Commonwealth Bank of Australia t/a BankWest v Bell
[2014] WASC 201
•4 JUNE 2014
COMMONWEALTH BANK OF AUSTRALIA t/a BANKWEST -v- BELL [2014] WASC 201
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2014] WASC 201 | |
| Case No: | CIV:2567/2013 | 19 MAY 2014 | |
| Coram: | PRINCIPAL REGISTRAR GETHING | 4/06/14 | |
| 10 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| B | |||
| PDF Version |
| Parties: | COMMONWEALTH BANK OF AUSTRALIA (ACN 123 123 124) t/a BANKWEST CARL WILLIAM BELL |
Catchwords: | Practice and procedure Application for a suspension order pending appeal |
Legislation: | Bankruptcy Act 1966 (Cth), s 134(1)(j) Civil Judgments Enforcement Act 2004 (WA), s 15 |
Case References: | Alvaro v Amaral [2013] WASCA 16 Bell v Cribb [2013] WASCA 159 Duckworth v Commonwealth Bank of Australia [2013] WASCA 24 Eastland Technology Australia Pty Ltd v Whisson [2003] WASCA 307; (2003) 28 WAR 308 Hamersley Iron Pty Ltd v Lovell (No 2) (1998) 20 WAR 79 Inglis v Commonwealth Trading Bank of Australia [1972] HCA 74; (1972) 126 CLR 161 M R & R C Smith Pty Ltd t/as Ultra Tune (Osborne Park) v Wyatt [2011] WASCA 43 Maguire v Makaronis [1997] HCA 23; (1997) 188 CLR 449 Perpetual Ltd v Buttarelli [2012] WASC 512 Perpetual Ltd v Buttarelli [No 2] [2013] WASC 190 Spiers Earthworks Pty Ltd v Landtec Projects Corporation Pty Ltd [2010] WASCA 226 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
CARL WILLIAM BELL
Defendant
Catchwords:
Practice and procedure - Application for a suspension order pending appeal
Legislation:
Bankruptcy Act 1966 (Cth), s 134(1)(j)
Civil Judgments Enforcement Act 2004 (WA), s 15
Result:
Application dismissed
Category: B
Representation:
Counsel:
Plaintiff : Mr M F Holler
Defendant : In person
Solicitors:
Plaintiff : Norton Rose Fulbright Australia
Defendant : In person
Case(s) referred to in judgment(s):
Alvaro v Amaral [2013] WASCA 16
Bell v Cribb [2013] WASCA 159
Duckworth v Commonwealth Bank of Australia [2013] WASCA 24
Eastland Technology Australia Pty Ltd v Whisson [2003] WASCA 307; (2003) 28 WAR 308
Hamersley Iron Pty Ltd v Lovell (No 2) (1998) 20 WAR 79
Inglis v Commonwealth Trading Bank of Australia [1972] HCA 74; (1972) 126 CLR 161
M R & R C Smith Pty Ltd t/as Ultra Tune (Osborne Park) v Wyatt [2011] WASCA 43
Maguire v Makaronis [1997] HCA 23; (1997) 188 CLR 449
Perpetual Ltd v Buttarelli [2012] WASC 512
Perpetual Ltd v Buttarelli [No 2] [2013] WASC 190
Spiers Earthworks Pty Ltd v Landtec Projects Corporation Pty Ltd [2010] WASCA 226
- PRINCIPAL REGISTRAR GETHING:
Factual background and litigation history
1 In June 2007 the Bank of Western Australia Ltd (trading as Bankwest) and Rosmill Pty Ltd entered into a loan agreement pursuant to which Bankwest advanced funds to Rosmill. From March 2010 onwards, Rosmill failed to make payments of principal and interest when due, and defaulted on the loan.
2 The sole director of Rosmill is Carl William Bell. In December 2004, Mr Bell executed a deed with Bankwest pursuant to which he guaranteed and indemnified Bankwest in respect of Rosmill's obligations to it (the Guarantee). In June 2007 Mr Bell entered into a mortgage in favour of Bankwest in order to secure repayment of all moneys owed by Rosmill to Bankwest. The land that was mortgaged is situated at 1 & 3 William Street, York, and more specifically is lots 32 and 33 on plan 126, being the whole of the land described in certificate of title vol 1380 folio 154 (the Property).
3 In August 2011 Bankwest commenced an action in the Supreme Court (CIV 2512 of 2011) seeking recovery of amounts owing by Mr Bell pursuant to the Guarantee. Bankwest sought, and obtained, summary judgment against Mr Bell in respect of the monetary amount due as a result of the breach of the loan terms and the calling up of the Guarantee. The judgment amount in the orders made on 1 December 2011 was $1,011,947, together with interest and costs on an indemnity basis.
4 On 1 October 2012 the entire business of Bankwest was transferred to the Commonwealth Bank of Australia (CBA) in accordance with the Financial Sector (Business Transfer and Group Restructure) Act 1999 (Cth).
5 By writ filed on 16 October 2013 CBA commenced an action seeking an order that Mr Bell deliver up vacant possession of the Property (Supreme Court action number CIV 2567 of 2013).
6 Mr Bell is currently an undischarged bankrupt. His trustee in bankruptcy is Barry Taylor of HLB Mann Judd. Mr Taylor consented to the institution of action CIV 2567 of 2013 by CBA.
7 Mr Bell entered an appearance on 6 December 2013.
8 After commencing action CIV 2567 of 2013 CBA's lawyers wrote to Mr Taylor inquiring of his intentions. There is a dispute as to whether Mr Taylor has given Mr Bell permission to defend the action.
9 By chamber summons dated 12 December 2013 CBA applied for summary judgment. As at 11 December 2013, the amount said to be owing by Mr Bell to CBA pursuant to the mortgage was $1,493,561.06.
10 By orders made on 22 April 2014, the master granted CBA summary judgment and ordered Mr Bell to deliver up vacant possession of the Property to CBA within 21 days.
11 On 9 May 2014 Mr Bell filed an application for an order suspending enforcement of the judgments on both CIV 2512 of 2011 and CIV 2567 of 2013. The application was, however, only filed in CIV 2567 of 2013.
12 Mr Bell filed an affidavit in support of the application, in which he stated that:
(a) the master was 'in jurisdictional error when he delivered the two irregularly obtained summary judgments against me in CIV 2512 of 2011 on 1.12.2011 and CIV 2567 of 2013 on 22.4.14'; and
(b) he was denied natural justice by Master Sanderson in delivering the summary judgments referred to above.
13 Mr Bell has filed a notice of appeal dated 8 May 2014 against what he describes as the consolidated decision in CIV 2567 of 2013, which includes CIV 2512 of 2011 and another action CIV 2130 of 2013, 'the purpose of which is to set aside the Irregularly Obtained Summary Judgments'.
14 Mr Bell also states that 'with the permission of my Bankruptcy trustee I shall be making an application to the Federal Court for the annulment of my Invalid bankruptcy'.
15 There are two issues requiring determination:
• Did Mr Bell's trustee in bankruptcy give him permission to bring either the action or this application?
• If Mr Bell is able to bring the application, should the court grant a suspension order?
Did Mr Bell's trustee in bankruptcy give him permission to bring either the action or this application?
16 As I have observed, Mr Bell is currently an undischarged bankrupt. Accordingly, it is his trustee in bankruptcy who has the power to 'bring, institute or defend any action or other legal proceeding relating to the administration' of his estate: Bankruptcy Act 1966 (Cth) s 134(1)(j); Bell v Cribb [2013] WASCA 159 [12] (Reasons of the Court).
17 Mr Bell states that his trustee in bankruptcy, Mr Taylor, gave him permission to defend the present action and bring the application for a suspension order.
18 In response to an inquiry from CBA's solicitors as to his intention, Mr Taylor wrote a letter that CBA's solicitors received on 24 February 2014. In it Mr Taylor stated that:
1. I do not intend to file a Memorandum of Appearance or oppose the orders sought by your client; and
2. I did not consent to the bankrupt entering an appearance in the Proceedings.
19 At the hearing before me on 19 May 2014, Mr Bell stated that he had in fact received the permission of Mr Taylor, in writing, to at least make the stay application. He referred to a notice dated 6 March 2014 which he served on Mr Taylor (pages 43 and following of his affidavit dated 27 March 2014). In it he stated:
13) You have indicated in your undated letter (purporting to be 24.2.2014) (marked as CWB2) and also marked in Nicholas White's Affidavit dated 25.2.2014 as Annexure: NRW-4. His Affidavit is in relation to his inquiry of you in his email dated 20.2.2014 for which you provided your response to his email: you are implying that by 24.2.2013 that you are then ready to quit and do no longer wish to be my Registered Trustee in bankruptcy, in the following terms:
13.1 Post 24.2.2014: you would not enter an appearance1 as my trustee in bankruptcy to represent me in my bankrupt case as you then did believe that I was not a bankrupt;
13.2 Post 24.2.2014: you do not wish to oppose the orders that the Plaintiff is pursuing against me because it matters not to you, as you did believe then that you were no longer my trustee in bankruptcy;
13.3 Pre-24.2.2014: you have not consented to my entering an appearance for myself as a non-bankrupt in the past as you did believe at all material times that I was indeed a bankrupt and consequently you were entitled to represent me2;
13.4 Post 24.2.2014: you no longer held that belief and consequently, you did believe that my bankrupt status had been wrongly adjudged and that I have the right to self-advocate as a self-litigant
- The first footnote reference is as follows:
Mr Nick White poses question 1: …… whether you would confirm?
'1.intend to file a Memorandum of Appearance in the Proceedings or oppose the orders sought; and' You answered:
'I do not intend to file a Memorandum of Appearance or oppose the orders sought by your client.'
Please note:
A Reasonable Constructive of which there is no alternative is:
i) as to Part 1 of question 1: Your 'do not' means that you currently on 24.2.2014 do not intend to represent me in the future as my Registered Trustee as you are convinced that I have been wrongly adjudged a bankrupt.
ii) as to part 2 of question 1: You also do not intend to oppose the orders sought by the Plaintiff in the future because you are no longer as at 24.2.2014 representing me as my Registered Trustee as I can be a self-litigant.
The second footnote reference is:
Mr Nick White poses question 2: …. Whether you would confirm?
'2. have consented to Mr Bell entering an appearance in the Proceedings.'
Your answer 2: I did not consent to the bankrupt entering an appearance in the Proceedings.
Again, a reasonable construction for which there is no alternative to your answer:
You can only did not consent to what happened in the past and you cannot did not consent to a future event. Consequently, it is implied from your answer that you would now consent to my entering an appearance in the current and future proceedings as you are now no longer my Registered Trustee post 24.2.2014. You are saying to me: 'I have stopped you in the past but I will no longer stop you in your future to speak up for yourself. You are not a bankrupt Carl and you can now speak up for yourself in court.'
If you had meant otherwise, you would have simply stated: 'I do not consent instead of did not consent to the bankrupt entering an appearance in the Proceedings.'
21 Mr Bell filed an affidavit dated 24 May 2014 on 26 May 2014. This affidavit does not contain any new correspondence from Mr Taylor. Rather, in it Mr Bell repeats the theme that because Mr Taylor has not responded to the notices served on him by Mr Bell that he has granted Mr Bell 'permission by tacit agreement to self-advocate'.
22 CBA filed an affidavit in response dated 27 May 2014 sworn by Mr White. It contains another letter from Mr Taylor, which provides as follows:
I am the trustee of the Bankrupt Estate of Carl William Bell.
I refer to your facsimile to me dated the 21 May 2014. With respect to the matters raised, I advise as follows:
1) I did not give my consent to the Bankrupt entering an appearance in respect of
a) The proceedings numbered CIV2567 of 2013 and a stay application; or
b) The appeal proceedings.
In fact the Bankrupt did not approach me to seek my consent which if he had I would not have given.
2) I do not intend to file a memorandum of appearance in respect of either the stay application or the appeal proceedings.
3) I do not oppose orders dismissing the stay application and the appeal proceeding filed by the Bankrupt.
4) At this stage I would not intend to appear in respect of the annulment application, and I am currently in discussions with the Australian Securities Financial Authority with respect to this matter.
23 This places the matter beyond doubt. Mr Bell did not have the permission of Mr Taylor to bring the application for a suspension order. Consequently, the application is incompetent and must be dismissed: Bell v Cribb [12].
If Mr Bell is able to bring the application, should the Court grant a stay?
24 Even if I had accepted Mr Bell's argument about permission, I would not have made a suspension order.
25 The court does have the power to suspend the enforcement of the judgment against Mr Bell pursuant to Civil Judgments Enforcement Act 2004 (WA) (CJEA) s 15. This power may be exercised by a registrar of the court: Rules of the Supreme Court 1971 (WA) O 46 r 2(1).
26 The CJEA provides that the court may only make a suspension order 'if there are special circumstances that justify doing so': CJEA s 15(3). By CJEA s 15(4), 'a suspension order may be made for any period (including an indefinite period) and may be made on terms as to costs or otherwise'.
27 The onus is on Mr Bell as the applicant to move the court to a favourable exercise of its discretion: M R & R C Smith Pty Ltd t/as Ultra Tune (Osborne Park) v Wyatt [2011] WASCA 43 [4] (Pullin JA); Spiers Earthworks Pty Ltd v Landtec Projects Corporation Pty Ltd [2010] WASCA 226 [16] (Newnes JA); Eastland Technology Australia Pty Ltd v Whisson [2003] WASCA 307; (2003) 28 WAR 308 [9] (Murray & Parker JJ).
28 A successful litigant at first instance will ordinarily be entitled to enforce the judgment pending the determination of any appeal: Spiers Earthworks [16]; Eastland Technology [9]. Moreover, in a mortgage action the general rule is that a stay will not be granted in circumstances where the mortgage debt has not been paid or paid into court: Inglis v Commonwealth Trading Bank of Australia [1972] HCA 74; (1972) 126 CLR 161, 164 (Walsh J); Duckworth v Commonwealth Bank of Australia [2013] WASCA 24 [2] (Pullin JA) [3].
29 In considering whether there are 'special circumstances' as required by CJEA s 15(3), the court may consider hardship and the balance of convenience: Hamersley Iron Pty Ltd v Lovell (No 2)(1998) 20 WAR 79, 91, 94 (Anderson J); Duckworth [2] (Pullin JA); Alvaro v Amaral [2013] WASCA 16 [3] (Pullin JA).
30 Mr Bell's application is made in the context of an appeal to the Court of Appeal. The facts of the present case are substantially identical to those considered by Pullin JA in Duckworth. In that case, the master had ordered the appellant to pay the respondent a sum of just under $3 million together with interest, and ordered that the appellant give possession to the respondent of the mortgaged property. The appellant sought a suspension order pending an appeal. Justice Pullin dismissed the application. The factors taken into account by Pullin JA included that:
(a) the debt had not been paid, or paid into court;
(b) the appellant had not demonstrated that she had any reasonable prospect of success in the appeal;
(c) even if the appellant succeeded on the appeal and had the transaction set aside, the appellant would still be required to pay the principal sum and interest at a reasonable rate, citing Maguire v Makaronis [1997] HCA 23; (1997) 188 CLR 449, 475 - 476 (Brennan JC, Gaudron, McHugh & Gummow JJ);
(d) there was no evidence that the appellant had any means of paying or reducing the debt or repaying the principal and interest other than by sale of the property; and
(e) the balance of convenience favoured the refusal of a stay because the judgment sum plus interest had exceeded the value of the mortgaged property.
31 Applying the principles set out above, in particular the decision in Duckworth, the following factors are relevant:
(a) the ordinary rule is that the CBA is entitled to enforce the judgment pending the appeal;
(b) Mr Bell has not offered to pay the mortgage debt into court, nor as he is a bankrupt, is there any prospect of him doing so;
(c) there is no evidence that Mr Bell has any means of paying or reducing the debt or repaying the principal other than by sale of the Property; and
(d) given the fact that Mr Bell is an undischarged bankrupt, and his trustee in bankruptcy did not oppose the grant of summary judgment, I am not persuaded that his appeal has reasonable prospects of success.
32 Mr Bell has not discharged the onus on him to satisfy the court that there are special circumstances which justify the suspension of the judgment pursuant to which CBA is entitled to possession of the Property. This decision is consistent with the decision in Duckworth. It is also consistent with the decision in Perpetual Ltd v Buttarelli [2012] WASC 512 and the subsequent decision inPerpetual Ltd v Buttarelli [No 2] [2013] WASC 190.
33 The application should be dismissed as being incompetently commenced. As Mr Bell is an undischarged bankrupt, it is appropriate that there be no order as to costs.
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