Background
Alexander Greenwich applied in a Full Court proceeding for an interlocutory freezing order against Mark Latham, the appellant in the substantive appeal. The Full Court had already determined that appeal, subject to costs. Greenwich sought to restrain Latham’s dealings with assets up to an unencumbered value of $1 million, covering damages and costs arising from the Federal Court litigation, damages awarded in related New South Wales Civil and Administrative Tribunal proceedings, and certain present and anticipated legal costs.
The application centred on Latham’s publicly listed Mount Hunter residential property. Greenwich feared that the property might be sold below market value or that the sale proceeds might be dissipated. He relied on a 2017 transfer of the property from Latham to his then wife for $1, Latham’s reacquisition of it in 2023 as part of a property settlement, mortgage changes in June 2026, the current sale listing, Latham’s failure to give direct evidence about those matters, and his refusal to provide requested undertakings.
The Court’s Holding
Justice Stellios dismissed the freezing-order application. The Court held that Greenwich had not proved facts from which a prudent, sensible commercial person would infer a real and sufficiently substantial danger that a judgment would remain wholly or partly unsatisfied through the dissipation, disposal, or diminution of Latham’s assets. Any risk shown by the evidence was speculative.
The public sale listing and agency agreement did not support an inference that the Mount Hunter property would be sold below market value; the available evidence instead indicated an intended open-market sale at fair value. The 2023 reacquisition and 2026 mortgage changes likewise did not establish a danger of dissipation. Although the 2017 transfer for $1 was unusual, the evidence did not establish that it was fraudulent, dishonest, or connected to threatened defamation litigation. Without a sufficient factual basis for suspicion, Latham’s failure to testify directly or provide undertakings did not justify adverse inferences.
Because the threshold danger was not established, the Court did not decide issues concerning delay, the balance of convenience, whether the NCAT judgments could be considered under the freezing-order rules, or the amount that any order should protect. The application was dismissed, with Greenwich ordered to pay Latham’s costs in an amount to be agreed or assessed.
Key Takeaways
- A freezing order requires evidence of a real and sufficiently substantial danger that assets will be dealt with so that a judgment remains wholly or partly unsatisfied; a remote or speculative possibility is insufficient.
- An unusual historical transaction does not, without evidence supporting an inference of fraud, dishonesty, or other improper conduct, necessarily establish a present risk of asset dissipation.
- A respondent’s silence or refusal to give undertakings may assist an applicant only where the evidence first raises a sufficient basis for suspicion; it cannot replace the applicant’s threshold proof.
Why It Matters
The decision underscores the demanding evidentiary burden imposed on parties seeking freezing orders. Because such orders substantially restrict a person’s ability to deal with property, courts will not treat them as security for a judgment merely because an asset is being sold or a creditor fears that payment may not be forthcoming.
Applicants must connect concrete facts to a current, substantial danger of dissipation. Historical dealings, unexplained financial arrangements, and refusals to give undertakings may be relevant, but they will not suffice when the proposed adverse inference remains speculative.