Court S Of Equity

Question: have you been to a foreclosure auction and bid or witnessed the bidding? I'm going to a foreclosure auction next week. There are 85 properties to be auctioned and the Master in Equity court said they would start at 11:00 and be done by 12:30. That is a minute per property. The lawyer who is researching the title on the home I might bid on, said he bids on behalf of some plaintiffs (banks) who can not make it there. There is a fee of 1% and around the middle of the month I look at the auction results and alot of them get $2500 bids, due to the 1% fee and that $2500 bid is the bid made by the bank or the person representing the bank. So, alot of the auctions go quick. If there is a piece of property worth 75,000 and the debt is 90,000, it might not get any bids but the bank's 2500 bid, so the bank then owns it and they can then hire an agent and get it listed and sold. I'm looking to hear from someone who has been to these auctions and bid on a house or been present and witnessed bidding on a house. I'd like to know what to expect as far as how long the judge gives you to make a new bid, can it be me and the lawyer representing the bank going back and forth, can the bidding go above the debt owed, etc. The county website is telling me the total debt owed by the foreclosed on person. So, that is what the bank is wanting. They could be thinking the bidding won't get that high and the rules allow the bank's representative to decide to seek a deficiency judgement by asking for that. They then bid $2500 and that particular auction is over. All interested parties come back 30 days later and the bidding resumes at $2500. The deficiency judgement request lets the bank seek a judgement against the owner for a % of the debt owed, if they think the auction is going to come in too low. Example would be the debt is 45000 and the bank thinks the auction will bring in 35000 so instead of taking the 35000 at the first auction, they ask for a deficiency judgement and all parties start again 30 days later, with the bank hoping to get 35000 from the auction of the house and 10000 from the previous owner. The house I am interested in could be a deficiency auction or not. I'll have to go and see what the bank wants to do. They'll ask for a deficiency judgement or go ahead and let the auction take place and the high bidder gets it. I'd like to hear from people who know how the bidding will go, between individuals, what process the judge uses and other information. Thanks.

Answer: I've bid and bought homes on the court house steps. I'd recommend, if you can, to go there at least the day beforehand and experience it. I'll share my experience in California. First, allow there are several homes scheduled for foreclosure that day, 2/3rd or greater are delayed. I've actually been following one for 1.5 years that has been in notice of trustee sale, and was given a date to be foreclosed on, but it keeps being delayed. Out here, a representative of the trustee provides the address and sales # and gives an opening bid. The opening bid may be greater or less then the amount owed. A bank can only ask up to the total amount that it would be out, no more. (This can included the amount owed plus the foreclosure cost late fees, legal fees, etc.) The bid can go higher though if another 3rd party wants to buy it. For example, one I went to last week was priced VERY low and went up over 200% of the asking price. (It started at 230K and sold at 460K). I also had one that the bank set the opening bid, but during bidding the bank went up 170K over it's original opening bid. I didn't understand why they didn't just start at their price (x+170K) in the first place, but that is what happened. The bank wants as much as they can get, but usually they price it lower at the actions because they don't want to deal with the additional costs of holding, fixing and selling the property. If you get it at the auction, then any clouds on title or damage to the property is no longer their responsibility. It's yours. Regarding the deficiency judgment... this is between the bank and the previous owner and has nothing to do with the new owner. Depending on what state the foreclosure is taking place, the bank may or may not have the right to a deficiency judgment after foreclosure. It also depends on the paperwork for the loan that was processed. Most purchase loans (loans taken out for original purchases) are non-deficiency judgment loans. This is important for the person who has/had the house...but like I said, not for you. You have a lawyer so he probably already shared all this with you, as well as the risks with action or court house step purchases. Hope this was helpful and good luck!

Question: Can someone who understands finance answer this question? I own 30,000 shares of IBCIQ.PK. This is Interstate Brands Corporation,Hostess cake, Dolly madison,Wonder, etc.... They have been bankrupt for 4 yrs. and is trading at 3 cents. I found this article which is saying there may be a buyout at $12.50 a share. I know this won't translate to 12.50 a share for stockholders but will it help at all maybe bring it to $1. I will post it now if it gets cut off go to google finance then enter IBCIQ.PK and it is the first article thank you. Oct 04, 2008 (The Kansas City Star - McClatchy-Tribune Information Services via COMTEX) -- IBC | Quote | Chart | News | PowerRating -- Interstate Bakeries Corp. received court approval Friday to arrange delivery of some bread. U.S. Bankruptcy Judge Jerry Venters gave the wholesale baking company permission to commit to nearly $600 million in financing agreements that will allow Interstate to finally emerge from more than four years of bankruptcy. The arrangements also will give a New York investment fund majority ownership in the newly restructured company. But in tacking down the financial commitments, Interstate had to agree to chip in something for its unsecured creditors, who had been slated to get nothing under the reorganization. Ripplewood Holdings has agreed to invest $130 million in Interstate, consisting of $44.2 million in cash and $85.8 million in convertible debt. In exchange, it will receive a 50 percent equity stake in the reorganized company. It also will get warrants to acquire an additional 15 percent stake at a price of $12.50 a share. In addition, Silver Point Capital LP and three other lenders that together hold about $450 million, or 53 percent, of IBC's pre-petition secured debt have agreed to swap that for $147.3 million in notes and $85.8 million in debt. The debt would be convertible to a 33 percent stake in the new company. The lenders also have agreed to a $339 million loan to help finance Interstate's exit from bankruptcy. That would supplement a $125 million revolving loan from General Electric Credit Corp. to further finance Interstate once it emerges from the protection of the bankruptcy court. In exchange for the agreement to invest, Interstate would pay Ripplewood $6.5 million in fees and up to $6 million in expenses. The lenders on the $339 million loan would collect $16.5 million in fees. About $3.2 million of those fees will be due if the court approves the equity portion of the financing arrangement. A hearing on that is set for Oct. 22. In its court filing, Interstate, which makes such iconic brands as Wonder Bread and Hostess Twinkies, called the financing agreement "a watershed moment" for the company and its 22,000 employees. Once the largest wholesale bread baker in the United States, it has closed more than a dozen bakeries and eliminated 10,000 jobs since falling into bankruptcy four years ago. But to finally reach that watershed moment Friday, Interstate decided it was going to have to give if it expected to get. Venters' approval came after Interstate and Ripplewood worked out a last-minute agreement with unsecured creditors, who are owed about $190 million. The unsecured creditors tried to put up a roadblock to the financing agreement with a motion filed Monday. Its lawyers objected to the baking company's "absolute" commitment to pay Ripplewood millions of dollars in fees, while Ripplewood could pull out of the deal if Interstate's financial condition changed "materially." IBC responded that the fees were appropriate and contended that "the objection should be viewed for what it is -- an effort to create leverage to get a settlement that provides some recovery to unsecured creditors." And in that regard, the unsecured creditors' strategy worked. Without providing details, lawyers for Interstate said it and Ripplewood agreed to give the unsecured creditors some cash and pay up to $890,000 in their expenses, plus other considerations. In exchange, the unsecured creditors dropped their objection to the financing commitment and agreed to support the baking company's reorganization. The approval Friday sets up Interstate for finally shedding bankruptcy protection. Lawyers said that they were preparing a slightly modified reorganization plan and that if the court approved its "disclosure" documents for the plan and approved a final version of the financing agreements, then the plan could go to creditors for a vote. Interstate has said it intends to get that done by Feb. 9, when its current bankruptcy financing expires. Interstate filed for bankruptcy protection Sept. 22, 2004. ------ Interstate's financials In a recent filing, Interstate Bakeries reported a loss of $143.7 million on sales of $2.8 billion for the year ending May 31. That compared with a loss of $112.8 million on sales of $2.9 billion in the previous fiscal year

Answer: What is your question? It looks like something got cut off in your copy-paste.

Question: How to refinance home and get ex's equity? Divorced, got a court order to refinance and pay the ex 50 percent of the equity. Bank will only finance 85 percent of the Original loan, and don't require appraisal. Mortgage owed 104,000, bought for 111,000. Bank will refinance amount owed plus all closing but no more. Cant cash out VA loan. How do I get his supposed equity? County assessor says its worth 125,000. What do I do?

Answer: You are going to have to go to a different bank. Try four banks and also LendingTree.com. Sounds like you need a home equity line for $10,500 [ ($125K - $104K)/2 ]. But that puts you at Loan to Value ratio of 91%. I don't know what you mean by cashing out a VA loan. Sounds like the court is trying to screw you. Since in this climate it is obvious you will have to pay an outrageously high interest rate and PMI to refinance. But, if you wrote it accurately, they said you have to 1) refinance 2) pay the ex 50% of equity ($10,500). You don't have to use the proceeds of refinancing to pay him - you could use other money. I am assuming you don't have the $10,500 on hand or you could comply with the order (refinance and just pay him.) You are going to have to refinance and then get a personal loan for the balance. You might talk to the VA about releasing him from the mortgage. If they will, you might be able to pay him the money over 5 years if you offer 12% interest. Or does he need the money now?

Question: A jointly owned property has just been court ordered to be altered to my ex's sole ownership but with? a Charge in my favor of 50% of the equity when she sells it. I have heard that she now intends to sell it to her current boyfriend for a fraction of it's market value and then when I am out of the picture they intend to sell it on for it's full market value. I can see nothing in the Court Order that prevents her from selling at any price she chooses or gives me any control of the selling price. Can she do this? Can I stop it?

Answer: Legally it would appear so. Get an injunction.

Question: Can the amount I received from an inheritance be disclosed in Court to my partner? My partner and I are going to court regarding our house which has both our names on the title deeds. I want to buy my partner's share (giving him his equity in the house). He wants the house and is prepared to give me my share. I have not told him how much I received from my mother's inheritance and he states that he can make me tell the court how much I received and if it's alot of money then the court will state that I can go and find another house. With all that said I have a son, the house is near his school and my place of work and I really don't want to move house nor do I want to tell him how much I received from the inheritance. I live in the UK.

Answer: You have offered him his equity in the house, you are not trying in any way to cheat him, you could even offer him a little extra. What money you have is not the issue it is your home and your sons you have a valid non sentimental reason for staying. The law will always take into account a child's circumstances first. He isn't claiming any of your money just trying to buy you out of the house. Sounds as if he is just trying to be nasty. However I would get yourself a good lawyer it will be worth the money and then go for costs!

Question: How does the courts have Jurisdiction? I was reading the U.S. Constitution in Article 3 section 2 gave the courts all jurisdiction in law and equity. but when I got to the 11th amendment it said it amends part of article 3 sec. 2. then it says that the courts have no jurisdiction in law and equity. so what is it?

Answer: You need to read ALL of the 11th Amendment, not just the first 20 words. The 11th amendment says that federal courts have no jurisdiction to hear lawsuits where the defendant is a State.

Question: the actual decision of the case and the legal issues? NEW SOUTH WALES SUPREME COURT CITATION: Ehsman v Nutectime International [2006] NSWSC 887 CURRENT JURISDICTION: Equity FILE NUMBER(S): 5189/05 HEARING DATE{S): 31 March 2006 DECISION DATE: 01/09/2006 PARTIES: Patricia Mary Ehsman (P/A) Nutectime International Pty Ltd (D1/R1) David Neilan Brady (D2/R2) Francis Joseph Frasca (D3/R3) David Bruce Paix (D4/R4) Timentel Pty Ltd (D5) JUDGMENT OF: Austin J LOWER COURT JURISDICTION: Not Applicable COUNSEL: R Harper SC (P/A) M J Cohen (D1-4/R1-4) SOLICITORS: McDonald Johnson (P/A) Sparke Helmore (D1-4, R1-4) CATCHWORDS: CORPORATIONS - statutory derivative action - application by 35% shareholder/director to bring derivative proceedings after company's assets were transferred to a company from which the applicant is excluded - inadequacies of proposed points of claim - whether those inadequacies prevent the court from determining the application under s 237 - distinction between personal and derivative claims - whether court is satisfied concerning good faith, best interests of company and serious question to be tried - ancillary order for applicant to indemnify company with respect to costs of derivative proceedings - considerations relating to the bringing of derivative and personal claims in single proceedings ACTS CITED: Corporations Act 2001 (Cth) ss 180-184, 232, 236-242 DECISION: See under heading "Conclusions" JUDGMENT: IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST AUSTIN J FRIDAY 1 SEPTEMBER 2006 5189/05PATRICIA MARY EHSMAN V NUTECTIME INTERNATIONAL PTY LTD & 4 ORS JUDGMENT 1HIS HONOUR: Before me is an application by the plaintiff, Mrs Ehsman, for leave under s 237 of the Corporations Act 2001 (Cth) to bring proceedings on behalf of the fifth defendant company, Timentel, by filing and serving a further amended originating process and amended points of claim. 2 , 3, 4, 5 and 6 Deleted The plaintiff's case 7The parties agree that Mr Brady and Mr and Mrs Ehsman came together in a business venture before Timentel was formed. Mrs Ehsman owned some patents for a split face wristwatch display, and she wished to exploit them commercially. Mr Brady had some marketing experience. There are disagreements about the commercial utility of Mrs Ehsman's patents, and as to the precise terms of their arrangements, which need not be resolved for present purposes. It is common ground that they respectively brought to the business of Timentel, when it was formed in 1998, the patents (such as they were) and a measure of marketing/commercial input. 8When Timentel was formed, Mrs Ehsman granted it a licence over her patents, for no consideration (although she received shares in the licensee entity). There is disputed evidence as to whether, as Mrs Ehsman asserts, she entered into the licence agreement in reliance on the assumption, encouraged by Mr Brady, that the licence would always be held by a company in which she would be a director and shareholder. The licensee's interest in the licence agreement was assignable. Mrs Ehsman claims, and the defendants deny, that it was a term and condition of the licence agreement that the licence would not be assigned by Timentel to a company in which Mrs Ehsman was not a shareholder and director. 9Initially the only shareholders were the Ehsmans and Mr Brady, and Mr Brady and Mrs Ehsman were the directors. Mr Brady's evidence is that he devoted very considerable time and effort, and expense, to travelling to Europe to negotiate for the commercial exploitation of the split face wristwatch display. According to him, the people he consulted in Europe told him that Mrs Ehsman's patents were just concepts and it would be necessary to work out the most efficacious interior wristwatch mechanisms to support the split face. That is disputed by Mrs Ehsman. But it is clear enough that Mr Brady did do some amount of developmental/marketing work in Europe, the cost of which was shared or partly shared with the Ehsmans. 10Mr Brady's evidence is that he came up with the idea of having movements in each half of the split face watch case for the forward and return hand movements, all controlled by an electronic integrated circuit, and that Mr Claude Ray, an experienced watchmaker, carried out the necessary design work. The eventual product, which he called a "hinged electronic watch", was based on ideas that were fundamentally different, he said, from Mrs Ehsman's patents. These matters are contested. 11Mr Brady said he negotiated a development agreement with Mr Ray's company, using a company with which he was associated, Renaissance Management, for that purpose. In turn he caused Renaissance Management to enter into an agreement with another company with which he was associated, DNB Global Corporation (registered in the Philippines), which made advance payments to Mr Ray's company. At a final hearing of this case it will be necessary to explore these corporate relationships and their purpose, and to understand better the nature of Mr Brady's interests. DNB Global appears to bear his initials, but there is some evidence that he is just one of five directors and is indirectly a shareholder. DNB Global is important in this case because, according to Mr Brady, it incurred substantial expenses through payments for development work, for which Timentel reimbursed it out of monies borrowed by Timentel from Mr Brady, Mr Frasca and Mr Paix. But Mrs Ehsman questions whether loans were ever in fact made by those three directors. 12Mr Brady said the development of the hinged electronic watch was very expensive and under the arrangements between them, Ms Ehsman was to contribute to that development. He alleges that she defaulted in that obligation. He claims that by March 2005 she owed and had not paid about $86,000. That is contested. According to Mr Brady, the development was eventually successful and the hinged electronic watch is protected by patents in various countries, procured at a cost to DNB Global, recoverable from Timentel. 13In about June 2002 Ms Ehsman and Mr Brady decided to bring in two other parties, namely Mr Frasca and Mr Paix. There is quite a bit of evidence, not all consistent, about the circumstances in which Mr Frasca and Mr Paix were invited into the company. What is clear is that Mr Frasca and Mr Paix joined the board of directors and acquired shares, they provided some capital, and in due course they sided with Mr Brady and against Mrs Ehsman. After they joined the board, the company's issued 100 ordinary shares were divided as follows: Mr Brady 35 shares, Mr and Mrs Ehsman 35 shares, Mr Frasca 15 shares, and Mr and Mrs Paix 15 shares. 14During 2002, it seems, Mrs Ehsman visited Europe and met with one of Mr Brady's contacts, Manuel Spode of Les Artisans Horlogers. There is conflicting evidence as to what happened at the meeting. Mr Frasca gives evidence in his affidavit that the meeting led to Mrs Ehsman being criticised by the other directors for intervening secretly without the board's authority, and for her suspicious approach. Mr Frasca also says that at a meeting he had with Mr and Mrs Ehsman in 2003, they told him that they were determined to bring Mr Brady down. These matters are also disputed. Nevertheless it appears that, some time after Mr Frasca and Mr Paix arrived on the board, if not earlier, the relationship between Messrs Brady, Frasca and Paix, on the one hand, and the Ehsmans, on the other hand, deteriorated. By now the relationship has completely broken down. 15There is a considerable amount of correspondence in evidence, and minutes of board meetings. I shall not describe this material in detail here. The correspondence shows that at least since early 2005, Mrs Ehsman has been concerned about verifying payments allegedly due by Timentel to DNB Global, and also about the financial management of Timentel more generally. The evidence is that the only bank account of Timentel has been relatively dormant at times when, the defendants allege, Timentel made payments to DNB Global. Mrs Ehsman's solicitors have written to Timentel's solicitors about these matters. 16Mr Brady claims that by about May 2005 there was a pressing need for capital for Timentel, to pay invoices to DNB Global of about $216,000 and certain other smaller debts. It appears that at this time Mr Brady, Mr Frasca and Mr Paix developed a proposal to lend Timentel up to $246,000 for a term of 60 days with interest of 17% compounding monthly, secured by a registered charge. Mrs Ehsman asked the copies of the draft loan facility and charge documents but received them only after they had been executed. A board meeting attended by Mr Brady, Mr Frasca and Mr Paix, but not Mrs Ehsman, on 9 May 2005 approved the loan proposal and authorised execution of the documents. Mr Brady, Mr Frasca and Mr Paix, acting as directors of the company, purported to authorise the company to enter into the loan facility and charge agreements in which they were the counterparties, without the consent of the other director/shareholder, Ms Ehsman. 17The defendants claim that the loan facility was drawn down and the money was used directly for payment of outstanding debts of Timentel, rather than for deposit into Timentel's bank account. Mrs Ehsman, by her solicitor, sought to verify the making of the loan but she says she has not received proper documentation. The evidence includes minutes of the board meeting of DNB Global on 18 August 2005, at which the directors of that company confirmed that the company had been paid for certain invoices, but the evidence is incomplete because, for example, the identity of the paying entity is not given. 18On 11 July 2005 Messrs Brady, Frasca and Paix as lenders made a formal notice of demand for payment to Timentel of an amount of about $247,000. But they gave the company a limited extension of time to repay. Mrs Ehsman's solicitors alleged in correspondence that any attempt to enforce the charge would render it void under s 267 of the Corporations Act, because the chargees were "relevant persons" for the purposes of that section. 19The security was not enforced but instead, at some stage it was proposed that the company would enter into an asset sale agreement and a deed of assignment of the licence, in favour of the other three directors or their vehicle, for a price supported by a valuation by Les Artisans Horlogers. In correspondence, Mrs Ehsman's solicitors endeavoured unsuccessfully to obtain information about the valuation - indeed, they approached the valuer directly without success. They alleged that the valuation did not cover all of the assets sold. They strenuously opposed the proposed transaction, on several grounds including that the transaction would be in breach of the contractual arrangements and understandings between Mrs Ehsman and the other three directors. 20Nutectime was formed in August 2005. The directors are Mr Brady, Mr Frasca and Mr Paix. The company has issued 100 ordinary shares. Mr Brady owns 60 shares, Mr Frasca owns 20 shares in Mr and Mrs Paix own 20 shares. Mr and Mrs Ehsman do not hold any shares. 21The asset sale agreement and the deed of assignment of licence were entered into by Timentel and Nutectime on 2 September 2005. The transaction was considered at a board meeting not attended by Mrs Ehsman. Messrs Brady, Frasca and Paix went through a procedure of formally disclosing their interest in the purchaser but then they proceeded, purporting to act as directors of the company, to approve the transaction. It appears that the contract was made and completion took place on the same day. The total sale price $277,000. According to Timentel's solicitors, the sale proceeds were used to pay out and discharge the charge over the company's assets. That appears to have meant that the bulk of the sale proceeds were directed to Mr Brady, Mr Frasca and Mr Paix. It is not clear from the evidence whether there was any actual movement of money. 22Up until May 2005 Mrs Ehsman had been a director and (with her husband) substantial shareholder of Timentel, which was the licensee for no consideration of her patents. On one view, the company owed a substantial amount of money to DNB Global, but it had procured substantial development work for its split face watch design. Any profits from the realisation of that development work would have come to Timentel, and Mr and Mrs Ehsman would have had a 35% interest in those profits. After 2 September 2005, Mrs Ehsman was still a director of Timentel and Mr and Mrs Ehsman remained 35% shareholders. But the company's substantial assets, and any prospect it may have had of earning profits from the development of the split face watch, had gone. Mrs Ehsman was still the licensor of her patents, but she was entitled to receive no consideration for the licence. The new licensee, Nutectime, was a company in which she had no interest, and that company had acquired Timentel's assets and any profit-making opportunity relating to the split face watch. The controllers and shareholders of Nutectime were her fellow directors and shareholders of Timentel. The draft APC and draft FAOP 23From this brief account it appears that if Mrs Ehsman could substantiate her allegations, this would be a case of self-dealing by her co-directors to her considerable disadvantage, and unauthorised diversion of a corporate opportunity. Experience shows that in such cases it is important for the plaintiff to identify with particularity the precise duties said to have been breached and the circumstances of the breach. That is important in the interests of clarity of presentation of the plaintiff's case, and to ensure that the defendant is not surprised by having to meet a case at trial different from what she had been led to expect. These considerations strongly suggest that in such a case, the plaintiff should proceed by statement of claim. Where the plaintiff is proceeding in her own right, invoking the oppression remedy, and also seeking to assert the company's rights in a derivative action, the need for clarity of pleading is especially strong. 24 Deleted 25I have endeavoured to identify those allegations that relate to some right of Timentel, and distinguish them from allegations relating to some right of Mrs Ehsman personally. In summary, for reasons given below, paras 7, 18-21, 22, 23-26, and 27-29 (and the claims to relief in paras 1-5, perhaps 7, and 8) of the draft APC are claims made on behalf of Timentel, and paras 8-16, 17, 30 and 31 (and claims to relief in para 6 and perhaps 7) are claims made by Mrs Ehsman personally. 26It is important to maintain the distinction between derivative and personal claims in the interests of clarity. But nothing in Part 2F.1A requires that a derivative action be in a separate proceeding in which no personal claims are made by the person who has carriage of the proceeding. For example, in Fiduciary Ltd v Morningstar Research Pty Ltd (2005) 53 ACSR 732 the plaintiffs were an individual and corporate plaintiffs, and leave was granted under s 237 so as to permit the individual plaintiff (who was a shareholder and officer of the corporate plaintiffs) to assert the rights of the companies in a proceeding in which he also asserted rights of his own. The combination of corporate and personal claims was not unlike the combination of claims in the present case, though the pleading was by an elaborate statement of claim. In that case, and here, the asserted derivative and personal rights arise to a large degree out of the same alleged facts. 27Here the sole plaintiff is Mrs Ehsman, and Timentel is a defendant. It is not proposed that Timentel should become a plaintiff if s 237 leave is granted, because Timentel is properly a defendant to some of Mrs Ehsman's claims. Nor is it proposed that the derivative action be constituted as a separate proceeding, because there are substantially overlapping facts concerning the derivative and personal claims, which should therefore be heard together. Section 236(2) says that proceedings brought on behalf of a company must be brought in the company's name. But there is now a substantial line of decisions holding that, despite the literal wording of s 236(2), leave under s 237 can be given where the company is a party to the proceeding as a necessary defendant in respect of other claims, without requiring the company become a plaintiff or insisting that the derivative action be brought in a separate proceeding: see especially Keyrate Pty Ltd v Hamarc Pty Ltd (2001) 38 ACSR 396, per Santow J at [18]-[19]; Metyor Inc v Queensland Electronic Switching Pty Ltd (2002) 42 ACSR 398, per McPherson JA at [14]-[15]; Charlton v Baber (2003) 47 ACSR 31, per Barrett J at [5]. 28I turn now to consider the draft APC, paragraph by paragraph. 29After preliminary allegations, para 7 of the draft APC asserts that by reason of their appointment as directors of Timentel, Mr Brady, Mr Frasca and Mr Paix owed Timentel various duties. There is a list of the standard duties of directors. The list reflects ss 180, 181, 182 and 183 of the Corporations Act, and also a duty to act honestly in the exercise of their powers and the discharge of their duties as directors (a formulation no longer found in the statute). [deleted latter part of paragraph] 30Having made allegations about the defendants' duties as directors of Timentel, the draft APC (paras 8-16) makes allegations about the licence agreement, leading to the assertion that the purported sale by Timentel to Nutectime of its rights under the licence agreement was in breach of the licence agreement. That is a personal claim by Mrs Ehsman against Timentel (and no other defendant) for breach of contract. It is not a claim for breach of any duty owed to Timentel. 31Para 17 pleads that, by reason of matters pleaded in paras 8-11, the first to fourth defendants are estopped from asserting that Timentel was entitled to sell or assign to the first defendant the rights of Timentel under the licence agreement. This was said to arise because Mrs Ehsman entered into the licence agreement in reliance on the assumption, encouraged by Mr Brady, Mr Frasca and Mr Paix, that the licence would always be held by a company of which she was a director and shareholder. Clearly the allegation of estoppel is made for the benefit of Mrs Ehsman personally rather than to vindicate some right or interest of Timentel. The document does not reveal how the allegation can be made against any defendant other than Mr Brady, given that the assumption is said to have been created and acted upon at the time of the licence agreement, which was made well before Mr Frasca and Mr Paix became involved. 32Paras 18-21 make allegations about breaches of duties owed by the other three directors to Timentel. They allege that Timentel did not receive any of the proceeds of sale of assets, or received only part of the proceeds, and Messrs Brady, Frasca and Paix received those proceeds or part of them. It is claimed that their conduct in receiving those proceeds constituted a breach of all of the duties pleaded in paragraph 7. I find it impossible to justify that claim, with respect to some of the duties identified in para 7, even taking into account the "particulars" to para 21. Moreover, the mere assertion that Timentel did not receive proceeds of sale and the other three directors did (even when the "particulars" to para 21 are added) cannot, per se, establish a breach of any of the duties identified in para 7. These allegations fall well short of a proper pleading. 33Para 22 alleges that by reason of the matters alleged in certain other paragraphs, Messrs Brady, Frasca and Paix have been unjustly enriched as a result of breach of the duties referred to in para 7. Presumably this is intended to establish a ground of recovery for Timentel. Again, the precise matters that might constitute unjust enrichment have not been adequately pleaded and, moreover, it is not easy to see why para 22 combines breach of directors' duties with unjust enrichment. 34Paras 23-26 make allegations against Nutectime, intended to support orders declaring void and setting aside the purported sale of assets or requiring Nutectime to hold the assets in trust for Timentel. These paragraphs seem to assert some entitlement to relief on the part of Timentel rather than Mrs Ehsman, although the remedies would obviously operate for her benefit as well. The precise foundation of the remedies is not clear. The drafter has not invoked the equitable principles concerning accessory liability for breach of trust with any specificity or clarity. To the extent that entitlement to the relief is said to arise out of Nutectime being "knowingly concerned in the breach" there is a suggestion of statutory accessory liability, but the statutory directors' duties do not create any accessory civil reliability for being knowingly concerned in the primary breach. There is "accessory" liability under the statute for de facto and shadow directors, but the allegations in the draft APC do not in terms invoke that liability. 35Paras 27-29 allege that the deed of charge dated 9 May 2005 is void and should be set aside because Timentel did not receive the benefit, or received only part of the benefit, of the money purported to be advanced. This seems to be the assertion of rights of Timentel rather than Mrs Ehsman personally. A deed of charge merely provides security for advances made under some other arrangement such as a loan facility agreement. It is not easy to see why the fact (if it be so) that the chargor did not receive the benefit of loan monies purported to be advanced under a loan facility agreement should, per se, lead to the consequence that the security for the loan is void. If the charge is security for money advanced under a loan facility agreement, and no money is advanced to the chargor, then nothing is secured by the charge but the charging instrument is nevertheless valid. 36Para 30 contends that the other three directors repeatedly failed or refused to furnish information to Mrs Ehsman relating to the affairs of Timentel. Particulars are given. As expressed, this is an allegation of breach of duty to Mrs Ehsman rather than Timentel. There is no allegation of any particular duty but it seems that the drafter had in mind either or both of the statutory rights of a director to gain access to certain information under ss 198F and 290, or the director's general law right of access to the information needed to discharge her fiduciary duty (eg Edman v Ross (1922) 22 SR(NSW) 351). A director seeking to assert those rights is not required to show that inspection is sought in good faith and for a proper purpose, whereas a shareholder seeking inspection under s 247A must do so. Para 30 is not clear enough. 37Para 31 asserts that, by reason of the matters asserted, the other three directors have conducted the affairs of Timentel in a manner oppressive to, unfairly prejudicial to or unfairly discriminatory against Mrs Ehsman, or contrary to the interests of the members as a whole, contrary to s 232. Mrs Ehsman has personal standing to complain under that provision. The difficulty with para 31 is that it relies globally on all of the other allegations, some of which do not seem to be pertinent (for example, the pleadings against Timentel itself based on breach of contract and against Mr Brady based on estoppel). It should be re-formulated with more precision. 38 Deleted 39The draft FAOP contains the same claims for relief as the draft APC, and therefore suffers from the defects just noted. It also contains a prayer for an order under s 237. This is inappropriate, given that the interlocutory application presently under consideration seeks a s 237 order and also leave to file the FAOP, so that the question of s 237 leave will have been addressed before the FAOP is filed. Further, in the draft FAOP the application is said to be made pursuant to ss 232, 236 and 237. Sections 236 and 237 do not need to be mentioned, for the reason just given, and s 232 appears from the draft APC to be only one of the statutory provisions under which relief is sought, the others being the various directors' duties provisions. 40My conclusion is that the draft APC and the draft FAOP are seriously defective, and therefore I shall not accede to Mrs Ehsman's application for leave to file and serve them in their present form. What is needed is a carefully considered pleading by statement of claim. However, my view is that the draft APC identifies in broad terms, though imprecisely and at times in a confused way, some derivative and personal causes of action that emerge on Mrs Ehsman's account of the evidence. The causes of action are: (A)a personal claim by Mrs Ehsman against Timentel for breach of contract arising out of Timentel's purported sale and assignment to Nutectime, sounding in damages (paras 8-16); (B)a personal claim by Mrs Ehsman against Mr Brady based the allegation that at the time of the making of the licence agreement he encouraged her to assume that the licence would always be held by a company of which she was a director and shareholder - though the appropriate remedy, if this ground is established, is debatable (para 17); (C)claims by Timentel against Messrs Brady, Frasca and Paix for breach of ss 182 and 183 and their general law duty to avoid conflicts of interest, by virtue of their self-dealing in the loan and security transactions and then the sale and assignment transactions, leading an order for an account of profit or an order setting aside the transactions, or a compensation order under s 1317H (paras 18-21 and 22); (D)a claim by Timentel against Nutectime for accessory liability under equitable principles which apply to a person who assists in a breach of fiduciary duty or receives property transferred in breach of duty, leading to an order requiring Nutectime to hold acquired property on trust or to account as a constructive trustee (paras 23-26); (E)a personal claim by Mrs Ehsman against the other three directors asserting infringement of her right of access as a director to information of Timentel, under the general law and perhaps under ss 198F and 290, leading to an order for access or to restrain obstruction (para 30); (F)a personal claim by Mrs Ehsman for relief under the "oppression" remedy in s 232, arising out of specifically pleaded facts and circumstances, leading to a range of possible remedies to address the oppressive or unfair conduct (para 30). 41I am not persuaded that there is any viable course of action underlying paras 27-29. 42I think the appropriate course is to dismiss the application for leave to file and serve the amended points of claim, and to direct Mrs Ehsman to file and serve a statement of claim to give effect to her personal and derivative claims having regard to these reasons for judgment. 43Section 237 authorises the court to grant leave to permit a person to bring proceedings on behalf of a company. Part 2F.1A does not explain the word "proceedings" or give any direct indication of the level of specificity of pleaded allegations and prayers for relief that the applicant for leave must achieve. Typically the applicant will provide the court with a draft statement of claim or (as here) points of claim, or some other document giving particulars of the derivative claims. But in my view it cannot be the case that a full statement of the derivative claims must be presented before the court can consider and determine a leave application. Were that to be required, any subsequent amendments to the pleaded case would need to be treated as a leave application under s 237 to which the criteria in s 237(2) would have to be applied. That, in my view, would be an unnecessary burden for case management. 44In my opinion the applicant for leave must identify and describe the proposed proceedings with sufficient precision that the court can properly assess the application having regard to the criteria that it is required to consider under s 237(2), and the opponents can respond to the application in terms of those criteria. That may be achieved by presenting the court with a draft pleading, but it may be achieved in other ways such as by outlining the claims in affidavit evidence. It is not hard to envisage an application that falls so far short of identifying the derivative causes of action to be asserted that the court is left unable to assess, for example, whether it is in the best interests of the company that the applicant be granted leave, and whether there is a serious question to be tried. Here, however, Mrs Ehsman has done enough in her draft points of claim (defective though they are) and in the voluminous evidence that has been adduced, to permit me to identify the causes of action broadly described in paragraphs (A)-(F) above, of which paras (C) and (D) are derivative claims. I am able to consider the application for leave under s 237 as an application for leave to bring proceedings on behalf of Timentel by a statement of claim that would assert the causes of action identified in paras (C) and (D) and seek appropriate equitable and statutory relief. The requirements for leave to bring a derivative action 45Section 236(1)(a) allows a member or officer, inter alios, to bring proceedings on behalf of the company with the court's leave. Ms Ehsman has standing both as a member and an officer of Timentel. 46Under s 237(2) the court is required to grant the application for leave if it is satisfied of five matters set out in subparagraphs (a) to (e). Subsection 237(3) and (4) establish a rebuttable presumption that the granting of leave is not in the best interests of the company in certain circumstances, but it is agreed that those circumstances have no application to the present case. There is no suggestion of the members of the company purporting to ratify or approve the conduct of the other three directors, so as to invoke s 239. 47Of the five matters that the court must address under s 237(2), the parties agree that the notice requirement in subparagraph (e) has been satisfied here. The defendants did not concede, in terms of subparagraph (a), that it is probable that the company will not itself bring the proceedings, or properly take responsibility for them, or for the steps in them. However, the evidence before me plainly establishes that this criterion is satisfied, in respect of proceedings to pursue any derivative claims of the kind identified at paras (C) and (D) above. Timentel is under the control of the other three directors, who are acting together in respect of the company's dealings with Mrs Ehsman. The other directors (and spouse, in the case of Mr Paix) are the majority shareholders. They have caused the assets of Timentel to be passed to Nutectime, a company in which they but not Ms Ehsman are the directors and shareholders. They have asserted, in answer to the present application, both on their own behalf and on behalf of Timentel, that there is no foundation for derivative claims to be brought. It is clear from their attitude, revealed in the evidence and upon the application, that they would not authorise the company to bring such proceedings. 48That leaves for consideration subparagraphs (b), (c) and (d) of s 237(2). In their submissions, the parties referred me to a substantial number of decided cases. It seems to me, however, that the courts' approach to these subparagraphs has become relatively clear in the course of decisions, and it is unnecessary for me to refer to authorities extensively. Additionally, I have reached the conclusion that this is a plain case in which all three criteria have been established, and that extensive exposition is unnecessary. Good faith 49In the Swansson case, Palmer J expressed the opinion at least two questions are generally relevant to this issue: namely, whether the applicant honestly believes that a good cause of action exists and has reasonable prospects of success; and whether the applicant is seeking to act in a derivative capacity for such a collateral purpose as will amount to an abuse of process. This approach has been followed frequently in subsequent cases. I was referred, inter alia, to the discussion by Brereton J. in Maher v Honeysett & Maher Electrical Contractors Pty Ltd [2005] NSWSC 859, at [30]. 50The evidence shows that Mrs Ehsman believes that a derivative action exists which has reasonable prospects of success. She has given sworn evidence in para [24] of her affidavit of 9 December 2006 to the effect that the company has a good cause of action with reasonable prospects of success for the claims that she outlines. I can see no proper basis in the evidence for doubting that this belief is honest. The highest the evidence goes is in the affidavit of Mr Frasca, where he deposes to a discussion with Mr and Mrs Ehsman in 2003 in which, on his version of it, they conveyed an implacable desire to destroy Mr Brady. But that evidence is contested and in any event, if accepted, it would not point to any lack of honesty in Mrs Ehsman's belief at the present time of her prospects of success in a derivative action. 51Mr Frasca's evidence might be taken to point to a collateral purpose on the part of Mrs Ehsman. But the evidence, if accepted, relates to a conversation some years ago, and the assertion of a collateral purpose is inconsistent with Mrs Ehsman's affidavit evidence. It seems to me that if Mrs Ehsman succeeds in making out her factual contentions, there is a plausible derivative action along the lines of paras (C) and (D) above. If such a derivative action is pursued successfully it will have a beneficial effect on the position of Mrs Ehsman in Timentel. Those conclusions, arising out of the evidence as a whole, makes it difficult to maintain that Mrs Ehsman's purpose in pursuing the derivative cause of action is a collateral one. As Brereton J remarked in Maher v Honeysett (at [33]), the objective facts and circumstances speak louder than an applicant's words about her honesty and purpose, and here the objective facts and circumstances, supported by much evidence, are reasonably eloquent. 52My conclusion is that Ms Ehsman has succeeded in satisfying me that she is acting in good faith for the purposes of s 237(2)(b). Best interests of the company 53In Maher v Honeysett, at [44], Brereton J observed that the phrase "best interests" directs attention to the company's separate and independent welfare, a notion that imports the familiar concept of the interests of the company as a whole. Here it is unnecessary to investigate the qualifications to that proposition arising where the company is insolvent or near to insolvency. In the present case Mrs Ehsman's pursuit of derivative claims will, if she is successful, enure to her benefit, as I have explained. 54As Brereton J pointed out (at [45]), "the existence in an applicant of a personal interest in the outcome of a proposed derivative action, or even of a personal animus against the company or other members of it, cannot be significant, let alone decisive, because they are usual concomitants of the types of disputes which lead to derivative actions, and few if any such actions would be brought but for personal interest on the part of the relevant applicant and in the absence of animus against the company or other shareholders". I respectfully agree. The fact that Mrs Ehsman has a personal interest in the outcome of Timentel's derivative claims, and even the existence of personal animus against Mr Brady (if Mr Frasca's disputed evidence is excepted), are not matters standing in the way of the conclusion that the pursuit of the derivative claims is in the best interests of Timentel. 55Relief having the effect of returning Timentel's assets or their beneficial ownership to the company cannot be obtained by Mrs Ehsman 's pursuit of personal claims (except perhaps through some creative orders on the "oppression" ground). The most direct and obvious way of recovery of the property is for Timentel to assert claims for recovery orders derivatively through Mrs Ehsman. If those claims are successful the result will be orders for the restoration of Timentel's property, an outcome which will be in the best interests of the company, although obviously not in the best interests of the majority shareholders. 56In my view it is appropriate for the derivative claims to be pursued in proceedings in which Mrs Ehsman also asserts personal claims, provided that great care is taken to distinguish the two categories of claims and the ingredients of the case to prove each category. I hope that a first step along that path will be taken by the preparation of a statement of claim. Although there is a risk of confusion in allowing a single proceeding that asserts personal and derivative claims, there is considerable advantage in doing so where, as here, there is a substantial common substratum of fact underlying the two categories of claims (see Maher v Honeysett at [53]). 57In all the circumstances I am satisfied that it is in the best interests of Timentel, for the purposes of s 237(2)(c), that Mrs Ehsman be granted leave under s 237. Serious question to be tried 58In my view this case should be treated as a case where the applicant is applying for leave to bring derivative proceedings, rather than to intervene in existing proceedings. The effect of my granting leave to her to file a new initiating pleading will be, if the job is done properly, to overhaul and substantially reconstitute the proceedings, as proceedings in which she pursues clearly articulated derivative and personal claims. Where the applicant is applying for leave to bring proceedings, s 237(2)(d) requires the court to be satisfied that there is a serious question to be tried. 59As Barrett J explained in Charlton v Baber at [55], the applicant bears the onus of proving sufficient material to enable the court to make this determination. But as I explained above, referring to Palmer J's judgment in Swansson (and see Maher v Honeysett at [19]), the court does not normally enter into the merits of the proposed derivative action to any great degree. The evidence must reach the same standard as applies for an interlocutory injunction, set out in such cases as Castlemaine Tooheys Ltd v State of South Australia (1986) 161 CLR 148 and Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199. The standard has been described as "relatively low" (Maher v Honeysett at [19]). 60In this case Mrs Ehsman has filed quite extensive evidence, which she relies on for the purposes of the application, and I also have before me substantial evidence on behalf of the defendants. I infer that the evidence before me is substantially the evidentiary cases of the parties for final relief. This is certainly not a case of affidavits hurriedly cobbled together to meet the exigencies of an interlocutory occasion. Having considered the evidence my view is that, although there are many disputed questions of fact, which I am not in a position to resolve, Mrs Ehsman's allegations are sufficiently substantial to cross the "serious question to be tried" hurdle. I am therefore satisfied that s 237(2)(d) has been met. The court's powers 61The court is empowered by s 241 to make any orders, and give any directions, that it considers appropriate in relation to proceedings brought with leave, or an application for leave. That section affirms the court's power under the Civil Procedure Act 2005 (NSW) to make an order requiring that the proceedings be brought by statement of claim, a step that I shall take for the reasons I have explained. It also expressly permits the court to make orders requiring mediation, a step that the court is also empowered to take by s 26 of the Civil Procedure Act. During the course of the hearing, I floated with the parties the question whether it would be appropriate to make an order for compulsory mediation. The suggestion was not opposed and I formed the view that if the parties did not voluntarily agree to mediate I should make an order. Unless the parties have, in the meantime, organised for mediation to take place, I shall include a mediation order in the orders that I make pursuant to these reasons for judgment. 62Section 242 permits the court to make any orders it considers appropriate about the costs of various persons, including the company, in relation to proceedings brought with leave under s 237 (see Fiduciary Ltd v Morningstar Research Pty Ltd (2005) 53 ACSR 732, at [56]). In such a case as the present, where the company is essentially a vehicle to pursue the commercial interests of four parties, one of whom is at odds with the other three, who oppose the bringing of derivative claims, and the plaintiff wishes to combine derivative claims with personal claims largely arising out of the same facts, it seems to me appropriate to require the plaintiff to indemnify the company in respect of costs it may incur, either directly or by virtue of a court order against it, with respect to the pursuit of the derivative claims. If the indemnity were not given, the other three directors would as a practical matter be required to bear the burden of 65% of the company's costs of pursuing derivative claims which they do not want it to pursue. Obviously, to the extent that the plaintiff makes a personal claim against the company, she should not be required to give such an indemnity. Further, the indemnity needs to be qualified so that it does not apply to any cost order made by the court with the intention of overriding the effect of the undertaking. The main purpose of that qualification is to enable the trial judge to make such order as to costs as he or she thinks appropriate after the final hearing, untrammelled by an undertaking that may cause an order for costs against the company to rebound against the plaintiff; but the qualification may also be useful to allow the court to override the undertaking in circumstances not presently foreseeable. 63Mrs Ehsman has succeeded in establishing that leave should be granted to her to bring derivative proceedings on behalf of Timentel, and to file and appropriate pleading to initiate those proceedings (and also to clarify her personal claims). That suggests that she should have her costs of the interlocutory application of 12 December 2005, against the defendants other than Timentel. In my view the fact that she will be required to give an undertaking as to the company's future costs is immaterial to the question of the costs of the application. Although I have found that the draft amended points of claim are seriously defective, they nevertheless convey plainly enough the nature of the derivative claims that Mrs Ehsman wishes to pursue. The defects in the pleaded case did not, in my view, provided a justification for the attitude of complete opposition to the application that the defendants presented to the court. Conclusions 64For the reasons I have given, I propose to make orders along the following lines: (1)Subject to the condition identified in order (2), grant leave to the plaintiff, under s 237 of the Corporations Act 2001 (Cth), to bring proceedings on behalf of the fifth defendant against the first, second, third and fourth defendants, asserting the causes of action generally identified in these reasons for judgment and seeking all or any appropriate remedies; (2)Order (1) is subject to the condition that, before any such proceedings are brought, the plaintiff must indemnify the fifth defendant for and in respect of all costs that the fifth defendant may incur (either on its own account or under an order of the court) by reason of the bringing, maintenance and conduct of the derivative proceedings, provided however that the indemnity is not required to extend to costs that the fifth defendant may incur in the proceedings as a defendant in respect of any personal claim made by the plaintiff, and shall not apply with respect to any final order for costs in the proceedings; (3)Direct the plaintiff to file and serve a statement of claim to give effect to her personal and derivative claims, having regard to these reasons for judgment, by no later than a date to be specified; (4)Order the first, second, third and fourth defendants to pay the plaintiff's costs of her interlocutory process filed on 12 December 2005, as agreed or assessed; (5)Subject to orders (1), (2) (3) and (4), the plaintiff's interlocutory process filed on 12 December 2005 is dismissed; (6)Order that the proceedings be referred for mediation by a mediator agreed to by the parties, such mediation to take place by no later than a date to be specified; (7)Liberty to apply to Austin J on 2 days notice. 65However, I shall give the parties the opportunity to draw my attention to any particular matters that might affect the question of costs, by (for example) causing me to award costs on a different measure or to limit the order for costs in some way. I shall also give them the chance to consider my proposed orders. I shall stand the matter over for the purpose of hearing any such submissions and making orders.

Answer: The Plainitff was granted leave to commence both sets of proceedings, provided she agree to indemnify the 5th Defendant for any costs of the derivative action; she does not have to indemnify the 5th Defendant for costs of her personal action. The Plaintiff must file the proceedings on a date to be fixed. The 1st-4th Defendants have to pay the Plaintiff's costs of this application. On all othe rmatters, the Plaintiff's application is dismissed. The claims are to be referred to a mediator. All parties may approach the judge on the issue of costs if they wish to make further submissions on that point. The issue was whether the Plaintiff should be granted leave to commence proceedings personally and on behalf of the 5th Defendant, against the 1st-4th Defendants. If you don't actually understand the Corporations Act and its application to this case, you need to concentrate more during your law classes.

Question: My Solicitor failed to stop my violent ex partner from harassing now 4 years later he,s taking me to court? After a violent relationship of 7 years with 3 hospital visits, I upped and left everything behind. I had no home, he lost me my job and threatened my family. After a 3 year court battle I finally got awarded half the equity of the flat. He insisted I take a further cut from his half to get my life on track and sorry for all his grief. After all this was my money that had paid for the flat from a former home of mine. He had been busy in and out of prison. He has just served me with a court hearing to regain half the money back, can he do this to me? After 4 years I have resettled and placed all that I had into a new home, can he take this home from me also? Will I have to run again? As the equity split was witnessed and signed through a solicitor can he over ride the legal agreement?

Answer: I think it's time for you to contact a lawyer and find out what your rights are.Find out what he can and cannot do from someone that deals with this stuff daily.I hope it all works out and that you come out ahead.

Question: Can someone change ownership after they get served court papers to get sued? Let's say the only bit of asset someone has is a little equity in their home and they get served court papers with some idiot suing them for a crazy amount of money which is a gamble if they'll win or lose. Can they remove their name from the title of their home and for example transfer it to their children so they don't have to end up selling it should they get a lien or court order to liquidate to pay the thief for the frivolous lawsuit? (ex. someone claiming they fell on their property and injured themselves now going after value of their home). This is in CA and some idiot is trying to take advantage of my old mom by this stupid lawsuit which the potheads in CA award these fools with.

Answer: No. Since the lawsuit has been filed, the courts will look at the as a fraudulent transfer to escape judgement. The transfer would be voided.

Question: what are the legal issues? NEW SOUTH WALES SUPREME COURT CITATION: Ehsman v Nutectime International [2006] NSWSC 887 CURRENT JURISDICTION: Equity FILE NUMBER(S): 5189/05 HEARING DATE{S): 31 March 2006 DECISION DATE: 01/09/2006 PARTIES: Patricia Mary Ehsman (P/A) Nutectime International Pty Ltd (D1/R1) David Neilan Brady (D2/R2) Francis Joseph Frasca (D3/R3) David Bruce Paix (D4/R4) Timentel Pty Ltd (D5) JUDGMENT OF: Austin J LOWER COURT JURISDICTION: Not Applicable COUNSEL: R Harper SC (P/A) M J Cohen (D1-4/R1-4) SOLICITORS: McDonald Johnson (P/A) Sparke Helmore (D1-4, R1-4) CATCHWORDS: CORPORATIONS - statutory derivative action - application by 35% shareholder/director to bring derivative proceedings after company's assets were transferred to a company from which the applicant is excluded - inadequacies of proposed points of claim - whether those inadequacies prevent the court from determining the application under s 237 - distinction between personal and derivative claims - whether court is satisfied concerning good faith, best interests of company and serious question to be tried - ancillary order for applicant to indemnify company with respect to costs of derivative proceedings - considerations relating to the bringing of derivative and personal claims in single proceedings ACTS CITED: Corporations Act 2001 (Cth) ss 180-184, 232, 236-242 DECISION: See under heading "Conclusions" JUDGMENT: IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST AUSTIN J FRIDAY 1 SEPTEMBER 2006 5189/05PATRICIA MARY EHSMAN V NUTECTIME INTERNATIONAL PTY LTD & 4 ORS JUDGMENT 1HIS HONOUR: Before me is an application by the plaintiff, Mrs Ehsman, for leave under s 237 of the Corporations Act 2001 (Cth) to bring proceedings on behalf of the fifth defendant company, Timentel, by filing and serving a further amended originating process and amended points of claim. 2 , 3, 4, 5 and 6 Deleted The plaintiff's case 7The parties agree that Mr Brady and Mr and Mrs Ehsman came together in a business venture before Timentel was formed. Mrs Ehsman owned some patents for a split face wristwatch display, and she wished to exploit them commercially. Mr Brady had some marketing experience. There are disagreements about the commercial utility of Mrs Ehsman's patents, and as to the precise terms of their arrangements, which need not be resolved for present purposes. It is common ground that they respectively brought to the business of Timentel, when it was formed in 1998, the patents (such as they were) and a measure of marketing/commercial input. 8When Timentel was formed, Mrs Ehsman granted it a licence over her patents, for no consideration (although she received shares in the licensee entity). There is disputed evidence as to whether, as Mrs Ehsman asserts, she entered into the licence agreement in reliance on the assumption, encouraged by Mr Brady, that the licence would always be held by a company in which she would be a director and shareholder. The licensee's interest in the licence agreement was assignable. Mrs Ehsman claims, and the defendants deny, that it was a term and condition of the licence agreement that the licence would not be assigned by Timentel to a company in which Mrs Ehsman was not a shareholder and director. 9Initially the only shareholders were the Ehsmans and Mr Brady, and Mr Brady and Mrs Ehsman were the directors. Mr Brady's evidence is that he devoted very considerable time and effort, and expense, to travelling to Europe to negotiate for the commercial exploitation of the split face wristwatch display. According to him, the people he consulted in Europe told him that Mrs Ehsman's patents were just concepts and it would be necessary to work out the most efficacious interior wristwatch mechanisms to support the split face. That is disputed by Mrs Ehsman. But it is clear enough that Mr Brady did do some amount of developmental/marketing work in Europe, the cost of which was shared or partly shared with the Ehsmans. 10Mr Brady's evidence is that he came up with the idea of having movements in each half of the split face watch case for the forward and return hand movements, all controlled by an electronic integrated circuit, and that Mr Claude Ray, an experienced watchmaker, carried out the necessary design work. The eventual product, which he called a "hinged electronic watch", was based on ideas that were fundamentally different, he said, from Mrs Ehsman's patents. These matters are contested. 11Mr Brady said he negotiated a development agreement with Mr Ray's company, using a company with which he was associated, Renaissance Management, for that purpose. In turn he caused Renaissance Management to enter into an agreement with another company with which he was associated, DNB Global Corporation (registered in the Philippines), which made advance payments to Mr Ray's company. At a final hearing of this case it will be necessary to explore these corporate relationships and their purpose, and to understand better the nature of Mr Brady's interests. DNB Global appears to bear his initials, but there is some evidence that he is just one of five directors and is indirectly a shareholder. DNB Global is important in this case because, according to Mr Brady, it incurred substantial expenses through payments for development work, for which Timentel reimbursed it out of monies borrowed by Timentel from Mr Brady, Mr Frasca and Mr Paix. But Mrs Ehsman questions whether loans were ever in fact made by those three directors. 12Mr Brady said the development of the hinged electronic watch was very expensive and under the arrangements between them, Ms Ehsman was to contribute to that development. He alleges that she defaulted in that obligation. He claims that by March 2005 she owed and had not paid about $86,000. That is contested. According to Mr Brady, the development was eventually successful and the hinged electronic watch is protected by patents in various countries, procured at a cost to DNB Global, recoverable from Timentel. 13In about June 2002 Ms Ehsman and Mr Brady decided to bring in two other parties, namely Mr Frasca and Mr Paix. There is quite a bit of evidence, not all consistent, about the circumstances in which Mr Frasca and Mr Paix were invited into the company. What is clear is that Mr Frasca and Mr Paix joined the board of directors and acquired shares, they provided some capital, and in due course they sided with Mr Brady and against Mrs Ehsman. After they joined the board, the company's issued 100 ordinary shares were divided as follows: Mr Brady 35 shares, Mr and Mrs Ehsman 35 shares, Mr Frasca 15 shares, and Mr and Mrs Paix 15 shares. 14During 2002, it seems, Mrs Ehsman visited Europe and met with one of Mr Brady's contacts, Manuel Spode of Les Artisans Horlogers. There is conflicting evidence as to what happened at the meeting. Mr Frasca gives evidence in his affidavit that the meeting led to Mrs Ehsman being criticised by the other directors for intervening secretly without the board's authority, and for her suspicious approach. Mr Frasca also says that at a meeting he had with Mr and Mrs Ehsman in 2003, they told him that they were determined to bring Mr Brady down. These matters are also disputed. Nevertheless it appears that, some time after Mr Frasca and Mr Paix arrived on the board, if not earlier, the relationship between Messrs Brady, Frasca and Paix, on the one hand, and the Ehsmans, on the other hand, deteriorated. By now the relationship has completely broken down. 15There is a considerable amount of correspondence in evidence, and minutes of board meetings. I shall not describe this material in detail here. The correspondence shows that at least since early 2005, Mrs Ehsman has been concerned about verifying payments allegedly due by Timentel to DNB Global, and also about the financial management of Timentel more generally. The evidence is that the only bank account of Timentel has been relatively dormant at times when, the defendants allege, Timentel made payments to DNB Global. Mrs Ehsman's solicitors have written to Timentel's solicitors about these matters. 16Mr Brady claims that by about May 2005 there was a pressing need for capital for Timentel, to pay invoices to DNB Global of about $216,000 and certain other smaller debts. It appears that at this time Mr Brady, Mr Frasca and Mr Paix developed a proposal to lend Timentel up to $246,000 for a term of 60 days with interest of 17% compounding monthly, secured by a registered charge. Mrs Ehsman asked the copies of the draft loan facility and charge documents but received them only after they had been executed. A board meeting attended by Mr Brady, Mr Frasca and Mr Paix, but not Mrs Ehsman, on 9 May 2005 approved the loan proposal and authorised execution of the documents. Mr Brady, Mr Frasca and Mr Paix, acting as directors of the company, purported to authorise the company to enter into the loan facility and charge agreements in which they were the counterparties, without the consent of the other director/shareholder, Ms Ehsman. 17The defendants claim that the loan facility was drawn down and the money was used directly for payment of outstanding debts of Timentel, rather than for deposit into Timentel's bank account. Mrs Ehsman, by her solicitor, sought to verify the making of the loan but she says she has not received proper documentation. The evidence includes minutes of the board meeting of DNB Global on 18 August 2005, at which the directors of that company confirmed that the company had been paid for certain invoices, but the evidence is incomplete because, for example, the identity of the paying entity is not given. 18On 11 July 2005 Messrs Brady, Frasca and Paix as lenders made a formal notice of demand for payment to Timentel of an amount of about $247,000. But they gave the company a limited extension of time to repay. Mrs Ehsman's solicitors alleged in correspondence that any attempt to enforce the charge would render it void under s 267 of the Corporations Act, because the chargees were "relevant persons" for the purposes of that section. 19The security was not enforced but instead, at some stage it was proposed that the company would enter into an asset sale agreement and a deed of assignment of the licence, in favour of the other three directors or their vehicle, for a price supported by a valuation by Les Artisans Horlogers. In correspondence, Mrs Ehsman's solicitors endeavoured unsuccessfully to obtain information about the valuation - indeed, they approached the valuer directly without success. They alleged that the valuation did not cover all of the assets sold. They strenuously opposed the proposed transaction, on several grounds including that the transaction would be in breach of the contractual arrangements and understandings between Mrs Ehsman and the other three directors. 20Nutectime was formed in August 2005. The directors are Mr Brady, Mr Frasca and Mr Paix. The company has issued 100 ordinary shares. Mr Brady owns 60 shares, Mr Frasca owns 20 shares in Mr and Mrs Paix own 20 shares. Mr and Mrs Ehsman do not hold any shares. 21The asset sale agreement and the deed of assignment of licence were entered into by Timentel and Nutectime on 2 September 2005. The transaction was considered at a board meeting not attended by Mrs Ehsman. Messrs Brady, Frasca and Paix went through a procedure of formally disclosing their interest in the purchaser but then they proceeded, purporting to act as directors of the company, to approve the transaction. It appears that the contract was made and completion took place on the same day. The total sale price $277,000. According to Timentel's solicitors, the sale proceeds were used to pay out and discharge the charge over the company's assets. That appears to have meant that the bulk of the sale proceeds were directed to Mr Brady, Mr Frasca and Mr Paix. It is not clear from the evidence whether there was any actual movement of money. 22Up until May 2005 Mrs Ehsman had been a director and (with her husband) substantial shareholder of Timentel, which was the licensee for no consideration of her patents. On one view, the company owed a substantial amount of money to DNB Global, but it had procured substantial development work for its split face watch design. Any profits from the realisation of that development work would have come to Timentel, and Mr and Mrs Ehsman would have had a 35% interest in those profits. After 2 September 2005, Mrs Ehsman was still a director of Timentel and Mr and Mrs Ehsman remained 35% shareholders. But the company's substantial assets, and any prospect it may have had of earning profits from the development of the split face watch, had gone. Mrs Ehsman was still the licensor of her patents, but she was entitled to receive no consideration for the licence. The new licensee, Nutectime, was a company in which she had no interest, and that company had acquired Timentel's assets and any profit-making opportunity relating to the split face watch. The controllers and shareholders of Nutectime were her fellow directors and shareholders of Timentel. The draft APC and draft FAOP 23From this brief account it appears that if Mrs Ehsman could substantiate her allegations, this would be a case of self-dealing by her co-directors to her considerable disadvantage, and unauthorised diversion of a corporate opportunity. Experience shows that in such cases it is important for the plaintiff to identify with particularity the precise duties said to have been breached and the circumstances of the breach. That is important in the interests of clarity of presentation of the plaintiff's case, and to ensure that the defendant is not surprised by having to meet a case at trial different from what she had been led to expect. These considerations strongly suggest that in such a case, the plaintiff should proceed by statement of claim. Where the plaintiff is proceeding in her own right, invoking the oppression remedy, and also seeking to assert the company's rights in a derivative action, the need for clarity of pleading is especially strong. 24 Deleted 25I have endeavoured to identify those allegations that relate to some right of Timentel, and distinguish them from allegations relating to some right of Mrs Ehsman personally. In summary, for reasons given below, paras 7, 18-21, 22, 23-26, and 27-29 (and the claims to relief in paras 1-5, perhaps 7, and 8) of the draft APC are claims made on behalf of Timentel, and paras 8-16, 17, 30 and 31 (and claims to relief in para 6 and perhaps 7) are claims made by Mrs Ehsman personally. 26It is important to maintain the distinction between derivative and personal claims in the interests of clarity. But nothing in Part 2F.1A requires that a derivative action be in a separate proceeding in which no personal claims are made by the person who has carriage of the proceeding. For example, in Fiduciary Ltd v Morningstar Research Pty Ltd (2005) 53 ACSR 732 the plaintiffs were an individual and corporate plaintiffs, and leave was granted under s 237 so as to permit the individual plaintiff (who was a shareholder and officer of the corporate plaintiffs) to assert the rights of the companies in a proceeding in which he also asserted rights of his own. The combination of corporate and personal claims was not unlike the combination of claims in the present case, though the pleading was by an elaborate statement of claim. In that case, and here, the asserted derivative and personal rights arise to a large degree out of the same alleged facts. 27Here the sole plaintiff is Mrs Ehsman, and Timentel is a defendant. It is not proposed that Timentel should become a plaintiff if s 237 leave is granted, because Timentel is properly a defendant to some of Mrs Ehsman's claims. Nor is it proposed that the derivative action be constituted as a separate proceeding, because there are substantially overlapping facts concerning the derivative and personal claims, which should therefore be heard together. Section 236(2) says that proceedings brought on behalf of a company must be brought in the company's name. But there is now a substantial line of decisions holding that, despite the literal wording of s 236(2), leave under s 237 can be given where the company is a party to the proceeding as a necessary defendant in respect of other claims, without requiring the company become a plaintiff or insisting that the derivative action be brought in a separate proceeding: see especially Keyrate Pty Ltd v Hamarc Pty Ltd (2001) 38 ACSR 396, per Santow J at [18]-[19]; Metyor Inc v Queensland Electronic Switching Pty Ltd (2002) 42 ACSR 398, per McPherson JA at [14]-[15]; Charlton v Baber (2003) 47 ACSR 31, per Barrett J at [5]. 28I turn now to consider the draft APC, paragraph by paragraph. 29After preliminary allegations, para 7 of the draft APC asserts that by reason of their appointment as directors of Timentel, Mr Brady, Mr Frasca and Mr Paix owed Timentel various duties. There is a list of the standard duties of directors. The list reflects ss 180, 181, 182 and 183 of the Corporations Act, and also a duty to act honestly in the exercise of their powers and the discharge of their duties as directors (a formulation no longer found in the statute). [deleted latter part of paragraph] 30Having made allegations about the defendants' duties as directors of Timentel, the draft APC (paras 8-16) makes allegations about the licence agreement, leading to the assertion that the purported sale by Timentel to Nutectime of its rights under the licence agreement was in breach of the licence agreement. That is a personal claim by Mrs Ehsman against Timentel (and no other defendant) for breach of contract. It is not a claim for breach of any duty owed to Timentel. 31Para 17 pleads that, by reason of matters pleaded in paras 8-11, the first to fourth defendants are estopped from asserting that Timentel was entitled to sell or assign to the first defendant the rights of Timentel under the licence agreement. This was said to arise because Mrs Ehsman entered into the licence agreement in reliance on the assumption, encouraged by Mr Brady, Mr Frasca and Mr Paix, that the licence would always be held by a company of which she was a director and shareholder. Clearly the allegation of estoppel is made for the benefit of Mrs Ehsman personally rather than to vindicate some right or interest of Timentel. The document does not reveal how the allegation can be made against any defendant other than Mr Brady, given that the assumption is said to have been created and acted upon at the time of the licence agreement, which was made well before Mr Frasca and Mr Paix became involved. 32Paras 18-21 make allegations about breaches of duties owed by the other three directors to Timentel. They allege that Timentel did not receive any of the proceeds of sale of assets, or received only part of the proceeds, and Messrs Brady, Frasca and Paix received those proceeds or part of them. It is claimed that their conduct in receiving those proceeds constituted a breach of all of the duties pleaded in paragraph 7. I find it impossible to justify that claim, with respect to some of the duties identified in para 7, even taking into account the "particulars" to para 21. Moreover, the mere assertion that Timentel did not receive proceeds of sale and the other three directors did (even when the "particulars" to para 21 are added) cannot, per se, establish a breach of any of the duties identified in para 7. These allegations fall well short of a proper pleading. 33Para 22 alleges that by reason of the matters alleged in certain other paragraphs, Messrs Brady, Frasca and Paix have been unjustly enriched as a result of breach of the duties referred to in para 7. Presumably this is intended to establish a ground of recovery for Timentel. Again, the precise matters that might constitute unjust enrichment have not been adequately pleaded and, moreover, it is not easy to see why para 22 combines breach of directors' duties with unjust enrichment. 34Paras 23-26 make allegations against Nutectime, intended to support orders declaring void and setting aside the purported sale of assets or requiring Nutectime to hold the assets in trust for Timentel. These paragraphs seem to assert some entitlement to relief on the part of Timentel rather than Mrs Ehsman, although the remedies would obviously operate for her benefit as well. The precise foundation of the remedies is not clear. The drafter has not invoked the equitable principles concerning accessory liability for breach of trust with any specificity or clarity. To the extent that entitlement to the relief is said to arise out of Nutectime being "knowingly concerned in the breach" there is a suggestion of statutory accessory liability, but the statutory directors' duties do not create any accessory civil reliability for being knowingly concerned in the primary breach. There is "accessory" liability under the statute for de facto and shadow directors, but the allegations in the draft APC do not in terms invoke that liability. 35Paras 27-29 allege that the deed of charge dated 9 May 2005 is void and should be set aside because Timentel did not receive the benefit, or received only part of the benefit, of the money purported to be advanced. This seems to be the assertion of rights of Timentel rather than Mrs Ehsman personally. A deed of charge merely provides security for advances made under some other arrangement such as a loan facility agreement. It is not easy to see why the fact (if it be so) that the chargor did not receive the benefit of loan monies purported to be advanced under a loan facility agreement should, per se, lead to the consequence that the security for the loan is void. If the charge is security for money advanced under a loan facility agreement, and no money is advanced to the chargor, then nothing is secured by the charge but the charging instrument is nevertheless valid. 36Para 30 contends that the other three directors repeatedly failed or refused to furnish information to Mrs Ehsman relating to the affairs of Timentel. Particulars are given. As expressed, this is an allegation of breach of duty to Mrs Ehsman rather than Timentel. There is no allegation of any particular duty but it seems that the drafter had in mind either or both of the statutory rights of a director to gain access to certain information under ss 198F and 290, or the director's general law right of access to the information needed to discharge her fiduciary duty (eg Edman v Ross (1922) 22 SR(NSW) 351). A director seeking to assert those rights is not required to show that inspection is sought in good faith and for a proper purpose, whereas a shareholder seeking inspection under s 247A must do so. Para 30 is not clear enough. 37Para 31 asserts that, by reason of the matters asserted, the other three directors have conducted the affairs of Timentel in a manner oppressive to, unfairly prejudicial to or unfairly discriminatory against Mrs Ehsman, or contrary to the interests of the members as a whole, contrary to s 232. Mrs Ehsman has personal standing to complain under that provision. The difficulty with para 31 is that it relies globally on all of the other allegations, some of which do not seem to be pertinent (for example, the pleadings against Timentel itself based on breach of contract and against Mr Brady based on estoppel). It should be re-formulated with more precision. 38 Deleted 39The draft FAOP contains the same claims for relief as the draft APC, and therefore suffers from the defects just noted. It also contains a prayer for an order under s 237. This is inappropriate, given that the interlocutory application presently under consideration seeks a s 237 order and also leave to file the FAOP, so that the question of s 237 leave will have been addressed before the FAOP is filed. Further, in the draft FAOP the application is said to be made pursuant to ss 232, 236 and 237. Sections 236 and 237 do not need to be mentioned, for the reason just given, and s 232 appears from the draft APC to be only one of the statutory provisions under which relief is sought, the others being the various directors' duties provisions. 40My conclusion is that the draft APC and the draft FAOP are seriously defective, and therefore I shall not accede to Mrs Ehsman's application for leave to file and serve them in their present form. What is needed is a carefully considered pleading by statement of claim. However, my view is that the draft APC identifies in broad terms, though imprecisely and at times in a confused way, some derivative and personal causes of action that emerge on Mrs Ehsman's account of the evidence. The causes of action are: (A)a personal claim by Mrs Ehsman against Timentel for breach of contract arising out of Timentel's purported sale and assignment to Nutectime, sounding in damages (paras 8-16); (B)a personal claim by Mrs Ehsman against Mr Brady based the allegation that at the time of the making of the licence agreement he encouraged her to assume that the licence would always be held by a company of which she was a director and shareholder - though the appropriate remedy, if this ground is established, is debatable (para 17); (C)claims by Timentel against Messrs Brady, Frasca and Paix for breach of ss 182 and 183 and their general law duty to avoid conflicts of interest, by virtue of their self-dealing in the loan and security transactions and then the sale and assignment transactions, leading an order for an account of profit or an order setting aside the transactions, or a compensation order under s 1317H (paras 18-21 and 22); (D)a claim by Timentel against Nutectime for accessory liability under equitable principles which apply to a person who assists in a breach of fiduciary duty or receives property transferred in breach of duty, leading to an order requiring Nutectime to hold acquired property on trust or to account as a constructive trustee (paras 23-26); (E)a personal claim by Mrs Ehsman against the other three directors asserting infringement of her right of access as a director to information of Timentel, under the general law and perhaps under ss 198F and 290, leading to an order for access or to restrain obstruction (para 30); (F)a personal claim by Mrs Ehsman for relief under the "oppression" remedy in s 232, arising out of specifically pleaded facts and circumstances, leading to a range of possible remedies to address the oppressive or unfair conduct (para 30). 41I am not persuaded that there is any viable course of action underlying paras 27-29. 42I think the appropriate course is to dismiss the application for leave to file and serve the amended points of claim, and to direct Mrs Ehsman to file and serve a statement of claim to give effect to her personal and derivative claims having regard to these reasons for judgment. 43Section 237 authorises the court to grant leave to permit a person to bring proceedings on behalf of a company. Part 2F.1A does not explain the word "proceedings" or give any direct indication of the level of specificity of pleaded allegations and prayers for relief that the applicant for leave must achieve. Typically the applicant will provide the court with a draft statement of claim or (as here) points of claim, or some other document giving particulars of the derivative claims. But in my view it cannot be the case that a full statement of the derivative claims must be presented before the court can consider and determine a leave application. Were that to be required, any subsequent amendments to the pleaded case would need to be treated as a leave application under s 237 to which the criteria in s 237(2) would have to be applied. That, in my view, would be an unnecessary burden for case management. 44In my opinion the applicant for leave must identify and describe the proposed proceedings with sufficient precision that the court can properly assess the application having regard to the criteria that it is required to consider under s 237(2), and the opponents can respond to the application in terms of those criteria. That may be achieved by presenting the court with a draft pleading, but it may be achieved in other ways such as by outlining the claims in affidavit evidence. It is not hard to envisage an application that falls so far short of identifying the derivative causes of action to be asserted that the court is left unable to assess, for example, whether it is in the best interests of the company that the applicant be granted leave, and whether there is a serious question to be tried. Here, however, Mrs Ehsman has done enough in her draft points of claim (defective though they are) and in the voluminous evidence that has been adduced, to permit me to identify the causes of action broadly described in paragraphs (A)-(F) above, of which paras (C) and (D) are derivative claims. I am able to consider the application for leave under s 237 as an application for leave to bring proceedings on behalf of Timentel by a statement of claim that would assert the causes of action identified in paras (C) and (D) and seek appropriate equitable and statutory relief. The requirements for leave to bring a derivative action 45Section 236(1)(a) allows a member or officer, inter alios, to bring proceedings on behalf of the company with the court's leave. Ms Ehsman has standing both as a member and an officer of Timentel. 46Under s 237(2) the court is required to grant the application for leave if it is satisfied of five matters set out in subparagraphs (a) to (e). Subsection 237(3) and (4) establish a rebuttable presumption that the granting of leave is not in the best interests of the company in certain circumstances, but it is agreed that those circumstances have no application to the present case. There is no suggestion of the members of the company purporting to ratify or approve the conduct of the other three directors, so as to invoke s 239. 47Of the five matters that the court must address under s 237(2), the parties agree that the notice requirement in subparagraph (e) has been satisfied here. The defendants did not concede, in terms of subparagraph (a), that it is probable that the company will not itself bring the proceedings, or properly take responsibility for them, or for the steps in them. However, the evidence before me plainly establishes that this criterion is satisfied, in respect of proceedings to pursue any derivative claims of the kind identified at paras (C) and (D) above. Timentel is under the control of the other three directors, who are acting together in respect of the company's dealings with Mrs Ehsman. The other directors (and spouse, in the case of Mr Paix) are the majority shareholders. They have caused the assets of Timentel to be passed to Nutectime, a company in which they but not Ms Ehsman are the directors and shareholders. They have asserted, in answer to the present application, both on their own behalf and on behalf of Timentel, that there is no foundation for derivative claims to be brought. It is clear from their attitude, revealed in the evidence and upon the application, that they would not authorise the company to bring such proceedings. 48That leaves for consideration subparagraphs (b), (c) and (d) of s 237(2). In their submissions, the parties referred me to a substantial number of decided cases. It seems to me, however, that the courts' approach to these subparagraphs has become relatively clear in the course of decisions, and it is unnecessary for me to refer to authorities extensively. Additionally, I have reached the conclusion that this is a plain case in which all three criteria have been established, and that extensive exposition is unnecessary. Good faith 49In the Swansson case, Palmer J expressed the opinion at least two questions are generally relevant to this issue: namely, whether the applicant honestly believes that a good cause of action exists and has reasonable prospects of success; and whether the applicant is seeking to act in a derivative capacity for such a collateral purpose as will amount to an abuse of process. This approach has been followed frequently in subsequent cases. I was referred, inter alia, to the discussion by Brereton J. in Maher v Honeysett & Maher Electrical Contractors Pty Ltd [2005] NSWSC 859, at [30]. 50The evidence shows that Mrs Ehsman believes that a derivative action exists which has reasonable prospects of success. She has given sworn evidence in para [24] of her affidavit of 9 December 2006 to the effect that the company has a good cause of action with reasonable prospects of success for the claims that she outlines. I can see no proper basis in the evidence for doubting that this belief is honest. The highest the evidence goes is in the affidavit of Mr Frasca, where he deposes to a discussion with Mr and Mrs Ehsman in 2003 in which, on his version of it, they conveyed an implacable desire to destroy Mr Brady. But that evidence is contested and in any event, if accepted, it would not point to any lack of honesty in Mrs Ehsman's belief at the present time of her prospects of success in a derivative action. 51Mr Frasca's evidence might be taken to point to a collateral purpose on the part of Mrs Ehsman. But the evidence, if accepted, relates to a conversation some years ago, and the assertion of a collateral purpose is inconsistent with Mrs Ehsman's affidavit evidence. It seems to me that if Mrs Ehsman succeeds in making out her factual contentions, there is a plausible derivative action along the lines of paras (C) and (D) above. If such a derivative action is pursued successfully it will have a beneficial effect on the position of Mrs Ehsman in Timentel. Those conclusions, arising out of the evidence as a whole, makes it difficult to maintain that Mrs Ehsman's purpose in pursuing the derivative cause of action is a collateral one. As Brereton J remarked in Maher v Honeysett (at [33]), the objective facts and circumstances speak louder than an applicant's words about her honesty and purpose, and here the objective facts and circumstances, supported by much evidence, are reasonably eloquent. 52My conclusion is that Ms Ehsman has succeeded in satisfying me that she is acting in good faith for the purposes of s 237(2)(b). Best interests of the company 53In Maher v Honeysett, at [44], Brereton J observed that the phrase "best interests" directs attention to the company's separate and independent welfare, a notion that imports the familiar concept of the interests of the company as a whole. Here it is unnecessary to investigate the qualifications to that proposition arising where the company is insolvent or near to insolvency. In the present case Mrs Ehsman's pursuit of derivative claims will, if she is successful, enure to her benefit, as I have explained. 54As Brereton J pointed out (at [45]), "the existence in an applicant of a personal interest in the outcome of a proposed derivative action, or even of a personal animus against the company or other members of it, cannot be significant, let alone decisive, because they are usual concomitants of the types of disputes which lead to derivative actions, and few if any such actions would be brought but for personal interest on the part of the relevant applicant and in the absence of animus against the company or other shareholders". I respectfully agree. The fact that Mrs Ehsman has a personal interest in the outcome of Timentel's derivative claims, and even the existence of personal animus against Mr Brady (if Mr Frasca's disputed evidence is excepted), are not matters standing in the way of the conclusion that the pursuit of the derivative claims is in the best interests of Timentel. 55Relief having the effect of returning Timentel's assets or their beneficial ownership to the company cannot be obtained by Mrs Ehsman 's pursuit of personal claims (except perhaps through some creative orders on the "oppression" ground). The most direct and obvious way of recovery of the property is for Timentel to assert claims for recovery orders derivatively through Mrs Ehsman. If those claims are successful the result will be orders for the restoration of Timentel's property, an outcome which will be in the best interests of the company, although obviously not in the best interests of the majority shareholders. 56In my view it is appropriate for the derivative claims to be pursued in proceedings in which Mrs Ehsman also asserts personal claims, provided that great care is taken to distinguish the two categories of claims and the ingredients of the case to prove each category. I hope that a first step along that path will be taken by the preparation of a statement of claim. Although there is a risk of confusion in allowing a single proceeding that asserts personal and derivative claims, there is considerable advantage in doing so where, as here, there is a substantial common substratum of fact underlying the two categories of claims (see Maher v Honeysett at [53]). 57In all the circumstances I am satisfied that it is in the best interests of Timentel, for the purposes of s 237(2)(c), that Mrs Ehsman be granted leave under s 237. Serious question to be tried 58In my view this case should be treated as a case where the applicant is applying for leave to bring derivative proceedings, rather than to intervene in existing proceedings. The effect of my granting leave to her to file a new initiating pleading will be, if the job is done properly, to overhaul and substantially reconstitute the proceedings, as proceedings in which she pursues clearly articulated derivative and personal claims. Where the applicant is applying for leave to bring proceedings, s 237(2)(d) requires the court to be satisfied that there is a serious question to be tried. 59As Barrett J explained in Charlton v Baber at [55], the applicant bears the onus of proving sufficient material to enable the court to make this determination. But as I explained above, referring to Palmer J's judgment in Swansson (and see Maher v Honeysett at [19]), the court does not normally enter into the merits of the proposed derivative action to any great degree. The evidence must reach the same standard as applies for an interlocutory injunction, set out in such cases as Castlemaine Tooheys Ltd v State of South Australia (1986) 161 CLR 148 and Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199. The standard has been described as "relatively low" (Maher v Honeysett at [19]). 60In this case Mrs Ehsman has filed quite extensive evidence, which she relies on for the purposes of the application, and I also have before me substantial evidence on behalf of the defendants. I infer that the evidence before me is substantially the evidentiary cases of the parties for final relief. This is certainly not a case of affidavits hurriedly cobbled together to meet the exigencies of an interlocutory occasion. Having considered the evidence my view is that, although there are many disputed questions of fact, which I am not in a position to resolve, Mrs Ehsman's allegations are sufficiently substantial to cross the "serious question to be tried" hurdle. I am therefore satisfied that s 237(2)(d) has been met. The court's powers 61The court is empowered by s 241 to make any orders, and give any directions, that it considers appropriate in relation to proceedings brought with leave, or an application for leave. That section affirms the court's power under the Civil Procedure Act 2005 (NSW) to make an order requiring that the proceedings be brought by statement of claim, a step that I shall take for the reasons I have explained. It also expressly permits the court to make orders requiring mediation, a step that the court is also empowered to take by s 26 of the Civil Procedure Act. During the course of the hearing, I floated with the parties the question whether it would be appropriate to make an order for compulsory mediation. The suggestion was not opposed and I formed the view that if the parties did not voluntarily agree to mediate I should make an order. Unless the parties have, in the meantime, organised for mediation to take place, I shall include a mediation order in the orders that I make pursuant to these reasons for judgment. 62Section 242 permits the court to make any orders it considers appropriate about the costs of various persons, including the company, in relation to proceedings brought with leave under s 237 (see Fiduciary Ltd v Morningstar Research Pty Ltd (2005) 53 ACSR 732, at [56]). In such a case as the present, where the company is essentially a vehicle to pursue the commercial interests of four parties, one of whom is at odds with the other three, who oppose the bringing of derivative claims, and the plaintiff wishes to combine derivative claims with personal claims largely arising out of the same facts, it seems to me appropriate to require the plaintiff to indemnify the company in respect of costs it may incur, either directly or by virtue of a court order against it, with respect to the pursuit of the derivative claims. If the indemnity were not given, the other three directors would as a practical matter be required to bear the burden of 65% of the company's costs of pursuing derivative claims which they do not want it to pursue. Obviously, to the extent that the plaintiff makes a personal claim against the company, she should not be required to give such an indemnity. Further, the indemnity needs to be qualified so that it does not apply to any cost order made by the court with the intention of overriding the effect of the undertaking. The main purpose of that qualification is to enable the trial judge to make such order as to costs as he or she thinks appropriate after the final hearing, untrammelled by an undertaking that may cause an order for costs against the company to rebound against the plaintiff; but the qualification may also be useful to allow the court to override the undertaking in circumstances not presently foreseeable. 63Mrs Ehsman has succeeded in establishing that leave should be granted to her to bring derivative proceedings on behalf of Timentel, and to file and appropriate pleading to initiate those proceedings (and also to clarify her personal claims). That suggests that she should have her costs of the interlocutory application of 12 December 2005, against the defendants other than Timentel. In my view the fact that she will be required to give an undertaking as to the company's future costs is immaterial to the question of the costs of the application. Although I have found that the draft amended points of claim are seriously defective, they nevertheless convey plainly enough the nature of the derivative claims that Mrs Ehsman wishes to pursue. The defects in the pleaded case did not, in my view, provided a justification for the attitude of complete opposition to the application that the defendants presented to the court. Conclusions 64For the reasons I have given, I propose to make orders along the following lines: (1)Subject to the condition identified in order (2), grant leave to the plaintiff, under s 237 of the Corporations Act 2001 (Cth), to bring proceedings on behalf of the fifth defendant against the first, second, third and fourth defendants, asserting the causes of action generally identified in these reasons for judgment and seeking all or any appropriate remedies; (2)Order (1) is subject to the condition that, before any such proceedings are brought, the plaintiff must indemnify the fifth defendant for and in respect of all costs that the fifth defendant may incur (either on its own account or under an order of the court) by reason of the bringing, maintenance and conduct of the derivative proceedings, provided however that the indemnity is not required to extend to costs that the fifth defendant may incur in the proceedings as a defendant in respect of any personal claim made by the plaintiff, and shall not apply with respect to any final order for costs in the proceedings; (3)Direct the plaintiff to file and serve a statement of claim to give effect to her personal and derivative claims, having regard to these reasons for judgment, by no later than a date to be specified; (4)Order the first, second, third and fourth defendants to pay the plaintiff's costs of her interlocutory process filed on 12 December 2005, as agreed or assessed; (5)Subject to orders (1), (2) (3) and (4), the plaintiff's interlocutory process filed on 12 December 2005 is dismissed; (6)Order that the proceedings be referred for mediation by a mediator agreed to by the parties, such mediation to take place by no later than a date to be specified; (7)Liberty to apply to Austin J on 2 days notice. 65However, I shall give the parties the opportunity to draw my attention to any particular matters that might affect the question of costs, by (for example) causing me to award costs on a different measure or to limit the order for costs in some way. I shall also give them the chance to consider my proposed orders. I shall stand the matter over for the purpose of hearing any such submissions and making orders.

Answer: HAHAHA, there is no way in he** anyone is going to read that whole thing...this has to be a joke.

Question: How can Obama tout equal pay for woman, we he doesn't even believe that himself? Obama Pays Female Staff Less Than Males While Democratic presidential candidate Barack Obama has vowed to make pay equity for women a top priority if elected president, an analysis of his Senate staff shows that women are outnumbered and out-paid by men. That is in contrast to Republican presidential candidate John McCain's Senate office, where women, for the most part, out-rank and are paid more than men. Obama spoke in Albuquerque, N.M. last week about his commitment to the issue and his support of a Senate bill to make it easier to sue an employer for pay discrimination. "Mr. McCain is an honorable man, we respect his service. But when you look at our records and our plans on issues that matter to working women, the choice could not be clearer," Obama told the audience in New Mexico, a voter-swing state. "It starts with equal pay. Sixty-two percent of working women in America earn half or more than of their family's income. But women still earn 77 cents for every dollar earned by men in 2008. You'd think that Washington would be united it its determination to fight for equal pay. " He continued, saying that he is proud to have supported the Lilly Ledbetter Fair Pay Restoration Act, which would extend the limit on how long an employee can wait before suing an employer for pay discrimination. The legislation was named after Lilly Ledbetter, who was a supervisor at Goodyear Tire & Rubber's plant in Gadsden, Ala. She sued for pay discrimination before retiring after 19 years because she had made $6,500 less per year than the lowest paid male supervisor. However, the U.S. Supreme Court threw out her case, saying she waited too long to file a complaint. The court said that under the 1964 Civil Rights Act, an employee must sue within 180 days of a decision regarding pay if alleged discrimination is involved. The bill sought to change the law, but Democrats could not muster the needed 60 votes to override a Republican filibuster. Obama voted for the equal pay litigation bill in April. McCain was campaigning that day and did not vote. But he has expressed opposition to the legislation, fearing it would open the door to too much litigation. On average, women working in Obama's Senate office were paid at least $6,000 below the average man working for the Illinois senator. That's according to data calculated from the Report of the Secretary of the Senate, which covered the six-month period ending Sept. 30, 2007. Of the five people in Obama's Senate office who were paid $100,000 or more on an annual basis, only one -- Obama's administrative manager -- was a woman. The average pay for the 33 men on Obama's staff (who earned more than $23,000, the lowest annual salary paid for non-intern employees) was $59,207. The average pay for the 31 women on Obama's staff who earned more than $23,000 per year was $48,729.91. (The average pay for all 36 male employees on Obama's staff was $55,962; and the average pay for all 31 female employees was $48,729. The report indicated that Obama had only one paid intern during the period, who was a male. ) McCain, an Arizona senator, employed a total of 69 people during the reporting period ending in the fall of 2007, but 23 of them were interns. Of his non-intern employees, 30 were women and 16 were men. After excluding interns, the average pay for the 30 women on McCain's staff was $59,104.51. The 16 non-intern males in McCain's office, by comparison, were paid an average of $56,628.83. The Obama campaign did not respond to written questions submitted on the matter Thursday by Cybercast News Service . During his Albuquerque speech, Obama criticized McCain for supporting the Supreme Court ruling on the pay-equity issue. "Sen. McCain thinks the Supreme Court got it right," Obama said. "He opposed the Fair Pay Restoration Act. He suggested that the reason women don't have equal pay isn't discrimination on the job - it's because they need more education and training. That's just totally wrong. " Obama continued, "Lilly Ledbetter's problem was not that she was somehow unqualified or unprepared for higher-paying positions. She most certainly was and by all reports was an excellent employee. Her problem was that her employer paid her less than men doing the exact same work. "

Answer: There could be many other factors involved. Manybe a couple of men make a lot more than the others. This would affect the average upward. Maybe the males have worked for him longer. Maybe they have more responsibilities. Have you done any research on this? Figures and averages can be very misleading. I think he is honest in his statements in this regard.

Question: What comments are there for each solution? A paper factory dumps polluting chemicals into the Snake River. Thousands of citizens live along the river, and they bring a suit, claiming damages. You are asked to testify at the trial as an impartial expert. The court is considering 4 possible solutions, and you are asked to comment on the potential efficiency and equity of each. Your testomony should be brief. a- Deny the merits of the case asd simply affirm the polluter's right to dump. The parties will achieve the optimal solution without government. b- Find in favor of the plaintiff. The polluters will be held liable for damages and must fully compensate citizens for all the past and future damages. c- Order an immediate end to the dumping, with no damages awarded. d- Refer the matter to the Enviornmental Protection Agency, which will impose a tax on the factory equal to the marginal damage costs. Proceeds will not be paid to the damaged parties.

Answer: b), and they'll be further taken to the cleaners when the entire town ends up with cancer.

Question: Is a Chapter 7 debtor's home mortgage limited to reaffirmation, redemption or surrender, after exempt? I am waiting for my attorney to get back to me next week. In the meantime if anyone knows the answer to this, I would really appreciate it. I have already filed and had my court date for my Chapter 7 bankruptcy. My Chapter 7 bankruptcy will be finalized on January 30 2007, and I will be released of all unsecured debt. On my "Debtors Statement of Intention" document, we put "Surrender" for my car, and that's exactly what I'm doing with it. For my house we put "Exempt" which made the equity exempt and allowed me to keep the home without a forced sale. The problem and question is with my home. The mortgage company's lawyer is pressuring me to "Reaffirm" by January 30. She says of I don't sign the reaffirm agreement then it will default to "Redeem" "Redeem" seems to mean pay a lump sum or surrender the property? The question is; Is a Chapter 7 debtor's home mortgage limited to reaffirmation, redemption or surrender, after Exempt? My attorney says there is a 5th choice, do nothing.

Answer: Really your only options are: 1. Surrender the property 2. Redeem the property pursuant 3. Reaffirm the debt 4. Claim the property exempt (avoid the lien) Another option you may have 5. Retain the property and continue to make payments http://www1.ncmb.uscourts.gov/opinions/d… The reaffirmation agreement is mainly to protect the creditor. If you default on the loan in the future the mortgage company can still collect the debt from you because you reobligated yourself to the debt. You may want to look at the amount of equity that is in your house to decide whether you want to reaffirm or not, once a mortgage loan go into default, their fees would take a great deal of equity out of the house. If you do not sign a reaffirmation agreement and you do fall behind on your payments, the mortgage company will most likely send your loan to their attorney to start foreclosing without giving you any notice to cure the default with them. Most mortgage companies will not send you a billing statement or contact you if you are late, because they would technically be violating the discharge injunction. If you have the discipline to send a payment each month and keep a track of every payment that you send, you would not have to sign a reaffirmation agreement.

Question: Foreclosure...bank seeking judgment on Home Equity Line of Credit? I was told by my real estate agent that if I did a short sale or foreclosure on my home in Arizona, that both the first mortgage and Home Equity Line of Credit (taken out 9 months after home purchase) would both be relinquished in a short sale or foreclosure. Because the house had dropped significantly in value and half the lots were vacant from owners doing the same thing, I decided to proceed with the short sale. It wasn't approved and went into foreclosure. Now the bank is pursuing judgment against me to garnish my wages. Unfortunately, I can't afford to retain an attorney. Is this a case I can win, even if I represent myself in a civil suit against this realtor? I also have email documentation asking him specifically how both loans would be treated. He responded with "Don't worry, I have it!" I also have a witness to him telling me this verbally. According to the anti-deficiency laws, the second loan is not forgiven because it's Non-Purchase Money, is this correct? Also, I'm wondering if I have a strong enough case to pursue this in civil court, representing myself.

Answer: The Arizona laws make a distinction between purchase-money loans and all others. The bank can go after you for the deficiency on the other loans. Many AZ attorneys believe that the intention of the legislature was to protect a homeowner on his personal residence. That no court will uphold a deficiency on your personal residence. We don't yet know if this will be true or not. So far, the banks have not been willing to pursue judgements because the borrowers (you) don't have any money. It is just a waste of time. You have a case against the realty agent but not for all of your damages. You were responsible to protect yourself. The agent was responsible to get the house sold. You might win a small judgement.

Question: family owes me $$ 4 my share of house i am entitled 2 a part they took equity loan twice i got nothin wat 2 do? My older sibling has taken out close to 100 grand on the house on 3 different home equity loans. im excluding the first cus it was small amount and had nothing to do with me. the 2nd loan was done behind my back. i was in need at the time of about $4000. a family meeting took place without me they took out $27K against the house. i didn't get a cent. 4 years later they told me they were gonna take out another loan. the economy was at its peak at the time, i told them i needed about $14,000 (credit cards, remaining car payments) and i would have the title of my car and the cards paid off. i was told i could only get $7,000 and i refused cus then i have to pay a higher part of the mortgage and still have my debt for another 2 years. and i was already nearly upside down as it was. they went ahead and took out $20,000 at that time. later i found out they took out $54,000 instead. i was hurt and betrayed. this is the 2nd time they did this. FAMILY for crying out loud. i have gotten married since and my wife will be here before the holidays and i have asked for my share even a small part of it to stay afloat and be able to bring her here from overseas. and i keep getting the runaround. im looking to take this to court. the stress has been overbearing and last year i needed therapy for my back which was really bad. doctors said it was stress-related. ive pretty much all but disowned them and live on my own now. i believe i have a strong case and that's messed up that an additional $34,000 was taken out behind my back like that for a crap house down state he wanted to renovate and rent. that was more important than helping out his only blood brother. if i take this to court how strong are my chances? i am owed $35,000 from my share of the house but i think i will go for a higher amount in court, as well as damages, both physical and emotional. people with knowledge of this type of situation and any experienced attorneys or anyone else please honest thoughts no flaming no bias just ur opinion on the matter at hand. thank you. when my dad died he left the house to my mom. in the 7+ years i lived there i paid nearly $38,000 of the mortgage but since everyone paid their share it was more like rent. we were supposed to sell the house in 06 before the market would crash which i warned everyone about cus i knew it was gonna happen before it did, but they refused our house has since depreciated badly, has no equity, and we wouldn't get anything for it now. i know where most of that money went to even his live-in girlfriend who had no legal claim to anything of our house got money from the loan. she wasnt even married into the family yet. and im a blood relative. Tro: house was left by my dad to my mom when he died. i helped pay the mortgage for 7 years but what i really did was pay 7 years of 2 combined loans worth $81,000 that i didnt get a single cent of. don't loans get frontloaded into the mortgage of a house? weve had the house since 1995. loan 1 was in 2001 loan 2 in 2005. ranger c: thanks for the lets not get greedy tip. it was outrageous picking up a cheap foreclosed home behind my back. i wont go for a whole lot but attorneys aint exactly cheap either, if you know what im saying if i ask for the same in court i would probably get much less after attorney fees which is why i have to up the ante and in retrospect $88,000 was taken out of the house already so anything i ask for is certainly reasonable dont u think? twitter bird: i'm not the legal owner of the property if i was they would be in deep trouble right now fraud doesn't even begin to describe it. im gonna try to get info on those two loans. right this greivous wrong.

Answer: first of all, you probably should have much documentation regarding everything about this house from the get go I am assuming from your story here that this was a family home that was left to the remaining children of the owner and they were to share and share alike did you participate in the payment of mortgage, taxes, and other expenses or was this property rented out so the family members shared profit and loss I had a client in a similar situation, each of about 7 of 8 children had received some advances on their inheritance even while the parents were alive, but in the end when it was sold those amounts were deducted from any proceeds from the sale and the only one who never had an advance got his whole share, at one time

Question: HOA trying to foreclose after winning judgment regarding maintenance and I won't pay court costs. What now? HOA said I was in violation d/t peeling paint on siding. They filed a suit and I received notice from the court regarding the matter in July 2008 and responded that month saying it would be fixed after hurricane season. The problem was corrected on schedule in October 2008 as stated in my letter dated July 2008 despite the actual hurricane (Ike - this is in Galveston). I replaced all the siding on the house at a cost of $25,000. Apparently, since HOA and lawyers are in Houston and could not see the siding had been replaced, they went ahead with lawsuit in March 2009. Apparently, a court date was set in March 2009 but I, the defendant, was never notified (I live in another state). Court said it was plaintiff’s responsibility to notify and it appears as though rather than using the address specified in my July 2008 letter. Court said they don't send notice certified mail (!) Because I received no notification of the court date, I did not appear and did not respond and a decision was made in absentia for the plaintiff. Fine is $1000 - OK but legal fees are over $2000. I'm not paying that. They have threatened foreclosure. I'm gonna talk to a lawyer (was going to even before the foreclosure threat d/t never being notified of court date) but is it possible to have a friend or relative just buy the property for the outstanding mortgage amount so the HOA doesn;t get their pound of flesh? I am in a different position than most since I have about 100K of equity in this place (currently rented out). Should I suck it up since legal fees for me would probably add up to the same as just paying the whole d***ned amount? I have had the same address since I left the state (2006). In fact, the last notice I have from the HOA is from Jan 2009 and is to the same address. I'm reading up on some very shady dealings of TX HOAs regarding foreclosure for small sums.

Answer: I feel your pain with TX HOAs. Hopefully the legislature will be able to get them under some sort of control. But that won't help you right now. You may end up having to pony up the legal fees too, but I was under the impression that before they could get a default judgment they would have to provide some proof of service (or attempt thereof). I could be wrong, and hopefully the judge would not let an error like that get by, but might be worth asking them to provide to you. Or, because the process was so sloppy ask them if they will accept the fine plus half the legal fees just to put this all to bed. Selling quickly to a friend isn't going to keep them from collecting; they'll have a lien filed almost certainly. Good luck.

Question: What if I don't show up to my divorce court summons in Arkansas? We have no children, I now live in Texas, thanks to him... I don't make much $$ .. he hasnt helped me at all, it was a pretty harsh deal -- 5 days before christmas, cops & all.. very dramatic guy. We dont have any equity .. its just that i really love him & dont a divorce over "irreconcilable differences" anyway he's got some "waiver" that i must sign infront of a notary public & mail back to him.. his mother works for this county's courthouse i figure its the cheapest possible way out. he says if i dont sign ill be served the papers & summoned to court and also that i could get failure to appear ? can anyone please give me any advice? thanks!

Answer: You don't have to sign anything. But, he's right about the summons. If you don't show and he does based on that the court would probably grant the divorce to him. Now if you go and fight it they may decide to revoke the divorce and make you guys get counseling. It can get really nasty. I hate to break this to you, but if he the divorce then just give it to him. Because if you start pushing all this crap you will have to hire a lawyer and you think you're broke now. It gets nasty. Now if you know that he has money you could do the papers from the state of Texas if you have lived there for more then six months and prove that you have filed taxes or paying for taxes in that state. If you can prove that he cheated on you or has a girlfriend. You can show that he never paid spousel support while you where seperated then yes you can take him to the cleaners. It's kind-of whatever you want to do. But, honestly hun he sounds like a jerk off anyway. Just get rid of him and move on. There will be a guy that is so much better and will respect you and love you for who you are. Good luck and I hope you decide what you want to do. Call a Lawyer and if you win ask that he pays for all lawyer and court costs. I bet he loves that one!

Question: I got ripped off and have the evidence to proove it, but Do I have case worth taking to civil court? Ok bare with me as I try and paint the picture. Im in the army and had sold my vehicle to a man in HIgher rank than I. The agreement was $3000. We went to the Equity LOAN Company which could only give $2500 max and he was to pay me the remaining $500 that day. So we get the loan after signing over the title in his name (mistake) but legally its the loan company's vehicle til he pays them back. After that we go to his bank which is closed. So he told me he'll pay me the rest Monday. So I drop him off and right him a bill of sale but in it I only state that, " I (my name) have sold (his name) a jeep (its brand) AS IS on this date". I never put how much was givin or owed. (now i no better). Ahyh monday comes and he asks if I can wait til payday, him and his wife had issues. Well payday comes and I text him. And its his wife, who states this is not a man to man deal that shes moreless in charge. Now this lady talks too much and she speaks for her husband. So my wife takes over and trys to negotiate. So its woman to woman now cuz I cant get to this guy. She text my wife in several messages that they will pay us, and there not going to rip us off. So they plan, that we'll swing by there house and get the rest of my money the following week because MORE ISSUES have come up. K now im getting irritated and Im strictly going off of this mans integraty, mind you the army has different laws than civilians. That day comes and again another reason comes up, So I voice record the conversation. I get them BOTH on recording talking about this money they owe me and that they would pay me in full on Feb 1, the army payday. Later on as the day goes buy this lady texts us that "the back light is out on the jeep and if it cost a fur tune shes not going to pay us our money cuz its bullshit." So I text her, them giving me the run around and not paying me is whats Bullshit. Then she Carry's on about how theirs nothing we can do cause we already signed the title over, and say the deal was $2500. Things get heated I called the military police (m.ps) They suggest to take this to the guys Sargent Major. So I do. I start collecting evidence 1st, so I went back to the LOAN company and had 2 workers right me witness statements about the deal they over heard for $3000. I also e-mail ALL the text messages from my phone and print them out, and I take my voice recording with me to this guys Sargent Major. So we're all in a room and HE has no idea what I got on him. So he begans to lie. Saying, "the deal was only 2500 idk what this guys talking about". Then I whoop out my evidence and put him on the spot. So I proove hes a lier in front of the Major. So theres a witness. But the major explains that he's in no Legal position to make him pay and tells me to go to JAG, a law office on post. I go there, talk with a lawyer who tells me laws are different with soldiers and theres a policy in the "books" that states a man of high rank cannot owe or borrow money from a soldier of lesser rank, weatherit be purchased property or damaged. He prints of the the papers and tells me to take it to Dudes cCommanderand that the commander has the authority to make him pay. (what a run around). SO I meet with yet again the MAJOR and now his COMMANDER. So again we're all in a room, I show him my evidence and then the Skum bag tells them that ya he owes me money but he found problems with the jeep lights and he'll get it fixed then pay me the difference. Again thats me having to go off his word, I tell them. And the cCommander explains legally he cant make him pay me so take it to civil court. Ok with all those witnesses, text msgs, voice notes, and maybe him admitting to it, Do I have a case? Should I bother. It is $500 bucks

Answer: You can take a civil case against him but not through the army/JAG office. When he purchased the car from you I'm sure he inspected the vehicle before signing the papers. If he did not, then Caveat emptor (let the buyer beware). This is a legal phrase that you can check on wikipedia. You both agreed that the vehicle would be sold for $3000 (documented). He paid you $2500 (documented) and you have further documented proof that he still owes you the balance but has not paid. As for his wife's interferance, she has no say in this matter as it is strictly between you and him. If they have issues then that's their problem but it does not interfere with a legal transaction for exchange of goods (you selling the vehicle for an agreed price and him accepting the price)

Question: News article, Obama's campaign funded by money stolen from lenders? Is that ironic? What are your thoughts? http://www.reuters.com/article/politicsN… "HSBC sues accused Democratic fund-raiser in New York NEW YORK (Reuters) - A fund-raiser for Barack Obama, Hillary Clinton and other Democrats who was charged last month with defrauding Citigroup Inc is being sued by HSBC for deceiving it into lending him $100 million. The lawsuit filed in New York State Supreme Court in early September accused private equity firm head Hassan Nemazee, 59, of engaging in an elaborate scheme to make HSBC Bank USA believe that its loan was secured by collateral in the form of U.S. Treasury Notes when it was not. Nemazee, who sits on the board of the Iranian American Political Action Committee, typically donates more than $100,000 annually to Democratic political candidates. He is listed as one of the top "bundlers" of contributions to Obama's 2008 presidential campaign, according to OpenSecrets,org, a website run by the Center for Responsive Politics research group. Nemazee was charged on August 25 of one count of bank fraud for seeking a $74 million loan from Citigroup's banking unit under false pretenses. He was arrested at Newark Liberty International Airport in New Jersey on August 23 as he was checking in for a flight to Italy, according to court papers. U.S. prosecutors accused him on September 2 of defrauding other banks. In a letter to a magistrate judge in Manhattan federal court, prosecutors said he repaid the Citibank loan by defrauding another bank, but did not identify it. The bank was HSBC, according to the civil lawsuit. The bank sued Nemazee for breach of contract and fraud. Nemazee's lawyers could not immediately be reached for comment. The HSBC lawsuit, dated September 2, said that "to accomplish the fraud, Nemazee represented to HSBC that he had $89 million in Treasury Notes, with a current market value of more than $125 million, in a specified brokerage firm account; submitted a supposed agreement from the brokerage firm with forged signatures, false addresses, and false telephone numbers; used a mail drop; and submitted fabricated brokerage statements." HSBC said that on August 24, "Nemazee drew $75 million from HSBC on his fraudulently obtained credit facility, and used the funds to pay off his Citibank loan." In court papers, lawyers said the government had frozen two of Nemazee's accounts at JPMorgan Chase & Co. They said JPMorgan Chase froze his securities account at Brean Murray, Carret & Co and Bank of America Corp froze his funds and those of his children. If convicted, Nemazee faces up to 30 years in prison and a fine that could reach $1 million or more on the one criminal charge. The cases are HSBC Bank USA NA v Hassan Nemazee 602735/2009 in New York State Supreme Court in Manhattan and U.S. v. Nemazee, 09-mj-1927 in U.S. District Court for the Southern District of New York (Manhattan)." What are your thoughts, opinions, or crituques on the article?

Answer: I think we need to charge Mr. 0bama with a crime, and he has committed several in both the campaign irregularities and since assuming office, such as his snitch site or the usurping the constitution and firing ceos!

Question: Can she take me to Small Claims Court? (Cincinnati/N.KY)? My ex girlfriend and I bought a house together 4-5 years ago, we re-fied 3 years ago for extra monies for around the house, had a lawsuit with a landscape company and settled, they made check out to both of us. She tells me in April she met someone else last Oct./Nov. I decide to move, find out I was not on re-fi loan so I am not financially responsible, file quit claim deed, close the account for $6500. Now she wants the money and says will take me to small claims for half. She now has mortgage, she can't afford alone, a re-fi due and will owe more than what it's worth so a hike in rates, and a house she will not be able to sell. Also, she took all my baseball memorabilia because I had closed account. Police said that's the risk of joint accounts, first one to the money wins. I did get back my memorabilia though. But she gets house, all the equity, most all furniture, plus one of my dogs and now wants half the money, plus I gave her $900 to help for May. What else do I owe her? Actually she told me in March about her "new" friend, not April.

Answer: It sounds like she is stuck with the house, her tough luck there. As for the money in the account- do either of you have any proof as to whom contributed the $$? The judge could split it 50-50, or if you can prove that you put like, 90% of the cash in, then you get a higher % back out. Of course, if she put in more than you, she would get the higher %. Its up to the judge though- yes, she can really sue you for this.