Commonwealth Bank of Australia v Cann

[2012] WADC 115

JURISDICTION     :   DISTRICT COURT OF WESTERN AUSTRALIA

IN CHAMBERS

LOCATION:   PERTH

CITATION:   COMMONWEALTH BANK OF AUSTRALIA -v- CANN [2012] WADC 115

CORAM:   DEANE DCJ

HEARD:   14 NOVEMBER 2011

DELIVERED          :   26 JULY 2012

FILE NO/S:   CIV 2915 of 2009

BETWEEN:   COMMONWEALTH BANK OF AUSTRALIA

Plaintiff

AND

GAVIN MICHAEL CANN
Defendant

Catchwords:

Defendant's application to set aside default judgment - Whether evidence defendant seeks to rely on is fresh evidence - Whether application constitutes an abuse of process - Whether defendant should be restrained from pursuing any further action in the District Court relating to matters raised in this action 

Legislation:

Nil

Result:

Application dismissed

Representation:

Counsel:

Plaintiff:     Ms K M McNally

Defendant:     In person

Solicitors:

Plaintiff:     Clayton Utz

Defendant:     Not applicable

Case(s) referred to in judgment(s):

Cann v Commonwealth Bank of Australia (No 2) [2011] FMCA 242

Cann v Commonwealth Bank of Australia (No 2) [2011] FMCA 768

P Vivante & Co Pty Ltd v Yap [2007] WADC 149

Parker v Transfield Pty Ltd [2000] WASCA 382

PNJ v The Queen [2009] HCA 6

Yap v P Vivante & Co Pty Ltd [2007] WASCA 287

1. DEANE DCJ:  In this matter the defendant, Mr Cann, seeks to have a default judgment against him obtained by the plaintiff set aside.  The application is opposed by the plaintiff which seeks an order that the defendant be restrained from filing any further applications, appeals or instituting any actions in the District Court in relation to matters raised in this action.  The matter has had a somewhat lengthy and protracted history and for that reason in order to place matters in context it is helpful to refer to a chronology filed by the plaintiff's solicitors on 27 October 2011.  That document in brief form refers not only to the history of the matter in the District Court of Western Australia, being No 2915 of 2009, but it also makes reference to some related matters involving the defendant in the Federal Magistrates Court of Australia, being matters Nos PEG 143 of 2010 and PEG 2 of 2011.  Finally, reference is made to actions in the Supreme Court of Western Australia, CIV 1501 of 2011 and CIV 2404 of 2011, in which the defendant is also involved.  The chronology is reproduced below.

1.	District Court of Western Australia
02.10.2009	Writ of Summons is filed by the Bank
14.01.2010	Order for substituted service
02.02.2010	Mr Cann is served with the Writ of Summons by substituted service
17.03.2010	Bank obtains default judgment against Mr Cann
03.05.2010	Mr Cann files a Chamber Summons to set aside default judgment
13.05.2010	Mr Saleeba (the mother's attorney) deposes that Mr Cann was not authorised to make the $100,000 transfer
22.06.2010	At directions hearing, Jackson McDonald seek leave to be removed from the record (Representation Issue)

06.07.2010	Representation Issue adjourned until 20.07.2010
20.07.2010	Jackson McDonald obtains leave to discontinue representing Mr Cann
Mr Cann makes an oral application for a stay of execution of default judgment pending appeal
28.07.2010	Principal Registrar Gething ordered that default judgment will be set aside if $100,000 paid into Court by 17.08.2010
17.08.2010	Mr Cann fails to pay $100,000 into Court
25.08.2010	Principal Registrar Gething refuses Mr Cann's oral application for an extension of time to pay $100,000 into Court
09.09.2010	Mr Cann files a notice appealing the Court orders dated 28.07.2010
28.09.2010	Deputy Registrar Hewitt orders that Mr Cann's appeal be amended to include an application for an extension of time to commence an appeal
27.10.2010	Judge Stone states that Mr Cann's defence is 'shadowy' but orders that default judgment will be set aside if Mr Cann pays $100,000 (less $35,000 held by the Bank) into Court by 10.12.2010
07.12.2010	Mr Cann files a Chamber Summons seeking an extension of time for the payment of monies into Court until 10.01.2011
13.12.2010	Deputy Registrar Harman dismisses Mr Cann's Chamber Summons filed 07.12.2010
21.01.2011 (dated 19.01.2011)	Mr Cann files a Chamber Summons seeking orders the Bank transfer monies from the Ruth Payne Trust account to himself
08.02.2011	Registrar Kingsley makes programming orders
01.03.2011	Registrar Hewitt dismisses Mr Cann's Chamber Summons dated 19.01.2011 (but filed on 21.01.2011)
05.09.2011	Mr Cann provides a notice of appeal of the default judgment to Clayton Utz (unfiled)
13.10.2011	Mr Cann's application is listed for a special appointment before a judge on 14.11.2011

2.		Federal Magistrates Court of Australia, No PEG 143 of 2010
24.06.2010		Bankruptcy Notice is filed with the Official Receiver
28.06.2010		Banktrupty Notice is served on Mr Cann
19.08.2010		Creditor's petition is presented
26.08.2010		Creditor's Petition is served on Mr Cann
17.09.2010		Mr Cann files a notice of opposition to application.  Mr Cann states:
'[he] has not seen the documents [Bankruptcy Notice] or its contents.  it probably got blown into the street and disintegrated in the rain.  As a consequence [Mr Cann] has not responded'.
21.09.2010		Hearing adjourned
26.10.2010		Hearing adjourned.  When asked whether he had been personally served with the Bankruptcy Notice, Mr Cann responds that he can't remember.
08.11.2010		Mr Cann does not attend Court.  Hearing adjourned.
14.12.2010		Hearing adjourned (as Mr Cann had emailed the Court stating that he was too ill to attend)
21.12.2010		Mr Cann personally provides a letter and medical certificate to the Central Office at 11.30 am seeking an adjournment of the hearing that commenced at 11.30 am on the basis that he was too ill to attend court
The Court makes a Sequestration order against Mr Cann with $5,718 in costs awarded to the Bank
3.		Federal Magistrates Court of Australia, PEG 2 of 2011
11.01.2011		Mr Cann files application for review of Sequestration order
07.02.2011	The Court orders Mr Cann to, inter alia, file and serve documents on ITSA and all of his creditors by 21.02.2011
04.03.2011	Mr Cann fails to comply with order 2 of the Court orders dated 07.02.2011 (i.e. file affidavit re service) and an extension is granted
22.03.2011	Mr Cann seeks further extension of time to comply with the Court orders dated 04.03.2011 and a certificate from the Court to Access legal representation (i.e. Legal Aid)
The Bank makes an oral application for the matter to be dismissed
The Court reserves judgment
08.04.2011	Mr Cann files a second application for review of the Sequestration order dated 21.12.2010 on the basis he was unable to attend the hearing due to illness and provided the Court with a medical certificate in that regard
08.04.2011	Mr Cann files a third application for review to adjourn the hearing listed for 12.04.2011
12.04.2011	The Court dismisses Mr Cann's second and third applications for review (both filed 08.04.2011) – [2011] FMCA 221
12.04.2011	The Court, inter alia, dismisses Mr Cann's application to set aside the Bankruptcy Notice
21.04.2011	Mr Cann seeks an adjournment due to ill health, which is refused
The Court extends time for Mr Cann to, inter alia, file and serve documents on ITSA and other creditors to 27.05.2011
08.07.2011	The parties attend a mediation conference.  The conference is adjourned until 10.00 am on 18.07.2011
18.07.2011	At 8.53 am, Mr Cann notifies Clayton Utz that he is unable to attend the mediation conference.  By consent, the mediation conference is adjourned until 10.00 am on 29.07.2011
25.07.2011	Mr Cann indicates that he is not going to attend the mediation conference listed for 29.07.2011.  The mediation is relisted on 10.08.2011
10.08.2011	The parties reach an 'in principle' agreement for the settlement of the dispute.  Settlement is to occur on 07.09.2011
23.08.2011	Directions hearing adjourned to 05.09.2011
05.09.2011	The Court extends time for Mr Cann to, inter alia, file and serve documents on ITSA and other creditors to 19.09.2011 and lists the matter for a full hearing on 01.12.2011.
11.10.2011	The Court dismisses Mr Cann's first application for review
4.	Supreme Court of Western Australia, CIV 1501 of 2011 and CIV 2404 of 2011
24.03.2011	Mr Cann files notice of originating motion seeking payment of the money in the Ruth Payne Trust account to him on the basis that the trust has been terminated
08.08.2011	Master Sanderson ordered that the public trustee replace Mr Cann as trustee
13.10.2011	Both matters listed for directions hearing

1. As can be seen from the chronology relevant to the history in the District Court the defendant filed his chamber summons to set aside the default judgment on 3 May 2010.  At that point the defendant had legal representation but shortly thereafter in mid‑July 2010 his solicitors ceased representing him.

2. When the defendant appeared before his Honour Judge Stone in the District Court on 27 October 2010, he addressed his reason for seeking an extension of time in which to commence an appeal.  The application was granted but a condition attached, namely that he pay $100,000 (less $35,000 held by the bank) into court by 10 December 2010, in order to have the default judgment set aside.  As can be seen from the chronology he had previously failed to do so by 17 August 2010 as ordered by the principal registrar.  According to the defendant he had sought to increase his home loan to provide him with further funds of $100,000 in order to pay that amount into court, but this was rejected by the lending institution as a consequence of the default judgment entered against the defendant.  The defendant advised the court on 27 October at that time that his property, which I understand to be a residence in Nedlands, was worth $1.8 million and he had a $1 million loan against the property.  There was some difficulty in the defendant focussing upon the argument at the hearing of that application because he informed the court he had not read the submissions filed on behalf of the plaintiff which were hand‑delivered to his home the previous day.  This he explained was because he was quite busy preparing for a job application as he had been unemployed for four years and in essence he had not had the time to consider the plaintiff's submissions.  In any event after hearing argument his Honour Judge Stone, despite taking the view that in the circumstances there was a serious question as to the defendant's bona fides and that the defence raised by him was shadowy, ordered that the default judgment be set aside on the condition to which reference has previously been made.  The defendant did not comply with that order and on 13 December 2010 his chamber summons of 7 December seeking an extension of time until 10 January 2011 to pay the monies into court was dismissed.

3. It was not until some months later on 5 September 2011 that the defendant provided an unfiled notice of appeal in relation to the default judgment to the plaintiff's solicitors.  That matter was listed for hearing at this special appointment on 14 November 2011.  In the interim the defendant was ordered by 19 October to file and serve any further affidavit in support of his application but he failed to do so.  As a result the solicitors for the plaintiff were not able to file an answering affidavit, however they did file submissions in opposition to the application which were emailed to the defendant who apparently received them.  When questioned about failing to comply with the order of the court at this hearing on 14 November, the defendant advised the court that he did not file any further materials with respect to the special appointment hearing as he believed that he had fully ventilated his argument before the court on previous occasions.

4. The defendant in argument reiterated that he wished the default judgment entered against him to be set aside.  If that were to occur the defendant proposed to obtain discovery which he believed would give him access to a cheque butt contained in his mother's cheque account indicating that the defendant's mother wrote him a cheque for the sum of $310,000 which was given to the defendant by his mother's power of attorney.

5. It is necessary to consider briefly the history of how it came to be that the defendant's mother, Ruth Harriet Grenville Payne, came to have a power of attorney appointed on her behalf.  This is addressed in an affidavit sworn by John Walter Saleeba on 13 May 2010 with an attachment 'JWS 1'.  That affidavit attests that on 3 August 2006 the defendant's mother revoked her power of attorney in favour of the defendant and appointed Mr Saleeba and Michele Ann Kershaw as her joint and several attorneys.  According to Mr Saleeba he was informed by the defendant's mother that she had agreed to provide the defendant at the defendant's request with a loan of $300,000 to enable him to settle his divorce proceedings in a way which would avoid the defendant having to sell his matrimonial home at 31 Bulimba Road in Nedlands.

6. It would seem according to Mr Saleeba's affidavit, that the proceedings in relation to that divorce became protracted over time and so the defendant increased his request for funds from his mother to $600,000 and eventually to $900,000.  The defendant's mother considered the amount of $600,000 was excessive and declined to provide that amount.  Further, Mr Saleeba in consultation with the defendant's mother's accountant, concluded that it would not be in her interest to provide that amount of funds to the defendant.  This information was conveyed to the defendant by letter dated 7 October 2008 which is the annexure 'JWS 1' to the affidavit.  In that letter the defendant was informed that his brothers supported the decision which had been made.  Further, he was informed that in the opinion of the defendant's mother's doctor, she had reached a point where she was incapable of managing her affairs and therefore she was not in a legal position to sign any documentation or commit to any arrangement which would be recognised at law.  Mr Saleeba, as the co‑power of attorney, advised the defendant that Mr Saleeba was now obliged to act in the best interests of the defendant's mother, regardless of any directions she might give him, as that was the legal position in the circumstances.

7. For this reason Mr Saleeba advised counsel acting for the plaintiff in this matter, that the defendant was not authorised to transfer $100,000 from his mother's account as he had done on 29 January 2009.  Mr Saleeba confirmed that the transfer had occurred when he received the defendant's mother's bank statement.  He then contacted the plaintiff advising it that the transfer was unauthorised.  He also advised the defendant's mother of what had occurred and according to Mr Saleeba's affidavit at par 7, she expressed annoyance that the defendant had effected the transfer of funds without first discussing it with her.  The plaintiff subsequently refunded the funds to the defendant's mother's bank account and commenced an action to recover the funds from the defendant.

8. Given the situation involving the defendant's mother's health in 2009, the defendant organised carers for her and arranged for their payment by either emailing Mr Saleeba the costs for the month so he could draw a cheque in favour for that amount and mail it to the defendant, or by Mr Saleeba personally placing the envelope containing the cheque in the letterbox at the defendant's residential address in Nedlands.  That arrangement remained in place until December 2009, at which time the defendant's mother with her husband, who was the defendant's stepfather, moved to a nursing home.  As I understand it they are both now deceased.

9. Mr Saleeba deposes that in early February 2010 he collected an envelope addressed to the occupier of 161 Victoria Avenue, Dalkeith which was the defendant's mother's home address.  That envelope contained correspondence from solicitors for the plaintiff relating to an action by the plaintiff against the defendant for recovery of the funds which had been transferred by him from his mother's bank account in early 2009.  According to Mr Saleeba's affidavit, the defendant's older brother arrived in Perth in February 2010 from Canada, where he formally resides, to make arrangements for the mother's home to be rented.  Mr Saleeba handed the correspondence he had received from the plaintiff to the defendant's brother suggesting that he discuss its contents with the defendant.  Mr Saleeba deposes that the brother subsequently advised him he had raised the matter with the defendant and had been instructed by the defendant to place the correspondence in the bin.

10. The defendant in his submissions regarding that correspondence claimed it was not sent to his home address in Nedlands and further he said it was never opened.  I reject this assertion because although to an extent Mr Saleeba's affidavit might be said to contain a degree of hearsay I am satisfied that as co‑power of attorney he would have ensured that the issue was brought to the defendant's attention.

11. In his submissions the defendant referred to his affidavit of 3 September 2011 stating that he had previously appealed this matter and the default judgment entered against him on 17 March 2010 had been set aside subject to conditions that he could not meet.  He states that this is a fresh appeal based on new evidence.  He reiterates in that affidavit that he did not receive a summons in relation to the plaintiff's claim and as he was unaware of the application he had no opportunity to provide a defence and that is why a default judgment was entered against him.  He claims that the proceedings against him by the plaintiff came about pursuant to the advice of Mr Saleeba, but that advice was wrong.

12. In support of this the defendant refers to annexure A to his affidavit, which contains an email of 25 June 2007 from the defendant to Mr Saleeba.  It also contains a reply email from Mr Saleeba to the defendant on 27 June 2007 where Mr Saleeba advised the defendant in part that his mother's account in May 2007 stood at $375,000 and Mr Saleeba suggested that subject to the defendant's mother's approval the best that could be done was for her to advance $350,000 to the defendant.  Mr Saleeba advised that he intended to discuss the matter with the defendant's mother.  In annexure B to that affidavit, by letter dated 26 February 2008 Mr Saleeba advised the defendant that his request of 20 February 2008 for a further loan of $50,000 had caused the defendant's mother to form the view that she was longer prepared to continue lending her son money.  However, she was agreeable to lending the defendant $300,000 of which he already had received $100,000.  It was made plain the funds were to assist the defendant with his divorce settlement.

13. Although a cheque for $50,000 was enclosed in that correspondence, it was stressed that the overall loan arrangement of $300,000 was reduced accordingly.  A sum of $50,000 was to be retained for use in the divorce settlement.  There was a further $150,000 available for the defendant at his request.  Once that final amount of $150,000 was provided that would be the end of the defendant's mother providing him with sums of money.  Mr Saleeba pointed out in the correspondence that taking into account the payment of that $150,000 on his estimate the defendant's borrowings from his mother would exceed the sum of $500,000, taking into account payment of all legal fees.  Annexure C to that affidavit is a copy of Mr Saleeba's affidavit of 13 May 2010 regarding the loan to the defendant by his mother of $300,000 to settle his divorce proceedings.  Annexure D to that affidavit, according to the defendant, refers in part to his mother's cheque in the sum of $310,000 made out to the defendant and given to him by Mr Saleeba on 9 July 2007 in return for the defendant's signature on a one page loan agreement.  Annexure D is a letter from the defendant dated 27 March 2009 to an entity called Poolman Scali Zinni which contains only the first page of the correspondence.  It does assert in par 1 that on 9 July 2007 the defendant was given a cheque from his mother for $310,000 to assist in his divorce settlement and to enable the defendant to purchase his wife's interest in the family home.  However, according to the defendant, settlement did not occur and so he returned the cheque to his mother.  It should be noted that events occurring in 2007 and material relating to them could hardly be described as fresh evidence at the current time.

1. The defendant advised the court that when Mr Saleeba indicated in June 2007 he would discuss the advance of $350,000 from the defendant's mother to him, the defendant in return was required to sign a one‑page loan agreement for $310,000.  He was also required to provide a second mortgage over his property in Bulimba Road, Nedlands.  Despite claiming that he signed the loan agreement, the defendant said he could not recall if he received a copy of it at the time or having received a copy whether he misplaced it.  This was another document that the defendant claimed he proposed to obtain, in conjunction with a copy of the cheque butt from his mother's account, if he was granted or obtained discovery.  He also advised the court that when he received the cheque for $310,000 he returned it to Mr Saleeba because he believed that if he banked it then as a result of his divorce proceedings his wife may get half of the proceeds of those funds.  He said he advised Mr Saleeba that in those circumstances he would draw on the funds as he needed to pay his legal costs and this conversation occurred within a week of 9 July 2007.  There is a conflict in the defendant's assertions as to whom he returned the cheque as at one stage he says it was to his mother (see annexure D), and then he says it was to Mr Saleeba.

2. It should be noted however that there is no reference in the defendant's affidavit of 13 September 2011 of him returning the cheque to Mr Saleeba within a week or so of receiving it.  No supplementary affidavit attesting to that fact has been filed by the defendant between 3 September 2011 and 14 November 2011, the hearing date of this application.  It would also appear that up until this hearing date the defendant had not approached anyone, including Mr Saleeba, with a view to obtaining a copy of the cheque butt and loan agreement in question.  The defendant explained this on the basis that he had been suffering ill health and has continued to do so, albeit that he presented no medical certificate to that effect to this court.

3. In addressing the court order for the conditional setting aside of the default judgment against the defendant whereby he was to pay by 10 December 2010 $65,000 into court or provide sufficient security for that amount by that date, Mr Cann explained that he applied to his bank for a loan in that amount, given what he claimed was the equity he had in his home, but as there were bankruptcy proceedings against him which affected his credit rating and given he was also unemployed, the bank rejected his application.  Following this, he claimed a formal offer was made to the plaintiff's solicitors regarding providing security for the $65,000, but that too was rejected as the defendant refused to provide a second mortgage over his home by way of security.  The defendant acknowledged that as the result of bankruptcy proceedings taken against him in the Federal Court he has been declared bankrupt.

4. Counsel for the plaintiff conceded that on 9 July 2007 Mr Saleeba advised the defendant that his mother would give him a cheque in the sum of $310,000 by way of a loan, on condition that prior to this occurring the defendant would sign a short form mortgage to secure repayment of the loan and other sums of money to his mother, with security being the defendant's residence in Bulimba Road, Nedlands.  The defendant asserts that he did not bank that cheque for reasons referred to previously.

5. Following the letter dated 26 February 2008 from Mr Saleeba to the defendant, stating the defendant had received only $100,000 of a purported $300,000 loan from his mother, Mr Cann asserts that about 27 January 2009 he telephoned his mother and requested if pursuant to the agreement to lend him $300,000, he could transfer a further $100,000 from her bank account to his.  He attests in his affidavit sworn 30 April 2010 that his mother agreed to this request.  That is why on 29 January 2009 he transferred the sum of $100,000 from his mother's account into his own bank account which, according to par 10(f)(i) of the affidavit, he noted as 'Loan GC'.  He then transferred $69,736.77 to the O'Sullivan Davies Trust account.

6. In that same affidavit at par 11 the defendant expresses a number of bases upon which he seeks to set aside the default judgment namely that:

   (a)he did not enter an appearance to the writ as he did not receive a copy of it;

   (b)he had not delayed in filing his application to set aside the default judgment;

   (c)he does not believe that the plaintiff will suffer any prejudice if the default judgment is set aside; and

   (d)he believes that he has a defence to the claim against him.

7. There is an obvious inconsistency and it may even be said a direct conflict between what the defendant asserts his mother said to him regarding the transfer of the $100,000 from her account into his account and what Mr Saleeba deposes to in pars 5, 6 and 7 of his affidavit of 13 May 2010.  When this was put to the defendant he advised the court that at that time his mother was in her early 90s and suffered from a very poor short term memory.  He persisted in his claim however that the sum of $100,000 which he transferred from her account into his own, was part of a loan of $300,000 which his mother had agreed to make to him sometime prior to the transfer of those funds.

8. Reference has been made to the defendant being declared bankrupt and the circumstances as to how this occurred require some explanation.  The proceedings, being No PEG 143 of 2010, in the Federal Magistrates Court of Australia concern an action commenced in June 2010 by the plaintiff for a sequestration order against the defendant based on the default judgment obtained against the defendant in the District Court.  As can be seen from the chronology filed on behalf of the plaintiff, there appears to have been some behaviour on the part of the defendant to frustrate those proceedings, but in December 2010 the order sought was made against the defendant and costs awarded to the plaintiff.  Following this by way of Federal Magistrates Court action PEG 2 of 2011, the defendant filed an application for a review of the order, which proceedings again according to the chronology, had a lengthy and somewhat frustrated history.  Whilst the defendant's first, second and third applications for review of the order have been dismissed, at the time of this hearing there were other proceedings listed for a full hearing in the court on 1 December 2011 which clearly had not been heard or resolved as at 14 November 2011.

9. In relation to the Supreme Court of Western Australia actions CIV 1501 of 2011 and CIV 2404 of 2011 there was an application by the defendant, it seems in his role as trustee of his mother's trust account being the Ruth Payne Trust, seeking an order of payment of monies out of the trust account on the basis that the defendant had terminated the trust and was the sole beneficiary and that the money involved should be paid to the defendant by the bank.  On 8 August 2011 Master Sanderson ordered that the public trustee replace the defendant as trustee.  Counsel for the plaintiff, being the Commonwealth Bank, advised this court that although the bank attended court it was essentially in an inactive capacity.  The co‑powers of attorney for the defendant's mother instructed counsel to attend on their behalf and another signatory to the trust, who is the stepdaughter of the defendant's mother, has also instructed counsel in that action.  Counsel for the plaintiff told this court that as far as she was aware that action has been stayed at this time.  According to the plaintiff's chronology a chamber summons filed on the defendant seeking the bank transfer funds from the Ruth Payne Trust account to the defendant was dismissed on 1 March 2011 by a registrar of the District Court.

10. The plaintiff in this action is not involved in CIV 2404 of 2011.  That concerns an application by the defendant's mother's co‑powers of attorney which resulted in an order being made by the court removing the defendant as a trustee and appointing the Public Trustee in his stead.  The defendant has appealed that decision and as at the time of this hearing the matter was ongoing in the Supreme Court, although counsel for the plaintiff has not seen or been served with any papers relating to that action.

11. By way of clarification, counsel for the plaintiff said that although the sum of $310,000 was agreed to be advanced to the defendant, that was the same amount of money referred to at times in the course of this hearing and these proceedings as $300,000.  The precise amount is in fact $310,000.  Relevant to that proposed loan it is important to appreciate that as from 3 August 2006 a Guardianship and Administration order was in place in relation to the defendant's mother appointing Mr Saleeba and Ms Kershaw as co‑attorneys with an enduring power of attorney and so from that date they were the only two persons entitled to make a loan agreement on behalf of the defendant's mother and, according to Mr Saleeba's affidavit, that did not occur.  It is also apparent from annexure B to the defendant's affidavit of 30 April 2010 that by letter dated 9 July 2007 Mr Saleeba made it plain that the cheque for the loan of $310,000 to the defendant from his mother, was subject to the defendant providing a mortgage over his residence in Bulimba Road, Nedlands.  That did not occur.

12. Therefore, counsel for the plaintiff submitted that the transfer of $100,000 by the defendant from his mother's account to his own bank account could not have occurred with her permission.  It was further submitted on behalf of the plaintiff that even if one were to assume the defendant was entitled to transfer funds in that amount from his mother's account by way of a loan, that sum has now been repaid to the defendant's mother by the bank and in absence of any documentary evidence regarding the loan, it must be assumed that it is repayable to the plaintiff upon demand.  In any event, the Trustee in Bankruptcy will call for all creditors, which includes the plaintiff, to provide proofs of debt so that any outstanding loans the defendant has will have to be paid.  The result will therefore be the same according to counsel for the plaintiff, who also pointed out that the plaintiff's costs in defending the various actions and appeals instigated by the defendant are also claims that will be included in a proof of debt by the plaintiff as a creditor in the bankruptcy matter.  Counsel also voiced concern that the defendant may be attempting to use his current application to set aside the default judgment to create a situation whereby he can attack the sequestration order of 22 December 2010, but that would be to no avail because the same result would occur. In my view on one interpretation of what the defendant told the court in his submissions at this hearing that is what he intends to do if he is successful in this application.

13. Counsel for the plaintiff also highlighted what were said to be some concerns relating to the defendant's credibility in this action, or at the very least the reliability of his recollection.  In par 3 of the defendant's affidavit dated 30 April 2010 he deposes that he was unaware of these proceedings prior to 26 March 2010.  The fact is however that the plaintiff obtained an order on 14 January 2010 for substituted service of the summons upon the plaintiff.  This apparently came about because according to an affidavit sworn on 13 January 2010 by counsel for the plaintiff, she had a telephone conversation with a person who claimed they were a tenant in the defendant's property in Bulimba Road, Nedlands who advised that the defendant had left Western Australia some six to eight weeks previously to travel to the ACT, leaving no precise forwarding address.  Counsel pointed out that the documentation relevant to the action was served at the defendant's Nedlands property and substituted service was also effected on the defendant's mother's property.  This also conflicts with the defendant's claim that such correspondence was never sent to his address in Nedlands.  As previously pointed out in relation to service at the mother's property Mr Saleeba's affidavit refers to his receipt of correspondence from the plaintiff's solicitors in relation to this action and his understanding from what he was told by the defendant's brother that he had raised the issue regarding that correspondence with the defendant.  Finally, counsel also understood that substituted service was effected upon the defendant through his email address at that time, although there was a change to the email address which arguably could have interfered with the service.  Nonetheless the plaintiff considered that substituted service had been effected pursuant to the order of the District Court.

14. It is common ground that the defendant did not enter an appearance or file a defence as a result of which a default judgment was entered on 17 March 2010.  Approximately two months later the defendant filed his first chamber summons to set aside the judgment which prompted the affidavit sworn by Mr Saleeba.

15. Although relevant to the bankruptcy action against him the defendant deposed in an affidavit of 17 September 2010 he had not been served with a bankruptcy notice on 28 June 2010, and in fact had not even seen it, it is the case that prior to 17 September the defendant actually attached a copy of it to an affidavit he swore on 17 July 2010 relevant to the proceedings in the District Court.  Further, in Cann v Commonwealth Bank of Australia (No 2) [2011] FMCA 768, (Federal Court final judgment) at (4) in the reasons for judgment, the court referred to an affidavit sworn by counsel for the plaintiff in these proceedings filed on 21 September 2010, indicating that the Bankruptcy Notice had been sent to the defendant by email on 4 July 2010. In addition before the District Court on 6 July 2010 and again on 20 July 2010 in open court and in a hearing before a registrar of the District Court, the defendant referred to the Bankruptcy Notice.

16. Counsel for the plaintiff asserted that further doubt is cast on the credibility of the defendant who sought to set aside the sequestration order in part on the ground that he could not attend the hearing on 21 December 2010 due to ill health.  He hand‑delivered a medical certificate to the court shortly before the hearing was to occur, but in Cann v Commonwealth Bank of Australia (No 2) [2011] FMCA 242 Registrar Lucev found there was no evidence that the defendant's medical condition affected him on the day and noted that he had in fact been well enough to hand‑deliver a letter and medical certificate to the registry shortly prior to the hearing.

17. The defendant further claimed in relation to the plaintiff's application to dismiss his Federal Court application for review, that he had no notice of that hearing which was to occur on 30 September 2011.  However in the reasons for judgment in Cann v Commonwealth Bank of Australia (No 2) [2011] FMCA 768 [18] Registrar Lucev held that the defendant had both actual and constructive knowledge of the hearing date.

18. Counsel for the plaintiff opposes the setting aside of the default judgment against the defendant relying not only upon what are said to be significant difficulties with the defendant's credibility and reliability, but also the ongoing delays with the action which it is argued are almost totally without a proper basis.  Further, it is said that the issues raised by the defendant which are said to constitute fresh evidence do not fall into such a category, and if in the past the defendant has chosen not to mention or raise matters that existed at the time or of which he then had knowledge, that is a matter for him in the sense that it was his choice not to do so.  The position of the plaintiff is in essence that the defendant's conduct in this action and indeed his conduct in associated actions constitutes an abuse of process.  Further, the plaintiff is rapidly reaching a position where, if the default judgment were to be set aside, there is a question of the future conduct of the matter from the plaintiff's perspective.  The issue is the repayment of $100,000 and the costs associated with continuing to pursue the matter, given the work that has been done to date by the plaintiff's lawyers, may well mean that it is financially unviable for the plaintiff to continue with the action.  That is a matter which counsel for the plaintiff argues is a factor to be taken into account in the exercise of the court's discretion.  The law is clear that where a default judgment is properly entered it should not be set aside lightly and without sound reason.

19. It is argued on behalf of the plaintiff that there have been numerous previous court appearances in relation to this matter with a view to resolving the issue and that the defendant has had a number of opportunities to ventilate his concerns and argument before the court.  For a variety of reasons referred to in numerous affidavits the defendant has filed and in oral submissions he has made to the court, he has not capitalised upon this opportunity to have the default judgment set aside.  In brief terms the plaintiff's counsel argues there are sound public policy reasons why litigation should come to an end, albeit that counsel concedes that these must be balanced against the necessity that justice is done and that if there is an arguable defence available to a party in the defendant's position, there should be an opportunity to present that defence if possible.

20. As previously noted, counsel for the plaintiff contends that the conduct of the defendant in this matter constitutes an abuse of process.  Reference was made to PNJ v The Queen [2009] HCA 6 [3] where the court observed that it was not possible to describe exhaustively what could be said to constitute an abuse of process. The court said however that in many cases of abuse of process at least one of the following three characteristics will exist:

    (a)the invoking of a court's processes for an illegitimate or collateral purpose;

    (b)the use of the court's procedures would be unjustifiably oppressive to a party; or

    (c)the use of the court's procedures would bring the administration of justice into disrepute.

21. Counsel for the plaintiff submitted that the defendant's application before the court falls in each of these three categories.  It is accepted however that these categories as previously noted are not exhaustive and the right of a litigant to pursue a claim for a court should not and must not be unduly fettered.  On the other hand as was noted by O'Brien DCJ in P Vivante & Co Pty Ltd v Yap [2007] WADC 149 (which was upheld on appeal – Yap v P Vivante & Co Pty Ltd [2007] WASCA 287:

    The Court has an inherent power to prevent misuse of its procedure if that misuse would bring the administration of justice into disrepute.

22. When one considers the chronology of the defendant's action in the District Court it can be seen that since 17 March 2010 when the plaintiff obtained default judgment against him, the defendant has had a number of opportunities to present his argument as to why the default judgment entered against him should be set aside.  In July 2010 he applied for a stay of execution of the default judgment pending appeal and was successful to the extent that in July 2010 the principal registrar of this court ordered the default judgment would be set aside if $100,000 was paid into court by 17 August that year.  The defendant failed to do this.  A short time later the defendant made an oral application for an extension of time to pay that sum into court which was refused and then in September that year the defendant filed a notice of appeal against the order of payment of monies into court.  On 27 October 2010 before his Honour Judge Stone in this court the defendant once again had the opportunity to have the default judgment set aside conditional upon payment of $65,000 into court which he failed to do within the time ordered so he sought an extension of time in which to do so.  That application was refused.  Then in January 2011 he sought an order that the plaintiff transfer monies from the Ruth Payne Trust account to the defendant and that chamber summons was dismissed in early March 2011.  Following this, although the defendant did not file a notice of appeal against the default judgment in the District Court, he provided a copy of such a document to the plaintiff's solicitors.  Eventually the matter was listed before the court at this hearing.  The defendant now claims in part of his argument that he wishes to obtain copies of two documents being the cheque butt and one‑page loan agreement previously referred to in these reasons, which he believes constitute fresh evidence and which will assist him in pursing his application to have the default judgment set aside.  It is the case however that on what the defendant tells the court he has been aware of the existence of these documents for a number of years and for reasons that are not particularly clear or satisfactory, he does not seem to have a copy of the loan agreement to which he refers and he has done nothing to date with a view to obtaining copies of the documents concerned.  I do not consider that these items constitute fresh evidence.  In any event there does not appear to be an argument that at one point his mother agreed to make a loan of $310,000 to the defendant but he returned the cheque and has given a number of explanations as to why he did so.

1. In addition the defendant claims that he has not been served with certain documentation and knows nothing of its existence, yet when one analyses the facts, for example those relating to the question of substituted service, it is apparent that the defendant must have been aware at the time of what was occurring in that regard.

2. Where a judgment in default has been regularly entered it is generally not set aside unless the court is satisfied that there is defence on the merits; par 13.10.6 to the Commentary of the Rules of the Supreme Court 1971.  There is an onus on a defendant to present a credible defence demonstrating that if the default judgment were to be set aside and the matter argued on its merits, the defendant would have a real prospect of success; Parker v Transfield Pty Ltd [2000] WASCA 382.

3. In the circumstances it is understandable and apparent why this court has previously ordered that the default judgment be set aside contingent on the payment of monies into court by the defendant.  He has on each occasion failed to do so.  In the course of this hearing it became apparent that in the past the defendant has rejected a condition that the plaintiff take a second mortgage over his property to protect its position.  It may be that the defendant, as he now claims, has reached the view that he would seriously consider such a proposal, but the reality is he is no longer in a position to do so as he has been declared bankrupt and it would seem that the Trustee in Bankruptcy proposes to make arrangements for the defendant's residential property to be sold in order to satisfy his debts.

4. The defendant told this court that he was unaware, because nobody informed him, that his mother on 3 August 2006 revoked her power of attorney in favour of him and Mr Saleeba and Ms Kershaw were appointed as powers of attorney in his stead.  The fact of the matter is, however, that he must have been aware of this development because he took action in the State Administrative Tribunal in 2009 to have Mr Saleeba and Ms Kershaw removed as attorneys.  That application was dismissed as can be seen in the annexures ('KMM 3' at pp 8 – 10) of Ms McNally's affidavit sworn 21 June 2010.  In the light of this it is difficult to understand why at this hearing the defendant informed the court that although he accepted he no longer had an enduring power of attorney in relation to his mother's affairs as from 3 August 2006, his understanding was that he still had written authority to act on her bank account which had never been revoked.  That would make no sense at all in the circumstances.  In any event, Mr Saleeba who with Ms Kershaw has been the mother's co‑power of attorney since 3 August 2006 deposes in his affidavit that the defendant was not authorised by him (nor presumably by Ms Kershaw) to transfer the $100,000 from the mother's account.  I accept this and I also accept Mr Saleeba's assertion that he was given to understand by her that the defendant's mother did not agree to the transfer of those funds.

5. For the reasons contained in this judgment the defendant's application to set aside the default judgment against him on 17 March 2010 is dismissed.  The materials comprising the fresh evidence to which the defendant has referred do not in the circumstances and on the history of this matter in my view constitute fresh evidence.  The defendant over a substantial period of time has failed to fully comply with court orders regarding payment of funds into court and the reasons he has advanced for failing to do so do not justify his current application being granted.

6. The concerns expressed by counsel for the plaintiff in this matter regarding the lengthy history of the proceedings in this court and the associated costs to the plaintiff, in combination with the time spent in dealing with the various applications are noted.  No doubt that forms part of the basis for the order sought by the plaintiff that the defendant be restrained from filing any further applications, appeals or instituting any actions in the District Court in relation to the matters raised in this action.  To make such an order in my view would be a very serious step and in all of the circumstances I do not consider that it would be appropriate for this court to do so, although that does not necessarily mean this issue cannot be pursued in the future by the plaintiff.

7. For the sake of completeness, reference should be made to some correspondence sent to the court by the defendant dated 20 November 2011, which was almost a week after this application was heard.  That correspondence indicated that the parties were in the process of settling this matter.  Upon further enquiry with solicitors for the plaintiff the court was advised that there were no ongoing settlement discussions with the defendant, although there had been some form of contact by letter between the parties on 16 and 17 November 2011, which did not eventuate in any resolution of the matter.  Further correspondence dated 8 May 2012 and 26 May 2012 was again sent by the defendant to the court.  It is not necessary to canvas in any detail the contents of that correspondence because it was not before the court as part of the hearing of the application and it has not come before the court in the form of any formal hearing or submissions.  The decision to dismiss the defendant's application has been made on the basis of material before the court as at 14 November 2011 including the submissions made on behalf of the plaintiff and the defendant at that time.

8. I will hear counsel for the plaintiff as to the formal orders that are requested consequent upon this decision.