Huang v Drumm

[2017] NSWSC 1515

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:	Huang v Drumm [2017] NSWSC 1515
Hearing dates:	3 November 2017
Date of orders:	07 November 2017
Decision date:	07 November 2017
Jurisdiction:	Common Law
Before:	Harrison J
Decision:	The summons should be dismissed with costs.
Catchwords:	COSTS – where plaintiff seeks an order staying the enforcement of costs orders made against her in separate proceedings – where plaintiff awaits a final costs decision in further proceedings – where plaintiff is concerned that enforcement of the current costs orders may frustrate her anticipated costs victory in the separate proceedings – where plaintiff’s reasonable prospects of success cannot be assessed in this Court – where defendant is entitled to the fruits of his judgment
Category:	Principal judgment
Parties:	Biru Huang (Plaintiff) Bernard Joseph Drumm (Defendant)
Representation:	Counsel: D Elliott (Defendant)   Solicitors: Lander & Rogers (Defendant)
File Number(s):	2017/329457
Publication restriction:	Nil

Judgment

1. HIS HONOUR: By her summons filed on 1 November 2017, Biru Huang seeks an order staying the enforcement of costs orders made against her in separate proceedings in the Local Court, in each case confirmed on appeal to the Common Law Division of this Court, pending an awaited decision in the Court of Appeal in yet further proceedings. Ms Huang’s application is supported by an affidavit sworn on 31 October 2017.

2. For the reasons that follow, I consider that the application should be dismissed.

3. Ms Huang’s concerns stem from the terms of a letter that was sent to her by Lander & Rogers, Lawyers, on 26 October 2017. That letter serves to some extent to explain the position in which Ms Huang finds herself and is relevantly as follows:

“1. We refer to previous correspondence.

Costs Order 1: Supreme Court of New South Wales Proceeding No. 2016/291992

2. On 29 September 2016, you filed a summons seeking to appeal from orders made by Magistrate Atkinson in the Local Court proceedings.

3. Adams J dismissed the appeal, and ordered that you pay Mr Drumm’s costs as agreed or assessed.

4. Mr Drumm’s costs have been assessed in the sum of $12,907.43. We filed the costs certificates and on 3 July 2017 judgment was entered in the Local Court for that amount. Interest continues to accrue in accordance with s 101 of the Civil Procedure Act 2005.

5. Mr Drumm caused a garnishee notice to be issued to the Commonwealth Bank of Australia. A payment of $178.47 was received from the garnishee. Accordingly, the outstanding balance of that judgment is $12,728.96.

Costs Order 2: Supreme Court of New South Wales Proceeding No. 2017/176611

6. On 13 June 2017, you filed a summons seeking to appeal from the orders made by Magistrate Barnett SC in the Local Court proceedings.

7. Adamson J dismissed the appeal and ordered indemnity costs fixed in the sum of $11,000, which were to be paid by 23 August 2017: Huang v Drumm [2017] NSWSC 1006. Again, interest continues to accrue in accordance with s 101 of the Civil Procedure Act 2005.

Payment of Costs order 1 and 2

8. The total amount outstanding of costs order 1 and 2 amounts to $23,728.96.

9. We are instructed that if you do not pay the above costs orders by 5.00pm, 31 October 2017, our client will take enforcement steps.

10. The enforcement steps may include issuing a bankruptcy notice, a charging order against your home, or the issue of a writ to the Sheriff to sell your property.”

4. This letter went on to refer to costs that Ms Huang has been ordered to pay to Mr Drumm in two other proceedings, by Judge Olsson on 25 August 2017 and by Registrar Bradford on 21 September 2017 respectively. These costs have so far not been assessed or agreed and Mr Drumm is therefore not presently in a position to enforce payment. They can be disregarded for present purposes.

5. In addition to these several sets of proceedings, Ms Huang is also a litigant in the Court of Appeal against Mr Drumm, having filed a Notice of Intention to Appeal from a decision of Williams DCJ in the District Court. As far as I am able to determine, those proceedings have been determined favourably to Ms Huang, save for the question of who should pay the costs. That issue has been reserved by the Court of Appeal. It is sufficient to note that, by reason of the somewhat unusual nature of the issues in dispute in the Court of Appeal, the prospect that the costs of the appeal will follow the event, and therefore favour Ms Huang, cannot presently be assumed. Ms Huang’s costs in the Court of Appeal are estimated by her to be approximately $93,000.

6. Ms Huang is concerned that, in the event that she is successful in the Court of Appeal on the question of costs, her anticipated victory will or may be frustrated if Mr Drumm institutes recovery or enforcement proceedings against her for the costs he is owed in other proceedings in a way that either sequestrates her estate in bankruptcy or that leads to the loss of her home. Ms Huang in effect says that she has a set off, cross claim or cross demand that is sufficient to meet or to extinguish Mr Drumm’s costs entitlements, but that the realisation of her position depends upon the awaited decision from the Court of Appeal. It is implicit in her claims that Ms Huang acknowledges her indebtedness to Mr Drumm for the costs to which the Lander & Rogers letter refers, but that she seeks to postpone her obligation to satisfy those claims until the publication of the costs decision by the Court of Appeal. I take it to be the position that Ms Huang maintains that the net result when known will be that she becomes Mr Drumm’s creditor.

7. I have no material before me upon the basis of which, or by reference to which, I could form a view about the likely outcome of the proceedings pending in the Court of Appeal. That includes the fact that I have been provided with very detailed written submissions prepared for use in that Court by Mr Svehla of counsel for Ms Huang.

8. In my opinion there is no evidence to which I have been directed that would support the orders that Ms Huang seeks. To start with, the action foreshadowed by Lander & Rogers on behalf of Mr Drumm has not become manifest in the form of some tangible step, such as the application for the issue of a writ of possession or the service of a bankruptcy notice. Lander & Rogers have done no more than indicate that they have instructions to proceed to recover the outstanding costs if payment is not received by a nominated date. In that sense there is nothing by way of enforcement action that would be amenable to an order for a stay. Mr Drumm is entitled to the fruits of his judgments and cannot at this stage legally be prevented from seeking to recover them.

9. Secondly, to the extent that Ms Huang has reasonable prospects of success in the Court of Appeal, that Court is the only forum that could realistically assess those prospects. In the proceedings before me, Ms Huang asks me to assume that she will be successful in order to establish a basis to prevent Mr Drumm from proceeding to recover what he is owed. It would be irregular for me to proceed to act upon that assumption when its correctness is incapable of determination.

10. The burden of Ms Huang’s complaint is that Mr Drumm is proceeding improperly or unconscionably in the circumstances. I accept that there is a significant background of animus between Ms Huang and Mr Drumm, but I am unable to restrain Mr Drumm in steps to enforce a legal right simply upon the basis of Ms Huang’s assertions about his motives. If Ms Huang has any enforceable right to restrain Mr Drumm in the manner described, her only possible recourse would be in the Court of Appeal. In so saying, I offer no indication or prediction about her prospects of success there. I also reiterate that at present there is nothing in place that a court could properly restrain.

11. In these circumstances I consider that the summons should be dismissed with costs.

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Amendments

08 November 2017 - Typographical corrections