Errigal Ltd v Equatorial Mining Limited & 3 Ors [2006] NSWSC 953

Errigal Ltd v Equatorial Mining Limited & 3 Ors [2006] NSWSC 953

Errigal demonstrated a good arguable case that it is entitled to 15% of profits distributed by CCML by whatever means to companies in the Equatorial group, either by proper construction of the agreement or by implied term of good faith. There is a real risk of judgment being unsatisfied due to likely removal of assets from Australia following takeover, justifying the making of a freezing order.

Jurisdiction
Australia
Judgment Date
06 September 2006
Procedural Posture
Equity Commercial Litigation / Interlocutory Applications for Freezing Order, Security for Costs, and Application to Set Aside Notice to Produce
Outcome
Freezing order made against first defendant; security for costs ordered; notice to produce set aside.
Legal Topics
['freezing Orders' 'interpretation of Contracts' 'implied Term of Good Faith' 'security for Costs' 'notice to Produce' 'distribution of Dividends']
['practice and Procedure' 'equity' 'contract'] ['freezing Orders' 'interpretation of Contracts' 'implied Term of Good Faith' 'security for Costs' 'notice to Produce' 'distribution of Dividends']

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 1 Authorities cited 2 Party arguments 2 Amounts and remedies 1
Sign in to unlock

Procedural Posture

Equity Commercial Litigation / Interlocutory Applications for Freezing Order, Security for Costs, and Application to Set Aside Notice to Produce

Legal Issues

  1. 1 ['Whether the plaintiff has a good arguable case for entitlement to 15% of profits/dividends distributed by fourth defendant (CCML) to companies within the corporate group under the 1993 agreement' "Whether the term 'dividend' in the agreement should be interpreted broadly to include distributions by other means" 'Whether an implied term of good faith prohibits the directors of CCML from exercising powers for the purpose of depriving the plaintiff of benefits under the contract' 'Whether a freezing order should be made against the first defendant (EQM) due to danger of dissipation of assets' 'Whether security for costs should be provided by the plaintiff' 'Whether a notice to produce should be set aside']

Ratio Decidendi

Errigal demonstrated a good arguable case that it is entitled to 15% of profits distributed by CCML by whatever means to companies in the Equatorial group, either by proper construction of the agreement or by implied term of good faith. There is a real risk of judgment being unsatisfied due to likely removal of assets from Australia following takeover, justifying the making of a freezing order.

Court Disposition

Freezing order made against first defendant; security for costs ordered; notice to produce set aside.

Orders

  • ['Order restraining first defendant from removing funds from Australian accounts below $A20,500,000' 'Ancillary relief: defendants to disclose financial institution accounts in which at least $A20,500,000 is to be held and to give prior notice of account changes' 'Plaintiff to provide security for costs as agreed'...