Harrison v City of Mount Gambier (Local Government Authority) - [2015] SASC 19

SUPREME COURT OF SOUTH AUSTRALIA
(Magistrates Appeals: Civil)
HARRISON v CITY OF MOUNT GAMBIER (LOCAL GOVERNMENT AUTHORITY)
[2015] SASC 19
Judgment of The Honourable Justice Gray
17 February 2015
LOCAL GOVERNMENT - REGULATION AND ADMINISTRATION - FINANCE - FEES AND CHARGES
MAGISTRATES - HEARING - PROCEDURAL FAIRNESS AND NATURAL JUSTICE
MAGISTRATES - JURISDICTION - GENERAL MATTERS - GENERALLY
Appeal against order authorising the issue of a warrant of possession made by a Magistrate. The appellant ratepayer had been in arrears of rates owed to the respondent Council for more than three years. On 5 March 2014, the Magistrate made orders issuing a warrant of possession but staying that warrant for a period of one month. A money judgment was entered in favour of the Council in the sum of $6,627.50. On 10 April 2014, the period of the stay having expired, the Court issued a warrant of sale in the amount of $6,807.50. On 12 May 2014, the Council applied to withdraw its request for the issue of a warrant of sale and instead applied for an issue of a warrant of possession. That application was not served on the appellant and the matter proceeded ex parte. The Magistrate issued a warrant of possession.
Whether the Magistrates Court had jurisdiction to order a warrant of possession. Whether the notice of intention to sell land for non-payment of Council rates was defective. Whether the Magistrate erred in failing to recognise and give effect to the tender by the appellant of a bank cheque in the amount of $6,807.50. Whether the appellant was denied procedural fairness in that the order of 12 May 2014 was made ex parte and without notice.
Held (allowing the appeal):
1. There was a want of procedural fairness in the matter proceeding on 12 May 2014 without notice to the appellant.
2. The orders of the Magistrates Court of 5 March and 12 May 2014 are set aside.
Local Government Act 1999 (SA) s 184, referred to.

HARRISON v CITY OF MOUNT GAMBIER (LOCAL GOVERNMENT AUTHORITY)
[2015] SASC 19
Magistrates Appeals: Civil
GRAY J.

This is an appeal against orders authorising the issue of a warrant of possession made by a Magistrate. On 10 February 2015, I made orders allowing the appeal and setting aside the orders of the Magistrate. My reasons follow.
The plaintiff and respondent, the City of Mount Gambier, is a Local Government Authority constituted under the provisions of the Local Government Act 1999 (SA). The defendant and appellant, Paul John Harrison, is the registered ratepayer for residential property in respect of which the plaintiff levies rates.
It is not in dispute that Mr Harrison owed arrears of rates to the City of Mount Gambier. The payment of rates had been in arrears for more than three years. On 27 August 2013, the City of Mount Gambier gave a notice of intention to sell the relevant property, claiming a total liability as at 15 August 2013 of $6,168.50. This notice was sent to Mr Harrison by registered post. Mr Harrison did not respond.
On 13 January 2014, an application was made to the Mount Gambier Magistrates Court by the City of Mount Gambier seeking the issue of a warrant of possession. In an affidavit in support of the application, it was asserted that the City of Mount Gambier required Mr Harrison to vacate the land and asserted that the Council had been unable to take vacant possession of the land. It was said that, in consequence, a warrant should be issued to the Sherriff to take possession of the land. The only remedy sought by the Council was that the Registrar of the Court sign a warrant of possession. The application came on for hearing on 3 February 2014. The solicitor for the City of Mt Gambier attended by telephone and Mr Harrison appeared in person. The proceeding was adjourned. On 5 March 2014, a further directions hearing was held and solicitors attended for both parties. Orders were made by the Magistrate issuing a warrant pursuant to the application but staying the warrant for a period of one month from 5 March 2014. A money judgment was entered in favour of the City of Mount Gambier in the sum of $6,168.50, together with costs of $459.00, leading to a total judgment of $6,627.50.
On 10 April 2014, the period of the stay having expired, a warrant of sale was issued pursuant to the order of the Court in the amount of $6,627.50, together with a further fee of $180.00, making a total of $6,807.50. On 28 April 2014, Mr Harrison’s solicitor advised the solicitors for the City of Mount Gambier that Mr Harrison had the judgment sum available to be paid and required the Council to discontinue the action. On 30 April 2014, the City of Mount Gambier responded that, in addition to the amount claimed on the warrant of $6,807.50, the City of Mount Gambier claimed further costs of not less than $2,364.06. On 1 May 2014, Mr Harrison attended the Mount Gambier Magistrates Court and tendered a bank cheque in the amount of $6,807.50. The Court refused to accept the cheque.
On 2 May 2014, the bank cheque was reissued in the amount of $6,807.50 and tendered to the solicitors for the City of Mount Gambier. The bank cheque was returned to Mr Harrison’s solicitors with a note that the solicitors for the City of Mount Gambier did not have instructions to accept that amount in satisfaction of the claim for arrears of rates and costs.
On 12 May 2014, the City of Mount Gambier applied to withdraw its request for the issue of a warrant of sale and instead applied for the issue of a warrant of possession. The application was listed for later the same day. The application was not served and the matter proceeded ex parte. The City of Mount Gambier was represented by a person who was not a qualified legal practitioner. The Magistrate issued a warrant of possession in the terms of the draft warrant filed that day. On 22 May 2014, Mr Harrison applied to set aside the warrant of possession and, alternatively, sought a stay of the warrant.
On 4 June 2014, Mr Harrison appealed to this Court against the order made by the Magistrate on 12 May 2014. The grounds of appeal asserted that the Magistrate’s Court had no jurisdiction to order a warrant of possession, that the notice of intention to sell land for non-payment of Council rates was defective, that the Magistrate erred in failing to recognise and give effect to the tender by Mr Harrison of a bank cheque and that, finally, Mr Harrison was denied procedural fairness in that the order of 12 May 2014 was made ex parte and without notice. It was further claimed that the earlier order for the issue of a warrant of sale made on 10 April 2014 was also made without Mr Harrison having an opportunity to be heard.
The Appeal
During the course of the hearing of the appeal, Mr Harrison accepted that he was in arrears with the payment of rates over a three year period and that he was liable to pay the amount of those rates together with interest, costs and fees. It was his case on the appeal that the amount of $6,807.50, being the judgment sum, was the full amount owing. At the suggestion of the Court, this amount was paid into the Suitors’ Fund of this Court on the basis that Mr Harrison claimed that this was all that was owing. The City of Mount Gambier maintained its position that this amount did not satisfy all outstanding amounts payable by Mr Harrison, but it was agreed that the monies could be paid out of Court without prejudice to the claim by the City of Mount Gambier that it was entitled to further amounts. Subsequently, the amount that was paid into Court has been paid out to the City of Mount Gambier. The remaining dispute related to the assertion of the City of Mount Gambier that a further amount of costs associated with the warrant were payable. Both parties also initially sought orders for the costs of the appeal. The further claim for costs by the City of Mount Gambier was not particularised beyond a claim for a general amount of not less than $2,364.06.
A review of the Magistrates Court file discloses that no reasons were given by the Magistrate for any of the orders made.
It is convenient to first address the complaint about the issue of a warrant of sale on 10 April 2014. On 13 January 2014, the City of Mount Gambier by its solicitors made application for the issue of a warrant of possession of property owned by Mr Harrison in respect of which it was said that rates had been in arrears for more than three years. The application asserted that the City of Mount Gambier sought to discharge its obligations to sell the land and wished to take possession pursuant to section 184 of the Local Government Act 1989 (SA). A solicitor acting for the Council filed a supporting affidavit which set out the relevant facts said to support the issue of a warrant of possession. The affidavit attached an amended notice advising of the Council’s intention to sell the property if the total liability for rates then said to be outstanding of $6,168.50 was not paid within one month of the service of the notice. The affidavit also exhibited evidence that relevant documents had been served by registered post on Mr Harrison. The affidavit also exhibited a Form 29 warrant of possession.
When the matter came on for hearing on 3 February 2014, the Magistrate’s fiat records that the Council’s solicitor attended by telephone, Mr Harrison attended in person, the matter was adjourned to 5 March 2014 and a note was made that Mr Harrison was to provide a concrete proposal to pay the outstanding rates.
On 5 March 2014, the matter came on for hearing in the presence of solicitors for both parties and the Magistrate’s fiat records that a warrant was issued pursuant to the application and the warrant was stayed for a period of one month. Following the application, the solicitors for the Council requested the issue of the warrant and attached to their request a Form 29 warrant of possession.
On 8 April 2014, the solicitors for the City of Mount Gambier made a request to the Registrar in which it was asserted that the total amount owing was $6,807.50 and that the judgment debtor was Mr Harrison, and sought an issue of a warrant of sale. Attached to the request was a Form 29 warrant of possession. In the covering letter, the solicitors asserted that they had included not only a Form 29 warrant of possession but also a Form 18 warrant of sale. The file reveals that the solicitors for the Council had provided a Form 18 warrant of sale, asserting a judgment debt of $6,807.50, together with interest on balance accruing from date of issue and costs of executing the warrant of sale.
The file reveals that the Sherriff’s Office had received two warrants, one a warrant of sale and the other a warrant of possession. Contact was made with the solicitors for the Council, who confirmed that they had requested a warrant of possession. The Sheriff’s Office noted that the warrant of sale was signed and sealed, but that the warrant of possession was only sealed. The Sherriff suggested that clarification be sought from the Registry and that, if correct, the warrant of possession should be signed by the Magistrate.
It is to be recalled that both parties were represented before the Magistrate on 5 March 2014, when, according to the Magistrate’s fiat of that date, the Magistrate issued a warrant pursuant to the application and stayed the warrant for a period of one month. The application sought the issue of a warrant of possession. The order did not authorise the issue of a warrant of sale. There does not appear to be any basis for the issue of a warrant of sale. No order was made by the Magistrate in that respect.
Apparently, this was recognised by the solicitors for the City of Mount Gambier as an application was made on 12 May 2014 that the City of Mount Gambier have leave to withdraw its request for the issue of a warrant of sale and in lieu issue a warrant of possession. The application was listed for hearing on the same day at 2.45 pm. An affidavit in support asserted that on 8 April 2014, a Form 18 requesting the issue of a further process wrongly sought the issue of a warrant of sale.
A difficulty with this assertion is that the file reveals that an application for a warrant of possession, being a Form 29, had been forwarded to the Court and, at the same time, a warrant of possession had also been sought. The Magistrate’s fiat of 12 May 2014 notes the attendance of a solicitor for the Council, no attendance from Mr Harrison, and an order made for the issue of a warrant of possession in terms of the draft filed that day. The request to the Registrar on this occasion now asserted that the amount owing was $6,987.50.
To my mind, it is clear that Mr Harrison should have had notice of the further application of 12 May 2014. By this time, Mr Harrison had already tendered a bank cheque on 2 May 2014 in regard to the total claim of which he had been given notice by that date of $6,807.50. His attempts to resolve the outstanding claim by the tender of a bank cheque were rebuffed and then, without notice to him, application was made to the court for a warrant of possession in lieu of a warrant of sale for a greater amount. No explanation has been made of the failure of notice to be given to Mr Harrison or his solicitors of the application. Had he been given notice, the issue as to the adequacy of the amount tendered by way of bank cheque could have been discussed and, one might have expected, resolved.
To my mind, there was a want of procedural fairness in the matter proceeding on 12 May 2014 without notice to Mr Harrison. I repeat that, had notice been given, one would have expected that the matter would have been resolved. For this reason, I made an order allowing the appeal and setting aside the orders of the Magistrates Court of 5 March and 12 May 2014.
In these circumstances, it is unnecessary to resolve the question of the jurisdiction of the Magistrates Court to have issued a warrant of possession. The challenge to jurisdiction potentially raises difficult and complex questions and this is an entirely unsuitable vehicle in which to further address other grounds of appeal.
On 10 February 2015, the matter was called on for judgment. I indicated to the parties that I had reached the conclusion that the appeal should be allowed and the orders of the Magistrates Court set aside. I then invited the parties to make submissions on costs.
No explanation has been offered by Mr Harrison as to why he would let the arrears of rates accrue for more than three years. It is apparent that on 5 March 2014, he acquiesced, or at the very least did not object to, the issue of a warrant of possession and appears to have sought a stay of that warrant for a period of one month. At that date, the amount owing was $6,627.50. The warrant of sale issued on 10 April 2014 leading to the claim of $6,807.50 was not the subject of any order of the Court and should not have been made. As noted, it was later withdrawn pursuant to the request of the solicitors for the Council. Once Mr Harrison became aware that the tender of his bank cheque was rejected and that the City of Mount Gambier was proceeding with the warrant of possession, it was open to Mr Harrison to approach the Court to set aside the summons, pointing out that he had not been heard in regard to the proceeding on 12 May 2014 and that he wished to resolve the matter by payment of the amount owing by bank cheque. Rather than adopting this practical and expedient approach, he issued his appeal, proceeding to broaden the issues in dispute. Relevantly, on 5 March 2014, no objection was raised to the jurisdiction of the Court to issue a warrant of possession.
On the other hand, the City of Mount Gambier has caused much confusion by seeking a warrant of sale when that course was not authorised by any order of the Court. The Council should also have given notice to Mr Harrison when this error was sought to be addressed. The Council’s claim for further monies was not properly particularised or pursued.
In these circumstances, the parties agreed that the appropriate course was for no order to be made as to the costs of the appeal. Counsel appearing on behalf of the Council indicated that he had been instructed to give an undertaking that, having received the amount of $6,807.50 earlier paid into Court by Mr Harrison, the Council would not take any further action in relation to the arrears in rent. I consider this to be an appropriate course. In effect, Mr Harrison has agreed to abandon any claim for the costs of his successful appeal. In return, the Council has agreed that it will not pursue any claim for an amount in addition to the $6,807.50 that it has already recovered in relation to the unpaid rates.
Conclusion
For the above reasons, I made orders allowing the appeal and setting aside the orders of the Magistrate dated 5 March 2014 and 12 May 2014 authorising the issuing of a warrant of possession. The effect of my orders is that the claims by the Council in relation to the arrears of rates are satisfied.