Djunaedi v Collins

[2015] SADC 120

DISTRICT COURT OF SOUTH AUSTRALIA

(Civil)

DJUNAEDI & ORS v COLLINS & ANOR

[2015] SADC 120

Judgment of His Honour Judge Tilmouth

14 August 2015

PROCEDURE - COURTS AND JUDGES GENERALLY - COURTS - RULES OF COURT

Application for summary judgment postponed to enable unrepresented defendants to obtain legal advice as to the exercise of the so called 'right to silence' in light of pending criminal proceedings with respect to the same subject matter.

District Court Civil Rules 2006 (SA) 6 DCR 172(3), 6 DCR 232(2); Halabi v Westpac Banking Corporation (1989) 17 NSWLR 26; McMahon v Gould (1982) 7 ACLR 202; Beare v Light Regional Council [2010] SADC 74; Wentworth v Rogers (No 5) (1986) 6 NSWLR 534; Glew v Frank Jasper Pty Ltd [2010] WASCA 87; Ceneavenue Pty Ltd v Martin (2008) 106 SASR 1; Atkins v Minister of Community Welfare (1988) 34 A Crim R 26; Fancourt v Mercantile Credits Ltd (1983) 154 CLR 87, referred to.
Jefferson Ltd v Bhetcha [1979] 1 WLR 898; Andrew Koh Nominees Pty Ltd (as Trustee for KL Unit Trust) v Pacific Corporation Ltd (No 3) [2010] WASC 248, applied.

DJUNAEDI & ORS v COLLINS & ANOR
[2015] SADC 120

1. There are two interlocutory applications before the court with respect to the underlying proceedings.  The plaintiffs claim to have provided moneys to the defendants between March and April 2014, intended to be applied to a certain investment, but which were not.  The first application is by the plaintiffs for summary judgment.  The second taken by the defendants, is for a stay of proceedings on the basis that they were since charged with dishonesty offences in relation to the subject matter of the proceedings.

2. The third statement of claim in the within action refers to meetings between the parties in February 2014, when certain representations were made.  The plaintiffs claim these were false, misleading and fraudulently made.  In a subsequent meeting of March 2014, it is claimed that the plaintiffs were given to understand their moneys were to be applied to the purchase of prime real estate investments in New York.  Again misrepresentations are claimed to have been made fraudulently.

3. In affidavit material before the court based primarily on banking records of accounts operated by the defendants, the payments of numerous sums advanced by the plaintiffs to the defendants, totalling $386,750, are traced into accounts operated and controlled by them.  These funds were not applied to the intended purpose and in some cases are demonstrated to have been applied to the repayment of a mortgage, a loan, the purchase of a Mercedes vehicle, and landscaping.  That is to say these funds were applied to the personal benefit of the defendants, often in substantial sums.  The defendants originally claimed to have transferred all these funds overseas, which is demonstrably not the case.

4. There is also evidence before the court that the Mercedes was traded in for a newer model on 14 April 2015, with a trade-in value of $47,000, and requiring a loan of $35,996.15.  Another Judge of this court made a Freezing Order on 29 January 2015, by which the defendants were bound not to ‘dispose of, deal with, or diminish the value of any of your assets in Australia’.  Mr Collins asserts that the contract with respect to the motor vehicle was made 12 months before the first car was bought and the defendants were obliged ‘to follow on with it’ and that the car had in fact gone up in value.[1]  Nevertheless this conduct is a prima facie breach of the order.

   [1]    T12.28-35

5. The defendants now face six charges of deception and one count of money laundering, for which they were bailed in the Christies Beach Magistrates Court on 4 July 2015, for hearing on 11 August this year.  These charges relate to the very transactions to which these civil proceedings relate.  It would appear at this early stage that if the defendants are committed for trial to the District Court, that is not likely to be heard until later this year, or even early 2016.

6. Although now unrepresented in the civil proceedings, the defendants are represented with respect to the criminal charges.  They have not complied with orders to file a defence in these civil proceedings.  They claim not to have done so on legal advice pending the outcome of the stay application, which was lodged on 15 July 2015.  Nor have they complied with a notice to admit facts, for similar reasons.

7. Under those circumstances it would be inappropriate to grant judgment in default, at least at this stage.  The difficulty the court faces in the application for summary judgment, is that it does not have the benefit, as it usually would have, of knowing on what basis the claim is to be defended.  That goes directly to the question of whether or not there is a ‘reasonable basis for defending’ the claim, as required by 6 DCR 232(2) of the District Court Civil Rules 2006 (SA).

8. There were oral assertions from the bar table by the first defendant personally on behalf of both defendants, to the effect that certain things were said at one of the meetings, affording a defence to the action, to which the plaintiffs had not referred.  No detail was given.  He advised ‘there is a legitimate defence to this and the plaintiffs know what that defence is because they were at a meeting and they know what was discussed ...’.[2]  He added, ‘I can’t say anything because I’m advised not to ... it never got to that stage of presenting to court’.[3]  This places the court in the position that it is unable to assess the merits of any potential defence at all.

   [2]    T 19.13-18.

   [3]    T 19.5-8.

9. So far as the application for stay is concerned, it is a grave matter to interfere with an entitlement to have an action tried in the ordinary course of civil proceedings. The burden is therefore on the defendants to show that it is just and convenient to displace those rights: Jefferson Ltd v Bhetcha.[4]  Balancing the justice of the case between the parties and paying regard to the possibility of miscarriage of justice by the disclosure of a defence, are relevant considerations, amongst many others: Halabi v Westpac Banking Corporation;[5] McMahon v Gould.[6]It does not appear as if the right to silence has much relevance to the present circumstances of the case, although the defendants are certainly entitled to decline to answer on the grounds that questions might incriminate them: Beare v Light Regional Council.[7]  It is well established that ‘the so-called “right to silence” does not extend to give … as a matter of right the same protection in contemporaneous civil proceedings’: McMahon v Gould,[8] Atkins v Minister of Community Welfare.[9] Doubtless, with the defendants being unrepresented, it is necessary to approach the matter with a degree of flexibility: Wentworth v Rogers (No 5),[10] Glew v Frank Jasper Pty Ltd.[11]

   [4] [1979] 1 WLR 898.

   [5] (1989) 17 NSWLR 26.

   [6] (1982) 7 ACLR 202.

   [7] [2010] SADC 74, [22], [32].

   [8] (1982) 7 ACLR 202, 206-207.

   [9] (1988) 34 A Crim R 26, 28.

   [10] (1986) 6 NSWLR 534, 536-537, 543.

   [11] [2010] WASCA 87, [10].

10. It is obviously not possible as things presently stand to identify what prejudice the defendants might face if they were prepared to disclose the material from which they say a different understanding was reached with the plaintiffs. Equally, at this stage there are too many contingent events to enable the court to identify with any confidence any real risk of injustice in the criminal proceedings: Andrew Koh Nominees Pty Ltd (as Trustee for KL Unit Trust) v Pacific Corporation Ltd (No 3).[12]

    [12] [2010] WASC 248, [75]-[76].

11. The courts have necessarily proceeded cautiously and with great care before making orders for summary judgment, because they effectively amount to final judgment: Fancourt v Mercantile Credits Ltd.[13]   Furthermore, the court must remain guarded to ensure ‘the interests of justice are not sacrificed on the altar of efficiency and expedition’: Ceneavenue Pty Ltd v Martin.[14]  It is an inordinately large step to make an order for summary judgment in a case involving misrepresentation as distinct from, for example, a claim in simple debt or for monies had and received. Even the more so when only one side of the transaction is before the court. 

    [13] (1983) 154 CLR 87, 99.

    [14] (2008) 106 SASR 1, [87].

12. In the circumstances it is proposed to adjourn the application for summary judgment to await the outcome of the next stage of proceedings in the criminal court, until after the 11 August 2015, and so as to afford the defendants the chance to obtain legal advice (as they are represented in the criminal proceedings) on the consequences in the summary judgment application of declining to place any material before the court as to a potential defence.  The defendants should clearly understand that at the resumed hearing they are at risk of orders requiring them to file defences and respond to the notice to admit.

13. Finally, there is the outstanding issue of the potential breach of the Freezing Order.  As the defendants maintain all their papers were seized by the police and the affidavit of Brevet Sergeant Tester deposes to the facts relating to the motor vehicles rather implying the police have the documents, there will be an order directing the Registrar to issue a subpoena pursuant to 6 DCR 172(3) of the District Court Civil Rules, directed to the Commissioner of Police to obtain copies of the documents relating to the trade-in and purchase of the 2012 Mercedes Benz C63 registration number ‘R4’ and the 2014 Mercedes Benz A250 registration number ‘WE4R1’.

14. In the meantime the orders of the court are therefore:

    1.Application for summary judgment adjourned at a date to fixed convenient to the parties sometime after 11 August 2015;

    2.     Order an interim stay in the meantime;

    3.     Question of costs reserved.