Giuseppe Romeo v Frank Papalia

[2013] HCASL 15

GIUSEPPE ROMEO

v

FRANK PAPALIA & ORS

[2013] HCASL 15

S224/2012

1. Frank Papalia and Julie Rance brought proceedings in the Supreme Court of New South Wales against Giuseppe Romeo and his wife, Anna Maria Romeo, claiming an amount in excess of $3.1 million due under a deed of loan and associated mortgage.  The solicitor who had appeared on the Romeos' behalf in the proceedings signed short minutes of order consenting to the entry of judgment against them.  The Registrar made orders in accordance with the short minutes, and judgment was entered on 1 October 2010.

2. On 26 October 2010 Mr and Mrs Romeo filed a motion seeking to have the judgment set aside.  The motion came before Sackar J.  Counsel appearing for Mr and Mrs Romeo announced that Mrs Romeo was not proceeding with her application.  Mr Romeo gave evidence stating that he had not spoken to Frank Papalia or Julie Rance about borrowing money and denying that he had signed any documents relating to loans from them or that he had received any money from them.  Sackar J formed an adverse view of Mr Romeo's credibility.  His Honour rejected material parts of Mr Romeo's evidence.  He found that Mr Romeo had been served with the statement of claim in the proceedings and that he knew that the solicitor, Mr Carbone, would be retained to act in the matter.  His Honour found that Mr Romeo was well aware over the years that Mr Carbone had been retained by Mrs Romeo to act on behalf of both of them in all kinds of matters.  His Honour concluded that either Mr Romeo expressly agreed to his wife telling Mr Carbone to consent to the entry of judgment against them or he had left it entirely in his wife's hands to make the decision as to what should be done in the circumstances.  In the result, Sackar J was satisfied that Mr Carbone had full authority, actual or ostensible, to enter the agreement.  His Honour dismissed the application to set aside the consent judgment. 

3. Mr Romeo appealed unsuccessfully to the Court of Appeal (Basten and Campbell JJA, Sackville AJA). 

4. Mr Romeo applies for special leave to appeal.  His proposed grounds assert that any general implied authority exercised by Mrs Romeo did not extend to acting as his agent in litigation "so as to advantage and forward her own separate interests in opposition to that of her husbands [sic] without disclosing that conflict of interest to the applicant".  Mr Romeo asserts that this ground of challenge was argued in the Court of Appeal but that the Court failed to deal with it in its reasons.  The Court of Appeal addressed one contention respecting a claimed conflict of interest between Mr and Mrs Romeo.  This was the contention that Sackar J had been wrong to draw a Jones v Dunkel[1] inference respecting the failure to call Mrs Romeo.  The Court of Appeal recorded counsel's submission that it had been inappropriate to draw that inference "because her interests were not only separate from that of her husband, but were actually in conflict"[2].  The conflict was said to arise because Mr Romeo had denied signing the deed of loan or mortgage and an obvious inference was that Mrs Romeo had done so in his name. 

   [1](1959) 101 CLR 298; [1959] HCA 8.

   [2]Romeo v Papalia [2012] NSWCA 221 at [104].

5. Sackville AJA, giving the leading judgment in the Court of Appeal, rejected the challenge to the drawing of a Jones v Dunkel inference.  His Honour pointed out that Sackar J had raised with counsel the possibility of a conflict between Mr and Mrs Romeo.  In this connection, Sackar J had informed counsel that in light of certain events he was proceeding on the assumption that any conflict between the two had been resolved.  Counsel appearing for Mr Romeo said nothing to disabuse Sackar J of that assumption[3].  The factual basis for the legal questions to which the application is said to give rise has not been established.  If special leave were granted the appeal would have no prospect of success. 

   [3]Romeo v Papalia [2012] NSWCA 221 at [123].

6. The application is dismissed. 

7. Pursuant to r 41.11.1 we direct the Registrar to draw up, sign and seal an order determining the application with costs.

J.D. Heydon
26 February 2013 V.M. Bell