Gold Coast City Council v. Mountdene Pty Ltd & Ors

[2008] QPEC 112

PLANNING & ENVIRONMENT COURT
OF QUEENSLAND

CITATION:

Gold Coast City Council v Mountdene Pty Ltd & Ors [2008] QPEC 112

PARTIES:

GOLD COAST CITY COUNCIL  (Applicant)
v
MOUNTDENE PTY LTD  (First Respondent)
and
JOHN PATRICK DOONEY             (Second Respondent)
and
KENT THOMAS MURPHY AND SARAH FRANCES MURPHY  (Third Respondents)
and
LEIZA RAE PARSONS  (Fourth Respondent)
and
COLIN JOHN WRIGHT AND LORAINE MAVIS WRIGHT  (Fifth Respondents)
and
MARK ANTHONY KRICK                 (Sixth Respondent)
and
KAREN PATRICIA GATES            (Seventh Respondent)
and
FRANK WILLIAM FRANCIS AND SANDRA EVELYN DENISE FRANCIS  (Eighth Respondents)
and
ALAN CHRISTOPHER O’BRIEN AND PATRICIA JAYNE O’BRIEN  (Ninth Respondents)

FILE NO/S:

482 of 2006

DIVISION:

Planning and Environment

PROCEEDING:

Application

DELIVERED ON: 

25 November 2008

DELIVERED AT:

Brisbane

HEARING DATE:

24 November 2008

JUDGE:

Kingham DCJ

ORDER:

1.  MR DOONEY IS IN CONTEMPT OF THE PLANNING & ENVIRONMENT COURT BY HIS NON-COMPLIANCE WITH THE ORDER THAT HE PROVIDE AN UNCONDITIONAL BANK GUARANTEE IN THE TERMS REQUIRED.

2.  THE APPLICATION IS ADJOURNED FOR FURTHER HEARING ON 29 JANUARY 2008 TO PROVIDE MR DOONEY WITH THE OPPORTUNITY TO PURGE HIS CONTEMPT AND FOR THE PARTIES TO MAKE FURTHER SUBMISSIONS AS TO PENALTY.

3.  COSTS ARE RESERVED.

CATCHWORDS:

CONTEMPT - Failure to comply with order to provide bank guarantee - whether a lawful excuse - whether wilful - whether due to circumstances beyond control of respondent - whether enforcement of a monetary order - contempt established - sentence adjourned for further hearing and so contempt may be purged

District Court of Queensland Act1967
Integrated Planning Act 1997
Penalties and Sentences Act 1992
Uniform Civil Procedure Rules 1999
Australasian Meat Industry Employees' Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98
Bakir v Doueihi & Ors [2001] QSC 414
Lade & Co Pty Ltd v Black [2006] QCA 294

COUNSEL:

M Hinson SC and N Kefford for the applicant

B G Cronin for the first and second respondents

SOLICITORS:

Minter Ellison - Gold Coast for the applicant

Haney Lawyers for the first and second respondents

1. HER HONOUR:  The unhappy history of endeavours to secure remediation of a site the subject of these proceedings is set out in reasons I gave when I made orders in this matter in July this year. Those orders included one which required the first and second respondents to provide an unconditional bank guarantee in favour of the Gold Coast City Council (GCCC) to secure performance of the remedial works.  The amount of the bond and the date by which it was to be provided were both varied by consent on 11 September 2008 to a sum of $546,256.00 with the guarantee to be provided by 6 October 2008. The guarantee has not been provided.

1. This is an application for an order that the second respondent, John Dooney be punished for contempt of court for failure to comply with that order. Mr Dooney concedes the non-compliance but disputes he has committed a contempt of court.  He argues the failure to comply is due to circumstances outside his control and is not punishable as contempt.

1. By application of s4.1.5(2) of Integrated Planning Act (IPA) and s129(2) of the District Court of Queensland Act, a Judge of the Planning and Environment Court has the same power to punish a contempt of the Planning and Environment Court as a Supreme Court Judge has to punish a contempt of the Supreme Court. Applications of this nature involve a consideration of those provisions but also Chapter 20 Part 7 of the Uniform Civil Procedure Rules (UCPR) which prescribes the procedure for dealing with such matters.

1. The second respondent’s argument addresses what conduct may constitute contempt of the Planning and Environment Court. s129(1)(a) of the District Court of Queensland Act provides that a person is in contempt of court if they, without lawful excuse, fail to comply with an order of the court.  Mr Dooney asserts his non-compliance is excused because it was caused by circumstances outside his control. This argument assumes the scope of conduct which may constitute contempt of the Planning and Environment Court is fixed by s129 of the District Court of Qld Act. I do not consider it is so confined.

1. Certainly S4.1.5(2) of IPA applies s129 of the District Court of Queensland Act to the Planning and Environment Court in the same way as that section applies to the District Court.  However, the IPA takes another step. S4.1.5(3) provides that if a person, at any time, contravenes an order of the court, the person is also taken to be in contempt of the court. The ordinary meaning of the words suggests no limitation. That provision, read with s4.1.5(4) which prescribes punishment for contempt under s4.1.5(3), must extend contempt of the Planning and Environment Court beyond that provided by application of s129 of the District Court of  Queensland Act. If that is not so, they are surplice and devoid of meaning.

1. In my view, the scope of conduct which may constitute a contempt of the Planning and Environment Court is determined by reference to both s129(1) of the District Court of Queensland Act and s4.1.5(3) of IPA. Even if Mr Dooney has a lawful excuse, as that term is used in s129(1)(a), s4.1.5(3) defines non-compliance with a court order as contempt. If that interpretation is correct, Mr Dooney’s concession the order has not been complied with establishes the offence.

1. It seems to me that the unqualified wording used in s4.1.5(3) sits comfortably with the analysis of the UCPR provisions undertaken by his Honour Justice Keane in Lade & Co Pty Ltd v Black. He observed at [71] that their benefit was that they enabled the court to come to a view of the nature of a contemnor’s conduct and the sanction appropriate for that conduct without having to mediate those considerations through indeterminate formulae, such as “casual, accidental or unintentional”. Under r930 of the UCPR a court may deal with contempt on a case-by-case basis according, inter alia, to the degree of personal fault revealed by the circumstances of the case.”

1. Whilst there was a divergence of views between Justices Keane and Jerrard in Lade’s case, I respectfully adopt and apply the Justice Keane’s reasoning. If I am in error in so doing, I am satisfied that Mr Dooney’s non-compliance is not “casual, accidental or unintentional”.

1. Apparently, on 11 September when the order was made, Mr Dooney held the view he could provide the guarantee in the terms agreed.  At some unspecified date his view changed. The affidavits of Mr Dooney and his brother Timothy Dooney, who is also his financial advisor, are light on detail and vague in their terms.  They do, however, establish the following matters.

1. Since the order was made on 11 September, there has been no attempt by or on behalf of Mr Dooney to raise the required guarantee.

1. Curiously, approaches were made to financiers to raise a bond between March and May this year which were apparently unsuccessful.  This is curious because, at that time, there was no order requiring a bank guarantee to be provided. Details of what Mr Dooney applied for, the basis for the applications and the reasons for refusal are absent. In his affidavit, Mr Timothy Dooney makes expansive and non-specific assertions about these enquiries which do not inspire confidence that all that could have been done was done to comply with the order.

1. The value of properties owned by the first and second respondents & associated cos is $137,184,000. The current liabilities are $91,496,500. The net equity is $45,687,500. I accept the full value may not be realised on a forced sale, but the size of the net equity compared with the bond ordered calls into question the bald assertion made by Timothy Dooney that no financier would be prepared to give a bond of $546,256 as there is no security available to that financier.” 

1. Mr Dooney explains his willingness to consent to the 11 September orders by reference to a contract for sale of some property which has since fallen through. The settlement date for the contract fell before the 11^th of September. Mr Dooney did not explain why, on 11 September, he still believed the sale would proceed, even though the settlement date had passed.  Nor is it clear when he learned the contract would not proceed.

1. At some indeterminate point, he formed the view he could not comply with the order. I am not persuaded on the material before me that it was not possible to obtain the guarantee.

1. Nevertheless, even if Mr Dooney’s conclusion was correct, he took no steps to draw that to the court’s attention.  An order of the court must be obeyed.  Those who wish to be relieved of its burden must do so by the proper course – either appeal it or seek to vary it. The failure to shoulder that responsibility is a relevant factor in considering whether Mr Dooney’s non-compliance was casual, accidental or unintentional.  Repeated requests by the Council’s lawyers to provide the bond went unanswered, save for a request for 1 month’s extension. Council did not purport to and could not have extended this court’s order.  A month did pass before the Council brought this application.  Mr Dooney does not explain what he had hoped to achieve in that time or why his hopes were not realised. 

1. Mr Dooney and his brother have focussed their attentions on action taken by financiers between June and November under securities over group assets. Recently, it appears Mr Dooney has made concerted efforts to sell group assets.  There are a number of contracts now on foot.  The group’s financial position will be improved if they are completed. The financial circumstances of the group form part of the context in which Mr Dooney’s non-compliance must be weighed in deciding its consequence.  They do not establish his non-compliance is casual accidental or unintentional. I find Mr Dooney’s non-compliance with the court order is wilful in two respects: firstly I am not satisfied that it is not possible for him to comply with it or that all reasonable steps have been take to so do; secondly Mr Dooney’s failure to seek a variation of or relief from an order he was not complying with was a deliberate omission.

1. The choice Mr Dooney made to leave an unsatisfied order in place is consistent with a pattern of disregard for court orders and a passive approach to the proceedings. Time and again the burden of engaging the court to deal with non-compliance has fallen upon Council and other respondents, owners of lots held out from dealing with them until remediation works are completed. 

1. Mr Dooney also argued that the requirement to provide a bank guarantee was in effect a monetary order which cannot be enforced by contempt proceedings. (Bakir v Doueihi & Ors) This case is distinguishable from one where a party employs the procedure for contempt to ensure payment of an amount ordered to be paid by the court. The guarantee is not a payment of money to the Council.  Further it does not secure a debt currently payable to it.  Its purpose is to secure a fund should Council choose to exercise the leave granted to it to enter and undertake the remediation works should the first and second respondents fail to perform them.  There is no debt currently due to the Council which it could otherwise enforce.

1. When dealing with contempt constituted by non-compliance with a court order the paramount consideration must be to secure performance. (Australasian Meat Industry Employees' Union v Mudginberri Station Pty Ltd at 107)  That imperative is of particular importance here as the guarantee was directed towards securing compliance with a programme of remedial works, which has been varied on a number of occasions as a result of the respondents’ non-compliance with schedules prepared and proposed by them to the court.

1. Mr Dooney argues there should be no finding of contempt and that the proceedings should be adjourned until the end of January 2009.  By then, he believes his financial position and that of the first respondent and its associated companies will have improved sufficiently that remedial works can be undertaken. I am not persuaded that is appropriate.

1. I am satisfied that Mr Dooney is in contempt of this court’s order of 11 September 2008 to which he consented without adjudication. Having made that finding, I may make any order that may be made under the Penalties and Sentences Act. I have been asked to impose a period of imprisonment but suspend it pending provision of funds and information about the sale contracts and an account for the proceeds of those sales. Imprisonment is a penalty not to be lightly imposed.  As the parties only have now my findings in relation to the contempt, it is appropriate that both have an opportunity to make submissions about penalty. Given the history of this case a term of imprisonment is certainly open. However, I am not minded to pass sentence without hearing further from the parties about penalty and without affording Mr Dooney an opportunity to purge the contempt. To that end I will adjourn the further hearing of this application until Thursday 29 January 2009 in Southport.

1. Mr Dooney is hopeful that his latest efforts to sell group assets will prove fruitful. Council has indicated some willingness to revisit how funds obtained from property sales can be best applied to remediate this site. I trust Mr Dooney will understand that it is in his best interests to work with Council with a view to achieving the objective of the court’s orders. I will hear from the parties on the 29^th of January as to what sentence should be imposed given these findings and in light of actions Mr Dooney takes in the interim to purge the contempt and remediate the site.

1. I will also deal with the question of costs on the return date.

1. My orders are:

1.          Mr Dooney is in contempt of the Planning & Environment Court by his non-compliance with the order that he provide an unconditional bank guarantee in the terms required.

2.          The application is adjourned for further hearing on 29 January 2008 to provide Mr Dooney with the opportunity to purge his contempt and for the parties to make further submissions as to penalty.

3.          Costs are reserved.