The Supreme Court has dismissed three appeals brought by Bula Limited, Bula Holdings, Richard Wood and Michael Wymes in a long-running dispute with three banks and a receiver appointed over Bula’s assets.
In a judgment delivered on 13 February 2003, Denham J. said the receiver’s possession and control of Bula’s assets arose from the agreements between Bula and the banks. The receiver had been appointed in 1985 under those agreements to realise the banks’ security. The court held that this was possession by consent and authority, not adverse possession, and that the Statute of Limitations 1957 did not apply in the circumstances.
The first appeal concerned preliminary limitation issues in the main action, which had begun in 1986 and had not yet gone to trial. The plaintiffs argued that the banks’ rights to the mortgaged property and debts had expired under the limitation statute. They also disputed the banks’ entitlement to principal and interest and sought, among other relief, return of title documents. The banks and receiver disputed those claims and raised other grounds for dismissing them.
The Supreme Court upheld the High Court’s decision that the plaintiffs had not established adverse possession. It said the receiver’s possession was for the banks’ benefit and did not diminish their rights. Because of that conclusion, the court said it was unnecessary to decide the other limitation issues, including arguments about acknowledgements, part payments and interest. The court made no orders on the banks’ and receiver’s notices to vary.
The second appeal challenged the High Court’s refusal to allow proposed amendments to the plaintiffs’ pleadings. The Supreme Court found the High Court had jurisdiction to refuse them and dismissed the appeal. The third appeal challenged a refusal of further discovery. The Supreme Court also dismissed that appeal, upholding the High Court’s ruling that no further documents were needed for the remaining limitation issues, while noting that the High Court had allowed for updated discovery concerning certain bank suspense accounts.
The underlying dispute followed Bula’s borrowing for planned mining operations. After financial difficulties, the banks demanded repayment in 1982 and appointed Laurence Crowley as receiver in October 1985. The receiver later sold the secured property and intended to distribute the proceeds to the banks. The Supreme Court’s judgment addressed the three appeals before it; it did not decide the main action at trial.