DGL Mobile Computer Services Pty Ltd v Lichtenstein [2011] FCA 313

DGL Mobile Computer Services Pty Ltd v Lichtenstein [2011] FCA 313

Variation of the undertaking should be granted because the purpose of a freezing order is not to provide security for judgment but to prevent abuse of process, and the payment or provision of security for bona fide and reasonable legal fees is a legitimate expense that should not be prevented by the undertaking.

Jurisdiction
Australia
Judgment Date
01 April 2011
Procedural Posture
Application / Interlocutory Application to Vary Undertaking (freezing Order)
Outcome
Application to vary undertaking (order) granted
Legal Topics
['freezing Orders' 'mareva Injunctions' 'legal Expenses and Undertakings' "breach of Director's Duties" 'misleading and Deceptive Conduct' 'breach of Confidence']
['corporations Law' 'civil Procedure'] ['freezing Orders' 'mareva Injunctions' 'legal Expenses and Undertakings' "breach of Director's Duties" 'misleading and Deceptive Conduct' 'breach of Confidence']

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Procedural Posture

Application / Interlocutory Application to Vary Undertaking (freezing Order)

Legal Issues

  1. 1 ['Whether a freezing order/undertaking should be varied to allow payment or provision of security for bona fide and reasonable legal fees' 'Whether the undertaking given by respondents on 10 December 2010 should be amended as sought']

Ratio Decidendi

Variation of the undertaking should be granted because the purpose of a freezing order is not to provide security for judgment but to prevent abuse of process, and the payment or provision of security for bona fide and reasonable legal fees is a legitimate expense that should not be prevented by the undertaking.

Court Disposition

Application to vary undertaking (order) granted

Orders

  • ['Paragraph F of the Undertaking dated 10 December 2010 is amended to permit dissipation of assets in the ordinary course of business or by payment, or provision of security for the payment, of bona fide and reasonable legal fees in this proceeding.']