Byrnes v Kendle (No 2) - [2010] SASC 64

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
BYRNES & ANOR v KENDLE (NO 2)
[2010] SASC 64
Reasons for Decision of The Full Court
(The Honourable Chief Justice Doyle, The Honourable Justice Nyland and The Honourable Justice Vanstone)
25 March 2010
APPEAL AND NEW TRIAL - APPEAL - PRACTICE AND PROCEDURE - SOUTH AUSTRALIA - POWERS OF COURT - REOPENING APPEAL
Court earlier dismissed an appeal in this matter - order dismissing the appeal sealed - application for an order that the hearing of the appeal be re-opened on the basis that the Court proceeded under a misapprehension of fact - whether Court has the power to set aside a sealed order - if so, whether appeal should be re-opened and the power exercised.
HELD: appropriate to proceed on the basis that r 242 of the Supreme Court Civil Rules 2006 (SA) gives the Court the power to set aside a sealed order - the relevant issue was argued and considered by the Court in its reasons - the Court did not misunderstand the issue - the fact that, after examining factual material in more detail, it is arguable that the Court came to a wrong conclusion, is not a sufficient basis to re-open an appeal - a reconsideration of the factual issue the subject of the application might necessitate a reconsideration of the whole case on a basis not previously argued before the Court - application to re-open appeal dismissed.
Supreme Court Rules 1987 (SA) r 84.12; Supreme Court Civil Rules 2006 (SA) r 242, referred to.
Autodesk Inc v Dyason [No 2] (1992-1993) 176 CLR 300, applied.
Elliott v The Queen (2007) 234 CLR 38; Byrnes v Kendle [2009] SASC 385; Copping v ANZ McCaughan Ltd (1997) 67 SASR 525; Glenmont Investments Pty Ltd v O'Loughlin (No 6) [2001] SASC 287; McAdam v Robertson (1999) 73 SASR 360, discussed.

BYRNES & ANOR v KENDLE (NO 2)
[2010] SASC 64
Full Court: Doyle CJ, Nyland and Vanstone JJ

DOYLE CJ: On 18 December 2009 the Court dismissed an appeal in this matter: Byrnes v Kendle [2009] SASC 385. The order dismissing the appeal was sealed on 20 January 2010.
The unsuccessful appellants have applied to the Court for an order that the hearing of the appeal be re-opened to permit counsel to put further submissions on one aspect of the appeal. The submissions are to the effect that the Court proceeded on a misapprehension of fact in relation to the relevant issue.
Notice of the application was given by letter dated 23 December 2009. A formal application to the Court should have been made, but no point was taken on that.
For the reasons that follow I would not set aside the order dismissing the appeal.
Power to set aside orders
In McAdam v Robertson [1999] SASC 169; (1999) 73 SASR 360 I said at [39]:
[39]I therefore proceed on the basis that, the judgment not having been drawn up, the Full Court may review its decision. The power is to be exercised with great caution. The reasons for that are obvious. There is a strong public interest in the finality of litigation. Once a stage in the process of litigation has been completed, ordinarily it should not be revisited. Our system of adversary litigation, with the obligation that it imposes upon the parties to present their whole case and to present their best case, would begin to collapse if courts too readily entertained applications to reopen decisions given after a full hearing. The power can be exercised if some important principle of law has been overlooked, or if there is an apparent misapprehension as to a significant fact, but this is to be distinguished from enabling a party to attempt to persuade a court that it should change its view of a matter that it has considered and decided.
Bleby J and Martin J agreed with my reasons at [69] and [70] respectively.
The High Court has confirmed that the power exists: Elliott v The Queen [2007] HCA 51; (2007) 234 CLR 38 at [31].
These decisions relate to a judgment that has not been drawn up and sealed. The order in question in this case has been sealed.
In Copping v ANZ McCaughan Ltd (1997) 67 SASR 525 Lander J said at 567-569 that r 84.12 of the now revoked Supreme Court Rules 1987 (SA) empowers the Court to set aside a sealed order, with a view to hearing submissions on the substance of the appeal, or an aspect of the substance of the appeal. I agreed with his reasons at 526. It was not necessary for the Court to decide the point, and Bollen J expressed no view on the matter.
In Glenmont Investments Pty Ltd v O’Loughlin (No 6) [2001] SASC 287 this Court proceeded on the basis that Copping was correctly decided, but again found it unnecessary to decide the point: at [17].
I am prepared to assume, without deciding, that Copping is correctly decided, and that the decision applies to r 242 of the Supreme Court Civil Rules 2006 (SA). Rule 242 relevantly provides:
242    Power to correct, vary or set aside judgment
(1)     The Court may correct an error in a judgment at any time.
(2)     If satisfied that the justice of a case so requires, the Court may—
(a)     vary a judgment; or
(b)     set aside a judgment and reopen an action.
Example -
The Court might set aside a judgment and reopen an action if satisfied that the judgment is vitiated by a mistake.
…
Mr Frayne SC, counsel for the respondent, put his submissions on that basis and was content for the Court to assume the correctness of the decision.
It is one thing to have the power to set aside a judgment dismissing an appeal. It is another thing to exercise it. The power must be exercised with care, and in particular with careful attention to the public interest in the finality of litigation.
Relevant guidance is to be found in the reasons of Mason CJ in Autodesk Inc v Dyason [No 2] (1992-1993) 176 CLR 300. Mason CJ dissented in the result, but there is no reason to doubt the correctness of what he said about the exercise of the power. He said at 302-303:
These examples indicate that the public interest in the finality of litigation will not preclude the exceptional step of reviewing or rehearing an issue when a court has good reason to consider that, in its earlier judgment, it has proceeded on a misapprehension as to the facts or the law. As this Court is a final court of appeal, there is no reason for it to confine the exercise of its jurisdiction in a way that would inhibit its capacity to rectify what it perceives to be an apparent error arising from some miscarriage in its judgment. However, it must be emphasized that the jurisdiction is not to be exercised for the purpose of re-agitating arguments already considered by the Court; nor is it to be exercised simply because the party seeking a rehearing has failed to present the argument in all its aspects or as well as it might have been put. What must emerge, in order to enliven the exercise of the jurisdiction, is that the Court has apparently proceeded according to some misapprehension of the facts or the relevant law and that this misapprehension cannot be attributed solely to the neglect or default of the party seeking the rehearing. The purpose of the jurisdiction is not to provide a backdoor method by which unsuccessful litigants can seek to re-argue their cases.
Brennan J made a point which is pertinent to the present case at 309. He said:
Here the ground on which the appeal was determined had been argued in the courts below and had been the subject of submissions in this Court. The appeal was determined after it was fully heard. That being so, I find no jurisdiction to set aside the judgment already pronounced merely because it is submitted by the unsuccessful party that, on further argument, the Court would be satisfied that it had reached the wrong conclusion in law.
I proceed on the basis of these statements of principle.
Exercise of power
The issue which Mr Tokley, counsel for the appellants, wishes to argue, arises from a loan of $8,000 made by Mr Kendle to his son. Mr Kendle borrowed $10,000 from an entity which had already lent money secured on the house property which, the Court decided, Mr Kendle held on trust for Mrs Byrnes and himself. The amount of the further borrowing of $10,000 by Mr Kendle was also secured by the mortgage that secured the initial advance to Mr Kendle. Mr Kendle lent $8,000 of that money to his son.
In my reasons I said:
[51]The precise circumstances in which Mr Kendle advanced $8,000 to his son are not clear. The Judge refers to the matter, but does not deal separately with the claim against Mr Kendle in respect of this amount. Mr Kendle agreed in evidence that he did not discuss the proposed loan with Mrs Byrnes “in depth”.
[52]In the circumstances, it is arguable that Mr Kendle should account to Mrs Byrnes for any amount still outstanding, on the borrowing secured by the Rachel Street property, in respect of the loan of $8,000 to Mr Kendle’s son. If anything was still owing in respect of that loan, it was deducted from the proceeds of sale of the Rachel Street property, and so Mrs Byrnes will bear one half of the amount outstanding, as things stand. However, on the evidence there are insurmountable obstacles to the enforcement of any such obligation. The amount (if any) outstanding in respect of the advance to the son is not identified. Mr Kendle raised the money by increasing his then indebtedness to the organisation that lent him money to buy the property at Rachel Street. He made all repayments on that loan, while the parties occupied the house at Rachel Street. In his affidavit tendered before the Judge he said that the amount outstanding on the loan secured over the property was less when the property was sold than it was when the property was purchased, indicating, if this is correct, that it is arguable that none of the monies advanced to his son remained outstanding. On the evidence, there is no satisfactory basis upon which to determine whether the amount for which Mr Kendle should account to Mrs Byrnes is $4,000 or now some lesser amount.
Mr Tokley submits that there is evidence from Mr Kendle supporting a finding that the amount of $8,000 had not been repaid, and was still outstanding when the house property was sold. He has taken the Court to the evidence in question, and to relevant bank statements. The Court was not referred to this material when the appeal was first argued, or if it was, it was referred to it in a general and passing manner.
The submissions that Mr Tokley now wishes to advance are directed to a point that I considered in my reasons, in the passage set out above. The substance of the submission is that the material now referred to by Mr Tokley should persuade me, and the other members of the Court, that my finding that there was no satisfactory basis upon which to determine the amount for which Mr Kendle should account to Mrs Byrnes is incorrect.
But, as I have said, the point was argued. It was not overlooked by the Court. When it was argued before there was some confusion as to amounts and as to the manner in which the relevant borrowings were identified. Mr Tokley wishes to argue the point in further detail, to persuade the Court that it was wrong.
To my mind this is the kind of submission which, in Autodesk, Brennan J said should not be entertained. In one sense it can be said that the Court proceeded on a misapprehension of fact. But the Court did not misunderstand the issue. The most one can say is that by examining the material in more detail than was done before, Mr Tokley mounts an arguable case that the Court came to the wrong conclusion. That in itself is not a sufficient basis to re-open the appeal. If it was, there would be no end to litigation, because from time to time an unsuccessful party will reasonably think that if a point could be reargued, a better outcome might be achieved.
There are other reasons why it is not appropriate to revoke the orders dismissing the appeal. They arose in the course of submissions by Mr Tokley, as a result of counsel and the Court focussing more closely than before on the issue of the advance to the son of $8,000. What was the arrangement, if any, between Mrs Byrnes and Mr Kendle relating to repayment of the initial amount borrowed by Mr Kendle and secured on the house in question? In fact Mr Kendle made all of the repayments. But was this by agreement or simply what happened? What was the arrangement made, if any, when the additional borrowing of $10,000 was made? Was there any arrangement or understanding as to liability for repayment of that amount? Mr Kendle acknowledged in his evidence that when the house in question was sold, Mrs Byrnes was entitled to one half of the net proceeds. What was the arrangement or understanding as to how the net proceeds would be determined?
If the appeal were to be re-opened, these matters would have to be considered. So would the submission by Mr Frayne that the increase in the value of the property, while Mr Kendle was making the mortgage payments, should be brought to account. I am not suggesting that this submission is correct.
The point is that the use of the $8,000 cannot necessarily be treated in isolation from other circumstances. If the appeal were to be re-opened, it might be necessary to reconsider the whole case, and on a basis not previously argued before this Court.
For those reasons, I consider that this is not an appropriate case for the Court to exercise a power, assuming it has it, to revoke the orders made dismissing the appeal and to hear further argument on the aspect of the appeal that I have identified. I would refuse the application.
NYLAND J: I agree that the application should be refused for the reasons expressed by the Chief Justice.
VANSTONE J: I agree that the application should be refused. I agree with the reasons of the Chief Justice.