Woodley v. Woodley

Australia

22.08.2019

Property

A freezing order should not be made unless risk of dissipation is established

The Applicants are the brother and sister-in-law of the late Terry Ray Woodley (the deceased). They are also creditors of his estate. The first Respondent is the widow of the deceased and the executrix of the deceased's will. The Applicants applied for a freezing order restraining the first Respondent from dealing with four properties that form part of the estate without the applicants' written consent.

It is not sufficient for the Court to conclude that, one or more of the events described in Order 52A Rule 5(4)(a) or (b) of Rules of the Supreme Court, 1971 might occur. The court must be satisfied that the identified danger (that the prospective judgment will be unsatisfied) arises because one or more of those events might occur. The court must be satisfied that there is a causal connection between the event and the danger. The risk or danger must be real or substantial, as opposed to a remote, speculative or a theoretical possibility. The applicant must prove facts from which the Court can infer the existence of a real or substantial risk or danger that the respondent will dispose of or otherwise deal with its assets in a way such that the applicant will not be able to satisfy any judgment obtained against the respondent.

The facts from which the risk or danger is to be inferred must be proved on the balance of probabilities. The fact that assets within the jurisdiction are moveable, and that the Respondent is incorporated outside the jurisdiction is not enough to warrant an inferential finding of danger of dissipation. No matter how strong the applicant's claim appears to be and how inconsequential the prejudice to the respondent by the ordering of security, a freezing order should not be made unless the risk of dissipation is established.

Present Court is not satisfied that, a risk of dissipation may be inferred from the facts. Over the past eight years the first Respondent has established a life in Western Australia. This is her children's home and it is her home. The first Respondent's life has been disrupted by the death of the deceased. It is a very sad event but not one that has destroyed the prospect of a happy life for the first Respondent and her children in Western Australia. The applicants' submissions underestimate the difficulties that would be involved in the first Respondent 'absconding' from Western Australia with two young children and establishing a new life in Russia. Reduced to its essence the premise upon which there is a risk of dissipation involves three matters: the first respondent is from Russia; assets in Russia are beyond the reach of the Court's enforcement processes; and the darker side of human nature. A risk of dissipation cannot be inferred from the facts in this case.

There is no evidence of any dishonesty or subterfuge on the first Respondent's part and no evidence that, she is not dealing with the Estate in an entirely proper manner. The applicants are owed a substantial sum of money by the estate and although their concern (no doubt heightened by years of stressful litigation) to ensure that, they are paid is readily understandable, they have not established that they are entitled to the drastic remedy of a freezing order.

Tags : Freezing order Remedy Entitlement

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