'
.. I
Law
Institute
ViCIDPia
LIV
4 70 Bourke Street, Melbourne
Telephone: 9607 9387
Fax: 9607 9558
CONTINUING LEGAL EDUCATION
Advanced Civil Litigation
Update on Mareva Injunctions & Anton
Piller Orders
Monday 17 June, 2002
Presenters:
Kate McMillan, SC
David Forbes
Barrister at Law
Chair:
Ian Lulham
Tolhurst Druce & Emmerson
'
ANTON PILLER ORDERS
By Kate McMillan, SC
THE ORIGINS OF THE ANTON PILLER ORDER
The term "Anton Piller order" is taken from the English Court of Appeal decision
Anton Piller KG v Manufacturing Processes Ltd.
1
In that case, counsel for the
plaintiff outlined the history of "permit" orders for inspection in the United Kingdom
for the previous 18 months. Judges of the Chancery Division had been making
orders that authorised the plaintiff and the plaintiff's solicitors to enter the
defendant's premises to inspect papers provided the defendant gave permission
but with the court ordering the defendant to give that permission. Counsel for the
plaintiff said that so far as it was known there had been seven ex parte applications
to the courts for such "permit" orders for inspection, five of which had been granted
and only one of which had been reported: E.M.I. Ltd v Pandif.
Counsel who
appeared for the appellant in Anton Piller also appeared for the plaintiff in E.M.I. Ltd
vPandit.
In E.M.I. v Pandit Templeman J stated: "The order sought by the plaintiffs appears,
to misuse a current popular phrase, to be Draconian ... I am prepared ... subject to
suitable safeguards, to make an order on the defendant to allow the plaintiffs to
enter on premises in which he is in occupation for the purposes specified by the
plaintiffs. This order will not involve forcible entry but would make the defendant
liable for contempt proceedings if he disobeyed the order ... In the normal course of
events, a defendant will have notice of the relief which is sought against him in the
exercise of the powers given by this rule and will be able to come along to the court
and to give reasons why the order should not be made or why, if it is made,
particular safeguards should be included.
Nevertheless, in my judgment, if it
appears that the object of the plaintiff's litigation will be unfairly and improperly
1
2
[1976] 1 Ch 55
[1975] 1 WLR 302
I
3
ensuring that justice can be done to the applicant. In Anton Piller, Lord Denning
said: "It seems to me that such an order can be made by a judge ex parte but it
should only be made where it is essential that the plaintiff should have inspection
so that justice can be done between the parties: and when, if the defendant were
forewarned, there is a grave danger that vital evidence will be destroyed ... and so
the ends of justice be defeated: and when the inspection would do no real harm to
the defendant or his case."5
In Bhimji v Chatwanl it was said that Anton Piller orders "stand ... at the extremity
of the court's jurisdiction. Some may think that they go beyond it. They involve the
court in the hypocrisy of pretending that the entry and search are carried on
because the owners of the premises have consented to it.
They impose on
plaintiffs solicitors the almost impossible task of describing fairly to non-lawyers the
true effect and nature of the orders. They present respondents with orders of great
complexity and jurisprudential sophistication and give little time for decisions to be
taken as to the response to be made to them. They vest the plaintiffs, one side in
what is usually highly contentious litigation, with the trappings of apparent
administrative authority to carry out the search. The usual presence of a policeman
adds to this illusion."
7
THE PLAINTIFF'S CASE
The essential elements which must be satisfied before an Anton Piller order would
be made are set out in the judgment of Ormrod LJ in Anton Piller: "There are three
essential pre-conditions for the making of such an order ... First, there must be a
strong prima facie case. Secondly, the damage, potential or actual, must be very
serious for the applicant. Thirdly, there must be clear evidence that the defendants
may have in their possession incriminating documents or things, and that there is a
5
Anton Piller supra at p61
[1991]1 AllER 705
7
Ibid at 712
6
5
The Contents of the Affidavit in Support
As a starting point, the contents of the affidavit in support of the application should
satisfy the three essential pre-conditions outlined by Ormrod LJ ie. the material
should set out the facts to support a strong prima facie case, set out the damage to
the applicant and set out the clear evidence that the defendants have the
incriminating documents or things in their possession and the grounds to establish
that there is a real possibility that such material may be destroyed by the
defendants if notice of the orders were given to the defendants. The affidavit of the
applicant should include material facts to satisfy all of the items outlined in the
Practice Notes and a full proposal by the applicant for the execution of the order.
In Brink's-Mat Ltd v Elcombe 12 Ralph Gibson LJ dealt with the principles which
determine whether there has been material non-disclosure in the context of a
Mareva order and the consequences the court would attach to any failure to comply
with the duty to make full and frank disclosure. It is the duty of the applicant to
make disclosure of all material facts being those facts which were material for the
judge to know in dealing with the application. The applicant must make proper
inquiries before making the application and the duty of disclosure applied to
material facts known to the applicant and to any additional facts which could have
been ascertained if reasonable inquiries had been made. The materiality of a fact
was to be decided by the court and not by the applicant or the applicant's legal
advisers.
In Milcap v Coranto 13 Davies J dealt with an application to set aside an Anton Piller
order on the ground of non-disclosure. He said: "When an ex parte order is sought,
the person seeking the order must be frank and disclose to the court all the matters
which, if put before the court, might have an effect upon the court's decision. The
facts that should be disclosed go both to matters of liability and matters of
discretion.
12
13
If a fact is material in that it would be a matter to be taken into account
[1988] 3 AllER 188
(1995) 32 IPR 34
7
(b)
The articles or documents obtained as a result of the order be retained by
the applicant's solicitors in safe custody.
(c)
Not to use any documents or information obtained as a result of the
execution of the order except for the purpose of civil proceedings in
connection with the subject matter of the dispute without leave.
(d)
That the order will be served by a solicitor who is independent of the
applicant and who will offer to the person served an explanation of the order
in plain language.
(e)
That the person served will be given the opportunity to take his or her own
legal advice.
The order usually requires the defendant to permit a stated number of persons to
enter specified premises in normal business hours to inspect relevant documents
and things and remove them to the safe custody of the plaintiffs solicitor.
An
independent solicitor must also be present when the order is being executed.
In Liberty Financial Pty Ltd v Scott 21 Weinberg J made an Anton Piller order against
the defendant and in addition to the normal safeguards contained in Anton Piller
orders it provided for the attendance of two named independent solicitors at the
time the order was executed.
The role of the solicitors was to supervise the
execution of the order and to prepare a written report to be filed with the court. The
order also provided for the preparation by the applicant's solicitors of an inventory
specifying and describing each item to be removed from the premises and it
provided that any documents so removed be delivered into the custody of the
supervising solicitors pending the further hearing of the application for interlocutory
relief.
The requirement that the defendant forthwith admit the plaintiffs solicitor to the
defendant's premises does not if the defendant desires to obtain legal advice mean
21
[2002] FCA 345
9
APPLICATIONS TO SET ASIDE OR DISCHARGE ANTON PILLER ORDERS
Defendants who have been served with an Anton Piller order may seek orders that
the Anton Piller order be set aside and/or discharged and that all documents seized
pursuant to the order be returned to the custody of the defendant or its solicitors.
The basis of such an application is usually on the grounds of material nondisclosure by the applicant when making the ex parte order.
Material non-
disclosure is a matter of fact and depends on the circumstances of each case.
In Thennax Limited v Schott Industrial Glass Limitecf 5 an application was made to
set aside an Anton Piller order in circumstances where material facts known to the
plaintiff had not been made known to the judge who granted the order.
His
Lordship Browne-Wilkinson J said: "... As time goes on and the granting of Anton
Piller orders becomes more and more frequent, there is a tendency to forget how
serious an intervention they are in the privacy and rights of defendants ... In my
judgment the rule of full disclosure to the court is almost more important in Anton
Piller cases than in other ex parte applications."
In Dart Industries Inc v David Bryar
27
26
Goldberg J dealt with an application to
discharge an Anton Piller order based upon alleged non-disclosure. His Honour
agreed with the views of Ralph Gibson LJ in Brinks and also to the tentative view
expressed by Browne-Wilkinson VC in Tate Access Floors Inc v Boswell
28
that
investigations of the circumstances in which an ex parte Anton Piller order was
granted should be restricted to the cases where there had been a serious failure to
make a material disclosure.
25
[1981] FSR 289.
Ibid at p298
27
(1997) FCA 481 (10 April1997)
28
(1999] Ch 512 at 534
26
II
Anton Piller order" 32 but this appears to be restricted, save for one or two forms of
rolling orders, to Canada.
In Fila Canada Inc v Doe
33
Reed J described the order as follows:
"The order, which is sought, is what is known as a "rolling" Anton Piller order. As is
obvious from the style of cause, when these orders are obtained from the Court
neither the identity or address of the persons against whom they will be executed
are known. On some occasions one or two persons may be identified as named
defendants but they will have no necessary connection to the Jane and John Does
against whom the order will be executed. The known defendants are allegedly
infringing intellectual property rights belonging to the plaintiff but in different places,
at different times and in different circumstances.
The "rolling" orders can be
distinguished from defendant-specific Anton Piller orders. While defendant-specific
Anton Piller orders may also include Jane and John Doe defendants, in general, the
latter will be connected to named defendants, for example, by being an employee
of the defendant or supplier of the alleged counterfeit goods of the defendant. The
"rolling" orders are executed against street vendors and transient flea markets
although they are framed in broad enough terms to encompass the search of retail
premises, office premises, vehicles, warehouses, as well as residences. They are
usually expressed to last a year subject to being renewed."
The rolling Anton Piller order does not sit easily with the classic Ormrod LJ criteria
for granting the order. The first pre-condition of demonstrating a strong prima facie
case can be met by pointing to the existence of the applicant's registered copyright,
trademark or patent and by setting out specific examples of infringement. The fact
that specific examples do not specify a particular defendant has not been
commented upon. The second pre-condition of proof of potential or actual damage
being very serious for the applicant can be met by the fact that the continued
presence of the infringing material in the market place will threaten the trade
32
For information regarding rolling Anton Piller orders I am indebted to J Berryman for his article
"Recent Developments in Anton Piller Orders" supra
13
venues." The terms of the statement of claim do not appear. An injunction was
granted restraining pending the determination of the action or further order "the
second defendants" and "the third defendants" (in the plural) respectively from
selling merchandise without the licence of Metallica or McCartney. Upon service on
them of a copy of the order by the plaintiffs solicitor, those defendants were
required to state their name and place of abode and deliver up the offending
merchandise. The injunction identified those to whom it was directed by reference
to their acts which infringed the plaintiffs rights, and it prohibited the performance of
those acts. The Metallica order (as the judge making it thought it might come to be
known) thus had the novel feature- which would have appealed to Lewis Carrollthat it became binding upon a person only because that person was already in
breach of it. The order of Anderson J. was, as we have said, directed to the world
at large.
The existing Jaw and procedure may be inadequate to deal with the
reprehensible activities of these intellectual bootleggers, but, with respect, we
cannot accept that an injunction can be granted against all the world ... At p188 of
the judgment it is said that on 16 March 1993 the plaintiff had obtained an
essentially similar order from the Federal Court of Australia.
The unreported
decision of the Federal Court mentioned by Anderson J is evidently that of Burchett
J., given in fact on 26 March 1993 in Tony Blain Pty Ltd v Jamison ... The order
there made was, first, a representative order that the defendant, one Jamison,
represent a group of persons (how the group was defined by the order does not
appear) and, secondly, an order for the delivery up of the infringing merchandise.
There seem to have been defendants other than Jamison; their identity or
description does not appear. It seems that no prohibitory injunction was granted."36
The reference by the Court of Appeal to Tony Blain Pty Ltd v Jamison
reference to a type of rolling order.
37
is a
The Federal Court case appears to have
decided that the named defendants were representatives of the wider class.
However, the plaintiff was allowed to seize the infringing merchandise and was
35
36
[1998) 4 VR 143
1bid at pp.160-1
15
CONCLUSION
Bearing in mind the strong criticism by the Court of Appeal in Victoria in the
Maritime Union case it seems reasonably safe to predict that the rolling Anton Piller
orders that are a feature in Canada will not become a feature in Victoria.
1'1-JU~I-2002
11:57
FROI1
TO
C 11CMILLAII
096079451
V 1 c_ iOQtA
PRACllCE NOlES
[12,680!
If only one Master is available, that Master will also bear in Cou
o 1 (subject
to other business pending) applications of the type ideoti1ied
the foUowing
paragraphs of Part B of the principal Practice Note: (b) (if the
neys held by the
Senior Master are held under the Trustee Act· 1958 other th for a person under
disability); (f) (as if "order" were substituted for "certificate ; (g); (h); (i); (j); (k);
(m); and (o).
applications in Court 7,
If another Master is available, that Master will hear s
Court 7A, or Court No 2, first floor, 471 Little Bourke eet, Melbourne. The place
of hearing will be specified in the summons (if. an but, to allow for subsequent
alterjltion due to inteJVeoiog circumstances, the w
of the day fixed for the
bearing should always be consulted.
Henceforth, summonses with respect t applications referred to in the
penultimate paragraph are to be filed with, 1f there is oo summons, a date for the
hearing of such au application is to be ob 'ned from, tho second secretary to the
Senior Master.
Applications for approval of a comP, mise in relation to a claim by or on behalf
of or against a person under disab' · will cooti!lue to be beard by a Master aod
arrangements for the bearing of ch an application may be made through the
se<:ood secretary to the Senior
ter>
Applications for the ap otmcot of a. provisional liquidator and other
applications to Master und the Corporations La\V (other than those referred to
in paragraph (f) and (g) of
B of the principal Practice Note) are to be made in
the 7th Court on a
edn""day, Thursday .. or . Friday. Unless extraordinary
circumstances obtain, e summons with respect to any sucb application is to be
referred in the first · stance to the. principal secretary to the Senior Master.
wt
a
Masters assisting e. aTIIJ/hLr
Wbere with espect to an application under tbis Practice Note to be heard by
Masters B
, Gaffney and Kings,. either Master Evans or Master Wheeler is
will accept a reference Crom any of the former witb·respect to such an
applicat' which the latter cannot hear as conveniently. Similarly, when any of tbe
former s available, he or she will accept references of applications from the Master
sitti in the Masters' Practice Court.
25' August 1993
/
.----··
KJ Mahony
Senior Master
.
[12,680)
Urgent ex parte applications
Practice Note '[1994] 1 VR 86
The Chief Justice has approved the issue of the foUowing Practice Note:
No 4 or 1993
Urgent ex pane applications
"f-
It is thought that it may be useful to publish for the information of the profession
a Practice Note setting out some of tbe matters that may fail to be considered when
an application is made ex parte Cor urgent interim relief. ·
0 Butkrworths
25,155
1'/-JUN-~I:ll:l;e
11:57
FR011
C MCMILLAN
320
[1984) V.R.
SUPREME COURT OF VICTORIA
PRACTICE NOTE
5
Practice and procedure - Urgent applications arter rise of court.
The Chief Justice has authorized the issue of the following Practice
Note:URGENT APPLICATIONS
It sometimes occurs that a very urgent application has to be made to a
Judge in Chambers after the Court has risen for the day.
There appears to be some misunderstanding in the profession as to the
proper method of arranging an appointment with a Judge in such
circumstances. The following procedure should be strictly followed:
Any practitioner having a very urgent application after the hour at which
the Judges sitting in the Practice Court have risen for the day may
telephone the associate to the junior Practice Court Judge for the purpose
of enquiring whether that Judge is able to hear the application. If the junior
Judge is unable to arrange to hear the application, the practitioner may
telephone the associate to the senior Practice Court Judge. If neither
associate can be reached by telephone, the practitioner may telephone the
senior associate to the Chief Justice.
The names and after hours telephone numbers of the associates to the
Practice Court Judges will, in future, be published in the monthly allocation
of Judges issued by the Court.
10
15
20
25
30
35
40
45
sc
572
SUPREME COURT
44 NSWLR 545)
[(1998)
For the reasons which I have set out above, l would propose that the
following orders be made:
(I) ORDER that order 2 made by Bryson J on 2 September 1997 be
discharged.
(2) IN (..lEU THEREOF ORDER that the appellant, within two months of this day,
pay to the registrar of the Court of Appeal a fine in the sum of $15,000.
(3) ORDER that the appeal otherwise be dismissed.
(4) MAKE NO ORDER as to the costs of any party to the proceedings.
A
A
B
B
c
c
APPENDIX*
MOTION 07.PMF- ANTON PILLER ORDER
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
MR JUSTICE
IN THE MA TIER OF AN INTENDED ACTION
BETWEEN
Intended Plaintiff
(2) where O'-'
disputed,
behalf of
undcrtakir
produce tl
(3) save a-' rr
all docurr
IT IS ORDER
I. THAT
self/hers<
appeann1
person s
duly autl
number
ad van tag
forth will
mention•
premise~
and
Intended Defendant
UPON MOTION made by counsel for the Intended Plaintiff (hereinafter called
"the Plaintiff")
AND UPON READING the documents recorded on the Court file as having
been read
AND the Plaintiff by counsel undenaking:
(I) forthwith to issue a writ of summons claiming relief similar to or
connected with that hereioafter granted;
(2) to make and file an affidavit verifying what was alleged by counsel
substantially in the terms of the draft affidavit of;
(3) as soon as practicable to serve upon the Intended Defendant(s) (hereinafter
called "the Defendant(s)") a copy of such affidavit and the exhibits
capable of being copied and a notice of motion for
19_ _ ;
(4) to serve on the Defendant(s) forthwith after the Plaintiff's solicitors
receive the same a copy of a written report on the carrying out of this
Order which shall be prepared by the supervising solicitor mentioned
below;
(5) to bring such motion before the Court on the said date and on that
occasion to place before the Court the written repon of the supervising
solicitor;
(6) to obey any Order this Court may make as to damages if it shall consider
that the Defendant(s) has/have sustained any damages because of this
Order which the Plaintiff ought to pay,
AND the solicitors for the Plaintiff by counsel for the Plaintiff (beiog their
counsel for this purpose) undertaking:
(l) to return the originals of all documents obtained as a result of this Order
within two working days of their removal;
• [&rrotu,.u. Nom ~ roolnole u SRI
.,
D
D
2.
(I)
(2)
(3)
F
[(4)
premise'
Defendo
and deli
and arti
herein
solicitoi
PROVI
This 01
(
approv<
being r•
Before
superv1
Order i
such p<
provid<
Save tc
be rem
and a
Order,
same.
Save t
search
an off
suitab~
0
3. THA1
(I) the "'
posse>
(2) to the
(a)
tl
l•
u- J ur-~- <'llllc'
11 : 53
FROI1
C MC11 I LLRrj
TO
096079451
•
(b)
4.
5.
6.
T
((19911)
SUPREME COURT
574
the names and addresses of all persons to whom he/she/it/they
has/have supplied or offered to supply any specified items; and
(c) full details of the dates and quantities of each offer to supply and
supply referred to in (a) and (b) above.
THAT the Defendant(s) do forthwith deliver to the Plaintiff's solicitors all
specified items in his/her/its/their possession custody or power.
THAT if any such. item exists in computer readable form only, the
Dcfcndant(s) shall cause it forthwith to be printed out and shall deliver the
print out to the Plaintiff's solicitors or (failing a printer) shall cause it
forthwith to be displayed to the Plaintiff's solicitors in a readable form.
A
4-l NSWLR]
A
F<
B
B
Practice "
Verifi,
IT IS FURTHER ORDERED:
(I) That the Dcfcndant(s) (and each of them) be restrained until after
_ _ _ _ J9_ _ or further Order in the meantime from (in the case of
the (first) Defendant whether itself or by its officers or employees or
agents or otherwise howsoever and as regards the (second) Defendant
whether himself/herself or by his/her employees or agents or otherwise
howsoever) directly or indirectly informing any person company or firm of
the existence of these proceedings or of the provisions of this Order or
otherwise warning any person company or firm that proceedings may be
brought against him/her/it/them by the Plaintiff(s) otherwise than for the
purpose of such Defendant obtaining legal advice from his/her/its/their
lawyers_
(2) That the Defendant(s) (and each of them) be likewise restrained until after
_ _ _ _ J9_ _ or further Order in the meantime from doing the
following acts or any of them:
(a)
(b)
7. THE Dcfcndant(s) is/are to be at liberty to apply to discharge or vary this
Order upon giving to the solicitors for the Plaintiff [
) hours notice of
his/her/its/their intention to do so.
to be
au tom
1970,
c
The
Rule"
re\evat
ti
D
D
ti
"01
c
HeJ,
word
inslruc
(2)
plaint I
E
THE SCHEDULE
The premises
The specified items
c
E
acted
purpo<
Not.
AC
Orders as ar 572A
CASES Ct
Solicitors for the appellant: Colin Biggers & Paisley.
No cases
Solicitors for the respondent: McCabes.
F
F
Solicitor for the Attorney-General: I V Knight (Crown Solicitor).
No addirr
MOTIO~
A dcfec
BAGRAY,
proper ver
Barrister.
PM We
J R Dur
G
G
7 Septet
BRYSC
applies in
•
Law Institute of Victoria.
Advanced Civil Litigation Seminar Series 2002.
Update on Mareva and Anton Piller Orders.
Monday 17 June 2002.
Mareva Orders
David T. Forbes, Victorian Bar
1.
What is a Mareva Order?
If you look up the term "Mareva Order" in Butterworths Australian Legal
Dictionary (1997 ed), you will search in vain. What you will find is a
reference to "Mareva Injunction". But that term and the title of the seminar
tonight are no longer legally correct. In Cardile v LEO Builders [1999] 198
CLR 380, Gaudron, McHugh, Gummow and Callinan stated (at [25]):
As the argument proceeded upon the grounds of appeal to which we
have referred, several matters became apparent. One was that the
English authorities appear to have developed to a stage where what is
identified as the Mareva injunction or order Jacks any firm doctrinal
foundation and is best regarded as some special exception to the
general Jaw. Another was that, whilst it is undesirable that asset
preservation orders of the Mareva variety be left as a sui generis
remedy with no doctrinal roots, the term "injunction" is an inappropriate
identification of that area of legal discourse within which the Mareva
order is to be placed.
At [42], their Honours stated:
to avoid confusion as to its doctrinal basis, it is preferable that
references to "Mareva orders" be substituted for "injunctions".
Despite this change in nomenclature, it is common to see subsequent
cases still using the outdated terminology and the incorrect methodology.
(See e.g. the decision of Warren J. in Liquor/and (Aust) Pty Ltd & Anor v
Anghie & Ors (2002) 20 ACLC 58, [2001] VSC 362 (2 October 2001).
So what is a Mareva Order? Shortly stated, it is an order by a Court or
Tribunal that restrains a named person or persons from dissipating or
dealing with assets or other things that might be required to satisfy a
judgement.
The term "Mareva" of course derives from the decision of the United
Kingdom Court of Appeal in Mareva Campania Naviera SA v International
In Patrick Stevedores Operations No 2 Ply Ltd v Maritime Union of
Australia [No 3], in their joint judgment, Brennan CJ, McHugh,
Gummow, Kirby and Hayne JJ said[64]:
"Interlocutory relief
The powers of the Federal Court under s 23 of its Act are powers
'to make orders of such kinds, including interlocutory orders, as it
"thinks appropriate"', as Deane J noted in Jackson v Sterling
Industries Ll~. He added:
The general principle which informs the exercise of the
power to grant interlocutory relief is that the court may make
such orders, at least against the parties to the proceeding
against whom final relief might be granted, as are needed to
ensure the effective exercise of the jurisdiction invokedll!J.
The Federal Court had jurisdiction to make interlocutory
orders to prevent frustration of its process in the present
proceeding."
Subject to two matters to which we shall come, this passage should
be accepted as a correct statement of principle. The first matter is
that, in that passage, the attention of the Court was directed to
orders against parties to the proceedings and against whom final
relief was sought. In that situation, the focus is the frustration of the
court's process. If relief is available against non-parties, the focus
must be the administration of justice. The second matter is that, to
avoid confusion as to its doctrinal basis, it is preferable that
references to "Mareva orders" be substituted for "injunctions".
In ABC v Lenah Game Meats (2001) 185 ALR 1, the High Court repeated
this approach (at [94]):
Likewise it was emphasised in the joint judgments in Patrick
Stevedores Operations No 2 Ply Ltd v Maritime Union of Australia [75]
and in Cardile v LED Builders Ply Ltd L.Z§] that the doctrinal basis of
the Mareva order is to be found in the power of the court to prevent the
frustration of its process. In Cardile [77], the point was emphasised by
the statement that to avoid confusion as to its doctrinal basis it is
3.
Who has power to grant Mareva orders?
a)
The Supreme Court.
S. 37 of the Supreme Court Act provides:
(1)
The Court may by order, whether interlocutory or final,
grant an injunction or appoint a receiver if it is just and
convenient to do so.
(2)
An order made under sub-section (1) may be made
either unconditionally or on such terms and conditions
as the Court thinks just.
(3)
The Court may grant an interlocutory injunction under
sub-section (1) restraining a party to a proceeding
from removing from Victoria or otherwise dealing with
assets located within Victoria, whether or not that
party is domiciled, resident or present within Victoria.
Given that Mareva Orders are no longer to be regarded as "injunctions", s.
37 may no longer serve as a sufficient basis for the Supreme Court'
power. However such a point is only academic because the Supreme
Court has undefined inherent jurisdiction. This extends to making of
Mareva Orders: National Australia Bank Ltd v Dessau [1988] VR 521. This
flows from its responsibility for the administration of justice in the state:
Grassby v The Queen [1989] 169 CLR 1 per Dawson J. Since
administration of justice is the sine qua non of the Mareva Order, power to
make such an order is an incident of the Court's inherent power.
b)
The Federal Court.
s. 23 of the Federal Court Act provides:
The Court has power, in relation to matters in which it has jurisdiction,
to make orders of such kinds, including interlocutory orders, and to
d)
The Family Court.
Removal of a child from Australian jurisdiction is as likely to frustrate the
process of the Family Court as is dissipation of assets in a claim for damges
or property. Although the Family Court is likely to have sufficient implied
power to grant a Mareva order, reliance can be placed on s. 68B of the
Family Law Act to obtain an injunction that is appropriate for the welfare of
the child. Similarly, s. 114 of the Family Law Act provides for injunctions in
relation to property of a party to the marriage. Again, if reliance on the term
"injunction" proves problematic in light of Cardile, recourse may be had to
the Court's implied powers.
e)
The County Court and Magistrates' Court.
S. 31 of the Supreme Court Act provides:
Every inferior court which has jurisdiction in equity or at law and in
equity(a)
has as regards all causes of action within its jurisdiction,
power to grant in any proceedings before that court such relief,
redress or remedy or combination of remedies, either absolute or
conditional, as the Court has power to grant in the like case; and
(b)
subject to section 32, in any proceedings before it may give
effect to every ground of defence or counter-claim, equitable or
legal, in as full and ample a manner as the Court might give in the
like case.
The County Court also has power under s. 49 of the County Court Act to
make any order that may be made by the Supreme Court in any civil
proceeding. The Magistrates' Court has power under s. 100 (1) (b) to
determine any claim for equitable relief within its jurisdictional limit.
In any event, the County and Magistrates' Court would most likely possess
the relevant power as an incident of their implied (as distinct from inherent)
very odd because s. 80 relates to the giving of directions and s. 97 states
the Tribunal must act fairly and in accordance with the substantial merits of
the case.
More comfort may be had from Jacques Nominees Ply Ltd v National
Mutual Trustees Ply Ltd [2000] VCAT 2009 (30 September 2000) where
Deputy President Macnamara held that under s. 123 the Tribunal had
power to make an Anton Piller order and noted that the learning in Cardile v
LED Builders applied as much to Anton Pillar orders as it does to Mareva
Orders.
The argument as to implied powers of Courts is probably as applicable to
the VCAT as it is to statutory Courts such as the County and Magistrates'
Courts.
4.
At what point should a Mareva Order be sought?
a)
General circumstances.
As the juridical basis of the Mareva Order is to prevent frustration of the
Court's process, the order should only be sought where there is a risk of
any act that will render a judgement worthless or at least worth less than its
face value. Care must be taken to distinguish dissipation of assets from
transformation. The fact that a defendant is selling an asset does not
indicate dissipation. Assuming the sale is for full value, the defendant's
assets will not be any less after the sale. What a sale may indicate however
is transformation into a liquid form to facilitate dissipation. If there is
evidence of that, an order may lie not to restrain the sale, but to restrain the
application of the proceeds.
..
.
iv)
The evidence will not disclose a sufficient risk of judgement being
frustrated;
v)
Any order obtained will be set aside and the undertaking as to
damages called upon.
In cases where the dissipation of assets is imminent, it is possible to
obtain an order even without papers. This can be done by contacting the
associate to the relevant Practice Court judge and making a time for an
urgent application. In these circumstances, the person with knowledge of
the imminent dissipation should give evidence orally and oral evidence
should also be given as to the underlying cause of action. As well as the
usual undertaking as to damages, an undertaking will be required to
institute proceedings within a fairly short time frame, usually a day or two.
5.
Pre-requisites to obtaining Mareva relief.
a)
If applying ex parte, full disclosure of all material
facts is required.
Any application made ex parte carries a corresponding obligation to
disclose all material facts, especially those which incline against the
applicant's case. Failure to do so provides grounds for dissolving the
original order: Thomas A Edison Ltd v Bullock (1912) 15 CLR 679. In
Westpac Banking Corporation v Hilliard [2001] VSC 187 and 198, the bank
failed to disclose material information on an ex parte application. The order
was later discharged and the Bank ordered to pay costs on a solicitor client
basis.
In practical terms, the obligation of complete disclosure means an applicant
for a Mareva Order must disclose any fact or material which:
4
•
'
•
c)
Likelihood of defendant dissipating asset?
A Mareva order requires that the plaintiff must establish a real risk of assets
being disposed of: Kirby J in Cardile v LED Builders at [122]. There must be
a danger of assets being removed or disposed of: Construction Engineering
(Aust) Ply Ltd v Tambel (Australasia) Ply Ltd [1984]1 NSWLR 274 at 279.
However, the danger of asset dissipation is not enough. The dissipation
must be such that it is likely any judgement will go unsatisfied: Glenwood
Management Group Ply Ltd v Mayo (at 54). Where the cause of action itself
(and the supporting affidavits) show illegal conduct, equitable fraud or other
serious wrongdoing, that can be enough for a Court to infer a real risk of
dissipation: Patterson v BTR Engineering (Aust) Ltd 1989 18 NSWLR 319
at 325-326. See also Pearce v Waterhouse [1986] VR 603.
d)
Undertaking as to damages;
In Cardile, Kiby J stated that Mareva relief should not be contemplated
without the provision of an undertaking as to damages (at [122]). If the
application is made ex parte, the Court is obliged to require, and the
applicant obliged to offer, an undertaking as to damages. If no undertaking
is given, the order will be set aside: National Australia Bank Ltd v Bond
Brewing Holdings Ltd (1990) 169 CLR 271 at 277.
e)
Balance of convenience?
The balance of convenience test is imposed when a traditional interlocutory
injunction is sought. The re-categorisation of Mareva orders as noninjunctive suggests that this test is no longer relevant to the grant of Mareva
Orders. If there is a good arguable case and a likelihood of the Court's
judgement being frustrated it is difficult to see how the balance of
convenience may lie against the grant of an order. However, the grant of a
Mareva Order is still very much a matter of discretion so the balance of
'
'
.
defendant: Cardile v LED Builders. An example of this is where a non-party
has received an unfair preference from the debtor.
7.
Can a Mareva Order be made against property
out of the Court's jurisdiction?
Where a defendant carries on business and has assets in a foreign
jurisdiction where enforcement is possible under a reciprocal regime for
registration of judgments, Mareva relief may not be appropriate: Reches Ply
Ltd v Tadiran Ltd (1998) 85 FCR 514; (1998) 155 ALR 478.
In the federal and NSW jurisdictions, the defendant may properly be
restrained from dealing with assets outside of the jurisdiction: OCT v Hickey
& Horne (1996) 96 ATC 4892; (1996) 33 ATR 453, Ballabil Holdings Ply Ltd
v Hospital Products Ltd (1985) 1 NSWLR 115 (NSWCA). However,
Victorian judges have decided alternately to follow and not follow the NSW
Court of Appeal decision in Ballabil Holdings - See National Australia Bank
Ltd v Dessau [1988] VR 521 and Brereton v Milstein [1988] VR 508
respectively.
8.
How to apply for a Mareva Order.
This paper has already touched on procedure for very urgent applications.
In other cases you should use the days that are available to have the
following documents drawn:
a) originating process and statement of claim;
b) summons or application to bring the matter before the Court;
c) affidavit material setting out material facts which are fundamental to the
cause of action (including unhelpful matters where applying ex parle);
The usual way this is done to include a precise weekly maximum amount in the
order which the defendant may use for these purposes.
Where a defendant's assets are unknown, a Mareva Order may also include an
order that the defendant make an affidavit disclosing the full extent of his assets.
Because the circumstances of each case will differ, slavish adherence to
precedents is to be avoided for Mareva orders.
10. How to oppose or dissolve a Mareva Order.
If you act for a defendant or non-party to a Mareva Order you first need to ask
whether the client wants the order set aside (see "Risks" section below). If so,
you should assess to what extent the plaintiff has adhered to the requirements
already set out in this paper. For example, if the order has been obtained ex
parte without disclosure of material facts known to the plaintiff, you are already in
a strong position to have the order dissolved.
Usually Mareva Orders are made "until further order" or some specified date.
This means application can be made to dissolve them without constituting an
appeal. If an appeal is made, leave would be required. (For the distinction
between a final and interlocutory order, see Little v State of Victoria [1998] 4 VR
596).
When you are instructed to oppose an application, you should file affidavit
material which shows the criteria referred to above have not been met. If you are
instructed to make application to dissolve a Mareva Order, a summons,
application or notice of motion should be issued which identifies the precise order
made and states the precise terms of an order dissolving or modifying the
original order.
:.
. ,
'·
manner which is deliberate or reckless, exemplary damages may be
awarded: Griffiths & Griffiths v Lawrence (1996) 186 LSJS 405.
12. Other Risks of applying for or opposing Mareva
Orders.
Applying for, opposing, or applying to discharge a Mareva order requires relevant
persons to give evidence on oath as to the circumstances giving rise to the
underlying cause of action and the defendant's financial position. The risk
involved in this is that the same persons may give evidence at trial which is
inconsistent with the claim or defence. The risk is higher for a plaintiff. Because a
Mareva order is often sought as a matter of urgency, evidence may be given
which after due investigation turns out to be false, incomplete or simply
damaging to the underlying claim. For practitioners this means 2 things. First,
great care should be taken to verify instructions and ensure that all material
placed before the Court is completely accurate. Second, the client should be
warned beforehand of the risks involved, including being called upon to make
good the undertaking as to damages.
References:
Lewitan QC, "Mareva Injunctions" LIV, Advanced Civil Litgation Seminar 20 July
1998.
Sullivan QC, Mareva Injunctions - Preparation and Conduct of Applications for
(and Opposition to) a Mareva Injunction, Australian Bar Review (Further details
unknown).
The author gratefully acknowledge the assistance of Mr Paul Hayes of the
Victorian Bar.