Kim Maree Bolitho v Permanent Custodians Limited

[2009] NSWCA 168

NEW SOUTH WALES COURT OF APPEAL

CITATION:
Kim Maree Bolitho v Permanent Custodians Limited & Anor [2009] NSWCA 168

FILE NUMBER(S):

HEARING DATE(S):
19 June 2009

JUDGMENT DATE:
19 June 2009

EX TEMPORE DATE:
19 June 2009

PARTIES:
Kim Maree Bolitho
Permanent Custodians Limited
Mark Griffin Professional Real Estate

JUDGMENT OF:
Allsop P Giles JA Macfarlan JA   

LOWER COURT JURISDICTION:
Supreme Court - Equity Division

LOWER COURT FILE NUMBER(S):
1634/2009

LOWER COURT JUDICIAL OFFICER:
Gzell J

LOWER COURT DATE OF DECISION:
19 June 2009

COUNSEL:
Self represented (Appellant)
A C Casselden (Respondent)

SOLICITORS:
Self represented (Appellant)
Gadens Lawyers (Respondent)

CATCHWORDS:

LEGISLATION CITED:
Civil Procedure Act 2005

CATEGORY:
Principal judgment

CASES CITED:
Port of Melbourne Authority v Anshun Pty Ltd (No 2) [1981] HCA 45; 147 CLR 589

TEXTS CITED:

DECISION:
1.  Dispense with the rules in relation to the filing of any formal documents for the bringing of the application for leave to appeal.
2.  Grant leave to appeal.
3.  Subject to order 4 dismiss the appeal.
4.  Vary the orders of the primary judge by setting aside the order of the primary judge dismissing the summons.

JUDGMENT:

IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

1634/09

ALLSOP P
GILES JA
MACFARLAN JA

19 JUNE 2009

KIM MAREE BOLITHO v PERMANENT CUSTODIANS LIMITED & ANOR

Judgment

1. The judgment of the Court was given by ALLSOP P:  This is an application either by way of application for leave to appeal or an appeal from the refusal by the Judge of the Court (Gzell J) today to make orders restraining the defendants to a notice of motion and a summons from proceeding with a settlement on Monday morning next as to the sale of certain property in Avalon. 

2. The first defendant (“Permanent Custodians”) to the notice of motion and summons is represented by Mr Casselden.  The other defendants are not represented but the primary defendant is Permanent Custodians who is the mortgagee in possession of a property.

3. The controversy arises from mortgage security given by the plaintiff to the first defendant over property at Avalon in New South Wales.  I will not refer to the precise address of the property in accordance with the Court’s practice of not identifying properties which may assist in the wrongful taking of identities of parties.

1. The defendant is the first registered mortgagee of the property in question and the plaintiff is the registered proprietor of the property.  It was asserted that the plaintiff defaulted in her obligations to the first defendant under the mortgage.  The plaintiff asserts that her default was minor, nevertheless, the first defendant obtained judgment for possession of the property.  This is not an appeal from the order for possession.

2. The first defendant subsequently entered possession of the property.  There is a body of evidence led by the plaintiff as to matters connected with that entry into possession and the dissatisfaction in relation to events connected with that taking of possession.  It is unnecessary to resolve those matters given the precise nature of this application. 

3. On 20 February 2009 the plaintiff approached the Equity Division and obtained an injunction from the then Chief Judge in Equity (Justice Young) preventing the first defendant from auctioning the property the following day.  The reasons of the Chief Judge in Equity are on the file and need not be discussed at any length now.  It is sufficient to say that his Honour indicated that the mortgagee was required to attend to its obligations in relation to the selling of the property. 

4. The matter next came before the court in early March before the now Chief Judge in Equity.  Her Honour identified in her judgment of 12 March that there were competing applications brought by the parties on that day, one of which was to discharge the injunction granted by Justice Young on 20 February.  Justice Bergin’s judgment of 12 March is on the file and there is no present need to recount it in any detail.  Suffice it to say, that her Honour on that occasion refused the application to discharge the injunction on that day, however her Honour varied the terms of it, in particular she vacated the words “until further order” and extended the time during which the injunction remained in place up to and including 5pm on 9 April.  Her Honour listed the matter before herself on 9 April.

5. From what has been said to the Court today and what is plain from her Honour’s reasons it appears that her Honour was mindful of the personal importance of the matter to the parties, in particular Ms Bolitho, and she urged the parties to consider mediation.

6. The material before Justice Bergin on that day as described by her Honour indicated that the mortgagee was contemplating sale of the property at a sum in the order of $700,000.  The matter came before the Equity Division on 9 April.  On that day Ms Bolitho was represented and orders by consent were made.  Those orders were in substance as follows:

   1The court referred the matter to mediation by a court appointed mediator;

2             The matter be listed for directions on 21 May.

1. The Court noted that the first defendant was entitled to market the property from 9 April and that the first defendant undertook not to enter into any contracts of sale before 15 May 2009.  It is to be noted that the injunction, as varied by Bergin CJ in Eq on 12 March was not extended.  The parties anticipated mediation and no doubt hoped for a satisfactory resolution.

1. The matter proceeded to mediation. There is some evidence in relation to that process. There was also a number of matters stated from the bar table about the conduct of the mediation. It was asserted by Ms Bolitho that from the way the mediation proceeded and in the light of subsequent events it could be concluded that the first defendant had failed to approach the mediation in good faith with a view to resolution of the matter. The material before the Court is inadequate to draw the conclusion that those participating on behalf of the first defendant in any way breached the obligation contained in s 27 of the Civil Procedure Act as to the conduct of mediations in good faith.

2. It is unnecessary to resolve that matter in any event for the purposes of today’s application, but we repeat there is insufficient evidence before this court to make out that conclusion.

3. The property was listed for auction on 16 May. That is a date that conforms with the time for auction that was noted by the court on 9 April, that is, not before 15 May.  Much of the body of complaints made by the plaintiff concern the background to and the conduct of the auction on 16 May.  In summary, the allegations made by Ms Bolitho are that the advertising of the property prior to the auction was both inadequate and misleading.  Secondly, that in all the circumstances of the advertising and the conduct of the auction it can be concluded that the property was either deliberately or recklessly sold at a gross undervalue, as much, it is said, as one-third of its value.  The third complaint concerning the auction was what was said to be the exclusion of the plaintiff’s partner, Mr Kelleher, from participating as a bidder at the auction for reasons which it is implicitly said were specious.  These matters taken together are said to amount to a dereliction of the duty of the mortgagee to act in accordance with its obligations in relation to obtaining the best possible price.  

4. There is no satisfactory evidence before the Court that the third party purchasers, who are not parties to the proceedings, had knowledge or notice of the inadequacy of advertising or other matters of complaint or that they were in any way complicit in that alleged behaviour.   To the extent that it may be able to be the subject of satisfactory proof that the mortgagee has wrongfully abandoned the interests of the mortgagor, the plaintiff, that is a matter capable of being vindicated in an independent action compensable in damages.  That is not, however, the present question which this court on appeal has to deal with.  We draw no conclusions about the legitimacy of the serious allegations made against the first defendant by the plaintiff.   The evidence before us is inadequate to draw the serious conclusions necessary to implicate the first defendant in that conduct.

5. The present question for us is whether exercising the powers and obligations of a Court on a re-hearing of the issues on appeal from Gzell J we should restrain one party to a contract from attending a contractually agreed settlement of a contract with a purchaser who is an independent third party and not a party to these proceedings and apparently, at least on the evidence, not a party who is implicated in the complaints.  This question arises also in circumstances where the plaintiff on 9 April consented to the sale process proceeding on the day it did, albeit not of course subject to the defects, if they existed, that she complains about.

6. In his final paragraph of his reasons the primary judge, Gzell J, said:

   “In my view damages are an adequate remedy and as a matter of discretion the balance of convenience favours allowing the settlement of the sale to take place on Monday, there being nothing to suggest that the successful bidder or bidders at the auction were other than bona fide purchasers without notice of any of the matters claimed by the plaintiff to be fraudulent.  I therefore dismiss the motion and dismiss the summons.”

7. It is not necessarily apparent to us that the proceedings before his Honour were interlocutory, nevertheless, his Honour appears to have treated them as such.  To the extent that they may be seen as interlocutory leave is required to appeal.  Given that the plaintiff below and the applicant here is a litigant in person no objection could properly be taken to the grant of leave to regularise any defect that might arise from the matter being interlocutory.

8. We should add at this point that the appeal was brought on an expedited basis without the formality of any notice of appeal or application for leave to appeal and to the extent necessary we make an order dispensing with the operation of the rules to permit that course to be taken nunc pro tunc.

9. The essential basis of his Honour’s declining of relief was that there was inadequate evidence or lack of evidence to implicate the third party purchasers in what is said to be the serious wrongs.  His Honour recognised, as we have explained, that should there be a cause of action for the wrongs identified and should proof be adequately maintainable as to the asserted conduct of the first defendant then an action would lie.  However, his Honour indicated in a manner with which we respectfully agree that there was no basis to restrain the completion of the contract with the independent third parties. 

10. For these reasons the orders that we propose to make are as follows.

1.Dispense with the rules in relation to the filing of any formal documents for the bringing of the application for leave to appeal or the appeal.

2.            To the extent that leave is necessary grant leave to appeal.

3.            Subject to order 4 dismiss the appeal.

4.Vary the orders of the primary judge by setting aside the order of the primary judge dismissing the summons.

1. The purpose of taking the course in order 4 is not to in any way interfere with his Honour’s refusal of an injunction to restrain the completion.  However, there may conceivably be an argument that if the summons is dismissed without more, the principles of Port of Melbourne Authority v Anshun Pty Ltd (No 2) ([1981] HCA 45; 147 CLR 589) may prevent the plaintiff litigating any personal action for damages to vindicate what she says are the wrongs that have been committed by the first defendant as mortgagee.

1. Such a matter would necessarily have to be pleaded in a statement of claim and properly articulated but it may be open to argument that the summons now filed is the proper vehicle in which to encapsulate that action therefore if the court were to uphold the dismissal of the summons that order may prevent the plaintiff in due course in seeking to vindicate her personal action should she be so advised and so decide.

2. For those reasons we would in substance dismiss the appeal but vary the order in the manner that we have identified.

1. The orders that we have proposed will be the orders of the court.  Is there any other order sought?

1. CASSELDEN:  I don’t seek any other order.

2. ALLSOP P:  Very well, thank you.  Mr Casselden does not seek any other order which means that there will be no order as to the costs of the appeal.

   **********

LAST UPDATED:
30 June 2009