Davidson v Suncorp-Metway Limited - [2020] FCA 795

FEDERAL COURT OF AUSTRALIA
Davidson v Suncorp-Metway Limited [2020] FCA 795

File number: QUD 18 of 2020

Judge: DERRINGTON J

Date of judgment: 2 March 2020

Catchwords:
CONTRACTS – release – release barring contemplated proceedings

ESTOPPEL – issue estoppel – res judicata – earlier proceedings in respect of different properties the subject of the same mortgage document

PRACTICE AND PROCEDURE – injunctions – interlocutory injunction – no serious question to be tried – balance of convenience

Legislation:
Constitution s 118

Evidence Act 1995 (Cth) s 185

Federal Court Rules 2011 (Cth) r 7.23

Cases cited:
Air Express Ltd v Ansett Transport Industries (Operations) Pty Ltd (1981) 146 CLR 249

Blair v Curran (1939) 62 CLR 464

Cardile v LED Builders Pty Ltd (1999) 198 CLR 380

Castlemaine Tooheys Ltd v South Australia (1986) 161 CLR 148

European Bank Ltd v Robb Evans of Robb Evans and Associates (2010) 240 CLR 432

Inglis v Commonwealth Trading Bank of Australia [1971] 126 CLR 161

Murphy v Lush (1986) 65 ALR 651

Rowe v Silverstein & Benson [1996] 1 VR 509

Suncorp-Metway Ltd v Nagatsuma & Anor [2019] QSC 16

Date of hearing: 2 March 2020

Registry: Queensland

Division: General Division

National Practice Area: Commercial and Corporations

Sub-area: Commercial Contracts, Banking, Finance and Insurance

Category: Catchwords

Number of paragraphs: 36

Counsel for the First Prospective Applicant: The first prospective applicant appeared in person

Counsel for the Second Prospective Applicant: The second prospective applicant did not appear

Counsel for the Prospective Respondent: Mr D Ananian-Cooper

Solicitor for the Prospective Respondent: Gadens Lawyers

ORDERS

QUD 18 of 2020

BETWEEN:
WILLIAM JAMES ALEXANDER DAVIDSON

First Prospective Applicant

RISA NAGATSUMA

Second Prospective Applicant

AND:
SUNCORP-METWAY LIMITED ABN 66 010 831 722

Prospective Respondent

JUDGE:

DERRINGTON J

DATE OF ORDER:

2 MARCH 2020

THE COURT ORDERS THAT:
1.The application for relief in paragraph 2 of the Prospective Applicants’ Originating Application dated 21 January 2020 (the Application) be dismissed.
2.The Prospective Applicants pay the Prospective Respondent’s costs of the application on an indemnity basis.
3.By 4.00 pm on 17 April 2020, the Prospective Applicants shall file and serve any further affidavit material in support of the orders sought by paragraph 1 of the Application.
4.By 4.00 pm on 1 May 2020, the Prospective Respondent shall file and serve any further affidavit material in response to the orders sought by paragraph 1 of the Application.
5.By 4.00 pm on 15 May 2020, the Prospective Applicants shall file and serve written submissions in relation to the orders sought by paragraph 1 of the Application.
6.By 4.00 pm on 22 May 2020, the Prospective Respondent shall file and serve written submissions in relation to the orders sought by paragraph 1 of the Application.
7.Paragraph 1 of the Application be listed for hearing at 10.00 am on 12 June 2020.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT
DERRINGTON J:
Introduction

The prospective applicants (the applicants) commenced these proceedings seeking:
(1)preliminary…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2020] FCA 795
Decision Date: 2 March 2020

CaseChat Overview and Summary

Davidson v Suncorp-Metway Limited involved a legal dispute between the applicants and the bank over the enforcement of a mortgage over property. The applicants sought relief in the form of an injunction to prevent the bank from exercising its legally enforceable rights. The bank opposed the application and sought its costs on an indemnity basis. The dispute centred around the enforceability of a release barring contemplated proceedings and the applicability of issue estoppel and res judicata in the context of an earlier proceeding concerning different properties under the same mortgage document. The applicants argued that the bank was estopped from enforcing the mortgage due to the prior proceedings, while the bank contended that the earlier proceedings did not apply to the current situation.

The court considered the legal principles of release barring contemplated proceedings, issue estoppel, and res judicata. It examined whether the earlier proceedings could be used to bar the bank from enforcing the mortgage in the current case. The court also assessed the balance of convenience in granting the injunctive relief sought by the applicants. It determined that the applicants failed to demonstrate a serious question to be tried and that the balance of convenience did not favour granting the injunction. The court found that the applicants' remaining assets were insufficient to satisfy the debt, and the interest on the outstanding facility continued to grow.

The court dismissed the applicants' application for relief and ordered them to pay the bank's costs on an indemnity basis. The court held that the applicants' claims were untenable, and the bank's solicitors had made a reasonable offer to settle the proceedings. The court also set out a timetable for the filing of further affidavit material and written submissions in relation to the orders sought by the applicants. The application was listed for hearing on a specified date.

Orders

Orders of the court

1. The application for relief in paragraph 2 of the Prospective Applicants’ Originating Application dated 21 January 2020 (the Application) be dismissed.

2. The Prospective Applicants pay the Prospective Respondent’s costs of the application on an indemnity basis.

3. By 4.00 pm on 17 April 2020, the Prospective Applicants shall file and serve any further affidavit material in support of the orders sought by paragraph 1 of the Application.

4. By 4.00 pm on 1 May 2020, the Prospective Respondent shall file and serve any further affidavit material in response to the orders sought by paragraph 1 of the Application.

5. By 4.00 pm on 15 May 2020, the Prospective Applicants shall file and serve written submissions in relation to the orders sought by paragraph 1 of the Application.

6. By 4.00 pm on 22 May 2020, the Prospective Respondent shall file and serve written submissions in relation to the orders sought by paragraph 1 of the Application.

7. Paragraph 1 of the Application be listed for hearing at 10.00 am on 12 June 2020.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

The applicants seek relief from the Court in the form of an injunction to restrain the Bank from exercising what are apparently its legally enforceable rights, but appear not to offer any ability to remediate any damage which might be caused to the Bank were such orders to be made. The interest on the outstanding facility continues to grow, and it appears that the value of the property that remains is unlikely to satisfy the debt. As Mr Davidson deposes to in his affidavit, his remaining assets “would be worth about $2 million”. In these circumstances, the balance of convenience does not favour the granting of the injunctive relief sought.Conclusion The application for the relief sought in paragraph 2 is dismissed. Costs The Bank seeks its costs as against each of the applicants. There is no reason why, given the application failed, that they should not have the costs of this application. Further, upon becoming aware of the filing of the application, the solicitors for the Bank immediately wrote to the solicitors for the applicants. The letter is in the form of a Calderbank offer. In it the solicitors set out the various reasons as to why the proceedings were misconceived and could not succeed. In that letter they invited the applicants to withdraw the proceedings and indicated that if that invitation was not accepted, the letter would be drawn to the Court’s attention on the question of costs and that they intended to seek a higher or more onerous order for costs than the standard basis. Mr Davidson claimed at this hearing that he was not shown this letter by his solicitors. Whether that is so or not, need not be determined. Given that the solicitors to whom it was sent were the solicitors on the record at the time, he is deemed to have received it. The letter made a reasonable offer in relation to the proceedings which were, for the reasons I have given, untenable. Therefore, the order for costs ought to be made on an indemnity basis.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

File number:	QUD 18 of 2020
Judge:	DERRINGTON J
Date of judgment:	2 March 2020
Catchwords:	CONTRACTS – release – release barring contemplated proceedings ESTOPPEL – issue estoppel – res judicata – earlier proceedings in respect of different properties the subject of the same mortgage document PRACTICE AND PROCEDURE – injunctions – interlocutory injunction – no serious question to be tried – balance of convenience
Legislation:	Constitution s 118 Evidence Act 1995 (Cth) s 185 Federal Court Rules 2011 (Cth) r 7.23
Cases cited:	Air Express Ltd v Ansett Transport Industries (Operations) Pty Ltd (1981) 146 CLR 249 Blair v Curran (1939) 62 CLR 464 Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 Castlemaine Tooheys Ltd v South Australia (1986) 161 CLR 148 European Bank Ltd v Robb Evans of Robb Evans and Associates (2010) 240 CLR 432 Inglis v Commonwealth Trading Bank of Australia [1971] 126 CLR 161 Murphy v Lush (1986) 65 ALR 651 Rowe v Silverstein & Benson [1996] 1 VR 509 Suncorp-Metway Ltd v Nagatsuma & Anor [2019] QSC 16
Date of hearing:	2 March 2020
Registry:	Queensland
Division:	General Division
National Practice Area:	Commercial and Corporations
Sub-area:	Commercial Contracts, Banking, Finance and Insurance
Category:	Catchwords
Number of paragraphs:	36
Counsel for the First Prospective Applicant:	The first prospective applicant appeared in person
Counsel for the Second Prospective Applicant:	The second prospective applicant did not appear
Counsel for the Prospective Respondent:	Mr D Ananian-Cooper
Solicitor for the Prospective Respondent:	Gadens Lawyers

JUDGE:	DERRINGTON J
DATE OF ORDER:	2 MARCH 2020