Equity-One Mortgage Fund Ltd v Pepe

[2015] VSC 161

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

S CI 2012 05754

EQUITY-ONE MORTGAGE FUND LTD (ACN 106 720 941)	Plaintiff
v
LUCA ANTHONY PEPE (ALSO KNOWN AS LUKE ANTHONY PEPE)	First Defendant
and
L.A.P. TRANSPORT SERVICES PTY LTD IN ITS OWN RIGHT AND AS TRUSTEE FOR THE LUCA PEPE FAMILY TRUST (ACN 088 384 570)	Second Defendant

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JUDGE:	GINNANE J
WHERE HELD:	Melbourne
DATE OF HEARING:	14 and 23 April 2015  and 14 May 2015
DATE OF JUDGMENT:	21 May 2015
CASE MAY BE CITED AS:	Equity-One Mortgage Fund Ltd v Pepe & Anor
MEDIUM NEUTRAL CITATION:	[2015] VSC 161

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CONTEMPT – Disobedience of injunction – Date of service of order – Supreme Court (General Civil Procedure) Rules 2005 rr 75.05, 75.11(1).

PRACTICE – Real property – Warrant of possession – Execution of previous warrants of possession – Defendant re-entering property – Further warrant issued – Supreme Court (General Civil Procedure) Rules 2005 rr 1.15, 69.03.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr R D Shepherd	Summit Partners Legal Advisers and Consultants
For the First Defendant	In person

HIS HONOUR:

1. The plaintiff, Equity-One Mortgage Fund Ltd, seeks an order that Mr Luca Anthony Pepe be punished for contempt under rr 75.05 and 75.11(1) of the Supreme Court (General Civil Procedure) Rules 2005, because it alleges that he did things set out in an amended statement of charge in breach of paragraph 3(a) of an order made by Vickery J on 6 May 2014.

1. The order of Vickery J contained four paragraphs.  The first granted Equity-One Mortgage Fund Ltd leave to file a second warrant of possession in respect of the property at Fairmount Street, Hadfield.  The second paragraph stated:

[t]he first defendant and any of his servants or agents be restrained from preventing, hindering or interfering with the Sheriff’s entry upon the Property in execution of the warrant and are further restrained from preventing, hindering or interfering with the actions of any police officer, Sheriff’s employee, plaintiff’s employee and any other person engaged by the plaintiff in entering on and taking possession of the Property.

1. The third paragraph which the plaintiff alleges has been breached stated:

On the plaintiff taking possession of the Property the first defendant and any of his servants or agents be restrained from:

(a)       entering on or remaining on the Property;

(b)       going within thirty (30) metres of the Property; and

(c)hindering the sale of the Property by the plaintiff exercising its powers as mortgagee in possession.

1. The fourth paragraph stated that there be no order as to costs.

1. The amended statement of charge relating to the contempt stated:

1.After the Plaintiff on 20 August 2014 took possession of the property situated at and known as 6 Fairmount Street, Hadfield in the State of Victoria (‘the Property’) the First Defendant entered on the Property and thereafter on 7 January 2015 and 19 February 2015 remained on the Property.

PARTICULARS

(a)The Plaintiff took possession of the Property on 20 August 2014.

(b)…

(c)The First Defendant entered on the Property on 7 January 2015 and 19 February 2015 and remained on the Property.

1. The plaintiff had obtained an order for possession of the property.

1. Mr Pepe was in Court on 6 May 2014 when Vickery J pronounced the order.  Mr Pepe represented himself on that occasion.

1. Mr Andrew Brown, the then solicitor for the plaintiff, who was in Court, gave evidence that Vickery J stated that the order was a serious order, that Mr Pepe must comply with it and that if he did not, he would ‘be in contempt of court which might make him liable to gaol or further fines’.  At the conclusion of the hearing, at the request of the Judge, Mr Brown spoke to Mr Pepe and explained the order that had been made and what would happen. 

1. The Sheriff of the Court, at the request of the Plaintiff, took possession of the property on 20 August 2014, changed the locks and installed an alarm system. 

1. The order was personally served on Mr Pepe on 6 December 2014.  A Penal Notice was attached to it.

1. It was accepted by both parties that the charge of contempt could only be established by actions proved against Mr Pepe that occurred after the personal service of the order on him on 6 December 2014. 

1. In Grocon Constructors (Victoria) Pty Ltd v Construction, Forestry, Mining and Energy Union,[1] Cavanough J stated:

   [1][2013] VSC 275.

It is common ground that, in general terms, the elements of a civil contempt, ie a contempt constituted by breach of a court order, are as follows:

(a)that an order was made by the court;

(b)that the terms of the order are clear, unambiguous and capable of compliance;

(c)that the order was served on the alleged contemnor or that service was excused in the circumstances or dispensed with pursuant to the Rules of Court;

(d)that the alleged contemnor has knowledge of the terms of the order;

(e)that the alleged contemnor has breached the terms of the order.[2]

[2]Ibid [8] (citations omitted).

1. An appeal from his Honour’s judgment was dismissed.[3]

   [3]Construction, Forestry, Mining and Energy Union v Grocon Constructors (Victoria) Pty Ltd [2014] VSCA 261.

1. The plaintiff must prove the contempt charge beyond reasonable doubt. 

1. There is significant evidence that Mr Pepe knew of the Court order and its effect.  That evidence includes his presence in Court representing himself when the order was made.  There is then his conversation with Mr Brown after the conclusion of the Court hearing.  There is evidence of two telephone conversations that he had with Sergeant J Baldwin, from the Sheriff’s office, on 15 August 2014, in which the terms of the order were explained.  Sergeant Baldwin gave evidence that Mr Pepe told her that he was refinancing the property and would not be moving.

1. There is also evidence of Mr Pepe’s conversations with Mr G Potenza, the solicitor for the plaintiff, and Mr M Cementon, a real estate agent, occurring on 23 October 2014.  Mr Pepe told them that he intended to remain in the house. 

1. Mr Potenza gave evidence that on 13 November 2014 he spoke with Mr Pepe and asked him why he was still living at the property.  Mr Pepe said:

I am living in the property as no one is helping me and I have nowhere else to go.  Equity-One is in trouble with the Ombudsman.

1. However, the only conduct of Mr Pepe that can form the basis of a contempt charge is conduct occurring after the personal service of the order on 6 December 2014.

1. I granted Mr Pepe an adjournment early in the afternoon of the first day of hearing, so that he could consider obtaining legal assistance.  The need for him to obtain legal assistance was brought to his attention as early as 6 May 2014 by Vickery J. 

1. On 13 May 2015, by email sent by my Associate, I raised with the parties the question of whether the statement of charge was bad for duplicity.  On 14 May 2015, I heard submissions from the plaintiff about that issue and on 20 May 2015 received written submissions on behalf of Mr Pepe.  The plaintiff sought leave to amend the summons and after hearing the parties I granted the plaintiff leave to re-open its case and to amend the summons and also granted Mr Pepe leave to re-open his case. Mr Pepe did not seek any further time to consider whether to call any further evidence and indicated that he did not wish to do so.

1. Mr P Lithgow, of counsel, attended the hearing pursuant to the Victorian Bar Legal Assistance Scheme and sat next to Mr Pepe at the bar table.  Although Mr Lithgow did not formally appear for Mr Pepe, he was able to provide considerable assistance to the Court and, no doubt, to Mr Pepe, by directing the Court’s attention to relevant issues and questions for its consideration. 

1. Mr Lithgow emphasised to the Court that it had to be satisfied that Mr Pepe had remained on the property after 6 December 2014. At best, there were only two occasions when witnesses had identified him as being on the property — on the two dates of 7 January 2015 and 19 February 2015.

1. The breach of the Court order of 6 May 2014 is proved by evidence of Mr Cementon that on 7 January 2015 he saw Mr Pepe at the property, and that when he called out Mr Pepe’s name, Mr Pepe, who was wearing only shorts, looked at him, returned into the property and closed the door behind him.  There was a blue Ford motor vehicle in the driveway of the property with the front window down.  Mr Cementon and Mr Potenza, who had been at the adjoining property, rang the doorbell on several occasions calling out Mr Pepe’s name, but there was no response.  Two dogs appeared at the rear of the property and commenced barking loudly.

1. When the Sheriff took possession of the property on 20 August 2014, dogs were also found on the property.  

1. The breach of the Court order is also proved from the evidence of Mr C Donadio that on 19 February 2015 he saw Mr Pepe arriving at the property in a vehicle and driving into the driveway. Mr Pepe then got out of the car, Mr Donadio spoke to him, in company with Mr Potenza, and served Court orders on Mr Pepe.  The terms of them were explained, and Mr Potenza told him that the current charges were serious charges and that he should obtain legal representation.

1. Mr Potenza gave similar evidence and said that Mr Pepe told him on 19 February 2015 that ‘I have no intention of leaving the property’.

1. Mr Potenza left a number of copies of the order for Mr Pepe at the property. 

1. Mr Donadio gave evidence of finding dogs on the property. 

1. On 19 March 2014, Mr Pepe said to Mr Cementon, ‘where else do you expect me to go.  This is my family home and I’m staying.  No one will kick me out’.

1. I consider that the terms of the order were clear.

1. The word ‘remain’ is a plain English term.  The second meaning given to it in the Macquarie Dictionary is:

To stay in a place: to remain at home.

1. The evidence of Mr Cementon establishes that Mr Pepe was on the property on 7 January 2015.  The evidence of Mr Donadio and Mr Potenza establishes that he was on the property on 19 February 2015.  There is also the evidence to which I have referred of statements by Mr Pepe that he proposed to remain at the property.

1. Mr Pepe called no evidence to contradict this evidence. 

1. I consider that Mr Pepe’s presence on the property on those two dates, when viewed in context, is sufficient to prove that he remained on the property after he had been personally served with the order.

1. I consider that the elements of the statement of charge have been proved beyond reasonable doubt by evidence that after 6 December 2014 Mr Pepe remained on the property. 

1. I am therefore satisfied that the charge of contempt is proved beyond reasonable doubt.

A third warrant of possession

1. The plaintiff also sought the issue of a third warrant of possession under the Supreme Court (General Civil Procedure) Rules 2005. The second warrant was executed on 20 August 2014 by the Sheriff’s office. A return was made to it and it is now spent. It was submitted that the Court had power to grant further warrants of possession. I accept that in an appropriate case that is so and that the power to issue a warrant of possession can be exercised from time to time as is appropriate. That power is given by r 69.03 and, if necessary, r 1.15.[4]

   [4]Cf Williams, Civil Procedure: Victoria, vol 1 (at Service 261) [66.03.30].

1. I consider that this is an appropriate case to order the issue of a further warrant of possession as there is evidence that Mr Pepe re-entered the property after the Sheriff executed the second warrant on 20 August 2014 and remains in possession.

1. The other orders sought in the plaintiff’s summons were not pressed. 

1. I will give further directions for the hearing of the plaintiff’s application for orders that Mr Pepe be punished for the contempt of court that I have found has been proved.

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