Jandric v Jandric [No 2] - [2007] WASC 273

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: JANDRIC -v- JANDRIC [No 2] [2007] WASC 273

CORAM: EM HEENAN J

HEARD: 24 OCTOBER 2007

DELIVERED : 24 OCTOBER 2007

PUBLISHED : 16 NOVEMBER 2007

FILE NO/S: CIV 1797 of 1998

BETWEEN: GOJKO JANDRIC
Plaintiff
AND
ELENA JANDRIC
First Defendant
REGISTRAR OF TITLES
Second Defendant

Catchwords:

Injunction - Interlocutory injunction - Discharge - Injunction gone stale after eight years - Interlocutory injunction to prevent sale of land pending trial of claimant's action alleging constructive trust - Action commenced but lapsed following springing order - Applicant became bankrupt - Trustee took no action to revive claim or institute fresh claim - Applicant discharged from bankruptcy - Defendant land owner applied for discharge of injunction - Applicant commenced fresh action but abandoned this because right remained in trustee in bankruptcy - Notice to trustee in bankruptcy to bring or abandon action - Section 60 of the Bankruptcy Act 1966 (Cth) - Trustee assigned right of action to claimant - Claimant commenced fourth action after application by land owner to dissolve injunction - Injunction discharged

Legislation:

Bankruptcy Act 1966 (Cth)

Result:

Interlocutory injunction discharged

Category: B

Representation:

Counsel:

Plaintiff:     Mr T Galic
First Defendant              :     Mr F Sammut
Second Defendant         :     No appearance

Solicitors:

Plaintiff:     Galic & Co
First Defendant              :     F Sammut & Co
Second Defendant         :     No appearance

Case(s) referred to in judgment(s):

Abeyratne v Trkulja (1998) 90 FCR 253
Aware Industries Ltd v Robinson (1997) 75 FCR 600
Blennerhassett v Scanlon (1826) 1 Hog 363
Coyne v Commercial Equity Corporation Ltd (1998) 20 WAR 109
Cummings v Claremont Petroleum NL [1996] HCA 19; (1996) 185 CLR 124
FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268
Green v Pulsford (1839) 2 Beav 70; (1839) 48 ER 1105
Jandric v Jandric [1999] WASC 22
Official Receiver in Bankruptcy v Schutlz (1990) 170 CLR 306
Re Bankrupt Estate of Cirillo (1996) 65 FCR 576
Re Carter [2000] FCA 1549
Willis v Yates (1834) Coop Temp Brough 498; (1834) 47 ER 177

EM HEENAN J: The plaintiff in this action, Mr Gojko Jandric, became bankrupt in 2002. Before then he had commenced two actions against the first defendant, Mrs Elena Jandric. The first (CIV 1797 of 1998) was an application for injunctive relief restraining the first defendant from dealing with particular land. An order granting such relief was made by Commissioner Buss on 18 May 1999. The second action (CIV 1571 of 1999) was commenced by writ of summons, filed on 25 May 1999, pursuant to the conditions upon which the injunction was granted by Commissioner Buss. In this the plaintiff asserted the existence of a constructive trust in his favour arising from alleged contributions made by him, in money and in kind, to the acquisition and construction of land and a home at Rockingham registered in the name of the first defendant. It had as its objective the vindication of the plaintiff's alleged equitable…

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.

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Details

Case: [2007] WASC 273
Decision Date: 24 OCTOBER 2007

CaseChat Overview and Summary

In the case of Jandric v Jandric [No 2], the central issue before the court was whether an interlocutory injunction, granted over eight years earlier, should be discharged. The injunction had been imposed to prevent the sale of land pending the outcome of a claim by the applicant, Jandric, alleging a constructive trust over the property. The case involves the complex interplay of bankruptcy law and property rights, with the property in question being held by Jandric's former spouse, Mrs Jandric. After the initial action lapsed due to non-compliance with a springing order, Jandric became bankrupt, transferring his claims, including the right to the injunction, to his trustee in bankruptcy. Following Jandric's discharge from bankruptcy, he sought to revive his claim, but this was hindered by the fact that the right to pursue the claim had vested in the trustee.

The legal issues for the court to resolve were whether the injunction could be discharged after such a lengthy period, and whether the failure to act on the claim by the trustee in bankruptcy justified the discharge. The court examined the effect of the bankruptcy and the subsequent transfer of rights to the trustee, as well as the trustee's inaction in pursuing the claim. The court also considered the principles governing the dissolution of injunctions and the circumstances under which an injunction may be deemed to have 'gone stale'. The decision hinged on whether the lapse of the original action and the subsequent bankruptcy proceedings justified the discharge of the injunction. The court found that the injunction had indeed become stale and was no longer justified, given the inaction of the trustee in bankruptcy.

The reasoning of the court was rooted in the understanding that an interlocutory injunction typically continues until trial or until it is dissolved by order, unless the underlying action is dismissed, in which case the injunction is discharged automatically. In this case, the second action had lapsed, and although the injunction was not granted in that action, it was still in force from the first action. The court acknowledged that the injunction was in a precarious state after the lapse of the second action and that the bankruptcy of Jandric transferred his rights, including the right to the injunction, to his trustee. Despite the opportunity for the trustee to pursue the claim, no action was taken, leading to the conclusion that the injunction should be discharged. The court ultimately determined that the injunction was no longer necessary and that it should be discharged, given the long period that had elapsed and the inaction of the trustee in bankruptcy.

Orders

Orders of the court

Interlocutory injunction discharged

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

The conclusion to be drawn from this, which Mrs Jandric's counsel urges, is that the second action thereupon lapsed - it seems to me that that is the correct conclusion to adopt: FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268. No attempt was then made by Mr Jandric to revive that action or, until very recently, to commence another action to vindicate his claim to the existence of a constructive trust over the Rockingham property. This does not mean that action CIV 1571 of 1999 disappeared without trace or lost all potential significance. Assuming that the effect of non‑compliance with the springing order had resulted in the action lapsing, or being struck out, there still remained the opportunity for Mr Jandric to apply for an extension of time to comply with the springing order and reinstate the action if he could show that the interests of justice required such a course: FAI General Insurance Co Ltd v Southern Cross Exploration NL. This present application is to discharge the interlocutory injunction granted by Commissioner Buss on 18 May 1999. The interlocutory injunction was not granted in the action which lapsed because of non‑compliance with the springing order (CIV 1571 of 1999) but, rather, in this first action (CIV 1797 of 1998). It was granted on conditions - namely, the prompt institution of the second action - in order to preserve the subject matter pending the determination of the claim in the second action or until further order. With the termination of the second action the reason for the interlocutory injunction disappeared. It seems to me, therefore, that if an application had then been made in the first action, the present proceedings, to dissolve the injunction, that result would have been extremely probable. That is not to say that Mr Jandric could not still have applied afresh for a further injunction, pending the re‑institution of his claim for relief had he sought to do so, but that was never attempted. There are many circumstances in which a party restrained or affected by an injunction may apply to the court for it to be dissolved. It is unnecessary to examine or review the many authorities dealing with occasions when injunctions may be dissolved but, except in the case of interim injunctions which last only to a specified date and which then cease to have effect unless extended, an interlocutory injunction will generally endure until trial or other order and its continuity will be presumed until then. On the other hand, if an action is dismissed an interlocutory injunction will be discharged automatically without any order for dissolution being necessary: Blennerhassett v Scanlon (1826) 1 Hog 363; Willis v Yates (1834) Coop Temp Brough 498; (1834) 47 ER 177; Green v Pulsford (1839) 2 Beav 70; (1839) 48 ER 1105. As a result, this injunction continued, albeit in an extremely precarious and fragile state, from the point at which the second action (CIV 1571 of 1999) lapsed. The next step in this long and sorry saga is that, on 21 October 2002, Mr Jandric became bankrupt. It follows from his bankruptcy, that all his property vested in his trustee in bankruptcy, including any choses in action, estates, interests or other claims which he had by way of a constructive trust or otherwise in the property registered in the legal ownership of Mrs Jandric: Bankruptcy Act 1966 (Cth), s 58, s 160. One of the items of property which therefore vested in the trustee in bankruptcy was the right, such as it was, for Mr Jandric to apply to the court, belatedly, for an extension of time to comply with the springing order in the second action (CIV 1571 of 1999) so as to be able to pursue that claim for relief arising from the alleged constructive trust.