CMG Equity Investments Pty Ltd v Australia and New Zealand Banking Group Ltd [2008] FCA 455

CMG Equity Investments Pty Ltd v Australia and New Zealand Banking Group Ltd [2008] FCA 455

The interlocutory injunction was refused because the plaintiffs faced substantial difficulties in establishing rectification and priority over ANZ, ANZ was not shown to have been on notice of the plaintiffs' alleged proprietary rights or guilty of relevant fraud or gross negligence, any loss could be remedied at trial by equivalent shares or equitable compensation, and the plaintiffs did not provide sufficient security in support of their undertaking in damages to protect ANZ against a fall in share value.

Jurisdiction
Australia
Judgment Date
03 April 2008
Procedural Posture
Contract; Practice and Procedure / Application for Interlocutory Relief to Restrain Sale of Shares Pending Trial
Outcome
Application for interlocutory relief dismissed.
Legal Topics
['contract to Lend Shares' 'rectification' 'rights of Innocent Third Parties' 'interlocutory Injunction' 'undertaking in Damages' 'securities Lending' 'equitable Priority']
['contract' 'equity' 'practice and Procedure'] ['contract to Lend Shares' 'rectification' 'rights of Innocent Third Parties' 'interlocutory Injunction' 'undertaking in Damages' 'securities Lending' 'equitable Priority']

Case Brief

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Procedural Posture

Contract; Practice and Procedure / Application for Interlocutory Relief to Restrain Sale of Shares Pending Trial

Legal Issues

  1. 1 ['Whether the plaintiffs had a sufficient case that their Securities Lending and Borrowing Agreement should be rectified so that they retained a beneficial or proprietary interest in shares lent to OP Securities.' 'Whether rectification or any equitable interest claimed by the plaintiffs could prevail against ANZ as an alleged innocent third party purchaser for value without notice.' 'Whether ANZ was put on notice or guilty of gross negligence as to any possible claims over the shares.' 'Whether the plaintiffs would suffer irreparable harm if interlocutory relief were refused.' "Whether the plaintiffs' proposed undertaking in damages, including $1 million security, was sufficient to protect ANZ."]

Ratio Decidendi

The interlocutory injunction was refused because the plaintiffs faced substantial difficulties in establishing rectification and priority over ANZ, ANZ was not shown to have been on notice of the plaintiffs' alleged proprietary rights or guilty of relevant fraud or gross negligence, any loss could be remedied at trial by equivalent shares or equitable compensation, and the plaintiffs did not provide sufficient security in support of their undertaking in damages to protect ANZ against a fall in share value.

Court Disposition

Application for interlocutory relief dismissed.

Orders

  • ['The application for interlocutory relief be dismissed.' "The first respondent's costs be in the cause."]