Commonwealth Bank of Australia v Nick Frisina Pty. Limited

[1999] NSWSC 917

CITATION:	Commonwealth Bank of Australia v. Nick Frisina Pty. Limited & Ors. [1999] NSWSC 917
CURRENT JURISDICTION:	Equity Division Commercial List
FILE NUMBER(S):	No. 50142 of 1998
HEARING DATE(S):	9th September 1999
JUDGMENT DATE:	9 September 1999
PARTIES :	Commonwealth Bank of Australia - P Nick Frisina Pty. Limited 1D, Nicola Frisina 2D, Julianna Frisina 3D, Anna-Maria Frisina 4D, Sandra Frisina 5D
JUDGMENT OF:	Hodgson CJinEq at 1

COUNSEL :	R.G. Forster SC for plaintiff D. Raphael for 1, 2 & 3 defendants A. Diethelm for 4D
SOLICITORS:	Corrs Chambers Westgarth, Sydney, for plaintiff Smith Monti Costa, Fairfield, for 1, 2 & 3D S. Nasti & Co. of Bankstown for 4D
CATCHWORDS:	MORTGAGES
DECISION:	See page 11 of judgment

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
COMMERCIAL LIST

CORAM: HODGSON, CJ in Eq.

Thursday 9th September 1999

NO. 50142 OF 1998
COMMONWEALTH BANK OF AUSTRALIA LIMITED V. NICK FRISINA PTY. LIMITED & ORS.

JUDGMENT (On Orders)

1 I have heard argument on two matters in relation to orders which the Bank submits should be made arising out of the judgment which I gave on 2nd September 1999. 2 Mr. Raphael for the first, second and third defendants has submitted that I should not make an order that his clients pay the costs of the separate determination. He submitted that costs were wasted on his side, because the Bank did not concede prior to the hearing of the case that the purported appointment of the new trustee was ineffectual or that the first defendant never validly became the trustee of the relevant trust. He submitted that a substantial part of the written submissions he prepared was directed to those issues, and that time and the associated costs were wasted. He also submitted that the parties he represented had some success in relation to the matters argued, including s.66B of the Conveyancing Act. However, he conceded that prior to the hearing, the Bank had not explicitly advised that it contested the two points which it ultimately conceded, and he also conceded that there was no enquiry made of the Bank whether or not it did concede those two points. 3 Mr. Forster submitted that the Bank had substantial success on all points argued, and that the whole of Mr. Raphael's submissions would have failed in any event by reason of the jus tertii point, but for the application made on the day of the hearing to have the matter argued on behalf of the trust. 4 In my opinion, the points raised by Mr. Raphael do not justify departing from the ordinary order as to costs, and I would propose to order that the first, second and third defendants pay the Bank's costs of the separate determination. 5 Mr. Raphael also submitted that the time proposed by the plaintiff for the execution of the judgment for possession, that is 9th October 1999, was insufficient. However, he did not lead any evidence concerning any difficulties that would be caused by execution of the judgment at that time, nor of any particular advantage that would be given by postponing it for some time after that date. 6 For that reason, I am minded to make the orders as proposed by the plaintiff, subject to an application that has been made this morning by Mr. Diethelm on behalf of the fourth defendant. 7 The fourth defendant is a beneficiary of the relevant trust. Mr. Diethelm tells me that it is proposed to lead evidence that money advanced by the Bank was misapplied, and that there has been consequential loss to the trust and the beneficiaries. He submits for that reason, the beneficiaries (and in particular, his client the fourth defendant) should be given an opportunity to lead that evidence before judgment for possession is given in favour of the Bank. He submitted that the questions concerning possession have not been determined against his client, and that his client should be given an opportunity to contest these matters. 8 As I indicated during argument, in my opinion that submission overlooks the way in which this case has proceeded. Some time ago, an order was made for separate determination of the issues between the Bank and the first defendant. Quite plainly, the principal issue to be determined between those parties was whether the Bank was entitled to possession of the properties. According to the pleadings, the only parties concerned in that issue were the plaintiff and the first defendant. The other defendants raised no defence to the claim for possession. Quite plainly, it was contemplated by the order for separate determination that the Court would finally determine all matters going to the Bank's entitlement to possession. If the beneficiaries, and in particular the fourth defendant, are now to be permitted to raise matters challenging the Bank's right to possession, it is plain in my opinion that they will have to make out a case by evidence which explains why they have not raised this matter earlier and why they permitted the matter to go for separate determination, and also they will have to show a prima facie case that the Bank is not entitled to possession. 9 In my opinion, what they would need to do in the first instance is to make out a case similar to that required for an interlocutory injunction; that is, not only make out some sort of prima facie case, but also show that the balance of convenience favours the Bank being prevented from having possession until the final determination of the issues they wish to raise. The way I see that at present, it would require prima facie evidence that a particular amount of the advances of the Bank was lost to the trust, payment of the balance to the Bank, evidence that the properties in question have a particular value to the trust or the beneficiaries over and above their money value, and provision for payment of future interest as it accrues. 10 What I propose to do is to make the orders sought by the Bank, but order that they be stayed and also not entered until and including 22nd September 1999; direct that on or before 20th September 1999, the fourth defendant serve all material it wishes to rely on on the Bank; and stand the matter over before me at 9.30am on 22nd September 1999. On that day, I would consider whether the material produced by the fourth defendant is sufficient to justify a substantial interlocutory hearing, and if it is, I would appoint a later time before me for such a hearing. 11 For those reasons, I make the orders in the Short Minutes of Order which I initial and date. 12 I stay Orders 1, 3, 4 and 5 until and including 22nd September 1999, and I direct that they not be entered until after 22nd September 1999. 13 I stand the matter over before me at 9.30am on 22nd September 1999.

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Last Modified: 09/09/1999