Coles Supermarkets Australia Pty Ltd v Fardous

[2014] NSWCA 296

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation:

Coles Supermarkets Australia Pty Ltd v Fardous [2014] NSWCA 296

Hearing dates:

25 August 2014

Decision date:

25 August 2014

Before:

Leeming JA

Decision:

The Notice of Motion filed 13 August 2014 is dismissed with costs.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Catchwords:

APPEAL - stay pending appeal - no risk of appellant being unable to recover amount paid pending appeal - whether possible prejudice to respondent relevant - variation of stay refused

Cases Cited:

Alexander v Cambridge Credit Corp Ltd (1985) 2 NSWLR 685
Kalifair Pty Ltd v Digi-Tech (Australia) Ltd [2002] NSWCA 383; 55 NSWLR 737
Vaughan v Dawson [2008] NSWCA 169

Category:

Interlocutory applications

Parties:

Coles Supermarkets Australia Pty Ltd (Appellant)
Abrahim Fardous (Respondent)

Representation:

Counsel:
Mr G Parker SC (Appellant)
Mr W Ward (Respondent)
Solicitors:
McCulloch & Buggy Lawyers (Appellant)
Jordan Djundja Lawyers (Respondent)

File Number(s):

2014/195027

 Decision under appeal 

Date of Decision:

2014-06-17 00:00:00

Before:

Sorby DCJ

File Number(s):

2013/70232

Judgment

1. LEEMING JA: The respondent to proceedings in this Court, Mr Abrahim Fardous, has the benefit of a judgment in his favour in the amount of $354,965 from the District Court against the appellant, Coles Supermarkets Australia Pty Limited (Coles). On 12 August 2014, Coles filed a notice of appeal, which it is entitled to do as of right.

1. Approximately a fortnight beforehand, there was a further hearing before the primary judge who altered (slightly) the judgment entered after trial, but, most relevantly for present purposes, granted a qualified stay of execution of that judgment. The application was contested and it is fair to say that substantially the same evidence before me today was before his Honour, save for the fact that the appeal at that stage was merely apprehended, rather than extant. His Honour stayed the judgment pending appeal to this Court on condition that Coles pay $150,000 to Mr Fardous within 28 days (I note that that time period has not as yet expired).

1. By motion filed 13 August 2014, Coles seeks a stay of the judgment debt on different terms. It was said from the bar table that an appropriate condition would be that $50,000, rather than $150,000, be paid within 28 days.

1. The appeal brought by Coles does not challenge the finding of liability. Nor does it challenge a small component of the damages ordered, namely, some $30,000. The balance of the judgment debt is in issue on the appeal.

1. I am content to proceed on the basis favoured by Mr Parker SC, who appeared for Coles, that it was not necessary for him (a) to seek leave to appeal from the interlocutory judgment of 30 July 2014 granting a stay on terms, or (b) to establish a material change of circumstances. The question of whether this application was properly made as it has been by motion was only raised today, and he has pointed to statements including in Alexander v Cambridge Credit Corp Ltd (1985) 2 NSWLR 685 at 692 supporting the application that has been made.

1. The gravamen of the application is that Coles fears that there is a risk that if the $150,000 ordered by the primary judge is paid, and it succeeds on appeal, then although it is not the case that Coles itself faces a risk of the funds not being returned to it, there will nonetheless be difficulties and inconvenience to Mr Fardous and his family, having regard to the assets that they have, to which they should not be exposed.

1. The uncontested evidence before me is that Mr Fardous has for some years been unemployed and in receipt of benefits from Centrelink. There is a statement in the decision of the primary judge to which I have been referred that "It is unlikely that Mr Fardous will ever work regardless of future treatment or its success". However, there is also uncontested evidence before me of two assets, described by his solicitor in correspondence as "ample" and "within the jurisdiction", namely an amount of money of around $70,000, and an interest, described on the title as a two-thirds share as tenant in common, of property in Arncliffe which the solicitor was instructed had a "realistic market value of $1.3 million". That is the extent of the evidence as to assets.

1. On the one hand, Coles does no more than point to Mr Fardous' unemployment and need to support a family as indicative of a risk; on the other hand, Mr Fardous does not proffer anything by way of security for any amounts paid to him pursuant to the judgment debt.

1. The argument as it was put by Coles turned upon the possibility that if the amount of $150,000 were paid, and Coles succeeded on appeal, the repayment of that, coupled with interest (at Court rates) and costs of the appeal (and, possibly, a different outcome for costs at trial) would lead to the probability that a significant part and perhaps all of the $70,000 fund would be consumed, and the further possibility that it would be necessary for Coles to levy execution upon the house at Arncliffe. That was said, repeatedly, to be a wholly undesirable outcome given that there was, and I accept, no credit risk whatsoever in the event that Mr Fardous at some subsequent time wished to enforce the judgment against Coles.

1. The applicable principles are well established and not in dispute before me. They are stated in Alexander v Cambridge Credit Corp at 694 and Kalifair Pty Ltd v Digi-Tech (Australia) Ltd [2002] NSWCA 383; 55 NSWLR 737 at [17]-[20]. A successful party is, as Mr Ward who appeared for Mr Fardous contended, prima facie entitled to the fruits of his or her judgment.

1. As explained by Campbell JA in Vaughan v Dawson [2008] NSWCA 169 at [16], what that "prima facie entitlement" means, in practical effect, however, is that the onus is on the applicant for a stay - here, Coles - to make out a case that is suitable for the Court to award a stay. Further, it is for Coles to demonstrate a proper basis for a stay that will be fair as between the respective interests of the parties: see Alexander v Cambridge Credit Corp at 694.

1. The difficulty faced by Coles on this application is that the answer to the "worst case scenario" to which it pointed (namely, complete success on the limited appeal it brings as to quantum requiring repayment by Mr Fardous) will, on the evidence before me, readily be able to be satisfied by, as it was put by Mr Ward in argument, funds obtained by way of a mortgage on the Arncliffe property.

1. There is perhaps another question as to whether it is even relevant for the Court to have regard, at the solicitous invitation of Coles, to the undesirability of hitherto unencumbered property becoming encumbered in order for Coles to enforce its entitlements in the event that it succeeds on appeal. That is, perhaps, a large question, bearing in mind Mr Fardous' prima facie entitlement to enjoy the fruits of his judgment in the meantime.

1. The short point, however, which is sufficient to resolve the application before me, is that Coles has failed to persuade me in circumstances where Mr Fardous' asset position is as I have described and there is no material risk of its being unable to satisfy such judgment debt as it can obtain, that any different term as the price of a stay of execution should be ordered than that which has been ordered by the primary judge.

1. For those reasons I will dismiss the notice of motion filed 13 August 2014 with costs.

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Decision last updated: 28 August 2014