Easy Stay Mining Accommodation Pty Ltd v Mt Morgans WA Mining Pty Ltd - [2020] WASCA 86

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT :   THE COURT OF APPEAL (WA)
CITATION:   EASY STAY MINING ACCOMMODATION PTY LTD -v- MT MORGANS WA MINING PTY LTD [2020] WASCA 86
CORAM:   MURPHY JA
MITCHELL JA

HEARD:   22 MAY 2020
DELIVERED          :   22 MAY 2020
PUBLISHED           :   27 MAY 2020
FILE NO/S:   CACV 42 of 2020
BETWEEN:   EASY STAY MINING ACCOMMODATION PTY LTD
Appellant
AND
MT MORGANS WA MINING PTY LTD
First Respondent
GROUNDED CONSTRUCTION GROUP PTY LTD
Second Respondent
OCS INTERNATIONAL PTY LTD
Third Respondent

ON APPEAL FROM:
Jurisdiction              :   DISTRICT COURT OF WESTERN AUSTRALIA
Coram:   GOETZE DCJ
Citation: GROUNDED CONSTRUCTION GROUP PTY LTD -v- EASY STAY MINING ACCOMMODATION PTY LTD [No 2] [2020] WADC 44
File Number            :   CIVO 154 of 2017, CIVO 155 of 2017, CIVO 183 of 2017, CIVO 152 of 2017, CIVO 153 of 2017

Catchwords:

Practice and procedure - Interim order - Application for stay pending appeal - Whether appeal and cross‑appeal had reasonable prospects of success - Balance of convenience

Practice and procedure - Interim order - Whether there should be determination of preliminary issue - Removal of third respondent from appeal

Legislation:

Civil Judgments Enforcement Act 2004 (WA), s 15(1), s 15(5), s 20(3), s 43(2), s 43(3), s 45, s 46(1), s 49, s 51, s 54, s 55, s 58, s 103, s 105
Construction Contracts Act 2004 (WA), s 31(2), s 38, s 40, s 43

Result:

Third respondent be removed as a party to the consolidated appeal
Appellant's applications otherwise be dismissed

Category: B

Representation:

Counsel:

Appellant	:	J Doyle
First Respondent	:	T J Palmer
Second Respondent	:	No appearance
Third Respondent	:	No appearance

Solicitors:

Appellant	:	Doyles Construction Lawyers
First Respondent	:	HWL Ebsworth Lawyers (Perth)
Second Respondent	:	No appearance
Third Respondent	:	No appearance

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

Carr v Finance Corporation of Australia Ltd (No 1) [1981] HCA 20; (1981) 147 CLR 246
Clone Pty Ltd v Players Pty Ltd (in liq) [2018] HCA 12; (2018) 264 CLR 165
Commonwealth Bank of Australia Ltd v Saraceni [2013] WASC 115
Commonwealth of Australia v Albany Port Authority [2006] WASCA 185
Computer Accounting and Tax Pty Ltd (in liq) v Professional Services of Australia Pty Ltd [No 6] [2014] WASC 105
Eastland Technology Australia Pty Ltd v Whisson [2003] WASCA 307; (2003) 28 WAR 308
Easy Stay Mining Accommodation Pty Ltd v Faigen [2017] WASC 266
Grounded Construction Group Pty Ltd v Easy Stay Mining Accommodation Pty Ltd [2019] WADC 153
Grounded Construction Group Pty Ltd v Easy Stay Mining Accommodation Pty Ltd [No 2] [2020] WADC 44
Hall v Nominal Defendant [1966] HCA 36; (1966) 117 CLR 423
Harmer v Federal Commissioner of Taxation [1991] HCA 51; (1991) 173 CLR 264
Kowalski v MMAL Staff Superannuation Fund Pty Ltd [2009] FCAFC 117; (2009) 178 FCR 401
Mighty River International Ltd v Mineral Resources Ltd [2020] WASCA 44
Murcia & Associates (A firm) v Grey [2001] WASCA 240; (2001) 25 WAR 209
Tradesman Technologies Pty Ltd v Ameduri [2012] WASCA 168

REASONS OF THE COURT:

Introduction

This matter came to a hearing on 22 May 2020 to consider the applications filed by the appellant (Easy Stay) in appeals CACV 42, 43, 44, 45 & 46 of 2020. The stay applications sought, in effect, three principal orders. First, they sought a stay of orders relating to the payment of moneys out of the District Court to the first respondent (Mt Morgans). Secondly, they sought a direction that there be, in effect, a determination of a preliminary issue in each of the appeals. Thirdly, they sought a direction that the third respondent (OCS) be removed as a party to the appeals. We dismissed the applications as to the first and second of those matters, and granted the applications with respect to the third of those matters. We said that we would provide written reasons and these are our reasons.
The appeals were consolidated by orders made on 30 April 2020. They are against related decisions of Goetze DCJ, dated 3 April 2020, in CIVO 152, 153, 154, 155 and 183 of 2017. Goetze DCJ published reasons in Grounded Construction Group Pty Ltd v Easy Stay Mining Accommodation Pty Ltd [No 2] [2020] WADC 44(primary decision).
Each of those matters in the District Court relates to an adjudication determination that was registered as a judgment in the District Court under s 43(2) of the Construction Contracts Act 2004 (WA) in favour of the second respondent (Grounded) against Easy Stay. Grounded subsequently obtained a 'debt appropriation order' under s 49 of the Civil Judgments Enforcement Act 2004 (WA) (CJE Act), in which debts owed by the first respondent (Mt Morgans) to Easy Stay were appropriated in favour of Grounded.
The primary decision dealt with an application by Mt Morgans under s 58 of the CJE Act that money paid into the District Court, purportedly standing to the credit of Easy Stay, be paid to Mt Morgans. The judge dismissed the application, effectively on the bases that (1) Mt Morgans' application erroneously assumed that the moneys in court stood to the credit of Easy Stay, and (2) the moneys in court were, in truth, payable to Mt Morgans once an 'irregularity' in an earlier order, dated 10 December 2019, was corrected. The result was that the moneys in court were ordered to be paid to Mt Morgans in any event. Easy Stay appeals against that order.

Background[1]

Adjudications and judgments in favour of Grounded

[1] The background is taken from the primary decision, unless otherwise indicated.

There were five adjudications under the Construction Contracts Act, each resulting in a determination in favour of Grounded.[2] Around October and November 2017, Grounded obtained an order for the enforcement of the five determinations in the District Court under s 43(2) of the Construction Contracts Act.
[2] Primary decision [4].
Section 43(2) and (3) of the Construction Contracts Act provide:
43.Determinations may be enforced as orders of court
…
(2)A party entitled to be paid an amount under a determination may enforce the determination by filing in a court of competent jurisdiction -
(a)a copy of the determination that the Building Commissioner has certified to be a true copy; and
(b)an affidavit as to the amount not paid under the determination.
(3)On filing under subsection (2), the determination is taken to be an order of the court, and may be enforced accordingly.
The judgment debts in favour of Grounded totalled $589,640.38, and were as follows:
(a)$133,441.60 in CIVO 152/2017;
(b)$91,434.24 in CIVO 153/2017;
(c)$143,041.81 in CIVO 154/2017;
(d)$127,536.99 in CIVO 155/2017; and
(e)$94,185.74 in CIVO 183/2017.

The position of OCS

OCS was not a party to the judgments. However, it had a charge over the assets of Easy Stay. The charge was registered under the Personal Property Securities Act 2009 (Cth) prior to the filing of the Construction Contracts Act determinations in the District Court. In the primary decision, the judge accepted, without deciding, that OCS's charge took priority over the judgments obtained by Grounded against Easy Stay. The judge also said that a solicitor's lien, held by the solicitors for Easy Stay/OCS, had priority over any funds to which Easy Stay and/or OCS might be entitled.[3]

Easy Stay's judicial review application against Grounded: CIV 2271 of 2017

[3] Primary decision [6].

Easy Stay subsequently sought judicial review in the Supreme Court of the five Construction Contracts Act determinations.[4] The judicial review proceedings were in CIV 2271 of 2017.

Debt appropriation orders - the CJE Act

[4] Primary decision [4].

As noted below, Grounded applied for 'debt appropriation orders' under s 49 of the CJE Act in respect of debts owed by Mt Morgans to Easy Stay.
Part 4 of the CJE Act is headed 'Enforcing monetary judgments'. Division 5 of pt 4 of the CJE Act is headed 'Appropriating debts owed to a judgment debtor'. Part 4 includes s 17 ‑ s 93. Amongst other things, s 51 of the CJE Act relevantly provides:
51.Debt appropriation order, effect of
(1)A debt appropriation order takes effect when it is served on the third person.
(2)A debt appropriation order has effect according to its contents subject to -
(a)Schedule 1 clause 2 and any order made under that clause; and
(b)any order made under Schedule 1 clause 3; and
(c)any order made under Schedule 1 clause 4.
(3)If an appropriated debt is payable to the judgment debtor in full at one time, the third person must pay the full debt to the judgment creditor -
(a)if the debt is due and payable to the judgment debtor at the time the order is made - within 7 days after the day on which the debt appropriation order is served on the third person; or
(b)in any other case - within 7 days after the day on which the appropriated debt becomes due and payable to the judgment debtor.
…
(6)A debt appropriation order ceases to have effect -
(a)when the third person is notified of the fact by the court or the judgment creditor; or
(b)when the third person is notified that an objection has been allowed under section 55; or
(c)when the judgment debt is satisfied; or
(d)when an order cancelling it has effect under section 103,
whichever happens first.
(7)If a debt appropriation order ceases to have effect or the judgment debt to which it relates is satisfied, the judgment creditor must immediately notify the third person.

Debt appropriation orders of 24 October 2017 and 29 November 2017

Mt Morgans was indebted to Easy Stay. Grounded applied for a 'debt appropriation order' against Mt Morgans in respect of each of the judgments. Debt appropriation orders were made in CIVO 152 ‑ 155 of 2017 on 24 October 2017, and in CIVO 183 of 2017 on 29 November 2017. This had the effect of ordering Mt Morgans to pay an 'available debt' to Grounded pursuant to s 45, s 46(1) and s 49(1) of the CJE Act.[5] For example, in CIVO 152 of 2017, the order was directed to Mt Morgans and provided, relevantly:[6]
Upon the application of [Grounded] ………. [Mt Morgans] are ordered to:
1.Pay to [Grounded] the debt or amount standing to the credit of [Easy Stay] of $133,441.60 due from you [Mt Morgans] to [Easy Stay] or so much of it as may be sufficient to satisfy $133,441.60 being the unpaid amount of the judgment debt after deducting such amount (if any) as need be notified in writing to you [Mt Morgans] by [Grounded] or the registrar as having been paid or credited to [Grounded] on account of that unpaid amount otherwise and under the order.
2.You [Mt Morgans] are to make payment to [Grounded] within seven days after the day of service of this order on you [Mt Morgans].
[5] Primary decision [7].
[6] Exhibit 1 - Application Bundle filed 5 May 2020, page 118.
In light of the above, each parties' position as at November 2017 may be summarised as follows:
1.Easy Stay - judgment debtor of Grounded, and creditor of Mt Morgans.
2.Grounded - judgment creditor of Easy Stay.
3.Mt Morgans - debtor of Easy Stay and 'third person'[7] subject to debt appropriation order.
4.OCS - secured creditor of Easy Stay assumed to be entitled to priority over payment to Grounded.

Mt Morgans' objections to the debt appropriation orders

[7] Section 45 of the CJE Act.

Section 54(1) of the CJE Act in effect confers a statutory right on a 'third person' (ie, the person to whom the debt appropriation order is addressed[8] - in this case Mt Morgans) to 'object' to a debt appropriation order. The objection may be brought on grounds in effect that:
(a)another person owns or claims or has an interest in the appropriated debt;
(b) the appropriated debt 'does not and will not exist'; and/or
(c) the third person (in this case Mt Morgans) has an unsatisfied money judgment against the judgment creditor (Grounded) or the judgment debtor (Easy Stay).
Any such application under s 54(1) must be commenced within seven days after the 'third person' (Mt Morgans) is served with a debt appropriation order: s 54(2)(c) of the CJE Act.
[8] Primary decision [9].
Mt Morgans, a 'third person' with a right to object under s 54(1) of CJE Act, objected to the debt appropriation orders in favour of Grounded. The bases for the objection were:
1.under s 54(1)(a), that OCS claimed an interest in the appropriated debt by way of an earlier registered charge, and
2.under s 54(1)(b), that the appropriated debt 'will no longer exist' upon the success of Easy Stay's judicial review application in the Supreme Court.[9]

Purported 'objections' by OCS and Easy Stay

[9] Primary decision [12]; exhibit 1 - Application Bundle filed 5 May 2020, page 128.

OCS and, it appeared, Easy Stay, both 'objected' to the debt appropriation orders with reference to Easy Stay's application for judicial review. OCS also 'objected' with reference to its position as (alleged) secured creditor.[10] However, in the primary decision the judge said that neither had a statutory entitlement under s 54 of the CJE Act to make the objection.[11]

Suspension orders suspending enforcement of Grounded's judgment debts - 31 October 2017 and 13 February 2018

[10] Primary decision [10] - [11].

[11] Primary decision [9].

On 30 October 2017, Easy Stay and OCS applied for orders to suspend enforcement of the judgment debts in favour of Grounded.[12] Easy Stay was entitled to make an application for suspension orders under s 15 of the CJE Act, which is within pt 3 of the CJE Act. There was, however, no legislative provision enabling OCS to apply for suspension orders.[13]
[12] Primary decision [13].
[13] Primary decision [14].
The applications to suspend the enforcement of the judgment debts in favour of Grounded came before the District Court on 31 October 2017.
On 31 October 2017, the principal registrar made interim orders suspending four of the judgments in favour of Grounded, and the debt appropriation orders. He also ordered that, by 2 November 2017, Mt Morgans pay the total of the four appropriated debts[14] into a bank suspense account of its choosing to be held in trust until further order.[15]
[14] In relation to CIVO 152 - 155 of 2017.
[15] Primary decision [16].
More particularly, the orders of 31 October 2017 were in the following terms:[16]
(1)Interim suspension order in of judgment and debt appropriation order from 4:00pm Thursday 2 November 2017 to 4:00pm 21 November 2017 [sic].
(2)By 4:00pm Tuesday 2 November 2017 Mount Morgan … (third person) pay the appropriated debt ($495,454.64) less deductible expense, into a bank suspense account of its choosing to be held in trust until further order of this court.
(3)The application adjourned for directions before a judge on the 17 November 2017 at 10:30am.
(4)Cost be reserved.
[16] This is taken from Grounded Construction Group Pty Ltd v Easy Stay Mining Accommodation Pty Ltd [2019] WADC 153 (Deputy Registrar Harman's decision) [4]; see also exhibit 1 - Application Bundle filed 5 May 2020, page 132.
Mt Morgans complied with these orders.[17]
[17] Primary decision [17].
On 17 November 2017, the orders of 31 October 2017 were extended until further order. The orders did not include CIVO 183 of 2017. However, on 13 February 2018, the judgment and debt appropriation order in CIVO 183 of 2017 in favour of Grounded were also suspended until further order by consent of all parties. The judgment sum in CIVO 183 of 2017 was also ordered to be paid into the trust account. Mt Morgans also complied with the orders of 13 February 2018.[18]
[18] Primary decision [17].
The bank's suspense account into which Mt Morgans paid the moneys pursuant to the above orders will be referred to as the 'Mt Morgans trust account'. The suspension orders referred to in [20] and [22] above will be collectively referred to as the 'Suspension Orders'.

Applications by Easy Stay and OCS for the determination of Mt Morgans' objections - November 2017

Sections 55(1) and 55(2) of the CJE Act provide, in effect, that if the judgment creditor does not 'allow' an 'objection' served by a 'third person', then the third person, the judgment debtor, or 'any other person whom the third person claims owns or has a claim on or interest in the appropriated debt' may apply to the court for an order that the objection be allowed.[19]
[19] Primary decision [19].
Grounded had not 'allowed' Mt Morgans' objections to the debt appropriation orders under s 55(1) of the CJE Act. Accordingly:
1.Mt Morgans (as the third person);
2.Easy Stay (as the judgment debtor); and
3.OCS (as any other person whom Mt Morgans claimed owns or has an interest in the appropriated debts),
were entitled to apply to the court for orders under s 55(2) of the CJE Act that Mt Morgans' objections be allowed. In the primary decision, the judge said that the CJE Act provides no time limit for making such applications.[20]
[20] Primary decision [20].
On 15 and 22 November 2017 respectively, apparently pursuant to s 55(2)(b) and (c) respectively, Easy Stay and OCS applied to the District Court for determination of Mt Morgans' objections to the debt appropriation orders, and sought orders to the effect that Mt Morgans' objections be allowed.[21] Mt Morgans did not itself make an application to have its objection determined.
[21] Primary decision [21]; Deputy Registrar Harman's decision [7] - [8].
The applications for s 55(2) orders by Easy Stay and OCS did not come on for hearing until 6 September 2019. They were heard at the same time as an application by Mt Morgans dated 22 August 2019 for (amongst other things) cancellation of the debt appropriation orders (see [34] below).

Settlement of judicial review proceedings between Easy Stay and Grounded - 17 July 2019

On 17 July 2019, the judicial review proceedings brought by Easy Stay in the Supreme Court (CIV 2271 of 2017) in respect of the five adjudication determinations in favour of Grounded were settled. Draft minutes of consent orders in CIVO 152 ‑ 155 of 2017 and CIVO 183 of 2017 were prepared and agreed by Grounded, Easy Stay and OCS. Mt Morgans did not agree.[22]
[22] Primary decision [23], [67].
The draft consent orders were in terms that:[23]
1.Half of the total judgment sums held in the Mt Morgans trust account, plus all interest earned on the total judgment sums, be paid to Grounded.
2.The remaining half of the judgment sums held in the Mt Morgans trust account be paid to Easy Stay.
[23] Primary decision [23].
Orders in terms of the draft consent orders were not made, given the absence of Mt Morgans' agreement.

The dismissal of Easy Stay's judicial review proceedings on 22 July 2019

Allanson J dismissed Easy Stay's judicial review proceedings by consent orders between Grounded and Easy Stay dated 22 July 2019. Allanson J ordered, relevantly:[24]
[Easy Stay's] application to set aside the Determinations in these proceedings (CIV 2271 of 2017 and CIV 1524 of 2018) be dismissed.

Mt Morgans' judgment against Easy Stay - 19 August 2019

[24] Exhibit 1 - Application Bundle filed 5 May 2020, page 145.

In separate proceedings, on 19 August 2019, Mt Morgans filed in the Supreme Court a Construction Contracts Act determination that Easy Stay pay Mt Morgans the sum of $1,181,704.94.[25]

Easy Stay's judicial review application against Mt Morgans: CIV 2562 of 2019

[25] Affidavit of D Ulbrick sworn 24 April 2020, par 3. Compare primary decision [35] - the judge said (it appears inadvertently) that the date was 19 July 2019.

On or about 2 September 2019, Easy Stay commenced judicial review proceedings in the Supreme Court (CIV 2562 of 2019) in respect of the determination in favour of Mt Morgans. It made no application for an interim stay pending determination of the judicial review proceedings.[26]

Mt Morgans' application of 22 August 2019 for cancellation of debt appropriation orders and other relief: the hearing before Deputy Registrar Harman

[26] Affidavit of D Ulbrick sworn 24 April 2020, pars 4 - 5.

On 22 August 2019, Mt Morgans, applied under s 103 of the CJE Act for the cancellation of:
1.the debt appropriation orders; and
2.order 2 of the orders of 31 October 2017 (see [20] above) to the effect that Mt Morgans pay the appropriated debt into a trust account until further order.[27]
Mt Morgans also applied for the dismissal of the 'actions' by Grounded, and the judgments in favour of Grounded.[28]
[27] Primary decision [25].
[28] Deputy Registrar Harman's decision [13]; primary decision [25].
On 6 September 2019, the applications by Easy Stay and OCS for determination of Mt Morgans' objection to the debt appropriation orders (see [26] above), together with Mt Morgans' application dated 22 August 2019, were heard by Deputy Registrar Harman. A 'proposal' by Grounded and Easy Stay to give effect to the settlement they had agreed to on 17 July 2019, ie, the Settlement Agreement, was also heard.[29] Deputy Registrar Harman delivered written reasons on 14 November 2019.

Deputy Registrar Harman's decision - 14 November 2019

[29] Primary decision [26].

Deputy Registrar Harman said that OCS's s 55(2) application was made out of time. He accordingly rejected that application.[30]
[30] Deputy Registrar Harman's decision [18] - [19]; primary decision [28].
He also rejected Easy Stay's s 55(2) application on the basis that it was, in effect, applying on grounds that would result in the interest of OCS being promoted ahead of Grounded's judgment.[31]

Mt Morgans' s 103 application

[31] Primary decision [28]; Deputy Registrar Harman's decision [21].

The deputy registrar dismissed Mt Morgans' application under s 103 of the CJE Act dated 22 August 2019. Deputy Registrar Harman said:[32]
[32] Primary decision [36].
1.He did not accept that the judgment debts in favour of Grounded had been extinguished by the settlement between Grounded and Easy Stay/ OCS.[33]
[33] Deputy Registrar Harman's decision [33] - [36].
2.The judgment debt obtained on 19 August 2019 in favour of Mt Morgans against Easy Stay could not be set off against the judgment debt in favour of Grounded on which the debt appropriation orders were founded. That judgment debt could not assist Mt Morgans under s 54(1)(c), ie, that it had an unsatisfied monetary judgment against Easy Stay. That ground of objection was too late in that it could not have been made within seven days of service of the debt appropriation order, which was issued on 24 October 2017. Further, s 103 did not permit Mt Morgans to avoid the constraints of s 54(2)(c).[34]
[34] Primary decision [36]; Deputy Registrar Harman's decision [39] - [42].
3.In relation to the suspension of the debt appropriation orders:[35]
By 31 October 2017 [Mt Morgans] had in part complied with its obligation under the debt appropriation order and I am satisfied that it had then conveyed both its intention to comply with the balance of its obligations and its willingness to undertake the role of trustee of the fund. The obligations of [Mt Morgans] to [Easy Stay] suspended under the order of 31 October 2017 have been overtaken by [Mt Morgans] having established and funded the account of which it now stands as trustee. Thereby it has been divested of its beneficial interest in the appropriated debt. It awaits an order for payment of those funds to a beneficiary. In effect [Mt Morgans] has been relieved of any outstanding obligation under the debt appropriation order and its role as third person under the debt appropriation order has ceased. The remaining role of [Mt Morgans] is as trustee.
I am satisfied that in terminating the trust the court would not then lift the suspension of the debt appropriation order but rather would order the trustee to pay the fund to the beneficiary.
By its application now before the court [Mt Morgans] would have both the debt appropriation order and paragraph 2 of the order of 31 October 2017 cancelled and the action be dismissed. That application is supported by evidence … that [Mt Morgans] now has the benefit of an adjudication under the Construction Contracts Act against [Easy Stay] and upon registration of the adjudication … is now also a judgment creditor of [Easy Stay].
The fundamental difficulty with the proposal of [Mt Morgans] is that the purpose in establishing the fund was to secure the interest of a prospective beneficiary. It is safe to consider that s 55 of the Act would dictate that upon allowance of any objection the beneficiary would be the objector, otherwise it would be [Grounded]. Until a determination is made under s 55 in relation to each objection the purpose for which the trust was established remains. The application would defeat the purpose of the court in making the order of 31 October 2017.
…
… [Mt Morgans] overlooks the fact that the trust was created by the court to await the outcome of any recourse to the statutory process of objection. Had [Easy Stay] been successful in its objection then clearly it would also have been entitled to an order for disbursement from the trust.
…
As for the debt appropriation order I will add that any outstanding obligation of [Mt Morgans] has been overtaken by the order of 31 October 2017. Any issue now put against the force or effect of the debt appropriation order has been rendered moot. (emphasis added)
[35] Deputy Registrar Harman's decision [28] - [31], [44], [46].
Deputy Registrar Harman concluded:[36]
The only conclusion open upon consideration of the applications of each of the parties is that that of [Mt Morgans] be dismissed; those of each of [Easy Stay] and [OCS] be dismissed; and accordingly that an order be made for payment of the trust fund by [Mt Morgans] to the judgment creditor [Grounded].
[36] Deputy Registrar Harman's decision [48].
Deputy Registrar Harman ordered that the money in the Mt Morgans trust account be paid in full to Grounded.[37]

The appeal to the District Court by Easy Stay and OCS from Deputy Registrar Harman's decision

[37] Primary decision [33].

On 15 November 2019, Easy Stay and OCS appealed Deputy Registrar Harman's decision. The appeal notice stated that the appeal (relevantly) was against the orders of Deputy Registrar Harman dismissing Easy Stay's, and OCS's, applications under s 55 of the CJE Act, dated 15 and 22 November 2017 respectively, for orders that Mt Morgans' objections to the debt appropriation orders be allowed (see [26] above).[38] The appeal notice sought payment out of the funds held in trust.[39] Mt Morgans did not appeal Deputy Registrar Harman's decision.[40]
[38] Exhibit 1 - Application Bundle filed 5 May 2020, page 154.
[39] Primary decision [34].
[40] Primary decision [46].
The appeal came on for hearing before Goetze DCJ on 10 December 2019. It was common ground at the appeal that Grounded and Easy Stay, with the consent of OCS, had settled their dispute in the Supreme Court judicial review proceedings on 17 July 2019.[41]
[41] Primary decision [47].
The emphasis of the appeal was upon seeking to obtain a final solution to the proceedings, following the settlement of Easy Stay's judicial review proceedings against Grounded, rather than challenging the Deputy Registrar Harman's reasoning.[42]
[42] Primary decision [48].
The parties agreed to the following orders:[43]
1.The money paid into the trust account by Mt Morgans, together with all interest earned thereon, was to be paid into the court.
2.One half of the principal sum was then to be paid to Grounded, together with all interest earned on the total principal sum, in accordance with the settlement between Grounded and Easy Stay/OCS.
3.The remaining one half of the principal was to be paid to Easy Stay/OCS via their solicitors' trust account, unless Mt Morgans applied to the Supreme Court for, and obtained, an order providing otherwise.
4.There be liberty to apply.
[43] Primary decision [48].
The proposed consent orders were intended to resolve the matter in light of the Settlement Agreement which had been achieved between Grounded and Easy Stay/OCS on 17 July 2019.[44]
[44] Primary decision [49].
Proposed order 3 sought to recognise that Mt Morgans had a judgment in the Supreme Court against Easy Stay, in relation to which Easy Stay was seeking judicial review (see [32] ‑ [33] above).[45]
[45] Primary decision [49].

Orders made by Goetze DCJ on 10 December 2019

Pursuant to the appeal against Deputy Registrar Harman's decision, on 10 December 2019 (extracted on 11 December 2019), Goetze DCJ made consent orders in the following terms, relevantly:
1.On or before 13 December 2019, the sum of $589,640.38 comprised of:
(1)$133,441.60 in CIVO 1522/2017 [sic];
(2)$91,434.24 in CIVO 153/2017;
(3)$143,041.81 in CIVO 154/2017;
(4)$127,536.99 in CIVO 155/2017;
(5)$94,155.74 in CIVO 183/2017;
all paid into a suspense trust bank account by [Mt Morgans] pursuant to orders dated 31 October 2017 and 13 February 2018, and any interest thereon, be paid into the District Court of Western Australia.
2.As soon as practicable thereafter, the Principal Registrar shall cause to be paid therefrom one half of the capital sum, being $294,820.19 plus all interest from the trust bank account to [Grounded] …
3.The remaining one half of the capital sum be paid to [Easy Stay] … such payment to be stayed pending any direction or order to the contrary from the Supreme Court of Western Australia in CIV 2562 of 2019 on an application to be filed in the Supreme Court by [Mt Morgans] no later than the close of business on 20 December 2019.
4.There be liberty to apply. (emphasis added)
Mt Morgans did not make an application to the Supreme Court in CIV 2562 of 2019 as contemplated by order 3. As noted earlier, CIV 2562 of 2019 concerned the judicial review proceedings brought by Easy Stay against Mt Morgans following the judgment obtained by Mt Morgans against Easy Stay in respect of a determination under the Construction Contracts Act.
The payment into court (order 1) and subsequent payment to Grounded (order 2) were made. Nothing further is due to Grounded.[46]
[46] Primary decision [50].

Mt Morgans' application of 19 December 2019 under s 58 of the CJE Act

On 19 December 2019, Mt Morgans filed applications in the District Court seeking an order under s 58 of the CJE Act that the money paid into the District Court (pursuant to order 1 of the orders of 10 December 2019), purportedly standing to the credit of Easy Stay (pursuant to order 3 of the orders of 10 December 2019) be paid to Mt Morgans. Mt Morgans claimed that it was entitled to payment on the basis of Mt Morgans' judgment against Easy Stay (referred to at [32] above).[47]
[47] Primary decision [1].
Section 58(1) of the CJE Act provides relevantly, in effect, that, in order to recover a judgment debt, a judgment creditor may apply to any court in which 'there is money standing to the credit of the judgment debtor', for an order that the money (or so much of it as is sufficient to satisfy the judgment debt) be paid to the judgment creditor. Section 58(3) provides that on the making of such an application the money in court must not be paid to the judgment debtor until the application is finally determined.

The primary decision

The primary decision concerned Mt Morgans' application under s 58 of the CJE Act.
The judge made findings to the following effect.

Consequences of the parties' settlement

The judge said that the settlement between Grounded and Easy Stay/OCS was by agreement between themselves for the payment of an amount to Grounded being one half of the total of the five judgments. Payment of that sum, plus interest, had been made by a consent order, by which the parties (including Mt Morgans) consented to payment to Grounded. This achieved the legislative purpose of the CJE Act and concluded any further interest held by Grounded in the actions in CIV 152 ‑ 155 of 2017 and CIV 183 of 2017.[48]
[48] Primary decision [67].
The judge noted that, pursuant to s 103 of the CJE Act:
1.Grounded (under s 103(1)(a)) could have applied to amend the judgments and appropriation orders in favour of Grounded; and
2.Easy Stay could have applied (under s 103(1)(b)) to amend the judgments in favour of Grounded.
His Honour said, however, that neither was obliged to do so.[49]
[49] Primary decision [62] - [63].
His Honour also said that Mt Morgans could have applied (under s 103(1)(b)) to amend or cancel:
1.the debt appropriation orders; and
2.the order requiring payment of the debt moneys into the Mt Morgans trust account.
The judge noted that Mt Morgans had made such applications under s 54(1) of the CJE Act, and that they had been dismissed by Deputy Registrar Harman. The judge said that Deputy Registrar Harman had wrongly dismissed those applications.[50]
[50] Primary decision [64].
The judge said that, following the settlement between Grounded and Easy Stay, the quantum of the judgment debts should have been amended to reflect that settlement. This would then have had a flow-on effect requiring amendment to the debt appropriation orders.[51]
[51] Primary decision [59].
The judge said that it would be wrong in principle to distribute to Easy Stay any surplus from the trust monies leftover after Grounded was paid the compromised debt due to it, when that surplus arose from a compromise and reduction in judgment debts after the payment into trust pursuant to a court order suspending execution and pending further order. Further, any right OCS had to recover the surplus under its security document and any right based upon the solicitor's lien were both dependent upon Easy Stay being entitled to such surplus.[52]

The need to amend under s 103

[52] Primary decision [60].

The judge noted that, in addition to the judgment and debt appropriation orders not being amended to reflect the Supreme Court settlement, the Suspension Orders had never been lifted.[53]
[53] Primary decision [65].
The failure to amend the judgments and the debt appropriation orders led the payment to Grounded being achieved in an irregular fashion in that procedural formalities were not complied with. To regularise the payments to Grounded, the judgment debts and debt appropriation orders should have been amended and the Suspension Orders lifted. Had that been done, then the irregularity of order 3 would have been apparent before the order was made.[54]
[54] Primary decision [68].
The judge found that, applying the provisions of s 103(1)(b) of the CJE Act, the original judgment sums and debt appropriation orders in favour of Grounded were to be amended by reducing each of the judgments by one half to reflect the compromised judgments, and that the quantum of the debt appropriation orders were likewise to be reduced.[55]
[55] Primary decision [69].
The judge also said that the Suspension Orders were to be lifted.[56]

Irregularity - s 105

[56] Primary decision [70].

His Honour observed that s 105 of the CJE Act provides:[57]
If the court that made an order under Part 4 or 5 of section 101 is satisfied that an irregularity has occurred in connection with the making or carrying out of the order, the court may make any order needed to correct the irregularity including an order -
(a)that sets aside the order or an act done under the order
(b)that requires the restitution of property or the payment of money, compensation or damages.
[57] Primary decision [71].
The judge said that s 105 of the CJE Act did not require an application to be made to it. Instead, his Honour said the exercise of power under s 105 is conditional upon the court's satisfaction of an irregularity having occurred in connection with the making of an order.[58]
[58] Primary decision [72].
His Honour cited Murcia & Associates (A firm) v Grey,[59] and said that if there is no statutory authorisation for the court's order and such order is made, then there is a nullity, and that consent does not operate to waive such a nullity or to create jurisdiction. Further, the primary judge said there is a duty on a judge to be satisfied that he or she had jurisdiction to make the order.[60]
[59] Murcia & Associates (A firm) v Grey [2001] WASCA 240; (2001) 25 WAR 209 [14] (Steytler J, Wallwork & Pidgeon JJ agreeing).
[60] Primary decision [73].
The judge said:[61]
[61] Primary decision [55] ‑ [56], [74] - [78].
The [CJE Act] provides:
'… for the enforcement of judgments given in the civil jurisdiction of courts and for related matters.'
This Act provides for the enforcement of Grounded's judgments against Easy Stay by appropriating the available debt due from Mt Morgans to Easy Stay: s 46(1). Grounded applied to the court and the court then issued debt appropriation orders. The only purpose of those debt appropriation orders was to recover the judgment debts: s 49(1).
The [CJE Act] limited Grounded's recovery under the debt appropriation orders to only so much as was required to satisfy its judgment debts. The Act is not concerned with the recovery of an available debt being greater than a judgment debt or the payment of a debt to a judgment debtor.
…
All of the matters set forth above show that such an irregularity has occurred. In particular the court does not have statutory authority to order payment of money to Easy Stay. The court's authority is limited as set out above at [55] and [56].
The meaning of 'irregularity' was accepted by Simmonds J in Computer Accounting and Tax Pty Ltd (in liq) v Professional Services of Australia Pty Ltd [No 6] [2014] WASC 105 at [129] to include:
'A breach of rule or principle; an irregular, lawless, or disorderly act. The lack of conformity to rule, law, or principle; deviation from what is usual or normal; abnormality, anomalousness.'
The Explanatory Memorandum for the Civil Judgments Enforcement Bill 2003 reads as follows:
'Clause 105 Irregular enforcement, courts' powers as to
This clause provides that if the court issues an enforcement order and is satisfied that an irregularity has occurred with either the making of the order or its carrying out, the court can correct the irregularity including setting aside its previous order as well as ordering any necessary restitution of property, payment of money, compensation or damages.
Circumstances could arise such as seizing property at the wrong address, seizing property after the judgment debt has been satisfied or seizing in a manner that constitutes non-compliance with the rules of court or regulations made under the Act. The clause therefore allows the court to address irregularities and is necessary for the good administration of justice.'
Relevant from the memorandum is the 'seizing of property after the judgment debt has been satisfied' given that the subject matter for determination here concerns recovery of an available debt in an amount exceeding the judgment debts, as to which, see above at [56].
Order number 3 from 10 December 2019 should be set aside as an irregularity and by substituting an order that the remaining monies paid into this court, and any interest earned thereon, be refunded to Mt Morgans.
Accordingly, the judge determined that order 3 of the orders of 10 December 2019 was to be set aside as an irregularity and substituted with an order that the remaining monies paid into the District Court, and any interest earned thereon, be refunded to Mt Morgans.

Goetze DCJ's orders of 3 April 2020

On 3 April 2020, Goetze DCJ made orders in the following terms:
(1)The original judgment sum and debt appropriation orders, being the sum of $589,640.38 comprised of:
(a)$133,441.60 in CIVO 152/2017;
(b)$91,434.24 in CIVO 153/2017;
(c)$143,041.81 in CIVO 154/2017;
(d)$127,536.99 in CIVO 155/2017; and
(e)$94,185.74 in CIVO 183/2017,
shall be amended by reducing each of the judgment sums by one half.
(2)The suspension orders made 31 October 2017 be lifted in each proceeding referred to in order 1.
(3)Order 3 of the orders of Judge Goetze dated 10 December 2019 is set aside and substituted by order 4 below.
(4)The principal registrar shall cause to be paid the remaining 50% of the money paid into court by Mt Morgans … on 13 December 2019, being the sum of $294,820.19 together with interest, to [Mt Morgans] comprising the following amounts (excluding interest):
(a)$66,720.80 in CIVO 152/2017;
(b)$45,717.12 in CIVO 153/2017;
(c)$71,520.90 in CIVO 154/2017;
(d)$63,768.49 in CIVO 155/2017; and
(e)$47,092.87 in CIVO 183/2017.
(5)Payment of moneys out of court pursuant to order 4 above, is stayed for 14 days from 3 April 2020.
(6)The s 58 application filed by Mt Morgans … on 19 December 2019 is dismissed.
(7) The parties bear their own costs.

Easy Stay's applications in the appeals to this court

Each of Easy Stay's identical applications is supported by an affidavit of Ms Tara O'Connell. Ms O'Connell's affidavit outlines, in general terms, the background to the primary proceedings and the correspondence between the parties. The correspondence includes a letter from the solicitors for Easy Stay dated 14 April 2020 to Mt Morgans' solicitors in which Easy Stay indicated that a stay would not be necessary if Mt Morgans gave an undertaking to the court and to the other interested parties to pay into court 'the whole sum without delay, defence, deduction or set off so as to restore the trust funds in the event of successful appeal'.[62] In response, Mt Morgans indicated, by its solicitors, that it did not consent to a stay and saw no reason to give the undertaking requested. The letter also said that Mt Morgans would obey any order made by the Court of Appeal and that there was no necessity for an undertaking.[63]
[62] Affidavit of T O'Connell sworn 15 April 2020, page 88.
[63] Affidavit of T O'Connell sworn 15 April 2020, page 93.
In substance, Easy Stay seeks a stay of the payment of moneys out of the District Court to Mt Morgans until the later of:
1.the determination of the appeal; and
2.the determination of its judicial review proceedings against Easy Stay in CIV 2562 of 2019 in respect of the adjudication and determination in favour of Mt Morgans against Easy Stay (ie, the adjudication and determination which formed the basis of the judgment obtained by Mt Morgans against Easy Stay on 19 August 2019 (see [32] ‑ [33] above)).

Parties' submissions

Easy Stay's submissions

The stay applications

Easy Stay filed submissions on 22 April 2020. It submits that there are 'special circumstances' within the meaning of s 15(1) of the CJE Act to justify a stay because:[64]
1.the present orders for payment out are a clear nullity being in excess of the jurisdiction of the District Court and of a clear principle of law and Easy Stay is entitled to have set aside the orders for payment out to Mt Morgan[s];
2.the prospects of success of the Appeal are strong and a cross appeal is likely in that the application of the Respondent Mt Morgan[s] was also refused (rightly in [Easy Stay's] view for the wrong reasons in any event);
3.the present orders would breach and distribute a trust fund and terminate a trust fund which has existed since 2017 and render the appeal nugatory unless Mt Morgans restores the fund;
4.there is a real risk that the trust funds may not be restored where Mt Morgans may argue that by reason of a defence, deduction or set off it is entitled not to restore the full (or any) amount of the trust funds to the Court;
5.there is a real risk that the secured interest of [OCS] and Dlaw may be affected by the payment out of the funds to Mt Morgan[s] where the preservation of the funds would otherwise preserve their unbroken interest in the trust fund;
6.Mt Morgans has been requested to provide an undertaking to the Court that it would restore the trust funds to the Court in the event of a successful appeal and has refused to do so; and
7.the appeal is able to proceed on the preliminary point and accordingly the stay can be expected to be short.
[64] Appellant's written submissions in support of the appellant's applications, par 26.
Easy Stay's submissions on the merits of the appeal are referred to below, in the context of its submissions on the determination of a preliminary issue.

Preliminary issue

Easy Stay submits that its primary contention in the appeal will be that the orders of 3 April 2020, setting aside order 3 of the orders of 10 December 2019 was a nullity. Easy Stay submits that it is a nullity because the order setting aside order 3 of the 10 December 2019 orders went beyond the jurisdiction of the court.[65] Easy Stay relies on Clone Pty Ltd v Players Pty Ltd (in liq):[66]
In each of the appeals in this Court, Clone had two grounds of appeal. Clone's first ground of appeal asserted that the Supreme Court's equitable power to set aside perfected orders, outside a statutory appeal, is limited to fraud and does not extend to forms of malpractice not amounting to fraud. Aside from categories of case that were not in issue in these appeals, that submission should be accepted. It would be inconsistent with both principle and a long historical foundation to extend the general power beyond actual fraud.
[65] Appellant's written submissions in support of the appellant's applications, pars 19 ‑ 20.
[66] Clone Pty Ltd v Players Pty Ltd (in liq) [2018] HCA 12; (2018) 264 CLR 165 [41].
Easy Stay also submits that the primary judge erred in his construction of s 105 of the CJE Act. Easy Stay submits that s 105 concerns only irregularities in the making or carrying out of an order, and that the primary judge did not identify, or properly identify, any irregularity in the making or carrying out of the orders.[67] Easy Stay relies on the decision of Simmonds J in Computer Accounting and Tax Pty Ltd (in liq) v Professional Services of Australia Pty Ltd [No 6]:[68]
I should also note as to each of those forms of irregularity that s 105 requires the irregularity to have 'occurred in connection with the making or carrying out of the order'. However, it was not put to me that this element was not met for any of the forms of irregularity contended for. Nor is it apparent to me that it was not met, having regard to the terms of the receiver orders, order 2.
[67] Appellant's written submissions in support of the appellant's applications, pars 32 - 33.
[68] Computer Accounting and Tax Pty Ltd (in liq) v Professional Services of Australia Pty Ltd [No 6] [2014] WASC 105 [140].
Easy Stay submits that the determination of the suggested preliminary issue will shorten the appeal (if it is successful) and therefore be an efficient use of the Court of Appeal's time, and result in a reduction in costs for both parties.[69]
[69] Appellant's written submissions in support of the appellant's applications, pars 23, 28.
Easy Stay says that it has 13 other grounds which it intends to raise on appeal if the argument that the orders were made in excess of jurisdiction is not accepted.[70]
[70] Appellant's written submissions in support of the appellant's applications, par 20.
Easy Stay also filed submissions on:
1.whether the orders of Goetze DCJ on 10 December 2019 were final or interlocutory;
2.the legal effect of order 1 of Goetze DCJ's orders dated 10 December 2019, resulting in the payment of money from the trust account to the District Court; and
3.whether the orders of Goetze DCJ on 3 April 2020 were final or interlocutory and whether leave to appeal herein is required.
They were filed on 12 May 2020, with responsive submissions on 18 May 2020. In general terms, they are along the lines indicated below.

Nature of orders made by Goetze DCJ on 10 December 2019

Easy Stay submits that at the hearing before Goetze DCJ on 10 December 2019, his Honour made final orders with the consent of the parties disposing of all issues between them.
Easy Stay submits that the legal effect of the orders of 10 December 2019 was of final orders because the substantive rights of the parties had been dealt with and disposed of on the merits by way of consent orders.[71] Further, Easy Stay submits that Goetze DCJ specifically expressed an intention at the hearing that the orders of 10 December 2019 would finish the matter in the District Court.[72]

The legal effect of order 1 of Goetze DCJ's orders made on 10 December 2019 for payment of money into the District Court

[71] Appellant's submissions filed pursuant to orders dated 30 April 2020, par 2.1.3.

[72] Appellant's submissions filed pursuant to orders dated 30 April 2020, par 2.1.3.

Easy Stay submits that the effect of the Settlement Agreement was that the full beneficial interest in a 50% share of the funds in the Mt Morgans trust account was transferred to Easy Stay and by way of a fruits of litigation lien, the full beneficial interest in the 50% share of the Mt Morgans trust fund passed by way of equitable assignment to the solicitors for Easy Stay/OCS and was secured under the floating charge held by OCS. Easy Stay submits the beneficial interests of Easy Stay and Mt Morgans established pursuant to the Settlement Agreement was confirmed by the orders of 10 December 2019. Easy Stay asserts that the payment of the Mt Morgans trust account funds into the District Court pursuant to order 1 of those orders did not affect the rights of the parties.[73]
[73] Appellant's submissions filed pursuant to orders dated 30 April 2020, par 2.2.7 - 2.2.10.
Easy Stay relies on Harmer v Federal Commissioner of Taxation[74] for the proposition that the payment of funds into the court does not affect or change the pre-existing rights of the parties. That case provides:
There are many circumstances in which trust money can be paid into court by a trustee either pursuant to an order made on the application of a beneficiary or pursuant to an application made by the trustee himself or herself. In such a case, the funds paid into court remain subject to any pre-existing trust notwithstanding the payment in. If some person or persons were presently entitled to the corpus or income before payment in, the fact of payment in to await the orders of the court will not, of itself, displace that present entitlement. If entitlement is disputed, the function of the court will be to identify existing interests in the money paid into court rather than to create new ones. If the interest of a beneficiary in the moneys is vested and the beneficiary has a right to demand and receive payment of income, the fact that the interest and the right are disputed and await vindication by the order of the court will not make the interest contingent or negate the existence of the right. That being so, if a beneficiary is found by the court to have had a pre-existing interest in the income, the fact that the interest was not admitted or its extent was not ascertained at the time of payment in or until the making of the relevant order does not mean that the beneficiary was not presently entitled to it both at that time and during the period pending the court's determination.

Nature of orders made by Goetze DCJ on 3 April 2020 and leave to appeal

[74] Harmer v Federal Commissioner of Taxation [1991] HCA 51; (1991) 173 CLR 264, 272.

Easy Stay submits that the orders made by Goetze DCJ on 3 April 2020 were final orders. In support of this position, Easy Stay relies on the test set out by the court in Hall v Nominal Defendant[75] and argues that the orders of 3 April 2020 can be clearly distinguished from examples of interlocutory orders in Kowalski v MMAL Staff Superannuation Fund Pty Ltd.[76] Accordingly, Easy Stay submits that leave to appeal is not required.
[75] Hall v Nominal Defendant [1966] HCA 36; (1966) 117 CLR 423, 439.
[76] Kowalski v MMAL Staff Superannuation Fund Pty Ltd [2009] FCAFC 117; (2009) 178 FCR 401 [33] ‑ [34].
Easy Stay submits that if leave to appeal is required, it should be granted because:
1.It is highly probable that the primary decision is incorrect;
2.There would be substantial injustice if leave to appeal was not granted;
3.The interests of justice weigh in the favour of the grant of leave to appeal.

Mt Morgans' submissions

The stay applications

Mt Morgans filed submissions on 24 April 2020. It submits that Easy Stay's submissions do not adequately explain why it contends that it has strong prospects of success.[77] Mt Morgans refers to Easy Stay's reliance on the decision in Clone, and submits that in that case, the court was considering the limits of a Supreme Court's equitable power to set aside perfected orders. However, the judge did not rely on such a power in this case.[78]
[77] Respondent's written submissions in opposition to the appellant's applications, par 5.
[78] Respondent's written submissions in opposition to the appellant's applications, pars 10 - 11.
Mt Morgans also submits that Easy Stay's reliance on the decision of Simmonds J in Computer Accounting and Tax [No 6] does not assist it, because the judge gave detailed reasons as to why there was an irregularity within the meaning of the CJE Act.[79]
[79] Respondent's written submissions in opposition to the appellant's applications, pars 11 - 13.
Mt Morgans submits that there is no adequate explanation as to why Easy Stay says the appeal would be rendered nugatory if a stay were not granted. In particular, there is no evidence that Mt Morgans would be unable to repay any money that it received pending the determination of the appeal. Also, Mt Morgans contends that Easy Stay's argument seems to proceed on an assumption that Mt Morgans would refuse to comply with any order made by the Court of Appeal, but there is no justification for such an assumption and the evidence is to the contrary. Nor do Easy Stay's submissions explain how or why it apprehends that a possible defence, or set off, or deduction could be agitated in the appeal.[80]
[80] Respondent's written submissions in opposition to the appellant's applications, pars 20 - 21.
Mt Morgans submits that it is also not apparent, absent explanation, that Easy Stay's presently unsatisfied judgment in favour of Mt Morgans in the sum of $1,181,704.94 would automatically relieve Mt Morgans of an obligation to comply with any order made by the Court of Appeal. To the extent that Easy Stay suggests that Mt Morgans might have the capacity to make some application for relief based on the unsatisfied judgment debt in the future, for example under the CJE Act, then it would presumably be the making of the orders on that application that would preclude Easy Stay's capacity to recover, rather than any failure to order a stay now.
Mt Morgans submits that, insofar as Easy Stay's submissions refer to the interests of OCS or Dlaw, the assertion is not properly explained. Further, OCS is in liquidation and does not wish to participate in the appeal. OCS is separately represented, and it is significant that it is not sought to assert the interests suggested by Easy Stay. Nor are Easy Stay's solicitors a party to the appeal. Mt Morgans asserts that if the true purpose of the appeal is to protect the interests of Easy Stay's solicitors, then a question arises as to whether those solicitors should have been named as an appellant and separately represented. In any event, Mt Morgans submits that there was no satisfactory explanation as to how the interests of those solicitors alters the disposition of the present application.[81]
[81] Respondent's written submissions in opposition to the appellant's applications, pars 23 - 25.
Mt Morgans also indicates that it has filed a cross‑appeal against the primary judge's decision in dismissing its s 58 application. Mt Morgans submits that if Easy Stay were to succeed in the appeal and the order for payment to Easy Stay was properly made, then the merits of Mt Morgans' s 58 application might need to be considered. Mt Morgans' notice of appeal has been filed 'to avoid any sterile procedural argument over Mt Morgans' ability to address the merits of Mt Morgans' s 58 application in such a circumstance'.[82]
[82] Respondent's written submissions in opposition to the appellant's applications, par 17.
Mt Morgans submits that there has been no application for a stay by Easy Stay pending the outcome of the judicial review proceedings in CIV 2562 of 2019. It also submits that Easy Stay has, in another matter, been denied a stay of the enforcement of a determination under the Construction Contracts Act pending a judicial review of the determination, given the objects and purposes of that Act: Easy Stay Mining Accommodation Pty Ltd v Faigen.[83]

Preliminary issue

[83] Easy Stay Mining Accommodation Pty Ltd v Faigen [2017] WASC 266; respondent's written submissions in opposition to the appellant's applications, par 27.

Mt Morgans submits that neither the application nor the submissions identify any proper basis upon which to order that the appeal proceed by way of determination of the alleged preliminary issue.[84] Easy Stay's submission also overlooks the significance of Mt Morgans' cross‑appeal. By the cross‑appeal, Mt Morgans (if necessary) will contend that its s 58 application should have been granted by the primary judge. Further, even if there were jurisdiction to order a hearing of the preliminary issue, the preliminary issue in this case would seem only likely to introduce unnecessary complexity, delay and expense. The issues to be canvassed on the appeal do not seem unusually complex, and they might readily be accommodated in a single hearing, as would ordinarily be the practise.[85]
[84] Respondent's written submissions in opposition to the appellant's applications, par 28.
[85] Respondent's written submissions in opposition to the appellant's applications, pars 28 - 30.
Mt Morgans also filed submissions on 12 May 2020, and responsive submissions on 18 May 2020 in relation to the matters referred to in [77] above. In general terms, they are as follows.

Nature of orders made by Goetze DCJ on 10 December 2019

Mt Morgans submits that order 3 of Goetze DCJ's orders dated 10 December 2019 expressly contemplates the possibility of an application being made for a 'direction or order to the contrary'. This means that the order could not have had the legal effect of finally determining the rights between the parties. Mt Morgans submits that if the orders were final, there could have been no further application.[86] Order 3 was subject to variation and therefore was interlocutory.[87]
[86] Respondent's submissions filed pursuant to orders dated 30 April 2020, par 6.
[87] Respondent's submissions filed pursuant to orders dated 30 April 2020, par 6; relying on Hall (439) and Carr v Finance Corporation of Australia Ltd (No 1) [1981] HCA 20; (1981) 147 CLR 246.
Mt Morgans submits that the legal effect of the orders made on 10 December 2019 must also be understood in the context of the CJE Act. Section 58 of the CJE Act provides for a judgment creditor (such as Mt Morgans) to apply for the money paid into the court to be paid to it. Mt Morgans asserts that the orders made 10 December 2019 did not and could not preclude a judgment creditor from making an application under s 58. Therefore, the orders of 10 December 2019 did not finally determine that Easy Stay was entitled to the money to the exclusion of a judgment creditor who obtained an order under s 58.[88]
[88] Respondent's submissions filed pursuant to orders dated 30 April 2020, par 9.
Further, Mt Morgans submits that s 105(a) of the CJE Act gives the court the ability to set aside an order made under pt 4 of the Act, which was the jurisdiction invoked by the primary judge.[89] Mt Morgans submits that the statutory scheme established by the CJE Act gave the court the capacity to set aside the order of 10 December 2019 given irregularities that had occurred, further illustrating the interlocutory nature of the orders.[90]

The legal effect of order 1 of Goetze DCJ's orders made on 10 December 2019 for payment of money into the District Court

[89] Respondent's submissions filed pursuant to orders dated 30 April 2020, pars 8 - 9.

[90] Respondent's submissions filed pursuant to orders dated 30 April 2020, pars 9 -12.

Mt Morgans submits that regard must be had to the statutory scheme established by the CJE Act. It relies on the position under this scheme, as observed by the primary judge, that the CJE Act does not provide for payment of an appropriated debt to a judgment debtor, such as Easy Stay, because Easy Stay could never obtain a greater interest by the payment into the trust than it had under the CJE Act.[91]

Nature of orders made by Goetze DCJ on 3 April 2020 and leave to appeal

[91] Respondent's submissions filed pursuant to orders dated 30 April 2020, par 19.

Mt Morgans submits that the orders made by Goetze DCJ on 3 April 2020 finally resolved the question of the party to whom the disputed half of the money no longer claimed by Grounded should be paid by ordering that it be paid to Mt Morgans. Mt Morgans points to the fact that those orders were not expressed in terms that contemplate a further order being made.[92]
[92] Respondent's submissions filed pursuant to orders dated 30 April 2020, par 20.
On the other hand, Mt Morgans acknowledges that the orders must be understood in the context of the statutory scheme set out in the CJE Act, including that, theoretically, a further application could be made pursuant to s 58 or further order could be made s 105 of the CJE Act. These matters suggest that the orders remain interlocutory.[93] If the orders were interlocutory, Mt Morgans submits that leave to appeal would be required and that the question of leave would likely be bound up with the merits of the appeal, and might be best considered at hearing of the appeal.[94]

The position of OCS

[93] Respondent's submissions filed pursuant to orders dated 30 April 2020, par 21.

[94] Respondent's submissions filed pursuant to orders dated 30 April 2020, par 22.

Easy Stay submits that the liquidator of OCS has requested removal from any or any active role in the proceedings. Easy Stay supports that removal.[95] Mt Morgans does not oppose the removal of OCS.[96]
[95] Appellant's written submissions in support of the appellant's applications, par 34.
[96] Respondent's submissions filed pursuant to orders dated 30 April 2020, par 4.
Lawyers for OCS sent an email to the Court of Appeal office on 20 April 2020 stating that OCS is in liquidation. The email asserts that pursuant to s 500 of the Corporations Act 2001 (Cth) OCS should not have been included as a respondent to the appeal. The email states that OCS consents to its removal as a party to the appeal.

Preliminary observations on materials in the District Court

On a necessarily preliminary view of the materials, the following observations may be made as to their arguable effect for present purposes.

Was there a need to amend the adjudicator's determinations and debt appropriation orders?

The Settlement Agreement between Easy Stay and OCS, on the one hand, and Grounded, on the other, dated 17 July 2019, was to the effect that, in consideration of Easy Stay and OCS agreeing to the dismissal of, and procuring the dismissal of, Easy Stay's judicial review proceedings, Grounded agreed that:
1.the judgment debts in its favour would be satisfied and discharged by the payment to Grounded of half the principal sum and all of the interest thereon in the Mt Morgans trust account; and
2.it would use reasonable endeavours to procure the payment of the balance of the money in the Mt Morgans trust account to Easy Stay.
Mt Morgans was not a party to the Settlement Agreement.
It is to be inferred that the 'proposal' put to Deputy Registrar Harman at the hearing on 6 September 2019 (see [35] above) was in pursuance of the Settlement Agreement. Deputy Registrar Harman rejected the 'proposal'.
Deputy Registrar Harman rejected Mt Morgans's reliance, in the s 103 application, on the Settlement Agreement as a ground for 'cancelling' the judgment debts and the debt appropriation orders in favour of Grounded. Deputy Registrar Harman also rejected Mt Morgans' s 103 application insofar as it sought to rely on the judgment which it obtained against Easy Stay on 19 August 2019. There was no appeal by Mt Morgans against the dismissal of its s 103 application.
Orders 1 and 2 of Goetze DCJ dated 10 December 2019 appear to have effectuated the Settlement Agreement between Grounded and Easy Stay. Having regard to the first term of the Settlement Agreement (see [102.1] above), those orders, arguably, effectively satisfied the judgment debts in favour of Grounded.
Order 3 of Goetze DCJ's orders of 10 December 2019 appears to have been, at least as between Grounded and Easy Stay, in furtherance of the second term of the Settlement Agreement (see [102.2] above), and, perhaps more generally, a resolution of the competing claims on the moneys in the Mt Morgans trust account. It was prima facie to the effect that:
1.After order 2 had been effected, the balance of the money was to be paid out of the District Court to Easy Stay.
2.The payment out to Easy Stay was stayed until at least 4.00 pm on 20 December 2019, and stayed beyond then, if Mt Morgans applied in CIV 2562 of 2019 for an order or direction that such moneys not be paid to Easy Stay (subject to order 4 below).
3.If Mt Morgans made such an application in CIV 2562 of 2019 on or before 4.00 pm 20 December 2019, the stay of the payment out to Easy Stay was to be continued until the determination of such application, and:
(i)if such application were granted to Mt Morgans by the Supreme Court, the stay would cease to have effect (having been overtaken by the Supreme Court orders on such an application); and
(ii)if such application were dismissed, the stay would cease to have effect, and there would be no impediment to the payment out to Easy Stay under order 3.
Arguably at least, the word 'satisfied' in the phrase 'if … the judgment debt to which [a debt appropriation order] relates is satisfied' in s 51(7) of the CJE Act[97] refers both to satisfaction by settlement or compromise, as well as payment in full. Also, at least on one view of it, Grounded's judgment debts were 'satisfied' within the meaning of s 51(6)(c) of the CJE Act upon compliance with orders 1 and 2 of the orders of Goetze DCJ dated 10 December 2019, and the debt appropriation orders ceased to have effect.
[97] See [11] above.
If that view is correct, then it is arguable that Goetze DCJ erred in considering it necessary to amend the 'original judgment sum' and the debt appropriation orders by order 1 of the 3 April 2020 orders.
The basis on which Goetze DCJ could amend an adjudicator's determination made under s 31(2) of the Construction Contracts Act may also be open to question.

Character of order 3 made on 10 December 2019

Easy Stay's submission that the District Court lacked power to vary order 3 of the orders made on 10 December 2019 proceeds on the premise that the order has the status of a final judgment. Easy Stay refers to the decision of the High Court in Clone,[98] as to the limited circumstances in which a court has power to set aside its own perfected final judgment outside a statutory appeal. Easy Stay does not seem to argue that if the orders were interlocutory, the power of the court to vary interlocutory orders was not properly exercised within the circumstances of this case.[99]
[98] Clone [41].
[99] As to the variation of interlocutory orders, see, generally, Commonwealth of Australia v Albany Port Authority [2006] WASCA 185 [23] ‑ [25]; Commonwealth Bank of Australia Ltd v Saraceni [2013] WASC 115 [9].
The procedural setting of the current appeal is quite different to that considered by the High Court in Clone. The discussion in that case concerned the circumstances in which a perfected judgment in an action brought for a determination of the final rights of the parties could be varied otherwise than on appeal. By contrast, the primary proceedings in the present case were not concerned with the final determination of substantive rights at all.
Rather the District Court was involved in the enforcement, under the CJE Act, of an adjudicator's determination under the Construction Contracts Act, which is itself not a final determination of the rights of the parties to the relevant construction contract.
Grounded obtained determinations under s 31(2)(b) of the Construction Contracts Act that Easy Stay was liable to make payments to it in amounts totalling $589,640.38. The adjudicator's determinations are binding on Grounded and Easy Stay.[100] Easy Stay was obliged to make the payments to Grounded on or before the date specified in the determination.[101] The payment once made is taken to be on account.[102]
[100] Section 38 of the Construction Contracts Act.
[101] Section 39(1) of the Construction Contracts Act.
[102] Section 40 and s 45 of the Construction Contracts Act.
When Easy Stay did not pay the determined amounts, Grounded was entitled to enforce the determinations by filing certified copies of the determinations and an affidavit as to non-payment in the District Court.[103] On filing, the determinations were taken to be orders of the District Court and could be enforced accordingly.[104]
[103] Section 43(2) of the Construction Contracts Act.
[104] Section 43(3) of the Construction Contracts Act.
One means of enforcement of the determinations was to apply for debt appropriation orders under s 49 of the CJE Act. Orders appropriating a debt owed by Mt Morgans to East Stay were made on 24 October 2017 and 29 November 2017. Once those orders were served on Mt Morgans, Mt Morgans was obliged to pay the appropriated debt to Grounded, under s 51(1) of the CJE Act. Grounded could apply to the court to enforce the debt appropriation order against Mt Morgans if it did not obey or object to the order, under s 56 of the CJE Act.
The Suspension Orders were made under s 15 of the CJE Act suspending enforcement of the determinations and debt appropriation orders. Ancillary or consequential orders were made under s 15(5) of the CJE Act requiring that Mt Morgans pay the appropriated debt into a bank suspense account 'to be held in trust until further order of' the District Court.
It was in this context that, on 10 December 2019, the primary judge made orders that the money in the Mt Morgans trust account be paid into court, that one half then be paid to Grounded and that the balance be paid to Easy Stay, but that the payment to Easy Stay be suspended pending orders on an application to be filed in the Supreme Court by Mt Morgans on or before 20 December 2019. These orders were made by consent of the parties including Mt Morgans.
The status of order 3 of the 10 December 2019 orders is the subject of contention in this appeal. Arguably, order 3 might be regarded as a further ancillary or consequential order under s 15(5) of the CJE Act, providing for the disposition of funds required to be paid into the Mt Morgans trust account pursuant to the earlier ancillary or consequential order. It might be argued that the court retained the power to make orders for the disposition of the funds while they remained in the court's control. Easy Stay's contrary view might also be arguable, but is not plainly and incontestably correct.
Further, as noted above, the 10 December 2019 orders, including order 3, were made by consent. The discretion of a court to vary an interlocutory consent order where it is in the interests of justice to do so, even if the orders are based on a contract, has recently been reaffirmed by this court.[105] Arguably at least, the fact that the orders of 10 December 2019, including order 3, were made by consent did not deprive Goetze DCJ of power to vary the order, although it may have been a relevant consideration in the exercise of that power.

Operation of s 105 of the CJE Act

[105] Mighty River International Ltd v Mineral Resources Ltd [2020] WASCA 44 [60].

If the orders of 10 December 2019 were final, a question would arise as to whether the orders of 3 April 2020 of Goetze DCJ could be sustained under s 105 of the CJE Act.
In answering this question, the issue to be determined would be whether order 3 of the orders of 10 December 2019 constituted an 'irregularity' within the meaning of s 105 of the CJE Act. Section 105 of the CJE Act relates to orders under, relevantly, pt 4 of the CJE Act. Section 105 provides:
105.Irregular enforcement, courts' powers as to
If the court that made an order under Part 4 or 5 or section 101 is satisfied that an irregularity has occurred in connection with the making or carrying out of the order, the court may make any order needed to correct the irregularity including an order -
(a)that sets aside the order or an act done under the order;
(b)that requires the restitution of property or the payment of money, compensation or damages.
Accordingly, the questions would seem arguably to be (at least):
1.Whether order 3 of the orders of 10 December 2019 was 'made' under pt 4 of the CJE Act.
2.If not, whether order 3 of the orders of 10 December 2019 might nevertheless be characterised as an act done 'in connection with the making' of some other order under pt 4 - relevantly, the debt appropriation orders.
3.Whether, in the making of order 3 of the orders of 10 December 2019, there was an 'irregularity' within the meaning of s 105 of the CJE Act.
It might be doubted whether the second of those questions could affirmatively answered as the reference to 'act done under the order' in s 105(a) of the CJE Act, read in the context of s 105 as a whole, appears to indicate that a distinction is being drawn between orders themselves, and acts done under orders.
A debt appropriation order under pt 4 of the CJE Act is an 'enforcement order'.[106] Section 20(3), in pt 4 of the CJE Act, provides:
When or after making an enforcement order, or any other order, [under pt 4] the court may make any necessary ancillary or consequential order and may do so on terms as to costs or otherwise. (emphasis added)
[106] Section 17 of the CJE Act.
As noted above, there is also a power, under s 15(5) of the CJE Act, to make any 'necessary ancillary or consequential order' in relation to a suspension order under s 15 of the CJE Act. However, suspension orders are not under pt 4 of the CJE Act.
The relevant application of s 105 may depend on the orders made by Goetze DCJ on 10 December 2019, including order 3, being orders 'made' under pt 4 of the CJE Act on the basis that they were 'consequential orders' made under s 20(3) of the CJE Act, relating to the payment and satisfaction of the judgment debts the subject of the debt appropriation orders made under s 49 of the CJE Act. Alternatively, for similar reasons, it might be argued that the orders of 10 December 2019 were made 'in connection with' the debt appropriation orders made under pt 4 of the CJE Act if (compare [124] above) an order itself could be an 'act done' for this purpose.
As to whether order 3 of the orders of 10 December 2019 involved an 'irregularity', the money in the Mt Morgans trust account was originally paid into the account as a result of (relevantly) an application by Easy Stay to suspend the enforcement of the judgment debt and the debt appropriation orders in favour of Grounded. Once the judgment debt in favour of Grounded had been satisfied, the purpose of the payment into the Mt Morgans trust account had, arguably, been exhausted by orders 1 and 2 of Goetze DCJ's orders of 10 December 2019. The moneys originally in the Mt Morgans trust account, and the moneys thereafter paid into court by the orders of 10 December 2019, nevertheless represented a debt originally owed by Mt Morgans to Easy Stay. Once Grounded's claim had been satisfied, prima facie the balance left was part of the debt owed to Easy Stay by Mt Morgans. On one view of it, Easy Stay had a better claim to the money as creditor of Mt Morgans unless the underlying debt had been satisfied or was perhaps set off by a greater amount owed by Easy Stay to Mt Morgans. There has been no argument by Mt Morgans to the effect that its judgment debt of $1,181,704.94 against Easy Stay is capable of being, or should be, set off. On one view of it, it is difficult to see how the order for payment out to Easy Stay could be characterised as an irregularity if, as at 10 December 2019, Mt Morgans had no better statutory or common law claim on the moneys in court.
Also, order 3 of Goetze DCJ's orders of 10 December 2019 was a consent order. It was deliberately sought by consent of all parties including Mt Morgans. The stay aspect of the order prima facie reflected the right to which Mt Morgans agreed to have recourse in order to recover the money. Moreover, Mt Morgans had not appealed Deputy Registrar Harman's decision. Whether, in these circumstances, order 3 of the orders of 10 December 2019 could properly be described as an 'irregularity' might be another matter.

Operation of s 58 of the CJE Act

The liberty to apply in order 4 of the orders of Goetze DCJ of 10 December 2019 appears to be directed to, or at least to have most practical operation with respect to, the stay aspect of order 3, referred to in [107.3] above (eg, if Mt Morgans, having made the application within time, thereafter failed to prosecute it diligently). Arguably however, whilst ever the money remained in court pursuant to the stay, the money was in court 'standing to the credit' of Easy Stay, and was thereby money in respect of which a claimant who was a judgment creditor of Easy Stay might seek an order for payment under s 58(1) of the CJE Act.
It might be added that the subsequent s 58(1) application by Mt Morgans was arguably consistent with the consent orders of 10 December 2019 insofar as it involved the exercise of a separate statutory right consistent with the operation of the consent orders leaving the funds standing to the credit of Easy Stay. On the other hand, any claim by Mt Morgans to an entitlement to the funds merely as the party who had paid the funds into court in the first place, would prima facie be inconsistent with the evident basis upon which the consent orders of 10 December 2019 were made.

Prospects of the appeal and cross-appeal

It follows from the above discussion that, in our view, a number of issues are raised by the appeal and the cross-appeal and that each has some reasonable prospect of success, although success for the moving party in each of the appeal and cross-appeal is far from assured.

Disposition

The stay application

The principles in relation to a stay pending the determination of the appeal were not in dispute. In general terms:[107]
(a)The successful litigant is ordinarily entitled to enforce a judgment pending the determination of any appeal.
(b)It is for the applicant for a stay to move the court to a favourable exercise of its discretion. Under s 15(3) of the CJE Act this court may only make a suspension order if there are 'special circumstances' that justify doing so and in an application for a stay under the Supreme Court (Court of Appeal) Rules 2005 (WA) this is also a usual requirement.
(c)The central issue will be whether the grant of a stay is perceived to be necessary to preserve the subject matter or the integrity of the litigation or whether a refusal of a stay could create practical difficulties in respect of the relief which may be granted on appeal. This may shortly be described as requiring the court to consider whether the right of appeal will be rendered nugatory if a stay is not granted.
(d)If it can be demonstrated that the right of appeal will be rendered nugatory if a stay is not granted, the stay will generally still be refused unless it can be established that the appeal has ultimately reasonable prospects of success.
(e)Finally, the stay may still be refused where it appears that the balance of convenience does not lie in favour of the applicant where, for example, the grant of a stay will occasion hardship to the respondent which may not be alleviated by the terms upon which the stay may be granted.
[107] Eastland Technology Australia Pty Ltd v Whisson [2003] WASCA 307; (2003) 28 WAR 308 [9]; Tradesman Technologies Pty Ltd v Ameduri [2012] WASCA 168 [22].
The point of the appeal is to give effect to order 3 of the orders of Goetze DCJ of 10 December 2019, requiring that the remaining money held in the District Court be paid out of court to Easy Stay. The effect of order 4 of the orders of Goetze DCJ of 3 April 2020 is to require payment of such money to Mt Morgans. The appeal will be rendered nugatory if a stay is not granted as the fund in court will have been paid away to Mt Morgans. The question of whether there is a risk that, if the appeal were upheld, Mt Morgans may not be in a position to restore the fund to the District Court (or perhaps to Easy Stay directly) is one better addressed in the context of a consideration of the balance of convenience.

In relation to the merits, as noted earlier, it may be accepted that, for present purposes, the appeal has arguable merit. On the other hand, it may also be accepted, for present purposes, that the cross‑appeal has arguable merit. In that event, success in the appeal would not prima facie result in the payment of the money to Easy Stay.
As to the balance of convenience, one factor to be taken into account is whether Mt Morgans may be unable to meet the payment required by any restorative orders if the appeal succeeds. Another is that the remaining money paid into the District Court is a fund to which Easy Stay has immediate recourse under Goetze DCJ's orders of 10 December 2019. Easy Stay's position is not akin merely to that of an ordinary judgment creditor.
On the other hand (1) there is no evidence that Mt Morgans is a particular credit risk, and (2) Mt Morgans is a judgment creditor of Easy Stay in an amount of approximately $1.18 million, which greatly exceeds the amount of the available funds in court.
Also, the primary proceedings have had a long and convoluted history. Whilst it is desirable to bring the litigation to an end, there is no evidence that any particular prejudice would be suffered if the fund were left undisturbed pending the hearing of the appeal.
Finally, the Construction Contracts Act is designed to produce an efficient resolution of the disputes governed by it. In these circumstances, that purpose has been effectuated by the payment of money to Grounded. The particular cashflow considerations behind the Construction Contracts Act have less significance in the present dispute, which is between a debtor (Easy Stay) and its creditor (Mt Morgans).
On balance, and with particular regard to the matters referred to in [137] above, it seemed to us that this was a case where the balance of convenience did not lie in favour of Easy Stay, and that, overall, including with regard to the matters in [135] above, the interests of justice did not warrant the grant of an order for a stay.
Further, there was, in any event, no proper basis for this court to order a stay pending the determination of Easy Stay's judicial review proceedings in CIV 2562 of 2019. Any application for a stay in that regard should be made to the General Division.

Determination of preliminary issue

In our view, the disposition of the appeal would most efficiently be effectuated if all the issues raised by Easy Stay were dealt with at the one time. Compartmentalising the appeal is unlikely to be efficient in the long run. Also, as there is a cross‑appeal by Mt Morgans, there is no basis for supposing that the preliminary issue proposed for determination will necessarily dispose of the dispute in any event.

The position of OCS

In light of the matters referred to in [99] ‑ [100] above, it was appropriate to order the removal of OCS as a third respondent.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
DM
Associate to the Honourable Justice Murphy
27 MAY 2020

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Citations

Easy Stay Mining Accommodation Pty Ltd v Mt Morgans WA Mining Pty Ltd [2020] WASCA 86

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