Golden Glory Pty Ltd v Deanne Louise Sacco

[2009] VSC 442

IN THE SUPREME COURT OF VICTORIA
AT MELBOURNE

PRACTICE COURT

No. 4932 of 2008

GOLDEN GLORY PTY LTD	Plaintiff
and
DEANNE LOUISE SACCO	Defendant

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JUDGE:	DAVIES J
WHERE HELD:	Melbourne
DATE OF HEARING:	14 September 2009
DATE OF JUDGMENT:	14 September 2009
CASE MAY BE CITED AS:	Golden Glory Pty Ltd v Deanne Louise Sacco
MEDIUM NEUTRAL CITATION:	[2009] VSC 442

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PRACTICE & PROCEDURE – Application for stay of execution of warrant for possession of property – Broad discretion to order stay – Whether proposed repayments would be sufficient to justify a stay – Whether there is any prospect that the property would not sell due to contamination so as to justify a stay – Rule 66.16 Supreme Court (General Civil Procedure) Rules 2005.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Ms L. Harrison	Robyn Calder
For the Defendant	Mr A. Herskope	Kalus Kenny

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HER HONOUR:

1. The defendant has applied pursuant to Rule 66.16 of the Supreme Court (General Civil Procedure) Rules 2005 for the stay of execution of a warrant for possession dated 1 July 2009.  The warrant for possession was issued following an order for possession of the property which was made on 4 February 2009.  That order for possession has not been challenged by the defendant.  The warrant was due to be executed at       1:30 pm today.  The plaintiff seeks to execute the warrant to enable the property in question to be auctioned on 29 September 2009.  I stayed the execution of that warrant until 4:00 pm this afternoon to enable the parties to complete their submissions before me. 

1. I have a wide discretion under Rule 66.16 of the Supreme Court (General Civil Procedure) Rules 2005 to stay execution in an appropriate case.[1]  The defendant relies on two bases for the stay.  The first is that the defendant seeks the opportunity to repay the debt, which the property secured, by way of instalments over a period of time.  The second basis is that there is some evidence to indicate that the taking of possession of the property for the purposes of sale may be a futile exercise because the property is unlikely to be sold at auction.

   [1]           Joskovitz v Bonnick [1964] VR 654.

1. The evidence reveals that the ability of the defendant to repay the debt by instalments depends upon her ability to continue to derive business income from the operation of the service station and mechanical workshop situated on the property.  Without that business income, she has no other means of repaying the debt.  Her husband is a bankrupt and works in the business as a mechanic.  Apart from the property and the service station business, the only other substantial asset that the defendant holds is her residence.  However, the net equity in that property, if sold, would not discharge the debt to the plaintiff. 

1. The defendant has put before the court some evidence concerning her capacity to repay the debt by way of instalments.  What she proposes are monthly payments in the sum of $4,333.  This proposed payment schedule is based upon her estimate of how much she would have available each month after meeting her living expenses and home loan repayments.  In turn, that is based upon financial accounts that have been prepared for the financial year which ended 30 June 2008 and financial statements for the period 1 July 2009 to 22 August 2009.  Those financial statements are not audited accounts.  The financial statements for the period from 1 July 2008 to 30 June 2009 have not yet been prepared and are not available.

1. The material before me falls far short of what I could confidently rely on to be satisfied that the defendant has the capacity to meet proposed payments of $4,333 per month or, indeed, any proposed payments.  I have before me evidence in a form that amounts to no more than assertions of her financial capacity to pay.  That evidence does not provide sufficient reason to disentitle the plaintiff from its right to possession of the property.

1. In my view, the evidence about whether the property is likely to be sold on 29 September 2009 at auction does not provide any greater weight in favour of the defendant.  In so concluding, I take into account the evidence filed on behalf of the defendant that the defendant's solicitor, Mr Kenny, had a conversation with Ms Calder, the solicitor for the plaintiff, in which Ms Calder told Mr Kenny on 25 August 2009 that: 

there was “no way in the world the property will be sold” given what [Mr Kenny] have put in the contract about the contamination of the property. 

1. An issue about the contamination of the property arises because the property has a long history of use as a service station and there is a quote before me in evidence that indicates that it will cost approximately $2 million to decontaminate the property.  Mr Rowe, who holds a power of attorney on behalf of the plaintiff, gave oral evidence before me today of a conversation he had had very recently with a Mr Murray Barker, the estate agent engaged to sell the property in which Mr Barker told him that there was a potential buyer for the property who would continue to use the property as a service station and mechanical workshop.  I cannot be satisfied that there is no prospect at all of the property being sold having regard to Mr Rowe’s evidence.

1. It was also submitted that if a warrant is executed and the defendant evicted but there is no sale of the property, the costs involved in the clean up of the property to make it saleable would clog up the equity of redemption and that is a factor I should take into consideration.  Again, on the evidence before me, I cannot be satisfied that there is absolutely no prospect of the property selling on 29 September 2009.

1. It was submitted that a Jones v Dunkel[2] inference should be drawn from failure of Ms Calder to give evidence to refute the content of the evidence contained in Mr Kenny's affidavit.  I do not accept that any Jones v Dunkel inference can be drawn.  The evidence goes no further and is no stronger than as at 25 August 2009, it was Ms Calder's opinion that the property would not be sold.  Since then some two weeks have elapsed and I have the evidence of Mr Rowe's conversation with the agent engaged to sell the property.

   [2](1959) 101 CLR 298.

1. For those reasons, the application is refused.

1. The orders that I will make are that:

1.The application by summons filed 14 September 2009 for a stay of execution of the warrant for possession dated 1 July 2009 is refused.

2.The defendant to pay the plaintiff's costs of and incidental to this application, to be taxed in default of agreement.

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