James v Yerkovich - [2024] QSC 14

SUPREME COURT OF QUEENSLAND

CITATION:

James v Yerkovich [2024] QSC 14

PARTIES:

GINA KAARA JAMES

(plaintiff)

v
EILEEN ALICE YERKOVICH

(defendant)

FILE NO/S:

BS 5670/20

DIVISION:

Trial

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court of Queensland at Brisbane

DELIVERED ON:

9 February 2024

DELIVERED AT:

Brisbane

HEARING DATE:

5 February 2024

JUDGE:

Brown J

ORDER:

1. The application is dismissed.

2. The parties will be heard as to costs at 9:15am on Thursday 15 February 2024.

CATCHWORDS:

PROCEDURE – SUPREME COURT PROCEDURE – QUEENSLAND – PRACTICE UNDER RULES OF COURT – DEFAULT OF APPEARANCE – POWER TO SET ASIDE DEFAULT JUDGMENT – CAPACITY – where default judgment was granted in favour of the plaintiff – where no notice of intention to defend or defence was filed – where the defendant applies to set aside summary judgment – whether the defendant was a person with impaired capacity at the time of service – whether there are other irregularities – whether default judgment should be set aside on discretionary grounds

COUNSEL:

M T de Waard, for the applicant
P Travis, for the respondent

SOLICITORS:

Kelly Legal for the applicant
Axia Litigation Lawyers for the respondent

The court must decide whether to set aside a default judgment entered by Applegarth J on 12 November 2021. The application is brought by Ms Melissa Joy who is the litigation guardian for her grandmother, Ms Eileen Yerkovich, the defendant in the proceedings. Ms Gina James, the plaintiff, is Ms Yerkovich’s daughter. Ms James claimed that she had transferred her interest in a property at Maleny to Ms Yerkovich in circumstances where that transfer of title should be set aside.
There is no issue that the defendant was personally served with the proceedings in New Zealand and did not defend them. She was also served personally with the order made by Applegarth J on 12 November 2021. The principal basis relied upon by the applicant is that Ms Yerkovich lacked capacity at the time of the claim and statement of claim being served upon her in 15 May 2021 and should have been served pursuant to r 109 of the Uniform Civil Procedure Rules 1999 (UCPR). Other matters said to demonstrate the judgment was irregularly entered have also been raised by the applicant. Alternatively the applicant seeks to set aside the judgment on the basis that there are a number of discretionary matters which favour the judgment being set aide.
Default judgment was given by an order of this Court pursuant to r 288 UCPR. The default judgment declared that Ms Yerkovich and her daughter Ms James held a property at Maleny as tenants-in-common, with each having a half interest in the real property. The plaintiff’s earlier transfer of her legal interest in the property to the defendant on or about July 2011 was set aside in equity on the grounds of unconscionable dealing. Orders were also made to appoint statutory trustees for the sale of the property and provided that the plaintiff and defendant were…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading James v Yerkovich

Details

AGLC: James v Yerkovich [2024] QSC 14
Case: [2024] QSC 14
Decision Date: 9 February 2024

CaseChat Overview and Summary

The case of James v Yerkovich involved a dispute where a default judgment had been entered in favour of the plaintiff. The defendant, Ms Yerkovich, sought to have this judgment set aside on various grounds. The Supreme Court of Queensland was tasked with determining whether the default judgment should be upheld or set aside. The central issues were whether Ms Yerkovich had impaired capacity at the time of service, which would have necessitated a different service procedure under Rule 109 of the Uniform Civil Procedure Rules (UCPR), and if there were any other irregularities that impacted the entry of the default judgment.

The court examined several arguments presented by Ms Yerkovich. These included the claim that she had impaired capacity and thus should have been served under Rule 109 UCPR, which mandates special service provisions for persons with such impairments. Other grounds for irregularity included the relief granted in the judgment, which was not part of the relief claimed in the Statement of Claim, the lack of a proper certificate of service, deficiencies in the Statement of Claim itself, and the possibility that the action was statute-barred under the Limitation of Actions Act 1974 (Qld). The court also considered whether, in its discretion, the default judgment should be set aside under Rule 290 UCPR.

In ruling on these issues, the court referred to the case of Cusack v De Angelis, which emphasized that a defendant is entitled to have an irregularly entered judgment set aside. However, the court determined that none of the grounds presented by Ms Yerkovich warranted setting aside the default judgment. The court found that while there were procedural irregularities, they did not rise to the level of affecting the fundamental fairness of the judgment. Therefore, the application to set aside the judgment was dismissed.

The court scheduled a further hearing to address the issue of costs, to be held at 9:15am on Thursday, 15 February 2024.

Orders

Orders of the court

1. The application is dismissed.

2. The parties will be heard as to costs at 9:15am on Thursday 15 February 2024.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

A number of issues were raised in relation to the application which have to be determined by the court, firstly:(a)whether the defendant Ms Yerkovich was a person of impaired capacity such that they should have been served in accordance with r 109 UCPR;(b)whether there were any other irregularities that affected the entry of the default judgment. In that regard the applicant raises four other grounds as constituting irregularities, namely:(i)that the relief granted to appoint a statutory trustee to sell the property the subject of dispute was not part of the relief claimed in the Statement of Claim and was not justified on the pleadings;(ii)that service was not proven for the purposes of r 282 UCPR because the affidavit of service did not provide for a certificate in the approved form as required by rule 120(2)(a);(iii)the statement of claim fails to plead all material facts to prove the causes of action as required by rules 149(b) UCPR; and(iv)the action was statute barred pursuant to s 27 of the Limitation of Actions Act 1974 (Qld).(c)whether as a result of any irregularities and/or in the court’s discretion, the judgment should be set aside pursuant to r 290 UCPR.Default Judgment Rule 290 UCPR provides that:The court may set aside or amend a judgment by default under this division, and any enforcement of it, on terms, including terms about costs and the giving of security, the court considers appropriate. The case of Cusack v De Angelis [2008] 1 Qd R 344 examined authorities relating to the concept of regularity within the context of default judgement.[1] Muir J (with whom Lyons J agreed) observed that:[2][36] It has been long accepted that a defendant is entitled to have an irregularly entered judgment set aside as of right, subject to the exercise of a power of amendment and the futility of interfering with the judgment. Such judgments are the product of the exercise of administrative acts performed without legal authority. Irregularity, as that term is used in relation to default judgments, normally results from a failure to comply with the rules of court relating to the entering of default judgments.[37] But the concept of irregularity has been given a more extended meaning. A number of cases support the proposition that where judgment is entered for too large an amount, the defendant is entitled to have them set aside ex debito justitiae… (footnotes omitted) His Honour further noted that:[43] The cases in which default judgments have been held to be irregular are ones in which there was either some deficiency in the steps prerequisite to the entering of default judgment or an abuse of process or something akin to it resulting from the plaintiff’s obtaining a judgment to which the plaintiff knew or ought reasonably have known he or she was not entitled. … It is uncontentious that personal service Rule 109 UCPR provides for service on a person who suffers from impaired capacity. It is uncontentious that Ms Yerkovich was not served as provided under r 109 UCPR.

Ratio Decidendi

Legal Principle Established

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CITATION:	James v Yerkovich [2024] QSC 14
PARTIES:	GINA KAARA JAMES (plaintiff) v EILEEN ALICE YERKOVICH (defendant)
FILE NO/S:	BS 5670/20
DIVISION:	Trial
PROCEEDING:	Application
ORIGINATING COURT:	Supreme Court of Queensland at Brisbane
DELIVERED ON:	9 February 2024
DELIVERED AT:	Brisbane
HEARING DATE:	5 February 2024
JUDGE:	Brown J
ORDER:	1. The application is dismissed. 2. The parties will be heard as to costs at 9:15am on Thursday 15 February 2024.
CATCHWORDS:	PROCEDURE – SUPREME COURT PROCEDURE – QUEENSLAND – PRACTICE UNDER RULES OF COURT – DEFAULT OF APPEARANCE – POWER TO SET ASIDE DEFAULT JUDGMENT – CAPACITY – where default judgment was granted in favour of the plaintiff – where no notice of intention to defend or defence was filed – where the defendant applies to set aside summary judgment – whether the defendant was a person with impaired capacity at the time of service – whether there are other irregularities – whether default judgment should be set aside on discretionary grounds
COUNSEL:	M T de Waard, for the applicant P Travis, for the respondent
SOLICITORS:	Kelly Legal for the applicant Axia Litigation Lawyers for the respondent