COMSERV (NO 210) PTY LTD v Robert Ristevski

This judgment concerns the plaintiff’s application for an order under s 74K of the Real Property Act 1900 (NSW) extending until further order the operation of its caveat lodged against the title to the property that is the subject of these proceedings or, alternatively, an interim injunction restraining the defendant from dealing with that property.

For the reasons that follow, both applications are dismissed.

The plaintiff lodged the caveat on 9 March 2022 against the title to property in certificate of title folio identifier 20/230019, known as 57 Grose Vale Road, North Richmond, New South Wales (the Property). The defendant to these proceedings is the registered proprietor of the Property. The caveat is identified by the number AR945008 (the Caveat).

The estate or interest claimed by the plaintiff in the Caveat is described as an “Estate in Fee Simple” arising by virtue of “Beneficial Interest in Trust”. The following details are set out in support of the claim:

These proceedings were commenced on 15 March 2022.

The plaintiff sues in its capacity as the trustee of the Delkou Family Trust.

The plaintiff alleges that it entered into an agreement with the defendant in 2016 to participate in a joint venture or endeavour pursuant to which the existing dwelling on the Property would be demolished and three townhouses would be constructed, the plaintiff would pay for the demolition, construction and other costs of the joint venture, the three townhouses would be sold, and each of the plaintiff and the defendant would be repaid their financial contributions to the joint venture and the net profit would be divided equally between them. The agreement is said to have been partly oral (comprising conversations between the defendant and Mr Van Delkou, who was then a director of the plaintiff but is now deceased) and partly implied.

The plaintiff also relies on an alleged oral representation by the defendant to Mr Van Delkou in 2017 to the effect that, if the plaintiff paid for the demolition, construction and other costs of the joint venture, then the plaintiff would receive repayment of those costs and would also be entitled to 50 per cent of the net profit from the joint venture.

The plaintiff claims to have paid demolition, construction and other costs totalling $1,275,637.63 during the period from 16 December 2016 to 11 February 2021 (the relevant period) in accordance with the alleged joint venture agreement or alternatively in reliance on the alleged representation.

The plaintiff alleges that the defendant has:

On the basis of the matters summarised at [7]-[10] above, the plaintiff pleads that:

The plaintiff alleges that the defendant has acted contrary to the common intention or the alternate common intention in denying that the plaintiff has any interest in the Property and in denying that the plaintiff is entitled to repayment of the demolition, construction and other costs paid and to 50 per cent of the net profit. The plaintiff pleads that this is unconscionable because the plaintiff has lost, or will lose, its interest in the Property or 50 per cent of the sale proceeds and the value of its alleged financial contributions (being the value of the demolition, construction and other costs that the plaintiff claims to have paid).

The plaintiff further pleads that it is unconscionable for the defendant to retain the benefit of the plaintiff’s interest in the Property and the value of the plaintiff’s financial contributions in circumstances where the parties’ relationship has broken down and the plaintiff never intended that the defendant would be entitled to retain the benefit of the plaintiff’s interest and financial contributions.

On the basis of the matters referred to at [12]-[13] above, the plaintiff seeks relief in the form of a declaration that the defendant holds his interest in the Property subject to a constructive trust in favour of the plaintiff as to 50 per cent or in such other proportion as the Court determines. Alternatively, and in the event that the Property is sold, the plaintiff is seeking a declaration that the defendant holds his interest in the sale proceeds (after discharge of the registered mortgage and paying of selling costs) subject to a constructive or express trust in favour of the plaintiff as to 50 per cent or in such other proportion as the Court determines.

Further or alternatively, the plaintiff claims that in the circumstances summarised at [7]-[10] above the value of the plaintiffs’ financial contributions is money had and received by the defendant to the use of the plaintiff and the plaintiff is entitled to an equitable charge or lien over the Property to secure the value of those financial contributions, together with interest and costs. The plaintiff seeks a declaration to that effect. Alternatively, and in the event that the Property is sold, the plaintiff seeks a declaration to the effect that it is entitled to an equitable charge or equitable lien in respect of the sale proceeds (after discharge of the registered mortgage and paying of selling costs) to secure the financial contributions, together with interest and costs.

Finally, the plaintiff makes an alternative claim for damages for breach of the alleged agreement.

In his defence filed on 5 May 2022, the defendant denies entering into the alleged joint venture agreement and making the alleged representation referred to at [7] and [8] above. The defendant pleads that he entered into an oral agreement with Mr Van Delkou on terms that he would lend monies to the defendant, the defendant would repay him when the defendant had completed the development and sold the Property, and Mr Van Delkou would not charge the defendant interest on the monies lent.

The defendant says that Mr Van Delkou loaned him some, but not all, of the amounts totalling $1,275,637.63 pleaded in the statement of claim. In submissions, counsel for the defendant emphasised that the defendant’s inability at this stage to identify precisely which amounts are disputed arises from the fact that the payments were made to third parties rather than directly to the defendant. The defence acknowledges that Mr Van Delkou has loaned monies to the defendant and that he (or his estate) is entitled to repayment of the amount loaned upon completion of the development and sale of the Property. The defendant denies that the monies lent were financial contributions to any joint venture.

The defendant denies that he is presently in default of any obligation to repay the monies, denies the alleged common intention and alternate common intention, denies that he has acted unconscionably and denies that he holds his interest in the Property or the sale proceeds of the Property (when sold) on constructive trust for the plaintiff or subject to an equitable charge or lien in favour of the plaintiff. The defendant denies any liability for breach of the agreement.

The defendant caused a lapsing notice to be served on the plaintiff under s 74J of the Real Property Act.

By notice of motion filed on 9 June 2022, the plaintiff seeks:

The defendant opposes the plaintiff’s application for those orders and offers an undertaking to the plaintiff and to the Court that he will not seek to dispose of, encumber or deal with the Property in any way without first giving the plaintiff 14 days’ notice of his intention to do so.

In support of the notice of motion, the plaintiff read:

Ms Stevanovic’s affidavit annexes a copy of the Caveat. Mr Streeter’s affidavit annexes a copy of the lapsing notice and deposes that it was served at the plaintiff’s registered office on 2 June 2022. The date of service was not in dispute, and it was common ground that 23 June 2022 is the date on which the Caveat will lapse if not extended by an order pursuant to s 74K of the Real Property Act.

Mr Sharpe was the accountant for Mr Van Delkou and his business entities, including the plaintiff, for approximately 10 years prior to his death on 29 November 2020.

Mr Sharpe deposes that, to his understanding, Mr Van Delkou “intended to provide the funds for the development” of three townhouses on the Property owned by the defendant, who is the husband of Mr Van Delkou’s granddaughter Ms Tanya Delkou. He gives evidence that he had a conversation with Mr Van Delkou in September 2017 to the following effect:

Mr Sharpe gives evidence to the effect that the discussion that he suggested between Mr Van Delkou, Ms Tanya Delkou and the defendant did not eventuate despite Mr Sharpe advising Mr Van Delkou that there were matters that needed to be discussed and considered, including the preparation of accounts for what Mr Sharpe describes as a joint venture and the GST implications of that venture.

Mr Sharpe put his concerns in writing to Mr Van Delkou in a letter dated 22 February 2019. The letter states that GST had been claimed on “costs paid by you” to develop “the Joint Venture Project” and recorded Mr Sharpe’s advice that it was necessary to prepare financial statements for “the joint venture” to maximise tax deductibility of its costs and ensure that GST is claimed correctly on those costs. Mr Sharpe also advised (my emphasis):

I note that the letter makes no reference to the plaintiff or the Delkou Family Trust.

Mr Sharpe received no response to his 22 February 2019 letter. He wrote to Mr Van Delkou again on 23 October 2019 reiterating his concerns about “the income tax and gst issues that may arise this joint venture partnership arrangement” (emphasis in original). The letter stated (my emphasis):

Mr Sharpe received no reply to his 23 October 2019 letter

Mr Sharpe’s evidence, which was not challenged at the hearing of the notice of motion, is that it was the Delkou Family Trust that had made payments totalling $1,275,637.63 to the builder and various third parties in connection with the development of the Property during the relevant period. This is corroborated by copies of cheques drawn on the plaintiff’s bank account and copies of the plaintiff’s bank statements that were exhibited to Mr Sharpe’s affidavit. There is evidence that the payments have been recorded in the balance sheet of the Delkou Family Trust for the 2017 to 2021 financial years as an asset described as “Joint Venture Costs”. The asset is not listed as a receivable but this ambiguous description casts no light on the nature of the asset.

There is no evidence suggesting that Mr Sharpe received any of the information that he had requested from Mr Van Delkou since February 2019 at any time before Mr Van Delkou’s death in November 2020.

There is no evidence that the alleged joint venture kept any financial statements or other books and records or was registered for GST or income tax purposes as Mr Sharpe had advised.

On 4 February 2021, Mr Sharpe wrote to Mrs Toni Delkou, the widow of the late Mr Van Delkou, setting out the assets of the plaintiff as trustee of the Delkou Family Trust. The letter identified those assets as including, relevantly, a “net cash type asset” of a “Loan to Property Joint Venture” in the amount of $1,341,429 “to be repaid on sale of properties”.

On 25 May 2021, Mr Sharpe prepared a valuation of the Delkou Family Trust for the purpose of valuing the late Mr Van Delkou’s units in that trust in connection with the application for a grant of probate. That valuation described the current assets as including an “Investment in Joint Venture at Cost” valued at $1,372,959. The valuation stated: “We understand this was a profit-sharing arrangement, though we have not sighted any documentation or agreements confirming this arrangement.”

On 25 January 2022, Mr Sharpe wrote to Mrs Toni Van Delkou requesting information about the current status of the Delkou Family Trust’s “interest in the joint venture property”. The letter stated:

Mr Sharpe did not receive a response to that letter.

Mr Steven Delkou is a director of the plaintiff and the son of the late Mr Van Delkou. In his affidavit sworn on 20 May 2022, Mr Steven Delkou has identified his late father’s signature on a preliminary tender issued by a builder in respect of the Property. The preliminary tender document names Mr Van Delkou as the client but specifies the client’s email address as a Hotmail address for Ms Tanya Delkou. Mr Van Delkou’s signature, which appears under the heading “Acceptance of Tender” bears the date 22 March 2018.

On 25 February 2022, Mr Steven Delkou caused the plaintiff’s solicitors to write to the defendant in the following terms (my emphasis):

The letter then referred to the legal costs that may be incurred if proceedings were commenced and, under the heading “DEMAND”, recommended that the defendant take steps to resolve the matter within the next seven days by contacting the plaintiff’s solicitor or by paying the amount of $1,372,958.68 to the plaintiff by cheque or to the plaintiff’s solicitor’s trust account.

I note that the letter refers only to a loan and makes no claim that the plaintiff has any security for the loan or any interest in the Property. The letter makes no claim that the loan is presently repayable and falls short of demanding repayment within seven days (making a request instead), yet threatens the commencement of legal proceedings if the loan is not repaid within seven days.

Mr Steven Delkou caused the plaintiff’s solicitors to send a second letter to the defendant on 25 February 2022. That letter referred to a loan by the plaintiff in the amount of $1,372,958.68 and to the earlier letter of 25 February 2022 calling for repayment of that loan. The second letter stated: “We are instructed that this is a substantial debt and that our client has an equitable interest in the Property.” The letter contained no information about the nature of the equitable interest asserted or the matters relied upon as creating the alleged equitable interest. The letter enclosed a Deed of Charge, Consent to Caveat and Acknowledgment of Debt that the plaintiff requested the defendant to sign in order “provide the assurance to our client that the loan will be paid to our client”. The letter asserted that the Deed was “a proportionate and appropriate means to protect our client’s interest” and stated that the plaintiff reserved its rights in the event that the Deed was not returned, duly executed, within seven days.

The enclosed Deed does not identify the equitable interest claimed by the plaintiff. Clause 2 of the Deed simply contains an acknowledgment by the defendant (referred to as “the Borrower”) that the plaintiff (referred to as “the Lender”) “has an equitable interest in the Property in that it paid for the construction of improvements including three townhouses on the Property”.

Recital A to the Deed records a loan of $1,372,958.68 to the defendant to demolish the existing dwelling and construct three townhouses on the Property. Neither the Deed nor either of the 25 February 2022 letters make any reference to an entitlement for the plaintiff to be paid any share of any profits of the development or any intention that the plaintiff would have any interest in the Property or in the sale proceeds of the Property when sold.

Recital B to the Deed states that the parties acknowledge that the Property has been developed and that the townhouses have been completed. There is evidence to the effect that this was not accurate as at 25 February 2022, in that the occupation certificate had not been issued for the townhouses and the Property had not yet been subdivided into separate lots for each townhouse. Counsel for the defendant submitted that this remains the position, and counsel for the plaintiff made no submission to the contrary.

Australia Post records exhibited to Mr Steven Delkou’s affidavit indicate that the 25 February 2022 letters were delivered to the defendant on 28 February 2022. The defendant’s solicitors responded promptly on 2 March 2022 disputing that the amount of the loan was $1,372,958.68 and requesting copies of the evidence relied on by the plaintiff in claiming to have lent this amount. The letter stated that the defendant had kept Mrs Toni Delkou apprised of the progress of the development and set out the current status, as referred to above. The letter stated that the defendant declined to sign the undertaking and deed requested by the plaintiff.

In his affidavit sworn on 20 May 2022, Mr Steven Delkou characterises the 2 March 2022 letter from the defendant’s solicitors as “denying that the monies advanced were a loan”. However, as confirmed in the defence filed on 5 May 2022 and further confirmed in defendant’s submissions at the hearing of the notice of motion, it is the amount of the loan that is disputed. The plaintiff now concedes that the amount specified in the 25 February 2022 letters was approximately $100,000 more than the amount that the plaintiff claims to have lent to the defendant.

Rather than responding by providing evidence of the amounts that the plaintiff claimed to have lent to the defendant, Mr Steven Delkou caused the plaintiff’s solicitors to respond to the defendant’s solicitors in the following terms on 4 March 2022:

The letter requested a reply by 5pm on 8 March 2022.

Adopting the same curious practice as had been adopted on 25 February 2022, the plaintiff’s solicitors sent a second letter to the defendant’s solicitors on 4 March 2022 asserting (incorrectly) that the defendant had denied any indebtedness to the plaintiff and that the defendant’s solicitors had “failed to provide your client’s version or any evidence in support of your client’s assertions”. This second 4 March 2022 letter also called on the defendant to provide by 5pm on 8 March 2022 “all documents or evidence and an account of what your client says is the arrangement as between our client and your client in respect of the Property”. The letter invited the defendant to undertake not to encumber, transfer, sell or otherwise deal with the Property without 14 days’ written notice to the plaintiff, and repeated the request for the defendant to sign a Deed of Charge and Consent to Caveat in different terms to that which had been enclosed with the second 25 February 2022 letter. The revised version of the proposed Deed enclosed with the 4 March 2022 letter refers to the plaintiff as “Party 1” and the defendant as “Party 2”. The Deed provides:

In addition to requesting that the defendant provide the proposed undertaking and sign the proposed Deed, the second 4 March 2022 letter also invited the defendant “to provide a full financial account in respect of the Property within 21 days”.

The defendant’s solicitors replied to the 4 March 2022 correspondence by email on 9 March 2022, stating:

As referred to earlier in these reasons, the plaintiff lodged the Caveat on 9 March 2022 and commenced these proceedings on 15 March 2022.

The defendant did not adduce any evidence but made submissions in opposition to the notice of motion.

Pursuant to s 74F of the Real Property Act, a person claiming to be entitled to a legal or equitable interest in land may lodge a caveat prohibiting the recording of any dealing affecting the estate or interest to which the person claims to be entitled.

Section 74F(5) requires the caveat to be in the approved form and to specify, inter alia, the prescribed particulars of the estate or interest to which the caveator claims to be entitled.

Clause 7 and Schedule 2 of the Real Property Regulation 2019 (NSW) require a caveat lodged under s 74F to specify particulars of:

Schedule 2 provides that it is not necessary to specify whether the estate or interest claimed is legal or equitable, the quantum of the estate or interest claimed (subject to certain exceptions that are not presently relevant) or how the estate or interest claimed ranks in priority with other estates and interests in the land.

Whether a caveat adequately describes the estate or interest claimed is to be decided from the point of view of a person examining the caveat, noting that this person will not necessarily be the registered proprietor: Hanson Construction Materials v Vimwise Civil Engineering [2005] NSWSC 880 at [28].

Section 74K of the Real Property Act relevantly provides:

As Brereton J (as his Honour then was) said in Sutherland v Vale [2008] NSWSC 759 at [10]-[12]:

Thus, the inquiry is not whether the caveator may have some interest in the relevant land. Rather, the Court must be satisfied that the caveator’s claim to the particular estate or interest in the land described in the caveat has or may have substance in the sense that there is a seriously arguable question.

Section 74L of the Real Property Act provides:

However, s 74L does not permit the Court to overlook the fact that the caveat claims a different estate or interest than that asserted on the hearing of the application to extend the caveat, or fails to give sufficient particulars of the estate or interest: see Hanson Construction Materials v Vimwise Civil Engineering, supra, at [28]-[38]; Sutherland v Vale, supra, at [12]; Choi v Kim [2013] NSWSC 1774 at [6]-[11]; Woodsman Pty Ltd v Jozic [2018] NSWSC 1311 at [11]-[17] and the authorities there referred to.

Counsel for the plaintiff conceded at the hearing of the notice of motion that the plaintiff’s claimed interest in the Property is wrongly described in the Caveat as an “Estate in Fee Simple”. The interest in respect of which the plaintiff claimed to have established an arguable case for the purpose of its application under s 74K of the Real Property Act was a beneficial interest under a constructive trust. It was submitted on behalf of the plaintiff that the misdescription of the estate or interest claimed in the Caveat as an “Estate in Fee Simple” is a matter of form which can and should be disregarded pursuant to s 74L of the Real Property Act. The plaintiffs submissions referred in very general terms to cases in which “various Judges have made it clear that under section 74L … the Court may disregard any failure of the caveator to comply strictly with the requirements as to form”. It was submitted that “[t]he test is whether there is ‘sufficient identification of the claimed interest’”. In support of that proposition, the plaintiff relied on Mayrin DM Pty Ltd v Kaiyu Deng [2019] NSWSC 1552 at [47].

For the reasons articulated by Brereton J in Sutherland v Vale, supra, at [12] (extracted at [62] above), I reject the plaintiff’s submissions, and accept the defendant’s submissions to the contrary. The misdescription of the estate or interest claimed by the plaintiff in the Property is a matter of substance and not a mere matter of form.

If the plaintiff’s submission were accepted, it would follow that a person examining a caveat would need to form their own opinion about the nature of the estate or interest claimed by the caveator by undertaking their own analysis of the potential consequences at law or in equity of the facts specified in the caveat as the foundation of the claim to the estate or interest specified. That would be an absurd outcome in my opinion, bearing in mind that the person examining the caveat may not be the registered proprietor and may not have any knowledge of or involvement in the facts and circumstances specified in the caveat as giving rise to the estate or interest claimed by the caveator. The plaintiff’s submission, if accepted, would give no effect to the express requirements of s 74F(5) of the Real Property Act and clause 7 and Schedule 2 of the Real Property Regulation that the caveat specify the estate or interest in land claimed by the caveator. Moreover, as counsel for the defendant submitted, the plaintiff would have the Court extend a caveat that was apt to mislead by reason of the interest claimed being wrongly described.

The judgment of Rein J in Mayrin DM Pty Ltd v Kaiyu Deng, supra, does not assist the plaintiff because it is not clear from the reasons for judgment how the caveator in that case had described the estate or interest in land claimed. The dispute in that case concerned whether there had been “sufficient identification of the basis of the claimed interest”, [1] rather than whether the nature of the interest had been accurately specified in the caveat. The focus was on the adequacy of the specification of the facts on which the caveator’s claim was founded.

The problem in the present case bears some similarity to the problem with the caveat considered by Darke J in Woodsman Pty Ltd v Jozic, supra, subject to one qualification that I will return to below. In that case, the plaintiff caveator had claimed an estate or interest described as “[t]he whole of the Registered Proprietors interest in the land” by virtue of a General Security Agreement between the plaintiff and the defendant which contained a charge by the defendant in favour of the plaintiff caveator over “all of its assets whasoever both present and future”, including land. Darke J held that the caveat was incurably deficient. Whilst the plaintiff caveator was prima facie the chargee under a charge granted by the defendant that extended over the land, and the plaintiff would therefore have an interest in land sufficient to sustain a caveat, that was not the interest claimed in the caveat. The estate or interest described was plainly not an adequate description of a claim under an equitable charge. His Honour held that s 74L of the Real Property Act did not permit the Court to overlook the inadequate description of the estate or interest claimed.

The qualification to which I referred above is that, in Woodsman Pty Ltd v Jozic, the General Security Agreement specified as the foundation of the caveator’s claim disclosed a caveatable interest (albeit not the interest specified). In the present case, there was a dispute between the parties as to whether the facts specified in the Caveat disclosed a constructive trust, and whether any such constructive trust was of a caveatable interest: see Mayrin DM Pty Ltd v Kaiyu Deng, supra, at [13]-[43] and the authorities there referred to. I do not find it necessary to determine that dispute in view of my conclusion that the plaintiff’s failure to specify the estate or interest claimed in the Property (specifying an estate in fee simple that is not in fact claimed) cannot be overcome by resorting to s 74L.

For those reasons, the plaintiff’s application for an order extending the operation of the Caveat fails.

The general principles governing the grant of interim injunctions are well established: see Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199; [2001] HCA 63, especially at [8]-[13], [18] (Gleeson CJ), [91] (Gummow and Hayne JJ, Gaudron JJ agreeing); Papas v Grave [2013] NSWCA 308 at [83] (Emmett JA, Sackville AJA agreeing).

The purpose of an interim injunction is to preserve the status quo until the rights of the parties can be determined at a final hearing or, to adopt the language of Gleeson CJ in Australian Broadcasting Corporation v Lenah Game Meats, supra, to “prevent the practical destruction” of the right in respect of which the plaintiff claims final relief “before there has been an opportunity to have its existence finally determined”. [2]

As counsel for the defendant submitted, a plaintiff applying for an interim injunction must establish that:

As Newnes JA said in Mineralogy Pty Ltd v Sino Iron Pty Ltd [2016] WASCA 105 at [87] (McLure P and Corboy J agreeing), the first requirement:

The inadequacy of a remedy in damages is often stated as a separate factor to be considered, but it is more accurately assessed as one aspect of the balance of convenience. The Court must determine whether the inconvenience or injury which the plaintiff would be likely to suffer if an injunction were refused outweighs or is outweighed by the injury which the defendant would suffer if an injunction were granted: Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618 at 622-623.

For the purpose of the plaintiff’s application for an interim injunction only, the defendant did not dispute that the plaintiff has established a serious question to be tried. I therefore proceed on the basis there is a serious question to be tried as to whether the plaintiff has an interest in the Property or the sale proceeds (when the property is sold) by way of constructive trust or equitable charge or is entitled to damages for breach of the alleged joint venture agreement. However, on the basis of the evidence presently before the Court, it is my opinion that the plaintiff’s claims relying on a constructive trust or equitable charge are not strong claims. The only evidence of anything more than a loan agreement between the plaintiff (or Mr Van Delkou) and the defendant is:

As the defendant submitted, there is no evidence that the plaintiff will suffer irreparable harm for which damages would be an inadequate remedy if the interim injunction is not granted. Contrary to the plaintiff’s submissions, the correspondence between the parties and their solicitors referred to at [40]-[53] above does not reveal “an attitude” on the part of the defendant that “leads to the inference that the defendant will not admit the amount of money he has received and certainly will not be repaying it”. Taking the plaintiff’s pleaded case at its highest, it is not entitled to repayment of any of the financial contributions that it claims to have made to the development or to any profits of the development unless and until the development is completed and the Property is sold. The plaintiff adduced evidence of a letter from the defendant’s solicitor stating that this has not yet occurred because, inter alia, an occupation certificate has not yet been issued and the Property has not yet been subdivided. The plaintiff did not adduce any evidence to the contrary.

In my opinion, the correspondence on which the plaintiff relies does not reveal any “attitude” on the part of the defendant that assists the plaintiff’s claim for an interim injunction. Rather, the correspondence indicates a determination on the part of the plaintiff to insist on repayment of what it has consistently described in recent letters as a loan irrespective of the fact that, on its own case, the loan is not yet due for repayment. Further, the correspondence reveals an unwillingness on the part of the plaintiff to engage with the defendant’s reasonable requests for information about the basis of the quantification of the plaintiff’s claimed entitlement (which the plaintiff now accepts is wrong) and a misguided “attitude” on the part of the plaintiff that it is for the defendant to either capitulate to the plaintiff’s demands or demonstrate that the plaintiff is not entitled to what the plaintiff claims.

In addition to admitting on the pleadings that the plaintiff advanced some of the claimed amounts and communicating in the correspondence referred to above his willingness to discuss the plaintiff’s claims upon receipt of further information, the defendant has given an undertaking to the plaintiff and to the Court that he will not seek to dispose of, encumber or deal with the Property in any way without first giving 14 days’ notice to the plaintiff of his intention to do so. An undertaking in those terms in favour of the plaintiff was recorded in the defendant’s written submissions dated 14 June 2022. During the hearing on 15 June 2022, the defendant, by his counsel, confirmed that the undertaking was given to the plaintiff and to the Court. Contrary to the plaintiff’s submissions, there is no evidence that would justify an inference that there is a “risk to the plaintiff” if the interim injunction is not granted. There is no evidence that damages would not be an adequate remedy or that the defendant would act in a way that would frustrate the enforcement of any judgment in favour of the plaintiff. In those circumstances, and having regard to the fact that the plaintiff’s claim to an interest in the Property or the sale proceeds (as opposed to a contractual right to payment) is not strong on the basis of the evidence presently before the Court, I do not consider that the balance of convenience favours granting the interim injunction sought by the plaintiff. It is sufficient to note the undertaking of the defendant to the plaintiff and to the Court.

For those reasons, the plaintiff’s claim for an interim injunction in the terms set out in paragraph 3 of the notice of motion fails.

Having regard to the fact that the defendant’s undertaking was offered to the plaintiff for the first time in written submissions the evening prior to the hearing of the motion, and was offered to the Court for the first time during the hearing on 15 June 2022, the appropriate order as to costs is that they are reserved. The intention of that order is that the costs of the notice of motion will ultimately be paid in the same way as the general costs of the proceedings unless either party persuades the Court at the conclusion of the proceedings that some other order should be made in accordance with r 42.7 of the Uniform Civil Procedure Rules 2005 (NSW).

For the foregoing reasons, the notations and orders of the Court are as follows: