coupled with the submission to your Honour that we weren't certain that he would be on that particular flight.
4. There was also a further exchange: … We say that your Honour properly made the order, having been taken critically to the agreement between he and Ms Nissi and this part of the transcript. It was expressly flagged with your Honour that we weren't certain that he was on the 2.15 flight but that were concerned and considered that he might well be, and the material that my learned friend puts forward to say this is an utter nonsense and, with respect, misses the point. His siblings were to depart on the Wednesday. On his own evidence he was to depart on the Saturday. Your Honour, in relation to the - sorry, just before I finish on the disclosure issue, your Honour, I'm hamstrung without the transcript, I can't remember precisely what I said or didn't say, whether my member is serving me correctly or not, so I will have to simply wait until that become available.
5. His Honour then delivered the Discharge Judgment ex tempore. That judgment included: 7. In my view, the orders made should be set aside. The reasons for that may be stated without going further into the complicated jurisdictional issues. In circumstances where this application was made in the course of a busy Duty List, and is being dealt with ex tempore to permit Mr Sharkey to leave on a flight booked for this evening (which will be a consequence of the orders I will make), I do not think it is wise to undertake any further examination of the bases of the power that I exercised last week. 8. One of the significant matters that was put to me on the ex parte application was the proposition that (and I quote paragraph 9 of the written submissions for Ms Nissi): Mr Sharkey will return to California immediately his evidence in the proceedings is completed. This is likely to be as early as this afternoon [i.e., the afternoon of 18 February 2015. 9. In fact, as Robb J subsequently made clear when the matter went back to his Honour, there was no suggestion ever that Mr Sharkey would leave the jurisdiction immediately after his cross-examination. Robb J stated that on 19 February 2015 at T 192.20-33. It has not been suggested that what his Honour said was in any way mistaken. 10. There has been put before the Court today a body of evidence to show that those who were intending to leave once their cross-examination and any re-examination was completed, were other witnesses called by Mr Sharkey in his case. There was documentary evidence which would have shown that it was intended that those people leave straight away. That material was not put before me on 18 February, no doubt because their departure was not a reason for seeking the order. 11. However, it is clear both from what is said in para 9 of the submissions and from what I said at [26] of my earlier reasons that I regarded as important by the consideration, "[t]hat Mr Sharkey intends to leave the country once his evidence is completed. He is said to be booked on a flight at 2.15pm today". 12. Unfortunately, the transcript of the ex parte application is not available. Thus, both counsel and I are forced to rely on our memories of what was said. I am prepared to accept that it may not have been stated as a matter of absolute certainty that Mr Sharkey was going to leave that very day. However, as I have said, it was stated that he would return immediately his evidence was completed and that it was likely that his evidence would be completed that afternoon. That time was derived by reference to the transcript of the hearing before Robb J on 16 February 2015, T 1.39-.46. 13. In the circumstances, it seems to me that there was, and I accept by oversight or inadvertence, a material misstatement on a relevant fact. I accept that this occurred in the heat of the moment or the confusion caused by the need to have separate counsel making the application before me. Nonetheless, the fact is that it did occur. 14. Had I been told that Mr Sharkey was not intending to leave (as is now clear he was not) for some days, I would not have made the orders ex parte, but would have given him an opportunity to answer the application. … 17. I do accept, as I recorded in my reasons at [22] and [23], that there were passages in the cross-examination of Mr Sharkey which could suggest that he had behaved, in relation to Ms Nissi, in an underhand and deceptive way; and likewise with his creditors more generally. That was a matter of some significance, because it gave colour to the proposition that Mr Sharkey's abrupt (as it seemed) departure might well be for the purpose of avoiding the enforcement of any order against him. 18. Whilst I remain of the view that that impression is available from the passages of transcript referred to, when it is put in the context of Mr Sharkey's frequent travel between America and this country, its significance is diminished. Further, it is a matter that Mr Sharkey could have addressed had he been given an opportunity to be heard. … 25. Accordingly, I discharge orders 1 and 2 made on 18 February 2015. I direct that the plaintiff's solicitor Mr Sperber is at liberty to return to the plaintiff the passport of the plaintiff that has been delivered into Mr Sperber's custody. 26. Counsel for Ms Nissi accepts that she must pay the costs, and puts nothing against the assessment of those costs on the indemnity basis. Accordingly, I order the defendant to pay the plaintiff's costs of the application, and direct that those costs be assessed on the indemnity basis. 27. The notice of motion filed in Court on 18 February 2015 is dismissed.
6. It is notable for the purposes of assessing the present application (see paragraph [150(3)] below) that while an indemnity costs order was made (and not resisted), no application was made on behalf of Mr Sharkey that the relevant lawyers pay those costs personally.
7. The transcript of the ex parte hearing before McDougall J became available to the parties later on the same day after the Discharge Judgment had been delivered. After receiving that transcript Mr Hyde wrote on the same day to the Associate to McDougall J: I would be grateful if you could provide this note to His Honour. This morning I made a submission believing that I had in some fashion qualified the timing for the departure of Mr Sharkey when submissions were made on 18 February 2015. Having reviewed the transcript, which was provided after the matter concluded today, it appears that I in fact made no such qualification, contrary to my recollection. Please accept my unreserved apology for this error. I have provided a copy of this letter to Mr Fernon to whom I also offer an apology.
8. That evening, Mr Sharkey attempted to leave Australia. He was detained at the airport by immigration as a result of the ex parte order that had been made by McDougall J. He was delayed, and nearly missed his plane, until a copy of the discharge order was provided to the authorities. While Mr Sharkey was ultimately allowed to leave and caught his scheduled (albeit delayed) flight, his luggage was lost for about 30 days. Mr Sharkey, understandably, found those events to be humiliating and distressing.

Subsequent events

1. Robb J delivered judgment in the substantive proceedings on 2 September 2015. As at the date of these reasons the substantive proceedings continue before his Honour on the question of damages owing by Mr Sharkey to Ms Mayahi-Nissi pursuant to her cross-claim.
2. On 29 September 2015 Mr Sharkey filed and served a notice of intention to appeal from Robb J's dismissal of his claim. A notice of appeal was filed on 3 December 2015. The filing of the notice of intention to appeal and subsequent notice of appeal ultimately came to be acknowledged as being misconceived and the purported appeal was discontinued by notice filed on 17 February 2016.
3. However, on 23 October 2015 (four weeks after the notice of intention to appeal was filed), Mr Sharkey's new solicitors (Bransgroves Lawyers) wrote to Mr Doble (the "Bransgroves Letter"). That letter set out the basis of what became the present application and is further considered in paragraphs [162] to [164] below. It concluded: 59. Should we not, by close of business Friday 30 October 2015, hear from yourselves that you (Eakin McCaffery Fox (sic)) intend to recuse yourselves from further representation of Ms Nissi in these proceedings and that any barrister involved in advising, preparing or appearing on the ex parte application on behalf of Ms Nissi will likewise recuse themselves, then we are instructed to file the application seeking orders to that effect.
4. By letter dated 12 November 2015 Mr Sharkey's solicitors informed the EMC Respondents that a motion to disqualify them and Mr Hyde would be filed with their client's Notice of Appeal. While the Notice of Appeal was filed on 3 December 2015 (see paragraph [85] above), it was not until 26 February 2016 that the notice of motion commencing the present application was filed. The amended notice of motion on which Mr Sharkey moves was filed in Court by leave on 23 March 2016.
5. Mr Hyde was briefed solely in relation to the application made to McDougall J. He has had no involvement in any other aspect of the matter and currently does not hold a brief in the matter. Mr Lynch SC informed me that it was "unlikely" that Mr Hyde would be retained in the matter again.
6. Through his affidavit sworn on 30 March 2016, Mr Doble informed the Court that "without making any admissions on this application or in the proceedings, my Firm has decided that, going forward, I will not be further involved with this case." That position was formalised while this judgment was reserved by the filing of a notice of change of solicitor on 7 April 2016 notifying that Ms Mayahi-Nissi has appointed Ms Jennifer Shaw of Eakin McCaffery Cox to act as her solicitor in the substantive proceedings in the place of Mr Doble.

The jurisdiction invoked by Mr Sharkey

1. Mr Sharkey's amended notice of motion invites the Court to exercise its inherent jurisdiction identified by Brereton J in Kallinicos v Hunt [2005] NSWSC 1181; (2005) 64 NSWLR 561 ("Kallinicos"). In an extensive consideration of the authorities, Brereton J identified three bases on which the Court would intervene to restrain a legal practitioner from acting for a particular client: 1. to give effect to the fiduciary obligations of that legal practitioner during the subsistence of his or her retainer; 2. the protection of confidences once the retainer is at an end; and 3. the Court's inherent jurisdiction to restrain legal practitioners from acting in a particular case as an instance of its inherent jurisdiction over its officers and to control its processes in aid of the proper administration of justice.
2. His Honour summarised the current law (citations omitted): 76 The foregoing authorities establish the following:- . During the subsistence of a retainer, where the court's intervention to restrain a solicitor from acting for another is sought by an existing client of the solicitor, the foundation of the court's jurisdiction is the fiduciary obligation of a solicitor, and the inescapable conflict of duty which is inherent in the situation of acting for clients with competing interests [Prince Jefri]. . Once the retainer is at an end, however, the court's jurisdiction is not based on any conflict of duty or interest, but on the protection of the confidences of the former client (unless there is no real risk of disclosure) [Prince Jefri]. . After termination of the retainer, there is no continuing (equitable or contractual) duty of loyalty to provide a basis for the court's intervention, such duty having come to an end with the retainer [Prince Jefri; Belan v Casey; Photocure; British American Tobacco; Asia Pacific Telecommunications; contra Spincode; McVeigh; Sent]. . However, the court always has inherent jurisdiction to restrain solicitors from acting in a particular case, as an incident of its inherent jurisdiction over its officers and to control its process in aid of the administration of justice [Everingham v Ontario; Black v Taylor; Grimwade v Meagher; Newman v Phillips Fox; Mitchell v Pattern Holdings; Spincode; Holborow; Williamson v Nilant; Bowen v Stott; Law Society v Holt]. Prince Jefri does not address this jurisdiction at all. Belan v Casey and British American Tobacco are not to be read as supposing that Prince Jefri excludes it. Asia Pacific Telecommunications appears to acknowledge its continued existence. . The test to be applied in this inherent jurisdiction is whether a fair-minded, reasonably informed member of the public would conclude that the proper administration of justice requires that a legal practitioner should be prevented from acting, in the interests of the protection of the integrity of the judicial process and the due administration of justice, including the appearance of justice [Everingham v Ontario; Black v Taylor; Grimwade v Meagher; Holborow; Bowen v Stott; Asia Pacific Telecommunications]. . The jurisdiction is to be regarded as exceptional and is to be exercised with caution [Black v Taylor; Grimwade v Meagher; Bowen v Stott]. . Due weight should be given to the public interest in a litigant not being deprived of the lawyer of his or her choice without due cause [Black v Taylor; Grimwade v Meagher; Williamson v Nilant; Bowen v Stott]. . The timing of the application may be relevant, in that the cost, inconvenience or impracticality of requiring lawyers to cease to act may provide a reason for refusing to grant relief [Black v Taylor; Bowen v Stott].
3. Mr King accepted that his client's application was to be determined by the application of the principles set out in the last four dot points of Brereton J's summary reproduced in the preceding paragraph. In particular, a number of Mr King's submissions were directed to the example of a case noted by Brereton J in Kallinicos: 45 In Kooky Garments Limited v Charlton [1994] 1 NZLR 587, Thomas J said that the court had an inherent jurisdiction to supervise the conduct of counsel in court, which included the ability to intervene when counsel or solicitors appeared in a matter in which they had an actual or potential conflict of interest, or where, by reason of their relationship with the client their professional independence might be doubted - because the integrity of the judicial process is undermined if the lawyers do not have the independence and objectivity which they are presumed to have.
4. Mr King, as part of his argument, invited the Court to conclude that on the basis of the conduct of those involved in the application to McDougall J, the Court could not be satisfied they had the independence and objectivity which they would otherwise be presumed to have so that the integrity of the judicial process was undermined.

Mr Sharkey's case against the respondents

1. By the time Mr Sharkey's amended notice of motion came on for hearing before me, the parties had been conducting their preparation for the hearing by reference to the allegations in the Bransgroves Letter and, once they were provided, the Submissions. However, a matter of considerable concern to the Court during the course of the hearing, given the seriousness of the allegations, was the need for precision on the part of Mr Sharkey as to the nature of the case being made against each respondent.
2. While the circumstances in which the Court's inherent jurisdiction to control its officers will be exercised it is not to be confined to particular circumstances, where that jurisdiction is invoked by reference to allegations of misleading conduct, misconduct and the like, precision in the case is required so the respondents know exactly what it is they have to answer and the Court understands what findings of fact it is being invited to make, including the extent to which the statutory enactment of the principle in Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336 in s 142 of the Evidence Act 1995 (NSW) may need to be applied. For example, was the conduct which is now criticised innocent, deliberate, fraudulent, reckless or negligent? Where a respondent's knowledge is relevant, is it alleged that the respondent had actual knowledge of something or that, while they did not actually know, they ought to have known?
3. In an endeavour to dispel any doubt about exactly how Mr Sharkey's case was put, immediately after the luncheon adjournment on the first day of the hearing the Court invited Mr King to prepare a schedule setting out exactly what the findings of fact were that his client submitted the Court should make and against whom, which, taken individually or together, justified the relief sought by Mr Sharkey in his amended notice of motion. That document was provided the next day and was ultimately entitled "Revised List of Applicant's Proposed Findings". It became Exhibit 8P in the application (the "Revised List").
4. Almost at the end of his final submissions, Mr King and I had the following exchange (T123: 24-47): HIS HONOUR: But Mr King, do you thereby abandon all these submissions about serious misconduct, unprofessional conduct? It is a very serious thing you are asking me to do and I have asked you several times to be quite precise about what findings you want me to make. Now there is, scattered through all this material, allegations of the most serious kind. Now either you ask me to give ‑ I'll have to deliver a judgment seriatim dealing with them or you say no, your Honour doesn't have to make any of those findings your Honour just does link each test according to Brereton J, which is it, Mr King? KING: It is the latter but having regard to the findings that we ask your Honour to make, for example, could I ask you to go to para 25? HIS HONOUR: That is no answer to my question. Having regard to the findings that you ask me to make, are the findings you are asking me to make in these submissions include finding serious unsatisfactory conduct? KING: We say that each of the matters that are contained in the revised list are supported and each of them are appropriate for your Honour to make. HIS HONOUR: So I can confine my consideration to the revised list of the allegations made in the revised list? KING: Yes. Subject to one issue regarding Mr Hyde which I will come to in a moment.
5. The matter in relation to Mr Hyde was that, for reasons which it is unnecessary for me to record, it was submitted that Mr Hyde could not obtain any forensic advantage from the fact that he had not been cross-examined before me. Mr King also submitted that the application against Mr Hyde should be decided against the background of an undertaking which had been sought from Mr Hyde's representatives during the morning of the first day of the hearing before me that Mr Hyde take no further part in the substantive proceedings, which undertaking Mr Hyde had declined to give.
6. Furthermore, during the course of the hearing Mr King helpfully clarified his client's submissions in certain respects: 1. The making of a submission which the Court ultimately finds to be wrong in law will not, without more, justify the engagement of the jurisdiction invoked by Mr Sharkey: T73: 10-13. 2. Mr King did not, and could not, submit that Mr Hyde had actual knowledge that the submission which Mr Hyde made to McDougall J as to the Court's powers to make the orders sought was wrong: T76: 3-7. 3. It was not suggested that Mr Doble actually knew that the instructions he was giving to Mr Hyde about what had occurred in Mr Fernon's opening was wrong. Rather the allegation was that Mr Doble had not made reasonable and appropriate inquiries such that his failure to do so constituted gross neglect: T76: 9-18. 4. Mr King's client pressed for a finding of unsatisfactory conduct in relation to professional obligations against Mr Doble: T123: 11-13. Although not expressly referred to by Mr King, the Court understood this submission (and that recorded in the preceding sub-paragraph) to invite the Court to apply the standard set out in s 296 of the Legal Profession Uniform Law (NSW) that "unsatisfactory professional conduct includes conduct of a lawyer occurring in connection with the practice of law that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent lawyer".
7. Accordingly, the Court will approach Mr Sharkey's amended notice of motion by reference to the Revised List, understood, insofar as it might be necessary, by reference to the matters set out in the preceding paragraph.

Mr Sharkey's amended notice of motion - the respondents' answers

1. Without intending any disrespect to the respondents' careful submissions (and ignoring that each respondent's submission was tailored to his or her interests), the totality of the respondents' submissions in answer to Mr Sharkey's amended notice of motion may be summarised as: 1. The relevant respondent's conduct simply could not be properly characterised as having the egregious quality sought to be attributed to it by Mr Sharkey. 2. If there be any doubt, the Court did have the power to make the orders made by McDougall J in the Restraint Judgment. 3. There was no utility in making any order against Mr Hyde, who had not played and would not be playing any further part in the proceedings. 4. The amended notice of motion was misconceived and should be struck out as against those EMC Respondents who had played no part in the relevant events. 5. Nothing which had occurred would excite the Court's exercise of what the authorities recognised as being an exceptional jurisdiction to be exercised with circumspection. 6. There had been an unsatisfactory and unexplained delay between the relevant events and when the present application was commenced. 7. Mr Sharkey had failed to demonstrate any matter which would justify the Court interfering with Ms Mayahi-Nissi's entitlement and desire to keep her existing legal team through the balance of the proceedings before Robb J and, taking into account the conduct referred to in paragraph [85] above, the inevitable appeal.

Mr Sharkey's amended notice of motion - consideration

1. Three matters relied upon by Mr Sharkey may be disposed of at the outset.
2. First, the Court does not accept that any valid criticism can be made of the respondents for not providing McDougall J at the ex parte hearing with a copy of Mr Fernon's email of 30 January 2015 (see paragraph [18] above). As McDougall J noted in paragraph [10] of the Discharge Judgment, there was no need to do so because that email did not say anything about the intended movements of Mr Sharkey. Putting that email into its context at the time of the relevant events (and without suggesting any criticism of him), it appears that even Mr Fernon had to be reminded by his solicitors of its existence (see paragraph [68] above) when he addressed Robb J the morning after the ex parte orders had been made.
3. Quite apart from the conclusion reached in the preceding paragraph, Mr Hyde has a further and complete answer to this part of Mr Sharkey's complaint. That answer is that there is no suggestion that Mr Hyde knew of the existence of that email. His evidence is that he did not know of it at the time of the ex parte application. The Court finds that he was unaware of the existence of that email at any time up to and including when the ex parte application was made
4. Second, the Court does not accept that any valid criticism could be made of the respondents by reason of the fact that the application to McDougall J was made ex parte. It was an urgent application of a kind frequently made ex parte given it invoked the Court's jurisdiction to make an asset freezing order. Inevitably, a judge sitting in a busy duty list will give consideration to whether or not a matter presented as an ex parte matter should be permitted to proceed in that manner. McDougall J, by entertaining the application, appears to have accepted that it was a proper matter for an ex parte application.
5. Insofar as the reason for urgency depended upon what Mr Fernon had said in his opening (see paragraph [20] above), while the respondents' understanding of what had been said (including as recorded in the transcript) was ultimately shown to be in error, the Court is satisfied that the understanding of Messrs Eakin, Doble and Hyde was genuinely and innocently held and not attributable to recklessness or negligence. The Court accepts that, in the heat of the moment, Mr Eakin thought he heard what he did during Mr Fernon's opening and that, with that mindset, the transcript could be read in the way it was.
6. Third, the Court does not accept that any criticism can properly be made of the respondents for the fact that the ex parte application was made to a judge other than Robb J. For precisely the reasons articulated in Mr Hyde's submissions (see paragraph [49] above), the matters identified by Robb J as being of concern to him (see paragraphs [62] and [70] above) and as accepted by McDougall J in paragraph [14] of the Restraint Judgment, the Court concludes that it was proper and appropriate for the ex parte application to be made to a judge other than Robb J, who was then the part heard trial judge.
7. In paragraph 15 of the Revised List, Mr King submits that "no satisfactory explanation has been provided to the Court on the following key issues by the respondents". The Court will consider each of those "key issues" in turn.

"How the error as to the interpretation of the opening of Mr Fernon, the opposing lawyer was made, when it is not clear either Mr Eakin or Mr Doble was in Court to hear his opening"

1. The evidence is clear that Mr Eakin was in Court, but not Mr Doble, to hear Mr Fernon's opening. The Court accepts Mr Eakin's explanation of what occurred (see paragraph [22] above) as inherently credible and truthful. It is, regrettably, an all too common experience for solicitors, counsel and even judges to think they heard something said in court which is ultimately not borne out by the transcript (assuming that the transcript is not itself in error). Context and preconceptions brought about by which side of the record someone is representing can have a powerful influence on the way something said in court may be heard. Different people will hear different things. Furthermore, particularly in circumstances of urgency, one person's account of what they heard if given to another may create a predisposition in that other to read the transcript in a particular way. That is what occurred in this case.
2. Mr Eakin has explained how he arrived at his interpretation of what Mr Fernon said in opening. He told Mr Doble. Mr Doble naturally accepted what Mr Eakin said and his perception of the transcript, along with that of Mr Hyde and, finally, McDougall J was coloured by the assertion (ultimately demonstrated to be wrong) that Mr Fernon had said Mr Sharkey would be leaving at the conclusion of his evidence. The Court is satisfied that the respondents' interpretation of what Mr Fernon said (and as subsequently set out in the transcript) was innocently arrived at and maintained by Messrs Eakin, Doble and Hyde up to and including the time of the ex parte application before McDougall J. Nothing in those events as the Court has found them to be warrants the exercise of the exceptional jurisdiction invoked by Mr Sharkey.

"Why no attempt was made to clarify with counsel for [Mr Sharkey], his lawyers, or with Robb J as to the alleged misunderstanding before taking the very serious step of an ex parte application to another Judge without notice?"

1. The Court adheres to the view expressed in paragraph [107] above that no criticism is to be made for the matter not having been raised before Robb J or the matter proceeding ex parte before another judge.
2. Given that the application of McDougall J was premised upon what the Court is satisfied was an innocently held wrong belief of a risk of imminent flight by Mr Sharkey, that is and of itself sufficient explanation as to why no attempt was made to raise the matter with Mr Fernon or Mr Sharkey's lawyers. It is in the nature of asset freezing orders and ancillary orders that they will often have to be made in urgent circumstances where, at least as far as the applicant for the orders is concerned, forewarning the respondent to those orders (or that person's legal advisers) may defeat the purpose of the orders themselves.

"Why Mr Fernon is being blamed for the misconceived application to McDougall J"

1. The Court does not understand any of the respondents to be "blaming" Mr Fernon for the application that was made to McDougall J.

"Why Robb J himself was not asked by the respondent or their counsel [Mr Cook] during the hearing when there was ample time after the matter adjourned on day 2 and on day 3 to do so, where the core issue did not go to credit [i.e. Mr Sharkey had said to the Court he was about to leave the country for good] as is apparent from the ready answer of Robb J at case book page 284?"

1. The "ready answer" referred to in the issue is what Robb J said which is reproduced in paragraph [70] above.
2. The Court has already accepted (see paragraph [107] above) that it was appropriate not to have raised with Robb J the matters which informed the ex parte application to McDougall J. Accordingly, Mr Eakin's and Mr Doble's concern that Robb J not be compromised by the issue being raised is a sufficient answer to this criticism. Furthermore, it cannot be relevant to Mr Sharkey's application as against Mr Hyde because the latter was not briefed in the substantive proceedings before Robb J.

"Why once Robb J gave his response to the factual basis of the orders made by his brother Judge no steps were taken to set aside the order as obligated by the Solicitors Rules [see rule 19]?"

1. Rule 19 of the New South Wales Professional Conduct Practice Rules 2013 (Solicitor's Rules) falls within the section headed "Advocacy and Litigation" and the subheading "Frankness in Court". The rule includes (emphasis added): 19.1 A solicitor must not deceive or knowingly or recklessly mislead the court. 19.2 A solicitor must take all necessary steps to correct any misleading statement made by the solicitor to a court as soon as possible after the solicitor becomes aware that the statement was misleading.
2. Mr Sharkey's criticism here is misconceived because neither Mr Eakin nor Mr Doble had made any statement to McDougall J (or, for that matter, to Robb J). Nor, if it applied would rule 19 require Messrs Eakin and Doble to do anything more than correct the allegedly misleading statement. That is not to say, however, that the correction of a misleading statement made on an ex parte application will not then have the consequence of an ex parte order being set aside (including by the Court of its own motion).
3. Quite apart from the application of rule 19, if this complaint is to be understood as raising the question as to why no steps were taken to set aside the order upon Robb J saying what he did (see paragraph [70] above), then the answer is in the sequence of events. It is sufficient to draw attention to two matters.
4. First, Robb J's "response to the factual basis of the orders" was made in the course of an application by Mr Fernon that McDougall J's orders be discharged (see paragraph [67] above). There was nothing for the respondents to do because Mr Sharkey, by his Counsel, was taking steps to set aside the order including on the express basis that there had been a misunderstanding of what Mr Fernon had said in opening.
5. Second, Robb J's observation (see paragraph [70] above) concluded with "Whether any of this information could cause the judge who made the orders to revoke any of them or to make some sort of alternative arrangement for hearing the matter I think is a matter for McDougall J". That is ultimately what occurred. Given that indication it was inappropriate for the respondents to do any more before Robb J.
6. Finally, the Court notes that this aspect of Mr Sharkey's complaint is not couched in terms as being against Mr Hyde. Nor could it be. Mr Hyde was not in Court when Robb J made his observations. No sensible criticism can be made of Mr Hyde in relation to his subsequent conduct. He acted in accordance with his instructions to resist the discharge of McDougall J's orders but did not cross-examine Mr Sharkey or otherwise submit contrary to the position that had by then emerged as to the proper construction of what Mr Fernon had said in opening.

"Why no response was given to the Schwaabs' letter of 18 February 2015 then and since?"

1. The relevant parts of this letter are set out in paragraph [56] above.
2. This complaint can only relate to Mr Doble, to whom the email was sent. There is no suggestion that it was seen by Mr Eakin.
3. Although he had no independent recollection of it, Mr Doble accepted he would have seen the emailed letter. He had no recollection of whether or not he had replied to it. No reply was produced in answer to a call by Mr King. The Court finds that there was no reply.
4. The difficulty for Mr Sharkey on this point is that while the email was sent at 1245pm on 18 February 2015 there is no evidence whether it actually came to Mr Doble's attention at a time when a response would have been called for. Given the press of events, including the fact that the matter was back before McDougall J at 2.00pm and then returned to Robb J (see paragraphs [57] to [64] above), the Court is not satisfied that the failure to respond to the email is sufficient to found any criticism of Mr Doble when it is clear that the letter was rapidly superseded by events, not least because the matters raised in it were ventilated between the parties in the subsequent court appearances that day.
5. In any event, in and of itself a failure to respond to that email would be insufficient to justify the Court's exercise of the jurisdiction invoked by Mr Sharkey in his amended notice of motion.

Other matters

1. The Revised List also invites the Court to make certain findings about breaches of the duty of candour and misleading the Court.
2. Three matters are raised in relation to the duty of candour.
3. It is first suggested that the EMC Respondents failed to disclose to the Court at the time of the ex parte application to McDougall J that there was no evidence that Mr Sharkey had any intention to abscond from the jurisdiction on completion of his evidence. It is correct to say that the EMC Respondents failed to make that disclosure. However, there was no breach of any duty of candour where the Court is satisfied that Mr Doble and Mr Eakin, innocently and subjectively, believed there to be such evidence, namely what they understood Mr Fernon to have said in opening and was then recorded in the transcript.
4. Next it is suggested that all of the respondents failed to disclose to the Court "that there was any evidence that the applicant had the intention of never returning to Australia". The Court assumes this should read "not any evidence". The allegation is misconceived because the application to McDougall J was not made on the basis that Mr Sharkey would never return to Australia but rather, referring to Mr Sharkey's own evidence before Robb J, that he had no immediate intention of returning to Australia and not earlier than two years (see paragraph 12 of Mr Hyde's submissions set out in paragraph [49] above).
5. Third, it is suggested that the respondents failed to disclose to McDougall J that Mr Sharkey did have assets within the jurisdiction, namely his chose in action which was his primary claim in respect of the relevant property. However, the existence of the property and the claim was disclosed to, and taken into account by, McDougall J. His Honour said in the Restraint Judgment: 23. … Finally, in this context, the transcript shows beyond doubt that, as Mr Sharkey has conceded, he no longer has any assets of relevance in Australia. 24. Thus, if Mr Sharkey succeeds in his claim, he would be entitled to the property but may not be in a position to recompense Ms Nissi for the amounts expended by her. 25. It may very well be that, in the hypothetical universe which I am considering, Ms Nissi would have an equitable lien on the property to secure repayment of that amount. However, without knowing the value of the property and the amount presently secured by the existing mortgage, I have no way of understanding whether that equitable lien (should it be made out) would be sufficient to recoup her for the amount that she has spent.
6. The balance of Mr Sharkey's submissions in relation to the alleged breaches of the duty of candour cannot succeed because the Court has not accepted the three fundamental matters on which the alleged breaches are based (see paragraphs [103] to [107] above). Furthermore, having regard to the seriousness of the allegations made (see s 142 of the Evidence Act 1995 (NSW)) the Court is not satisfied that the respondents' conduct was anything more or less than the product of innocent error. The more sinister explanations advanced by Mr Sharkey are not made out.
7. The findings sought in relation to the allegation of "misleading the Court" squarely bring Mr Hyde into their scope along with the EMC Respondents. It was submitted that Mr Hyde and, through him, the EMC Respondents, wrongly represented to the Court both that it had jurisdiction to make orders in the nature of a writ of ne exeat colonia and that the orders sought were "ancillary" orders under UCPR Part 25, r 25.14.
8. It is a very serious matter to suggest that counsel or solicitors misled the Court. In relation to either a submission of fact or law, a court could be misled innocently or deliberately. An example of being innocently misled, whether through genuine inadvertence or incompetence, might be a submission that a court had a particular power under a statute which had, in fact, been repealed. To develop that example further, it would be a case of being deliberately misled if counsel or the solicitors in fact knew of the repeal of the relevant legislation.
9. Mr King properly eschewed any suggestion that he was inviting the Court to find that Mr Hyde positively knew that what he was submitting to McDougall J about the Court's jurisdiction was wrong (see paragraph [99(2)] above). Mr King was right to make that point clear, as there is absolutely no evidence that could have supported such a submission. While the same qualification was not expressly made in relation to the EMC Respondents, the same conclusion follows because there is no suggestion that either Mr Eakin or Mr Doble actually knew or even believed that the Court did not have the requisite jurisdiction. On the contrary, Mr Doble had undertaken research which satisfied him there was a basis for the orders sought (see paragraph [27] above).
10. Mr Sharkey's case on this point therefore turns on the Court being satisfied that, as a matter of law, the Court does not have the power to make the orders made by McDougall J and that, innocently, the contrary submission was put by Mr Hyde. Even if that were the case, the Court is well satisfied that it would not be sufficient to warrant the EMC Respondents and Mr Hyde being prevented from continuing to represent Ms Mahayi-Nissi. That must especially be the case where, as here, it has not been suggested on Mr Sharkey's behalf that no counsel or solicitor acting reasonably could have responsibly made the relevant submissions to McDougall J.
11. Mr Hyde and the EMC Respondents sought to meet this allegation head on by seeking to persuade the Court that it clearly did, as a matter of law, have the power to make the orders which were made ex parte by McDougall J. It does not seem to me to me to be necessary or (in the context of an application of this kind) desirable for the Court to come to a final view on this question and the Court expressly refrains from doing so. However, it is a sufficient answer to Mr Sharkey's complaint if the Court is satisfied that it was reasonably open for Mr Hyde to submit to McDougall J that his Honour had the necessary power. Counsel cannot be criticised for putting any submission that was reasonably open to be put. The Court has no difficulty in concluding that it was strongly arguable that his Honour had the requisite power on the basis of the following three arguments put on behalf of Mr Hyde and the EMC Respondents.
12. First, the Court has statutory jurisdiction to grant relief by way of order (rather than writ) to the same effect as the writ of ne exeat colonia and for delivery up of the passport: Supreme Court Act, 1970 (NSW), s 69(1) applying the principles set out in Glover v Walters [1950] HCA 1; (1950) 80 CLR 72; see also Danieletto v Khera, SCNSW, unreported, Bryson J, 17 February 1995, BC9504240; Cardile v Led Builders Pty Ltd [1999] HCA 18; (1999) 198 CLR 380 at [39] ("Cardile").
13. Second, noting that the Restraint Motion sought orders for the payment in or securing of an amount of $547,090 (see paragraph [48] above), the Court had inherent jurisdiction also to make the order in the nature of ne exeat colonia and for delivery up of the passport to prevent abuse of its own processes including the frustration of any potential judgment. That jurisdiction was confirmed by Supreme Court Act 1970, s 23, continued by Civil Procedure Act 2005 (NSW), s 5(1); see Jackson v Sterling Industries Limited (1987) 162 CLR 613 at 623 per Deane J ("Jackson"); Cardile at [26]; Bayer AG v Winter [1986] 1 WLR 497; [1986] 1 AllER 733; Talacko v Talacko (No 2) [2009] VSC 444; (2009) 25 VR 613 at [46].
14. Payment into court can be ordered as ancillary to Mareva or asset freezing type relief: Jackson at [625]; Millennium Federation Pty Ltd v Bigjig Pty Ltd [1998] QCA 432; [2000] 1 QdR 275 at [14]-[15]; Sleiman v Afeich [2005] NSWSC 1063.
15. Third, the Court's power can be found in UCPR Part 25, r 25.14. Order 5 sought in the Restraint Motion, which prayed for the deposit of money into a trust account, satisfies the definition of a freezing order under r 25.11(1). The orders in the nature of the writ of ne exeat colonia and for the delivery up of the passport fell within the definition of an ancillary order in r 25.12(1) to a freezing order or prospective freezing order. In any event, the orders could be made as freezing orders or ancillary orders if the Court considered it "in the interests of justice to do so" pursuant to r 25.14(6).
16. In reaching the conclusion set out in paragraph [137] above, the Court does not overlook that, because it was an ex parte application, Mr Hyde was under an obligation under Rules 29 (a) and (c) of the NSW Barristers' Rules to disclose to the Court any "legal matters which are within the barrister's knowledge… and the barrister has reasonable grounds to believe would support an argument against granting the relief or limiting its terms adversely to the client". While Mr King submits in the Revised List that Mr Hyde was wrong to submit to McDougall J that the Court had jurisdiction to make an order in the nature of the writ of ne exeat colonia, there is no specific criticism in terms that, in breach of his obligations on an ex parte application, Mr Hyde had some particular legal matters that were within his knowledge which he failed to disclose to McDougall J.
17. However, the Revised List does submit that the orders obtained from McDougall J had not been lawful in New South Wales since 1970 by reason of (currently) s 129 of the Civil Procedure Act 2005 (NSW) which provides that "No person is to be arrested on mesne process issued by the court". That section is no answer to the orders made by McDougall J because they were not for the arrest of Mr Sharkey. Section 129 does not prevent orders of the kind made by McDougall J and, insofar as it might be suggested on behalf of Mr Sharkey, assuming Mr Hyde knew of s 129 he had no obligation to draw it to his Honour's attention at the time of the ex parte hearing.

Mr Sharkey's amended notice of motion - conclusion

1. Mr Sharkey's amended notice of motion unequivocally invoked the test identified by Brereton J in Kallinicos at [76]: The test to be applied in this inherent jurisdiction is whether a fair-minded, reasonably informed member of the public would conclude that the proper administration of justice requires that a legal practitioner should be prevented from acting, in the interests of the protection of the judicial process and the due administration of justice, including the appearance of justice.
2. For the reasons set out above, Mr Sharkey has not established any of the criticisms of the conduct of the EMC Respondents and Mr Hyde which were deployed as being matters which would compel the archetypal member of the public to reach the conclusion referred to in the test quoted in the preceding paragraph. On the contrary, the Court is positively satisfied that the archetypal member of the public, appraised of the matters recorded in these reasons, would reach the conclusion that what occurred was accurately, succinctly but nevertheless compendiously explained by McDougall J in the Discharge Judgment and that, as such, there is no basis to prevent the EMC Respondents (and, if she wished, Mr Hyde) from continuing to act for Ms Mayahi-Nissi. At the risk of repetition, McDougall J's explanation was: 13. In the circumstances, it seems to me that there was, and I accept by oversight or inadvertence, a material misstatement on a relevant fact. I accept that this occurred in the heat of the moment or the confusion caused by the need to have separate counsel making the application before me. Nonetheless, the fact is that it did occur.
3. It follows that the Court declines to exercise what was recognised in Kallinicos as an exceptional jurisdiction to be exercised with caution.
4. For completeness, and by way of further support for the conclusion which the Court has reached in the preceding paragraph, it is necessary to address seven additional matters.
5. First, the EMC Respondents and Mr Hyde submitted that the amended notice of motion was brought after an unexplained and unsatisfactory delay. The Discharge Judgment was delivered on 25 February 2015. However, the first complaint (being the Bransgroves Letter) was not made until 23 October 2015 and required a response by 30 October 2015, failing which a motion would be filed. However, that motion initiating the present application was not filed until 26 February 2016 - one year and a day after the Discharge Judgment.
6. There is no evidence explaining the delay other than that Bransgroves, Mr Sharkey's current solicitors, were not retained until 8 September 2015. Mr King submitted that "it was legitimately thought that when the matter was reserved, that it wasn't appropriate to bring such an application" (T80:27-29).
7. To the extent those matters may be considered an explanation for the delay in bringing the application, the Court does not accept them for three reasons: 1. It will be recalled that Robb J delivered his judgment in the substantive proceedings on 2 September 2015, being before Bransgroves were retained. It is entirely opaque as to who "legitimately thought" that it was inappropriate to bring the application while his Honour was reserved. In any event, the fact that his Honour was reserved is not a sufficient reason to hold back an application of this seriousness if it was genuinely considered to have a proper foundation. Delay is inimical to such an application for at least three reasons. First, it has a significant public interest component which calls for timely action. Second, in fairness to all concerned such an application should be pressed while the relevant events are fresh in the minds of those involved. The third reason is set out in paragraph [151] below. 2. The explanation ignores the fact that as at the date of the Discharge Judgment (25 February 2015), Robb J had adjourned the substantive proceedings for final submissions to 9 March 2015. That was a significant event in the life of the litigation and Mr Sharkey permitted the EMC Respondents to continue to act for that occasion without complaint. If the present application were to have been made, it could and should have been made between 25 February 2015 and 9 March 2015. 3. All the significant facts and matters relied upon in support of the amended notice of motion were known to Mr Sharkey and his legal advisers as at 25 February 2015. They were all deployed before McDougall J on that day. Mr King, rightly, did not suggest that something new had come to Mr Sharkey's attention since 25 February 2015 about the relevant events that had excited the present application. The same matters that were advanced to persuade McDougall J to discharge his earlier orders have been raised before me, but in the different context of an attempt to characterise the conduct of the EMC Respondents and Mr Hyde in the worst possible light. Given all the relevant facts were known as at 25 February 2016, it is remarkable that if Mr Sharkey and his legal team were so persuaded of the misconduct of the EMC Respondents and Mr Hyde that, in addition to the unopposed indemnity costs order, they did not there and then make an application for the relevant lawyers to be made personally responsible for the costs that had been incurred. McDougall J would have been the best placed judge to have considered such an application insofar as it involved an examination of the conduct of the respondents to the amended notice of motion.
8. Quite apart from the fundamental failure to make out the grounds for the relief sought, the unexplained delay in bringing the present application is an additional factor which militates, albeit not conclusively, against the success of the amended notice of motion. In addition to the matters identified in paragraph [150(1)] above, a third reason why any application such as the present should be brought promptly is that the longer a lawyer remains instructed in a case, the more there is likely to be to hand over and explain to a new lawyer (and hence greater expense incurred by that lawyer's client) if the Court restrains the first lawyer from continuing to act.
9. Second, the allegations made against Mr Doble recorded in paragraphs [99 (3) and (4)] above are rejected. Mr Doble made reasonable and appropriate inquiries by speaking to Mr Eakin (who was a firsthand witness to what Mr Fernon had said in opening) and then reviewing the transcript of the opening himself (see paragraph [29] above). Although Mr Doble's understanding of what Mr Fernon had said was ultimately demonstrated to be in error, the Court is satisfied it was an innocent error. Neither that conduct nor anything else put by Mr Sharkey against Mr Doble (or against Mr Hyde to the extent any such allegation is made against him) meets the "unsatisfactory professional conduct" or "gross negligence" tests which Mr King urged upon the Court.
10. Third, the Court finds there is no basis in the evidence to support Mr Sharkey's submission that the ex parte application before McDougall J was brought for some ulterior or improper purpose. Nor has the allegation recorded in paragraph [93] above (that the respondents lacked the requisite independence and objectivity) been made out.
11. Fourth, Mr Sharkey criticised the scope of Mr Hyde's apology (see paragraph [82] above) and submitted that it was inadequate. The Court rejects that submission. Mr Hyde's apology was entirely proper, was directed precisely to the only matter which required a communication with McDougall J by way of an apology and demonstrated a correct understanding by Mr Hyde of his obligations to the Court and his opponent pursuant to Rule 27 of the NSW Barristers' Rules to correct any misleading statement "as soon as possible after the barrister becomes aware that the statement was misleading".
12. Fifth, an attempt was made during the course of the hearing to criticise Mr Doble for "continued involvement" in the proceedings when his affidavit evidence had indicated that, without admissions, he and his firm had decided that he would have no further involvement in the substantive proceedings. The criticism of Mr Doble was misconceived. It was based on two pieces of correspondence that related to the present application and not the substantive proceedings. It was neither improper nor inappropriate for Mr Doble to engage in that correspondence in relation to this application in which he was intimately involved. It was certainly not inconsistent with his stated position, now confirmed by a notice of change of solicitor (see paragraph [89] above) that he was to have no further involvement with the substantive proceedings.
13. Sixth, having regard to the seventh of the matters summarised by Brereton J in Kallinicos (see paragraph [91] above), Mr Sharkey has not demonstrated any due cause which would displace the public interest in Ms Mayahi-Nissi not being deprived of the lawyers of her choice. She wishes now to retain Ms Shaw as her solicitor for the balance of the substantive proceedings and there is no reason for the Court to interfere with that choice. It seems inevitable that there will also be an appeal (see paragraph [85] above). Nor has any reason been shown why she should not retain Mr Hyde if, in the future, she wished to do so.
14. Seventh, Mr King submitted that because Messrs Eakin and Doble had not called Mr Cook "to demonstrate that he had the same misconceived view as them" in circumstances where Mr King submitted Mr Cook could not possibly have had that view, a Jones v Dunkel inference should be drawn against Messrs Eakin and Doble. That submission is rejected. Mr Cook's view was not in issue before me and, therefore, he is not a witness who the Court would have expected to be called by the EMC Respondents or Mr Sharkey. In the absence of some other evidence that could have supported a finding that Mr Cook did not share Messrs Eakin's and Doble's view of what Mr Fernon had said, what Mr Cook thought or did not think is irrelevant to the determination of how Messrs Eakin and Doble understood matters at the time of the ex parte application to McDougall J.

The EMC Respondents' notice of motion

1. The primary relief sought in this notice of motion: 2. A DECLARATION that the respondent's solicitors' letter dated 23 October 2015 to Eakin McCaffery Cox (the "Letter"), and the respondent's counsel's written submissions dated 30 March 2015 (the "Submissions"), are scandalous, oppressive or both within the meaning of UCPR 4.15. 3. ORDER the Letter and the Submissions be taken off the Court file. 4. ORDER the respondent's Amended Notice of Motion filed on 23 march 2016 be summarily dismissed.
2. In relation to the prayer for summary dismissal of Mr Sharkey's amended notice of motion, the Court is satisfied that application is well founded in the case of those EMC Respondents who had absolutely nothing to do with the relevant events, namely Mr Cox, Mr Stafford and Mr Sarah. At least as an ordinary incident of partnership law, where a firm of solicitors is sought to be restrained from acting by reference to its fiduciary duty to its client or in reliance on confidential information, it is both necessary and correct for the entire partnership to be joined to such an application. However, the present application, properly understood, could only have been directed against those individual officers of the Court about whose conduct complaint was made. Neither the evidence nor the submissions advanced on behalf of Mr Sharkey disclosed any factual or legal basis for relief against those three of the EMC Respondents who played no part in the proceedings before Robb J. They have an entitlement to have the proceedings summarily dismissed as against them.
3. On the other hand, while Messrs Eakin and Doble have also succeeded in resisting Mr Sharkey's amended notice of motion, their involvement in the relevant events meant that they could not have satisfied the very high threshold for summary dismissal of the amended notice of motion against them.
4. Insofar as the relief sought in relation to the Bransgroves Letter and the Submissions is concerned, UCPR Part 4 r 4.15 provides: 4.15 Court's power to deal with scandalous matter in documents (1) If any matter contained in a document on the court file is scandalous, frivolous, vexatious, irrelevant or oppressive, the court may order: (a) that the matter to be struck out of the document, or (b) that the document be placed in a sealed envelope on the court file, or (c) that the document be taken off the court file. (2) A sealed envelope referred to in subrule (1) (b) may not be opened except by order of the court.
5. The Bransgroves Letter commenced: 1. As you know we act for Christopher Sharkey. 2. We have reviewed the first and second judgments in relation to the ex parte order of McDougall J in the NSW Supreme Court and its subsequent discharge and in particular with the conduct of the solicitors and barristers involved in bringing the application. 3. From our review of the judgments and the law it seems clear the conduct amounted to professional misconduct as defined in the Legal Profession Uniform Law which governs the conduct of NSW practitioners.
6. Because Mr King ultimately did not rely on the Bransgroves Letter for the formulation of his case on this application, the Court does not propose to compound the vice in that letter by recording it in any detail. It makes serious allegations against the solicitors and counsel who were involved in the application before McDougall J on behalf of Ms Mayahi-Nissi. However something of its contents must be described, if only so that a reader of these reasons can understand why the Court has determined that the Bransgroves Letter should be sealed. It includes allegations such as "grave misstatement of the law", "recklessness", "professional misconduct", "complete fabrication", "wilful deception" and "connivance".
7. After rereading the Bransgroves Letter several times and allowing the maximum latitude possible in favour of its author, the Court nevertheless concludes that many parts of the letter can fairly be described as hectoring and hyperbolical in their criticisms of the respondents. The Bransgroves Letter does not display the sober and dispassionate examination of the readily available objective facts that the Court would expect to have been undertaken before such serious allegations could be properly made.
8. Mr King's submissions (the "Submissions") are dated 30 March 2016. While more temperate in tone than the Bransgroves Letter, the Submissions nevertheless repeat in terms many of the serious allegations made in the Bransgroves Letter.
9. The fact that Mr King did not ultimately rely on the Bransgroves Letter and the Submissions would not in and of itself be sufficient to grant the relief sought by the EMC Respondents. However, when that is combined with the serious nature of the allegations made in those documents (most of which were not pressed through the Revised List) and the extraordinarily inappropriate tone of the Bransgroves Letter (see paragraph [164] above), the Court is satisfied that those documents meet the description of scandalous or oppressive. But for the possibility that this matter may go further, the Court would have acceded to the application that those documents be removed from the Court file. However, taking that possibility into account, the Court will exercise the power conferred by UCPR Part 4, r 4.15(b) to order that those documents be placed in a sealed envelope in the Court file marked "Not to be opened without further order of the Court".

Conclusions and orders

1. Subject to the following paragraph, the orders of the Court will be: 1. The amended notice of motion filed on 23 March 2016 on behalf of Christopher James Sharkey is dismissed. 2. Christopher James Sharkey pay the respondents' costs of the amended notice of motion referred to in order (1). 3. The copies of the letter from Bransgroves Solicitors to Eakin McCaffery Cox dated 23 October 2015 and the submissions of P.E. King of Counsel dated 30 March 2016 that are on the Court file be placed in a sealed envelope to be retained on the Court file and marked "Not to be opened without further order of the Court". 4. Christopher James Sharkey pay the costs of the applicants on their motion filed in Court on 4 April 2016. 5. The exhibits may be returned to the parties to be held by them in accordance with paragraph 28 of Practice Note SC Gen 18.
2. I have not overlooked that the EMC Respondents sought in their motion that Mr Sharkey pay their costs on the indemnity basis and forthwith and that Mr Hyde also wished to be heard on costs. If any special costs applications are to be pressed, the Court will require further submissions. The Court will hear the parties as to how any such applications should be progressed.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 29 April 2016