Bernstrom v National Australia Bank Ltd

[2002] HCATrans 404

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane  No B49 of 2002

B e t w e e n -

ANITA BERNSTROM

Applicant

and

NATIONAL AUSTRALIA BANK LTD

Respondent

Application for a stay

CALLINAN J

(In Chambers)

TRANSCRIPT OF PROCEEDINGS

AT BRISBANE ON TUESDAY, 15 OCTOBER 2002, AT 11.00 AM

(Continued from 14/10/02)

Copyright in the High Court of Australia

HIS HONOUR:   Yes, Mr Bradshaw.

MR BRADSHAW:   I advise the Court, your Honour, that my client is not able to raise the moneys.  She seeks the indulgence to have 30 days in which to attempt to raise it and if your Honour is inclined to grant that concession, there are things I should bring to your Honour’s attention.  She seeks 30 days in which to try and raise the moneys, your Honour.

HIS HONOUR:   All right.  Have you anything to add to that, Mr Bradshaw?  Is there anything you want to add to that?

MR BRADSHAW:   Only to correct something yesterday, your Honour.  I was asked about the park operating, it is, but there is an order in the District Court and the Planning Court that she should not operate in a certain way.  She now has council approval for that and has not gone back to the court to have that order removed.  So I thought I should bring it to your Honour’s attention that it is not a straightforward – it is just operating lawfully.

HIS HONOUR:   Thank you for that, Mr Bradshaw.  Mr Lilley, what is your attitude?

MR LILLEY:   Your Honour, the sum of money is about $50,000 and the interest rate is around about $300 a day – sorry, $100‑odd a day and about $3,000 a month.  My attitude would be that if my learned friend wanted to press that, there should at least be some material before the Court to indicate there is some hope of the money – or some source that the money might be obtained from.  The material put in by the applicant on this application tends to indicate that there is no prospect of any money being available and I put in my outline that even if this appeal is successful, it appears that the property will have to be sold to meet my client’s debt in due course.

It is not the applicant’s case that for some reason the debt will never be payable.  It is simply the applicant’s case that at the relevant time we were estopped from making demand.  But unless there is some material, your Honour, to show that there is some hope in the matter, I press your Honour not to entertain the application for a further 30 days.  All of these expenses are mounting up and just eating into whatever equity the applicant has.

HIS HONOUR:   Mr Lilley, what I am inclined to do is to grant a stay for, say, seven days, perhaps nine days, upon condition that, say, $45,000 were paid into your solicitors trust account within, say, eight days from today and at the same time an unconditional undertaking be provided by the applicant to pay – is it $2,500 a month?

MR LILLEY:   I think it was – I will give your Honour the exact figure.  It is $104.55 per day.

HIS HONOUR:   That is interest?

MR LILLEY:   That is interest.

HIS HONOUR:   And the actual capital reduction was supposed to be $2,500 a month, was it not?

MR LILLEY:   In fact the last mortgage payment was $2,633.  That comes from ‑ ‑ ‑

HIS HONOUR:   It is certainly mounting up, is it not?

MR LILLEY:   Yes, your Honour.  It started as 2,400 and it went to 2,663 in October 2000.

MR BRADSHAW:   Was that with penalties or is that ‑ ‑ ‑

MR LILLEY:   No, that is before default occurred.  That was before the 10,000 came in.  It went up to 2,663.

HIS HONOUR:   What did you actually want stayed, Mr Bradshaw?

MR BRADSHAW:   Stay of the enforcement, your Honour.

HIS HONOUR:   Stay of the enforcement.

MR LILLEY:   Your Honour, there might be some advantage if an order were framed along the lines of a stay for so many days to allow the applicant to pay that money.  Failing payment, an order that she vacate by a certain date.  That would give the Bank some benefit.

HIS HONOUR:   Yes.  Rather, perhaps, than make an order that she vacate, make it a condition of any order that I might make in her favour that she undertake to vacate.

MR LILLEY:   Yes, that would be ‑ ‑ ‑

HIS HONOUR:   I only put it that way because I do not like to make a different order from the order that was made by the Court of Appeal, which was – what was the actual formal order of the Court of Appeal?

MR LILLEY:   The order of the Supreme Court was judgment for the sum of money and that we recover possession.

HIS HONOUR:   That is right, possession, was it not?

MR LILLEY:   And the order of the Court of Appeal was to dismiss the appeal.

HIS HONOUR:   That is right.  So you have been out of possession for a long time, have you not?

MR LILLEY:   Yes, your Honour.  Mind you, I should say, your Honour, my client has not pressed the issue for some time because of the appeal and other matters.

HIS HONOUR:   No.  All right, thank you, Mr Lilley.

MR LILLEY:   Thank you, your Honour.

HIS HONOUR:   In this matter the applicant has applied to this Court for special leave to appeal from a judgment of the Court of Appeal for money payable under a mortgage and possession of property the subject of that mortgage.  The basis upon which the applicant resisted the claims of the respondent was that there was an oral agreement between her, or on her behalf, and the respondent which would have enabled the postponement of payment of some of the money which was outstanding at the time of the institution of the proceedings.  The contentions of the respondent with respect to this matter were rejected, both at first instance in the Supreme Court of Queensland and in the Court of Appeal. 

I would express no view on the prospects of success that the applicant might have in the application for special leave.  It is sufficient to say that all of the arguments which could be advanced on her behalf seem to have been advanced and completely dealt with in the earlier proceedings.  But on any view of the matter the applicant owes a great deal of money to the respondent.  No reduction in the indebtedness has been made since the judgment of the primary judge in the Supreme Court.  In the meantime interest at more than $100 per day has been accumulating and remains unpaid.

When the current application, an application for a stay pending the hearing of the special leave application, came before me yesterday, I pointed out to counsel for the applicant that it was really very difficult even to consider entertaining the application in the absence of any proposal on behalf of the applicant to reduce the admitted indebtedness which is increasing.  I granted to the applicant an adjournment of 24 hours to enable her to try to make some arrangements to reduce the indebtedness or to make some satisfactory proposals to do so.

When the matter came back on for hearing before me this morning, counsel for the applicant informed me that in the short time which had elapsed his client had been unable to make any arrangements to obtain further funds.

In the circumstances, I am minded to grant a stay, but a very short one indeed, and upon strict conditions.  I am prepared to grant a stay of enforcement proceedings pursuant to the judgment of the Court of Appeal of Queensland for a period of seven days from today upon these conditions.  First, that by next Tuesday, 22 October, the applicant has caused to be lodged in the trust account of the solicitors for the respondent the sum of $50,000.  Secondly, that the applicant unconditionally undertake to pay to the respondent the sum of $3,500 per month in reduction of principal and interest owing to the respondent, the first payment thereof to be made to the trust account of the solicitors for the respondent on 22 October next.  Thirdly, that the applicant pay to the trust account of the solicitors for the respondent the sum of $1,500 in partial reduction of the respondent’s costs of the application which is before me.

I will make an order that the parties have liberty to apply but I wish to make it clear that if the conditions are not met in all respects, the respondent will be free to take whatever steps may be available to it to give effect to the orders of the Court of Appeal of Queensland and that that may be done without any further application to this Court.  I can inform the parties that the application for special leave can be heard on 14 March next year and I would order that the applicant pay the respondent’s costs of this application to the Court, including any reserved costs, and I would certify for counsel.

I do not think there is anything you can say about costs, Mr Bradshaw.  You have orders against you.  Your client has made no payments at all.  You have sought the indulgence of the Court and you bring the respondent here.  I think that is correct, is it not?

MR BRADSHAW:   It is a matter that I have to leave in your Honour’s hands.  I cannot strongly urge your Honour to the opposite ‑ ‑ ‑

HIS HONOUR:   All right.  Mr Lilley, is there anything further?

MR LILLEY:   Your Honour, there is only one thing.  Perhaps it need not be said but I take it my instructing solicitors are free to account to my client for the moneys once they are received in the trust account.

HIS HONOUR:   Yes, quite.  It is your client’s money.

MR LILLEY:   Yes, your Honour.

HIS HONOUR:   I merely put it in that ‑ ‑ ‑

MR LILLEY:   So that there is a place for it to go.

HIS HONOUR:   Exactly.

MR LILLEY:   Yes.

HIS HONOUR:   Then it avoids any argument about whether the payments have been made appropriately or anything of that kind.

MR LILLEY:   I just wanted to clarify that point, that is all, your Honour.

HIS HONOUR:   Yes.

MR LILLEY:   I do not think it needs to be specified.

HIS HONOUR:   And it also has the advantage, I think, that the parties remain at arm’s length.

MR LILLEY:   Yes, your Honour.  Thank you, your Honour.

HIS HONOUR:   There is nothing further, Mr Lilley?  That order enables you to do whatever you wish to do if the conditions are not fully satisfied within seven days.

MR LILLEY:   Yes.  I am just not sure whether it should be the order of the Court of Appeal or the order of the Supreme Court since it was not ‑ ‑ ‑

HIS HONOUR:   I would think the last order would be the Court of Appeal, would it not?

MR LILLEY:   It would be.

HIS HONOUR:   And would it not have simply affirmed the orders of the Chief Justice at first instance?  It was the Chief Justice who sat, was it not?

MR LILLEY:   Yes, it was and I think the order of the Court of Appeal was that the appeal be dismissed.

HIS HONOUR:   All right.  Well, let me make it clear that when I referred to the order of the Court of Appeal I intended to refer to the affirmation of the order of the Chief Justice and all such orders as have been made in the Supreme Court, whether in the Court of Appeal or by the primary judge – are the orders that I referred to and intended be the subject of enforcement if the conditions are not satisfied.

MR LILLEY:   Thank you, your Honour.

MR BRADSHAW:   If your Honour please, in relation to 14 March, I may be travelling down for it.  Is it the sittings commencing 14 March or that actual date?

HIS HONOUR:   No, it will be that day, Mr Bradshaw.  It is by video link from Canberra but that does not mean you cannot appear.  Parties sometimes do choose to appear, but you can appear here and it can be done by video link, but either way, that will be the day.

MR BRADSHAW:   Thank you, your Honour.

HIS HONOUR:   I do not know what order in the list it will be.  There are usually about 10 or 14 cases in the day.  All right.  Nothing further?

MR LILLEY:   No, thank you, your Honour.

MR BRADSHAW:   No, your Honour.

HIS HONOUR:   All right, thank you.

AT 11.20 AM THE MATTER WAS CONCLUDED