Metro Chatswood Pty Ltd v CRI Chatswood Pty Ltd (In Liquidation) (Receivers and Managers Appointed) & Ors [2012] NSWCA 49

Metro Chatswood Pty Ltd v CRI Chatswood Pty Ltd (In Liquidation) (Receivers and Managers Appointed) & Ors [2012] NSWCA 49

The balance of convenience favours granting an interlocutory injunction because Metro has an arguable appeal and would suffer real financial and reputational harm if the Guarantee is called prematurely; security provided by Metro sufficiently protects CBA against any prejudice from delayed payment.

Parties
Applicant: Metro Chatswood Pty Ltd; First Respondent: CRI Chatswood Pty Ltd (In Liquidation) (Receivers and Managers Appointed); Second Respondent: Commonwealth Bank of Australia
Jurisdiction
Australia
Judgment Date
22 March 2012
Procedural Posture
Appeal / Interlocutory Application for Injunction Pending Appeal
Outcome
Interlocutory injunction granted pending appeal, with security to be provided by applicant; costs to be in the appeal.
Legal Topics
Interlocutory Injunction, Bank Guarantees, Balance of Convenience, Retail Development Agreement
Civil Procedure Commercial Law Interlocutory Injunction Bank Guarantees Balance of Convenience Retail Development Agreement

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Parties

Metro Chatswood Pty Ltd

Applicant

CRI Chatswood Pty Ltd (In Liquidation) (Receivers and Managers Appointed)

First Respondent

Commonwealth Bank of Australia

Second Respondent

Procedural Posture

Appeal / Interlocutory Application for Injunction Pending Appeal

Legal Issues

  1. 1 Whether an interlocutory injunction should be granted restraining CBA from demanding payment under a bank guarantee pending appeal
  2. 2 Whether the balance of convenience favours granting the injunction
  3. 3 Whether the notations and easements on the certificate of title constitute an 'encumbrance' under the Metro Settlement Deed

Ratio Decidendi

The balance of convenience favours granting an interlocutory injunction because Metro has an arguable appeal and would suffer real financial and reputational harm if the Guarantee is called prematurely; security provided by Metro sufficiently protects CBA against any prejudice from delayed payment.

Court Disposition

Interlocutory injunction granted pending appeal, with security to be provided by applicant; costs to be in the appeal.

Orders

  • Applicant by its counsel giving the usual undertaking as to damages and subject to compliance with security order, second respondent restrained from notifying Suncorp-Metway Ltd to make payment under Bank Guarantee No 6009 until further order.
  • Applicant to provide security for interest loss by paying sums to deposit account nominated by second respondent, calculated as [$15,000,000 x (BBSY + 3.5%)] ÷ 4 by specified dates and to be held in controlled moneys account as per Freehills’ terms.