| JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : LAW -v- GANNAWAY as administrator of the estate of NANCY CLOONAN HALL [No 2] [2011] WADC 195 CORAM : SWEENEY DCJ HEARD : 27 MAY 2011 DELIVERED : 8 NOVEMBER 2011 FILE NO/S : CIV 2509 of 2002 BETWEEN : MAURICE FREDERICK LAW CHERYL LAW
SPUNTER PTY LTD
Plaintiffs
AND
MICHELE-MAREE GANNAWAY as administrator of the estate of NANCY CLOONAN HALL
Defendant
Catchwords: Execution - Leave to issue execution more than six years after judgment Legislation: Civil Judgments Enforcement Act 2004 s 13, s‚103
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Result: Application for extention of time within which to appeal dismissed Representation: Counsel:
Plaintiffs : In person
Defendant : Mr C P Stokes
Solicitors:
Plaintiffs : Not applicable
Defendant : Chris Stokes & Associates
Case(s) referred to in judgment(s):
Audrey Francis Hall as Executrix of the Estate of Kenneth Duncan Hall v Chin [2008] WASC 255
Banque Commerciale SA en liquidation v Akhil Holdings Pty Ltd (1990) 169 CLR 279
Chin v Hall [2009] WASCA 216
Chin v Hall [No 2] [2011] WASCA 96
Dennehy v Reasonable Endeavours Pty Ltd [2001] VSC 447
Duer v Frazer [2001] 1 All ER 249
Gallo v Dawson (1990) 93 ALR 479
Geneva Finance Ltd v Bandy [2008] WASC 236
Hall v Hall [2007] WASC 34
Hall v Hall [2007] WASCA 94
Law v Hall [2008] WASCA 257
Law v Hall [2008] WASCA 257 (S)
Law v Hall [2009] WASCA 86
National Westminster Bank PLC v Powney [1990] 2 All ER 416; [1991] Ch 339
Solic v Bertossa [1969] VR 594
Spunter Pty Ltd v Hall (No 2) [2007] WASC 239
Spunter Pty Ltd v Hall [2006] WASC 6
Stone v Smith (1887) 35 Ch D 188
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1 SWEENEY DCJ: On 10 September 2002, the three plaintiffs, Maurice and Cheryl Law and their company Spunter Pty Ltd, commenced District Court action CIV 2509 of 2002 against the defendant Nancy Hall.
2 The action was pleaded in the statement of claim as a claim for an indemnity against various costs incurred by the plaintiffs on behalf of, and at the request of, the defendant, pursuant to the terms of a contract dated 5 October 2000 and then subsequent written authorisations from the defendant requesting the plaintiffs to pay certain of her accounts. The amount claimed was $144,871.47 together with interest on that sum. 3 On 10 October 2002, no appearance having been entered by Ms Hall to the action, this court ordered that 'the defendant do pay the plaintiffs $144,871.47 and interest in the sum of $690.62 and $777.00 costs'. On at least five occasions Ms Hall attempted unsuccessfully to have that default judgment set aside. On 13 January 2008, Ms Hall died. 4 On 13 October 2009, on an ex parte basis, Deputy Registrar Hewitt granted the plaintiffs leave to enforce that default judgment, leave being required because more than six years has elapsed since the judgment took effect: s 13(1)(a) of the Civil Judgments Enforcement Act 2004. He also gave leave to the plaintiffs to serve any application to enforce the judgment on Ms Michele-Maree Gannaway, Ms Hall's daughter and sole heir and the administrator of her estate. 5 On 15 April 2010, however, on the application of Ms Gannaway for those orders to be set aside or, in the alternative, that proceedings be stayed, Deputy Registrar Hewitt reversed his decision and set aside those orders. 6 It is against the reversal of his decision to grant leave to enforce the judgment that the plaintiffs now appeal. The notice of appeal was filed on 2 July 2010, 67 days out of time, so, to be successful, the plaintiffs also require an extension of time within which to appeal. 7 Mr Law, who is unrepresented, has previously been given leave by this court to 'represent' all three plaintiffs. 8 For the reasons which appear below, the application for an extension of time within which to appeal is dismissed.
Nature of the appeal 9 An appeal from a registrar of this court to a judge is a hearing de novo, meaning that the matter is heard afresh and a decision is given on (Page 4)
the evidence presented at the fresh hearing. It is not necessary therefore for the plaintiffs to demonstrate error on the part of Deputy Registrar Hewitt. I am considering the application which was made before him on 15 April 2010 as if it were being made before me. In effect, then, this is the administrator's application to set aside the orders of 13 October 2009 granting the plaintiffs leave to enforce the judgment or, in the alternative, to stay the proceedings. 10 While I may consider materials which were not before the deputy registrar and which have been filed since that application, I will not have regard to materials which have been forwarded to me by Mr Law since the hearing of this appeal. A statutory declaration and other materials were forwarded to my associate after the hearing of the matter and, as such, are attempted private communications upon which there has been no opportunity for the administrator to be heard and I have not considered those materials.
Did the learned deputy registrar have power to reverse his own order? 11 Previously, a fellow judge of this court suggested rather strongly to the parties that the deputy registrar may have lacked the power to recall his previous order, so that the administrator's proper remedy was an appeal against the order of 13 October 2009 granting leave. Counsel for Ms Gannaway was unable at the time to point his Honour to that power. Although that is not a ground of appeal, Mr Law has, not surprisingly, now adopted that argument in his submissions. In his written submissions dated 24 May 2011 Mr Law appears to be suggesting deliberate improper conduct on the part of the deputy registrar. The submissions, and those that follow dated 16 March 2011, contain many unsubstantiated and irrelevant assertions of fraud, dishonesty and incompetence against various people. 12 No application was made before me to add a new ground of appeal, and I indicated fairly early in the hearing that I considered there was power in the deputy registrar to reverse his order. 13 But because the suggestion that the deputy registrar lacked power to reverse his own order was one firmly raised by this court previously, and because of the derogatory tone of Mr Law's written submissions, I will deal with the submission here. (Page 5)
14 The power to reverse an order is to be found in s 103 of the Civil Judgments Enforcement Act 2004, which provides as follows: 103. Amending and cancelling orders etc. (1) If a court makes an order under this Act (the original order), a person — (a) who obtained the original order; (b) to whom the original order is addressed; (c) who is authorised to do anything under the original order; or (d) who is affected by, or whose property is affected by, the original order, may apply to the court for an order that amends or cancels the original order. (2) The court may make an order that amends or cancels the original order and may do so on terms as to costs or otherwise. … 15 The order of 13 September 2009 being the original order made under the Act, Ms Gannaway, either in her own right as Ms Hall's sole heir, or as administrator for her mother's estate, is a person who was affected by, or whose property was affected by the original order and was therefore able to apply to the court for an order that amended or cancelled the original order. I find that the deputy registrar did indeed have power to cancel his original order. 16 Counsel also relied upon s 9 of the Civil Judgments Enforcements Act but it seems to me that section does not take the matter further. It relates to the power of the court to review a decision of a prescribed officer of the court who does not constitute the court. The power is to be found in s 103 of the Act. 17 Section 15 also contains a power to stay proceedings, but it is clear from the deputy registrar's reasons that he revoked the leave he previously gave, rather than granted a stay. 18 As to Mr Law's other varying complaints about the deputy registrar contained in his written submissions, ranging from conflict of interest and (Page 6)
bias to assisting to cover up fraud, they are largely incomprehensible and utterly devoid of merit and I will say no more about them.
The more detailed background to this matter 19 This appeal is the latest application in a rather protracted set of proceedings involving various parties which have been launched in both this court and the Supreme Court. It assists understanding of this matter and, to an extent, assists the plaintiffs' position if I set out some of that history. Some of this has been captured in affidavits and some not, but it is a matter of public record. Although nine years have now elapsed since default judgment was entered, the plaintiffs have not lain idle all that time, although they have not encountered much success in their attempts to recover the debt. 20 The background to this matter has been encapsulated by several judges of the Supreme Court and, apart from my descriptions of the materials filed in this action, I have borrowed from them in the summary which follows, which draws on the following judgments: Spunter Pty Ltd v Hall [2006] WASC 6 (Jenkins J); Spunter Pty Ltd v Hall (No 2) [2007] WASC 239 (Simmonds J); Audrey Francis Hall as Executrix of the Estate of Kenneth Duncan Hall v Chin [2008] WASC 255 (Master Sanderson); Chin v Hall [2009] WASCA 216 (McLure P, Owen & Buss JJA); and finally Chin v Hall[No 2] [2011] WASCA 96 (Pullin & Newnes JJA). Some of those judgments are more directly related to this case than others, but all complete the picture of the background to this matter and also the various ways in which Mr Law has been engaged in this matter apart from the applications before this court. 21 There are two parallel sets of litigation which have been running for a number of years: an action between Audrey Hall and Nancy Hall (CIV 2073 of 2003) and then these proceedings in this court between Mr and Mrs Law and Spunter Pty Ltd on the one hand and Nancy Hall on the other (CIV 2509 of 2002). 22 The late Nancy Hall was the registered proprietor of two properties, one in Mount Lawley and one in Hazelmere. There was a registered first mortgage over both those properties in favour of Engineering Facilities Pty Ltd, the mortgages securing a loan of $350,000 made to Ms Hall in 1992. 23 In December 1994 her brother, Mr Kenneth Hall, lent Ms Hall $374,107 to pay out the loan from Engineering Facilities Pty Ltd and, as security for his loan, Mr Hall took a transfer of the two mortgages from (Page 7)
Engineering Facilities Pty Ltd. The transfer of those mortgages was registered on 12 December 1994 and so he then became the registered first mortgagee of both properties. 24 In 1995 Nancy Hall became bankrupt and her statement of affairs listed her brother Kenneth as a secured creditor and acknowledged that she then owed him at least $500,000. As part of the bankruptcy proceedings, Mr Hall lodged a proof of debt with the Trustee in Bankruptcy claiming that he held the first mortgage security in respect of a loan of $374,107 and also interest which had accrued of $18,387. 25 I now come, briefly, to the agreements the subject of proceedings in this court. On 5 October 2000 Spunter Pty Ltd, of which Mr and Mrs Law were the directors, and Mr and Mrs Law in their own rights as 'the Guarantors' executed a deed. It recorded that, on 25 September 2000, Spunter Pty Ltd, 'the Lender', had borrowed an unspecified sum of money from Citibank Ltd, secured by a mortgage over Spunter's property at Herne Hill, for the purpose of, firstly, lending Nancy Hall, 'the Borrower', $24,000 to enable her to repay an existing debt to a Mr Graeme Harris and, second, to assist Ms Hall to fund litigation seeking compensation for losses occasioned by a fire at her former premises of the Railway Hotel, Kalgoorlie. 26 The deed records that, in consideration of Spunter Pty Ltd and Mr and Mrs Law carrying out their promises, Ms Hall would indemnify and repay to the company and Mr and Mrs Law all costs and expenses and interest incurred by them in the loan from Citibank, in discharging the said loan and in preparing and stamping the agreement. Ms Hall further agreed to authorise, in writing, Spunter Pty Ltd and Mr and Mrs Law to pay accounts on her behalf in pursuing her claim for compensation in relation to the fire at the Railway Hotel. The plaintiffs' eventual writ in this court purported to be based upon this deed. 27 There were subsequent documents generated, but I will not complicate this history by detailing them here. I refer to them later, when I examine the plaintiffs' pleadings. 28 On 9 August 2001 Ms Hall's brother Kenneth died. Earlier that year he had executed his last will appointing his wife Audrey his sole executor and beneficiary of his estate. Probate was granted on 6 February 2002. 29 On 26 July 2002 Spunter Pty Ltd lodged two caveats on Ms Hall's properties in Hazelmere and Mount Lawley. (Page 8)
30 On 10 September 2002 Spunter Pty Ltd and Mr and Mrs Law commenced this action in this court: CIV 2509 of 2002. The writ was served and no appearance was entered. On 10 October 2002 default judgment was entered for the plaintiffs for the sum of $144,871.47 and interest and costs. 31 On 21 October 2002, a writ of fieri facias was issued by the plaintiffs in respect of the judgment amount, but the writ was returned unexecuted. 32 I return now to the registered mortgages held by Kenneth Hall, deceased, over his sister's Mount Lawley and Hazelmere properties. On 6 March 2003 his widow, Audrey Hall, served a default notice on Nancy Hall, which alleged that Ms Hall had failed to pay the principal sum and interest due under the mortgage. A further letter of demand requiring payment or vacant possession of the properties was left unsatisfied. On 3 September 2003 Audrey Hall instituted CIV 2073 of 2003 in the Supreme Court, in which she claimed the money outstanding under the mortgage and sought possession of the properties. 33 On 4 November 2003, a further writ of fieri facias was issued by the plaintiffs in this matter and filed with the Registrar of Titles against the Hazelmere property. 34 On 9 February 2005 Spunter Pty Ltd commenced action CIV 1142 of 2005 in the Supreme Court, in which it sought an extension of the two caveats that it had lodged over the Mount Lawley and Hazelmere properties in July 2002. On that same day, a further writ of fieri facias was issued and filed with the Registrar of Titles against the Hazelmere property, still in an attempt to execute upon the default judgment obtained in this action. It was returned unsatisfied. 35 On 2 March 2005 Nancy Hall filed a chamber summons in this court, together with an affidavit in support, seeking to set aside the default judgment entered in October 2002 in this action. It was listed for hearing on 8 March 2005. The notations on the summons suggest that there was initially no appearance for Ms Hall and her application was dismissed with costs against her. Another notation suggests Ms Hall turned up later and was told to make a fresh application. 36 Either by fresh application, or by that same application, the matter was listed for hearing on 18 March 2005. Ms Hall failed to appear and Deputy Registrar Harman ordered that her application be dismissed. (Page 9)
37 That same day Ms Hall filed another chamber summons applying to have the default judgment set aside. The matter was heard in chambers on 1 April 2005 before Groves DCJ who dismissed the application: Law v Hall [2005] WADC 75. 38 Judge Groves dismissed this application on two grounds: firstly, that the delay in bringing the application was not explained by material on affidavit and, further, 'there is no sufficient information or evidence which suggests that any credible defence is raised insofar as the issues the subject of the judgment are concerned'. His Honour pointed out numerous times during the argument of the matter and in his extemporaneous judgment that material contained within submissions is not evidence. His Honour also commented that Ms Hall had sought to rely upon many irrelevant matters. His Honour concluded: Ms Hall has indicated that she perhaps wants to call other evidence and witnesses to give evidence of other matters. Again, as I say, such matters as may be identified in the submissions which are not the subject of the basis of the application would be irrelevant. In my view no purpose whatsoever would be served in adjourning the application off to another appointment. The plaintiffs have a judgment which on the face of it was regularly obtained and regularly obtained some two and a half years ago. They have taken steps to protect that judgment by registering a writ of fi fa against land and in the face of the information which is before me there is no basis upon which I could set aside that judgment. 39 Ms Hall tried again, by a document filed 5 April 2005 and entitled 'interlocutory application to set aside default judgment of 10th day October 2002 that was refused on 1st April 2005'. She again failed to appear at the hearing of 22 April 2005 and Sleight DCJ dismissed the application. 40 Ms Hall tried again to set the default judgment aside, by a chamber summons dated 31 May 2005. The hearing took place on 21 June 2005 and Ms Hall was actually represented at that hearing by Mr Nicholas Chin. Registrar Kingsley dismissed her application and, in addition, ordered that 'any further application to set aside judgment be by way of leave from a judge of this court'. 41 On 19 December 2005, in the Supreme Court, Jenkins J heard the application on the part of Spunter Pty Ltd to extend its two caveats over the Mount Lawley and Hazelmere properties in CIV 1142 of 2005. Ms Hall, represented by Mr Chin, opposed the application. On 20 January 2006 Jenkins J extended the caveats on the condition that Spunter Pty Ltd commence proceedings within 21 days to determine whether it had acquired an equitable charge over the properties by virtue of the words in (Page 10)
a second deed dated 4 November 2000 to the effect: 'Spunter Pty Ltd ACN 002 179 375 (Maurice and Cheryl Law, Guarantors) shall have first call on my estate': Spunter Pty Ltd v Hall [2006] WASC 6. 42 On 7 February 2006 Mr Chin lodged a caveat over the Hazelmere and Mount Lawley properties for the purpose of protecting his solicitor's lien for unpaid legal fees. 43 On 10 February 2006, within the 21 days specified by Jenkins J, Spunter Pty Ltd and Mr and Mrs Law commenced CIV 1131 of 2006 in the Supreme Court, against Nancy Hall. They claimed, among other things, a declaration that the second deed created an equitable charge over her properties in their favour. Ms Hall entered an appearance to that action. That action eventually became inactive, having been stayed before the close of proceedings. 44 Meanwhile, in this court, the plaintiffs filed an application for an enforcement order on 23 February 2006 seeking a means enquiry and a property (seizure and sale) order relating to the Hazelmere property. 45 The means enquiry appears to have been left in abeyance, but a property (seizure and sale) order to the sheriff was issued by this court on 27 February 2006. 46 In August 2006 the trial in the matter of CIV 2073 of 2003, the action between Audrey Hall and Nancy Hall over the loan from her brother Kenneth, commenced. This was the action in which Ms Audrey Hall was suing for payment of money under the mortgages and also seeking an order for possession of the Mount Lawley and Hazelmere properties. Ms Nancy Hall was unrepresented. 47 After Audrey Hall presented her case, the trial judge, Jenkins J, adjourned the hearing to allow Nancy Hall to prepare her defence. When the trial resumed in November 2006, Nancy Hall failed to appear. There being no evidence before the court to contest Ms Audrey Hall's evidence, and the trial judge being satisfied of the veracity of that evidence, Jenkins J awarded judgment in favour of Audrey Hall for the principal sum of $374,107 plus interest at the agreed rate of 15% per annum, which had swelled the original principal sum to the final judgment sum of $2,301,010. Jenkins J also ordered that Nancy Hall deliver up possession of the Mount Lawley and Hazelmere properties: Hall v Hall [2007] WASC 34. Those properties were still caveated by Spunter Pty Ltd. (Page 11)
48 On 23 February 2007, upon the plaintiffs' application, the property (seizure and sale) order issued by this court was extended by another six months. 49 In March and April 2007 Nancy Hall brought several applications in the Supreme Court. She filed an appeal notice out of time against the orders made by Jenkins J on 19 February 2007 for the payment of monies and delivery up of possession of the two properties to Audrey Hall. She also applied for a stay of execution of those orders. On 27 April 2007 McLure JA dismissed the application for a stay of Jenkin J's orders and adjourned the application for an extension of time within which to appeal: Hall v Hall [2007] WASCA 94. 50 On 23 March 2007 Nancy Hall applied in CIV 1142 of 2005 to remove the caveats held by Spunter Pty Ltd over the two properties and also to set aside the default judgment given in this action in this court in October 2002. This was her last attempt to set aside the default judgment. On 19 October 2007 Simmonds J dismissed her application: Spunter Pty Ltd v Hall (No 2) [2007] WASC 239. Not surprisingly, Simmonds J decided that he had no jurisdiction to set aside a default judgment of the District Court. 51 On 13 January 2008 Nancy Hall died, intestate. 52 On 30 June 2008 Audrey Hall brought an action in CIV 1775 of 2008 against Mr Chin, Ms Hall's former solicitor, and Spunter Pty Ltd seeking the removal of their caveats over the Mount Lawley and Hazelmere properties. She sought the removal of the caveats so as to be able to sell the properties under the powers contained in the mortgage. 53 On 14 August 2008 she applied for summary judgment against both Mr Chin and Spunter Pty Ltd. That application was heard before Master Sanderson on 29 October 2008 who granted the application and ordered both Mr Chin and Spunter Pty Ltd to remove their caveats immediately: Audrey Francis Hall as Executrix of the Estate of Kenneth Duncan Hall v Chin [2008] WASC 255. In essence, Master Sanderson's reasons as against Spunter Pty Ltd were: Even if the second defendant did have some form of interest in the property which arose by the advance of money, it is an interest subordinate to the plaintiffs' interest as first registered mortgagee. That is enough to dispose of the second defendant's argument. The second defendant has no defence to this claim. (Page 12)
54 On 4 November 2008 in CACV 106 of 2008 Mr Law filed an appeal on behalf of Spunter Pty Ltd against the master's orders. The gravamen of his complaint was that Spunter Pty Ltd was never informed of the hearing of the application (although Master Sanderson did take into account an affidavit sworn by Mr Law in opposition to the application) and that, in any event, the mortgage held by Audrey Hall was a 'fictional' document. 55 In making that claim, Mr Law was borrowing, presumably, from Ms Nancy Hall's contention that the mortgage given to her brother was a sham arrangement and that he had never expected to be repaid. That contention was dismissed by Jenkins J in the trial in which Ms Nancy Hall presented no defence. Spunter Pty Ltd's appeal was dismissed on 4 December 2008 by Pullin and Buss JJA on the basis that it had no reasonable prospect of success: Law v Hall [2008] WASCA 257. 56 On 13 December 2008 Mr Law made an application for the Court of Appeal to recall the judgment dismissing the appeal on the ground that he had been dealt with unfairly by the court. The application to recall the judgment was dismissed on 20 January 2009 by Pullin and Buss JJA: Law v Hall [2008] WASCA 257 (S). 57 On 22 January 2009 in CACV 100 of 2008 the Court of Appeal heard an application by Mr Law for an extension of time within which to appeal against the orders of Jenkins J, made on 19 February 2007, for the payment of monies and delivery up of possession of the properties to Audrey Hall. Neither Mr Law nor Spunter Pty Ltd had ever been a party to that decision, of course. The basis of the appeal was that Spunter Pty Ltd, rather than Audrey Hall, held the first mortgage on the properties. Again, this was an argument based upon the words of cl 3 of the second deed of 4 November: 'Spunter Pty Ltd CAN 002 179 375 … shall have first call on my estate.' 58 The application was refused and the appeal dismissed by McLure and Pullin JJA on 15 May 2009: Law v Hall [2009] WASCA 86. 59 On 25 March 2009, Ms Michele-Maree Gannaway was granted letters of administration over her late mother's estate. 60 Back to this action in this court, on 23 July 2009, the plaintiffs filed an application for a means enquiry directed at Ms Gannaway, summonsing her to attend and produce all financial records and a statement of assets and liabilities of the late Ms Nancy Hall and documents pertaining to Morcodian Pty Ltd and the beneficial ownership of the shares in that company. (Page 13)
61 As at 12 August 2009 neither the Mount Lawley property nor the Hazelmere property had been sold. In the meantime, Ms Gannaway had lodged a caveat over both properties claiming an interest as a beneficiary by reason of her mother Nancy Hall having died intestate. The master had ordered that the caveat be removed pursuant to a memorandum of consent filed by the solicitors for Ms Gannaway and Audrey Hall. 62 On 2 September 2009, the principal registrar of this court, Mr Gething, set aside the means enquiry summons, no doubt because more than six years had elapsed since the entry of default judgment and therefore leave was required to enforce that default judgment: s 13(1)(a) of the Civil Judgments Enforcement Act 2004. 63 Then on 13 October 2009, on an ex parte basis, Deputy Registrar Hewitt granted the plaintiffs leave to enforce that default judgment and also gave leave to the plaintiffs to serve any application to enforce the judgment on Ms Gannaway as administrator of the estate. 64 Further matters occurred in the Supreme Court, and even the High Court, involving Mr Chin and his caveat to protect his legal fees. He was utterly unsuccessful. They are of peripheral relevance only, and only obliquely involve Mr Law because, in one of those matters, Mr Chin wished to call him as a witness. He was refused permission to do so and that matter was dismissed: Chin v Hall [No 2] [2011] WASCA 96. 65 Meanwhile, back in this court, on 15 April 2010 Deputy Registrar Hewitt reversed his decision of 13 October 2009 and set aside those orders. And that brings me back to this appeal. 66 In his submissions, Mr Law has also referred to having made an application dated 26 May 2010 to the Supreme Court for a writ of certiorari to quash Deputy Registrar Hewitt's order of 15 April 2010. The application was apparently heard before Murray J and was unsuccessful.
Legal principles relating to an application for leave to enforce judgment after six years 67 Section 13(1)(a) of the Civil Judgments Enforcement Act 2004 provides: 13. Courts leave to enforce needed in some cases (1) Leave of the court must be obtained before an order may be made under this Act to enforce a judgment - (Page 14)
(a) if 6 years have elapsed since the judgment took effect; … (2) On an application for leave under subsection (1), the court - (a) may give leave if it is satisfied that the person seeking to enforce the judgment is entitled to do so and that the person against whom the order is sought is liable to satisfy the judgment; (b) may order the trial of any issue that needs to be decided in order to determine if the judgment may be enforced and, if it may be enforced, by whom and against whom; and (c) may do so on terms as to costs or otherwise. 68 Time begins to run from the date of the default judgment, which was entered on 10 October 2002. Plainly it does not begin to run from the filing of the most recent writ of fieri facias, or from the sending of the most recent correspondence, as is submitted by Mr Law in his third set of written submissions dated 8 April 2011. The Act does not contemplate leave being required only after six years of inactivity. Leave to enforce the judgment was required, contrary to Mr Law's submissions. 69 By the time the plaintiffs sought leave to enforce this judgment, Nancy Hall had died. 70 The burden of proof was upon the plaintiffs to show that they were entitled to enforce the judgment: Solic v Bertossa [1969] VR 594, 595. This burden will usually be discharged by proof of the judgment and evidence on affidavit that some or all of it remains unpaid: Dennehy v Reasonable Endeavours Pty Ltd [2001] VSC 447; BC200107288 [16]. 71 It is not enough, however, that the judgment creditor satisfies the two criteria set out in the subsection. The use of the word 'may' makes it clear that there is still an unfettered discretion to grant or refuse leave: Geneva Finance Ltd v Bandy [2008] WASC 236 (Master Sanderson). 72 In Duer v Frazer [2001] 1 All ER 249, Evans-Lombe J considered the application of O 46 r 2 of the Rules of the Supreme Court, which was consistent with s 13(1)(a) of the Civil Judgments Enforcement Act 2004. Having considered two decisions of the English Court of Appeal, Evans-Lombe J stated [25]: (Page 15)
It seems to me that these two passages from judgments in the Court of Appeal apply to govern the exercise of the discretion to permit the issue of execution after the expiry of six years under RSC Ord 46, r 2 and that they are support for the proposition that the court would not, in general, extend time beyond the six years save where it is demonstrably just to do so. The burden of demonstrating this should, in my judgment, rest on the judgment creditor. Each case must turn on its own facts but, in the absence of very special circumstances such as were present in the National Westminster Bank case, the court will have regard to such matters as the explanation given by the judgment creditor for not issuing execution during the initial six-year period, or for any delay thereafter in applying to extend that period, and any prejudice which the judgment debtor may have been subject to as a result of such delay including, in particular, any change of position by him as a result which has occurred. The longer the period that has been allowed to lapse since the judgment the more likely it is that the court will find prejudice to the judgment debtor. 73 The special circumstances which had arisen in the National Westminster Bank case (National Westminster Bank PLC v Powney [1990] 2 All ER 416; [1991] Ch 339) were that the delay in obtaining execution was largely brought about by administrative delays in the relevant county court. There are no such special circumstances to be considered in this case.
Basis upon which Deputy Registrar Hewitt originally granted leave to enforce the judgment 74 In support of the plaintiffs' original application for leave to enforce the judgment after six years had elapsed, Mr Law filed a brief affidavit, sworn 21 September 2009, in which he deposed to having obtained default judgment on 10 October 2002 and to having had the bill of costs, which formed part of the judgment, allowed by the taxing officer on 29 July 2005 and, on that basis, deposed that he was entitled to enforce the judgment and the taxed costs. 75 He also deposed to the fact that Nancy Hall had passed away on 13 January 2008 and that her daughter, Michele-Maree Gannaway, was granted letters of administration for her estate on or about 25 March 2009, which letters were annexed to the affidavit. On that basis, Mr Law deposed that Ms Gannaway, as administrator of the deceased's estate, was liable to satisfy the judgment and taxed costs from the assets of Ms Hall's estate. (Page 16)
76 Pursuant to reg 7(2) of the Civil Judgments Enforcement Regulations 2005: The application for leave does not have to give notice of the application to the person against whom an order under the Act to enforce a judgment is to be sought unless the court so orders. 77 In this case the court did not so order and the initial hearing of 13 October 2009 proceeded on an ex parte basis. That occurred notwithstanding the fact that Ms Gannaway had opposed the means enquiry summons which was set aside on 2 September 2009 and was represented at that hearing. By reason of no notice having been given to Ms Gannaway, there was no material before the court opposing the order. 78 After giving leave to enforce the judgment, Deputy Registrar Hewitt also gave leave 'to serve any application to enforce the judgment on Michele-Maree Gannaway as administrator for the estate of the late judgment debtor'.
Deputy Registrar Hewitt's reasons for reversing his own order of 13 October 2009 79 Following the hearing, on 15 April 2010, of the administrator's application to set aside the orders of 13 October 2009, the deputy registrar stated that, while a number of issues had been canvassed before him, he intended to focus on one aspect to the exclusion of others and commented (ts 48): In my view, there is significant doubt as to the regularity of the judgment which is possessed by the plaintiffs. 80 That conclusion was reached on two bases. Firstly, the deputy registrar pointed out that, given the terms of the judgment, each of the three plaintiffs is possessed of a judgment for the full sum in excess of $144,871.47, whereas the materials before the court suggested that all, or practically all, of the money advanced to Ms Hall was advanced by Spunter Pty Ltd and not by Mr or Mrs Law individually. 81 Secondly, in relation to the aspect of the claim which pertains to Mr Law as an individual, being a claim for services provided to Ms Hall by Mr Law for attending meetings and assisting Ms Hall, at the rate of $45 per hour together with petrol costs, a claim of $8,955, the deputy registrar concluded that 'nothing whatever is presented in the statement of claim which would support that aspect of the claim'. (Page 17)
82 That is the basis upon which Deputy Registrar Hewitt set aside his own previous order. Now that might be characterised as a finding by the deputy registrar that one of the two basic criteria of s 13(2)(a) of the Civil Judgment Enforcement Act, that is to say 'that the person seeking to enforce the judgment is entitled to do so', has not been made out. Alternatively, it might be characterised as a finding that while, on the face of the face of the judgment, the plaintiffs were entitled to enforce the judgment, the lack of support in the pleadings for the judgment led the court to exercise its general discretion against the plaintiffs. I place the former interpretation upon Deputy Registrar Hewitt's reasoning but, in any event, it leads to the same result. 83 Ground 4 of this appeal complains: The learned Registrar erred by not taking into account the fact that the Defendant was at all material times in a lull state and was capable of accomplishing her normal business efficiently and in an astute and businesslike manner and as such no reasonable presumptions could arise that she was incompetent or unwell mentally, even though she had a history of psychiatric morbidity since she was a young lady in her twenties. 84 As to that issue, the deputy registrar concluded that, while it was clear that, towards the end of Ms Hall's life, she was not mentally competent and that her mental incapacity extended some time prior to the appointment of a guardian of her affairs, it was difficult to say whether that lack of capacity had any impact on her behaviour when the action was commenced and the judgment against her entered. He concluded: There is certainly nothing that establishes it with the necessary level of certainty to enable me to take any heed of the fact that, in later life, she was not mentally capable. I therefore support my decision purely on the fact that the plaintiffs have sought leave to execute on what, in my view, is clearly an irregular judgment. 85 It follows from these comments quoted that Ms Hall's mental state played no part in the deputy registrar's decision and ground 4 has no substance. 86 That is not to say that Ms Hall's mental state is an irrelevant issue before me. I am hearing this matter afresh.
Materials before the court by way of explanation of the delay in appealing 87 The notice of appeal was filed on 2 July 2010, some 67 days out of time. The respondent to the appeal appears to have assumed a 48-days (Page 18)
delay, based upon the notice of appeal having been filed on 2 June 2010, but it is dated 2 July 2010 and bears a date stamp from the registry of 2 July 2010. In view of the time limit of '10 days after the date of the decision' (r 15(2) District Court Rules 2005), that is a significant delay, although not so lengthy as to cause any particular prejudice to the administrator. 88 In his undated affidavit, filed on 20 December 2010, Mr Law deposes to three reasons for that delay. 89 The first is that his former solicitor, Ms Savas of Corser & Corser, 'confused me and did not take any concrete action to appeal the decision of Registrar and allowed it to lapse'. He complains that Ms Savas did not act promptly and he had only two days to work out how to appeal the decision, which he could not do without proper legal advice. He also says that 'the prospect of paying hefty legal bills was looming before me and this discouraged me from pursuing justice to make this appeal'. 90 Annexed to the affidavit is an email from his former solicitor Ms Savas which reads: Dear Maurice, I refer to the Special Appointment before Registrar Hewitt on 15 April 2010, attended by Counsel and yourself. I attach copy of Counsel's report of that hearing, and I confirm that if you wish to appeal Registrar Hewitt's decision, the rules allow you 10 days (from the date of the decision) to do so. I do note, however, that Counsel has not advised you to appeal Registrar Hewitt's decision but rather is of the opinion that you should instruct us to rectify the pleadings prior to make a new application for leave to enforce the judgment … I await your further instructions. 91 The email having been sent on 23 April 2010 at 12.36 pm, only two clear days were left in which to file any notice of appeal. It is unclear from the email whether Mr Law had already had discussions with counsel as to the prospects of success of an appeal following the hearing itself and he does not depose to any such discussions. 92 What is clear is that he was informed of the time limit of 10 days from the date of the decision, before those 10 days expired. What is also clear is that counsel who attended advised against appealing the decision and recommended a different course of action. Ms Savas herself has not voiced her own opinion on the topic. It is difficult to see what is actually confusing about the email. (Page 19)
93 Certainly it left little time within which to comply with the time limit, should Mr Law have wished to do so. That does not begin to explain why he took a further 67 days to do so. There is no suggestion that he gave Ms Savas instructions to appeal. 94 The second reason Mr Law cites for the delay is 'I was going in and out of hospitals having suffered from an infectious disease on my right hand and I was operated for the second time. I also had dental problems which needed to be fixed. I also suffered a pain in my groin which required manipulative therapy'. 95 He annexes to his affidavit various medical certificates, which provide little relevant detail. The notice of appeal in this matter was filed on 2 July 2010. A letter from a Dr Paul dated 6 July 2010 indicates that Mr Law was under treatment due to muscular strain for his right groin since April 2010. A certificate from Mr Sturtridge, physiotherapist, certifies that Mr Law received treatment on 15, 17 and 25 June 2010. A medical certificate from Mr Knox, osteopath, dated 6 July 2010 certifies that Mr Law first received treatment for a lumbar and shoulder problem on 22 June 2010 and was advised to rest as much as possible. A medical certificate from North Metropolitan Health Service indicates that Mr Law was unfit for work between 6 September and 30 October 2010 (months after he had lodged his application) and provides no details as to the reason. A dental certificate from Metropolitan Health Services indicates that Mr Law was examined on 9 September 2010 and considered unfit for duty for one day. 96 I see nothing in those medical certificates which supports the proposition that Mr Law was medically unable to file the appeal either within time or within a short time thereafter. The certificates are utterly lacking in any detail about the severity of any injuries and for the most part do not relate to the relevant time period. Mr Law gives no relevant detail about when he underwent surgery or the recovery period. 97 Finally, Mr Law says that the affidavits he wished to rely upon could only be gathered after 15 April 2010 and the evidence and affidavits took a lot of time to obtain. These affidavits are annexed to his affidavit. The first is an affidavit of Duncan Harris sworn 5 May 2010 at Midland containing four brief paragraphs, the second, from Mr Graeme Harris, is a two-paragraph affidavit sworn at Midland on 6 May 2010 and the third is an affidavit from Mr Law's wife which is one page long and sworn at Midland on 5 May 2010. (Page 20)
98 There has been a great deal of repetition in the affidavits placed before this court. I have seen each of these affidavits numerous times, annexed to affidavits of Mr Law. They were clearly drafted either by Mr Law or the deponents themselves and are certainly not in the usual form of affidavits put before this court. 99 But each of these three deponents, and Mr Law, had already sworn an affidavit in opposition to the administrator's application to have Deputy Registrar Hewitt set aside the leave he gave to enforce the judgment. Those affidavits all appear to have been drafted by a lawyer. Mr Law's affidavit was sworn 11 February 2010, Mr Graeme Harris swore his on 15 February 2010, Mr Duncan Harris swore his on 12 February 2010 and Mrs Cheryl Law swore hers on 12 February 2010. The later affidavits of Messrs Harris and Mrs Law add nothing, or almost nothing, to their earlier ones, which could simply have been relied upon again. And of course they need not have all been filed together with the notice of appeal. 100 Making every reasonable allowance for the fact that Mr Law is now unrepresented, perhaps he understood that he had to repeat the process all over again. But the affidavits from Messrs Harris and Mrs Law are not remotely lengthy or detailed affidavits. They are very brief. The deponents are local people, who live not far from him and one is his wife. It is difficult to see why these affidavits could not have been produced sooner, and why, all of the affidavits having been sworn in early May, the appeal was not then lodged until 2 July 2010. 101 Mr Law has also referred in his submissions (but not on affidavit) to having made an application for an order nisi before Murray J in relation to the order of Deputy Registrar Hewitt. No details are given and there is no material before me on affidavit explaining how that is said to have prevented him from filing this appeal earlier or why it is that he pursued that misconceived course when he had been informed by his lawyer, Ms Savas, about his right of appeal. 102 An extension of time is not automatic. The discretion to extend time is given for the sole purpose of doing justice between the parties: Gallo v Dawson (1990) 93 ALR 479, 480. 103 Taking the matter at its most favourable for Mr Law, I accept that the failure of his solicitor to inform him of the time limit until three days prior to its expiry put him under pressure if indeed he did wish to lodge a notice of appeal. There is no suggestion he gave any such instructions to his (Page 21)
then solicitor. That time pressure may explain the filing of the notice of appeal several days late. It does not explain the lengthy delay and nor does any other matter raised by Mr Law. In short, the delay in this case is not adequately explained. That may not be fatal, however, if I consider there to be real merit in the appeal itself and that justice requires time to be extended.
Factors relevant to the court's discretion 104 This is an appeal from an order reversing a previous order of the court granting leave to the plaintiffs to enforce judgment more than six years on. The application to reverse that order is therefore before me afresh and so this is really the administrator's application that I am considering. But the fact that the court is being asked to reverse its own order does not place any additional difficulty in the administrator's way when the original order giving leave was made on an ex parte basis and where there was, consequently, no material before the court opposing the order at that time. In considering this appeal then, I am really considering again whether the plaintiffs ought to be given leave to enforce their default judgment obtained in 2002. 105 In his written submissions, Mr Law disputes the assertion that the hearing of 13 October 2009 was ex parte, solely on the basis that, at the attempted means enquiry proceedings on 2 September 2009 (which were dismissed because no leave had been given to enforce the judgment at that stage), Ms Gannaway was given notice that the plaintiffs would subsequently be seeking leave to enforce the judgment. That does not alter the fact that the matter was then heard ex parte and rather highlights the fact that, prior to the matter proceeding on an ex parte basis on 13 October 2009, the plaintiffs were on notice that Ms Gannaway was opposed to their efforts to enforce the judgment and was represented. It would have been prudent and courteous for the matter to have been formally served upon Ms Gannaway's lawyers so that any opposition could be determined in one hearing, rather than two, but nothing really turns upon that in the end. 106 The discretion to give or refuse leave to enforce a judgment after the lapse of six years being an unfettered one, the court may consider factors over and above the two basic criteria set out in s 13(2)(a) of the Civil Judgments Enforcement Act, without which there can be no grant of leave. 107 What this court will not consider are allegations made in written submissions, not supported by evidence. Mr Law's three sets of written (Page 22)
submissions make repeated references to an alleged fraud on this court perpetrated by various people, being Ms Audrey Hall, Ms Gannaway and several solicitors. This court will not go behind the judgments of the Supreme Court in relation to the various actions before that court. Nor is this court privy to any arrangements, if indeed there have been arrangements, reached between Ms Gannaway and Ms Audrey Hall, or the current state of play in relation to the order for possession of the Hazelmere and Mount Lawley properties. Submissions do not constitute evidence. And such submissions as there are alleging various improprieties by various people are, in any event, largely incomprehensible. 108 Factors that I do consider relevant to the exercise of the court's discretion in this case include the age of the default judgment, Ms Hall's numerous unsuccessful attempts to have that judgment overturned, any factors going to the regularity of the judgment including the extent to which the pleadings provide a basis for the judgment, any material tending to cast doubt upon Ms Hall's mental capacity at the time she entered the agreements with the plaintiffs and at the time the action was commenced against her, the extent to which the plaintiffs have pursued the enforcement of the judgment since it was entered on 10 October 2002, the extent to which there might be any assets in the estate to satisfy the judgment debt and any prejudice caused the administrator by the lapse of time. I will consider each of these factors in turn, although not necessarily in that order.
Ms Hall's attempts to set the default judgment aside and prejudice to the administrator 109 The plaintiffs have a default judgment entered, now, nine years ago. The writ was served and no appearance entered and therefore default judgment was, on its face, regularly entered, as found by Groves DCJ on 1 April 2005. Further, in her affidavit of 1 March 2005 in support of her application to have the judgment set aside before Groves DCJ, Ms Hall acknowledged a debt of some unspecified sum: I do owe various sums of monies to the Plaintiffs because it was given to me by them for specific commercial purposes for which I am willing to repay. 110 Groves DCJ found that Ms Hall's affidavit had failed to raise a credible defence on the merits and failed to advance any adequate explanation for the delay in applying to set the judgment aside. (Page 23)
111 There should be finality in litigation. The fact that all attempts to set the judgment aside failed would ordinarily be a compelling factor in favour of giving leave to enforce the judgment. 112 As against that, however, it does not appear from the judgment that any consideration was given to the pleadings themselves and the extent to which the pleadings provide a basis for the ultimate sum claimed, or provide any basis at all for the entry of judgment in favour of Mr and Mrs Law personally. That was not considered at any stage prior to Deputy Registrar Hewitt basing his decision upon that point. 113 The hearing before Groves DCJ was not a summary judgment application, where the plaintiffs were expected to support their case and prove there was no serious issue to be tried. The onus was upon Ms Hall, who failed to address the relevant issues. Groves DCJ could only make so much allowance for the fact that Ms Hall was unrepresented. She had had some informal legal assistance, apparently, but it was ineffective. And his Honour was not privy to the material that has been placed before me in relation to the issue of Ms Hall's mental health. 114 Ms Hall is now deceased. There is no potential at all for Ms Gannaway to give direct evidence bearing upon these agreements. She has no knowledge of them. Indeed, it has probably been the case for some years, at least from 2006, that Ms Hall's position could not be competently explored even with sound legal assistance due to her mental state, an issue I deal with later. The lapse of time means there can be no competent attempt to challenge the default judgment. 115 Those factors militate against the fact that the plaintiffs have in their favour a default judgment which was unsuccessfully challenged, so that this factor bears both ways.
The age of the judgment and steps that have been taken to enforce it 116 Default judgment was entered in October 2002. Nine years have elapsed. The subject matter of the action dates back to 2000 and 2001. That is a lengthy period, but not extraordinarily so given that, in hearings of this sort, at least six years must have passed. In the meantime, however, the judgment debtor has passed away. 117 The administrator asserts in her submissions that no steps have been taken to enforce the judgment since February 2005. (Page 24)
118 In his affidavit of 11 February 2010 Mr Law deposes that on 3 April 2003 he was advised by Mr Rafferty of the sheriff's office that there was little chance of success in recovering any property. He also states that he became aware in about 2003 that Audrey Hall had commenced an action against Nancy Hall for default on a loan secured by a registered mortgage over the Hazelmere and Mount Lawley properties. 119 He deposes that, on or about 9 February 2005, his solicitors lodged a second writ of fieri facias to enforce the judgment and says: At that time, I was still being advised that the Defendant did not appear to have any property to be seized to satisfy the Judgment and the Taxed Costs, and that it would be waste of my money to continue to attempt to enforce the Judgment and Taxed Costs in such circumstances. 120 The respondent's submission, however, that no steps have been taken since then to enforce the judgment rather overlooks Mr Law's efforts in the Supreme Court to preserve the caveats over the Hazelmere and Mount Lawley properties. 121 It is apparent from the detailed background to this matter which I set out earlier that Mr Law, on behalf of Spunter Pty Ltd, has not lain idle. 122 In December 2005, in the Supreme Court, Mr Law was seeking (and was successful) the extension of the two caveats over the Mount Lawley and Hazelmere properties in CIV 1142 of 2005. 123 In February 2006, the plaintiffs commenced CIV 1131 of 2006 in the Supreme Court against Nancy Hall seeking a declaration that the second deed created an equitable charge over her properties in their favour. A property (seizure and sale) order to the sheriff was also issued by this court on 27 February 2006 which, on the plaintiffs' application of 23 February 2007, was extended by another six months. 124 In the meantime, the decision in CIV 2073 of 2003, the action between Audrey Hall and Nancy Hall, had gone against Nancy Hall, resulting in an order for possession against the Mount Lawley and Hazelmere properties, which rendered the prospects of any enforcement of the judgment debt by the plaintiffs in this case fairly futile. 125 But in 2008, Spunter Pty Ltd was still fighting to keep its caveats over the Mount Lawley and Hazelmere properties until Master Sanderson, on 29 October 2008, ordered Spunter Pty Ltd to remove its caveats immediately. (Page 25)
126 Mr Law's attempts to enforce the judgment have been unsuccessful, but he has been actively involved in attempting to pursue the Hazelmere and Mount Lawley properties. The essential difficulty has been, or course, that both properties have been encumbered with a first registered mortgage which was always going to take priority over any potential equitable interest held by Spunter Pty Ltd. 127 It does not appear that Ms Hall was ever summonsed to a means enquiry in this court, though an application for one was filed. Mr Law deposes that he does recall one occasion where he had been informed that Ms Hall was at Bentley hospital and he attended the hospital to serve some documents upon her. He does not say what documents they were, or even what year this occurred, but says that, after he served her, he noticed that she was not, in his opinion, a well person and says he did not then proceed with any legal proceedings against her at that time. That is likely, based upon Ms Gannaway's affidavit, to have been in 2007. 128 It seems not unreasonable that Mr Law did not then summons Ms Hall to a means enquiry from that point on. And nor, given the result of the dispute between Ms Audrey Hall and Ms Nancy Hall, does it seem unreasonable that the plaintiffs did not continue to apply for writs of fieri facias. 129 Mr Law deposes that, having heard that Ms Hall had passed away and that Ms Gannaway was granted administration of the estate on 25 March 2009, those events triggered him to consult a lawyer and seek advice as to whether he had any possibility of enforcing the judgment against Ms Hall's estate. After demanding payment of the debt from the estate, with no result, he then applied unsuccessfully to carry out a means inquiry to examine the administrator, which was set aside by the principal registrar of this court on 2 September 2009 for lack of leave to enforce the judgment. The plaintiffs then sought that leave. 130 In the circumstances of this case, I do not consider that this factor tells against the plaintiffs. I find they have actively attempted to enforce the judgment debt over the years.
Are there any assets against which to execute the judgment in any event? 131 Among the materials before the court is a statement of assets and liabilities of Ms Hall's estate prepared by the Public Trustee and lodged with the Supreme Court probate office. It lists assets of $1.7 million, the two major assets being the Hazelmere and Mount Lawley properties, against liabilities of $2.38 million, the major liability being the judgment (Page 26)
for $2.3 million in favour of Audrey Hall. In her affidavit of 16 November 2009 Ms Gannaway deposes: This Statement shows that the estate was and is technically insolvent and it will only become solvent should the estate be successful in overturning the court judgment won by my aunt three months before my mother's committal. 132 There is no evidence before this court to suggest that the position has changed in relation to the order for possession. Mr Law has made a number of accusations in his written submissions, incomprehensible to me, suggesting fraud of some sort and some sort of arrangement between Ms Audrey Hall and Ms Gannaway which he characterises as the 'guilty flee conduct' of Ms Audrey Hall in giving back assets to the estate, but there is nothing by way of evidence at all to suggest anything other than that those properties are yet to satisfy a debt of $2.3 million. That tends to suggest further attempts to enforce this judgment debt will be as futile as the past attempts. 133 The only evidence suggesting a potential asset relates to the Colliefields Hotel and Ms Hall's shares in Morcodian Pty Ltd. Mr Law attaches to his affidavit of 11 February 2010 a true copy of a record of the certificate of title for the Colliefields Hotel. The registered proprietor since 30 May 2001is Morcodian Pty Ltd of lot 126 Hazelmere Circus, Hazelmere, the same address as Ms Hall's Hazelmere property. The hotel was encumbered by registered mortgage I443242 to Clifford and Gwenyth Monkman, registered 10 April 2003, which mortgage was transferred to Mr and Mrs Gannaway as joint tenants and registered 1 May 2008 (after Ms Hall's death). 134 Also annexed to Mr Law's affidavit is an Australian Securities & Investments Commission historical company extract for Morcodian Pty Ltd indicating that it is deregistered and was dissolved on 8 June 2008, that its principal place of business was lot 126 Hazelmere Circus, Hazelmere until 1 November 2004 when it became 91 Throssell Street, Collie (the address of the Colliefields Hotel) and that its only director and sole shareholder was Nancy Hall who held two ordinary shares, being the only shares issued. 135 On the strength of that document, as at her death, Ms Hall was the owner of two shares in Morcodian Pty Ltd, which was possessed of an asset in the Colliefields Hotel. Those shares in Morcodian Pty Ltd are not listed in the statement of assets and liabilities of the estate of Ms Hall. (Page 27)
136 In her affidavit of 16 November 2009, Ms Gannaway deposes that Morcodian Pty Ltd is a private company with two $1 shares of which she and her husband are the sole directors and shareholders. She does not state when that transfer of shares occurred and for what consideration and attaches no documentation from the Australian Securities & Investments Commission supporting that claim. Nor does she address the issue of whether the company has been re-registered. 137 Ms Gannaway asserts in her affidavit: The plaintiffs have no entitlement to any information concerning Morcodian Pty Ltd and I respectfully ask that all references to Morcodian Pty Ltd be struck off the plaintiffs' application. 138 On the basis of the material before this court, that position is untenable. If Ms Hall died possessed of the only two issued shares in Morcodian Pty Ltd, then the shares were an asset of the estate, capable of being valued and subject to meeting the debts of the estate. Of course it may be that there is little or no equity in the hotel. But that could be the legitimate subject of a means enquiry. 139 Had the estate had no assets anyway, I would have regarded that factor as going against the plaintiffs but, given the potential asset of the shares, which may or may not have had value, I would regard this factor as neutral.
The statement of claim and supporting evidence 140 It is necessary now to examine in some detail the basis of the plaintiffs' claim against Nancy Hall. 141 Paragraph 4 of the statement of claim pleads that, on or about 25 September 2000, Spunter Pty Ltd borrowed $140,000 from Citibank Ltd. The terms of that loan, including any ongoing fees and the interest rate, are not pleaded. 142 On 5 October 2000 Spunter Pty Ltd (of which Mr and Mrs Law were directors) and Mr and Mrs Law as 'the Guarantors' executed a deed which recorded that, on 25 September 2000, Spunter Pty Ltd, 'the Lender', had borrowed an unspecified sum of money from Citibank Ltd, secured by a mortgage over Spunter Pty Ltd's property at Herne Hill, for the purpose of lending Nancy Hall, 'the Borrower', $24,000 to enable her to repay an existing debt to a Mr Graeme Harris and for a second purpose of assisting Ms Hall to fund litigation seeking compensation for losses occasioned by a fire at her former premises of the Railway Hotel, Kalgoorlie. (Page 28)
The statement of claim annexes this deed as 'Schedule A'. Although it is not now so annexed, it is in the court file and may well have become dislodged with so many hearings, so I have had regard to it. 143 The deed records that, in consideration of Spunter Pty Ltd and Mr and Mrs Law carrying out their promises, Ms Hall would indemnify and repay to the company and Mr and Mrs Law: (i) All costs and expenses incurred by the Lender and the Guarantors in obtaining the loan from Citibank. (ii) All costs and expenses incurred by the Lender and the Guarantors in effecting settlement of the said loan from Citibank. (iii) All interest, costs and charges imposed by Citibank during the term of the loan on all monies advanced to the Borrower by the Lender and Guarantors such interest to be calculated on a daily rate. (iv) All costs and expenses incurred by the Lender and the Guarantors in effecting discharge of the said loan from Citibank. (v) All costs and expenses incurred by the Lender and the Guarantors in the preparation, stamping and lodging of this Agreement. 144 In addition, by cl 2: The Borrower shall authorise in writing the Lender and the Guarantors to pay accounts incurred by the Borrower in pursuing her claim for compensation for losses occasioned by the fire at the Borrower's former premises. Upon receipt of such written authorisation the Lender and the Guarantors shall make such payments from the Citibank loan. 145 On its face the document was executed as a deed by Spunter Pty Ltd by its directors with the common seal affixed and by Mr and Mrs Law in their own right and also by Ms Hall and it was stamped at the stamp office on 19 October 2000. 146 In his affidavit of 11 February 2011 Mr Law refers to this first deed dated 5 October 2000 and deposes that the deed was drafted at his home as a joint effort between himself, his wife and Ms Hall and swears that the signature on the document is Ms Hall's signature. In a supplementary affidavit sworn 15 February 2010 Mr Law deposes that the independent witnesses to this first agreement were Mr Ralph O'Brien and his wife Elizabeth O'Brien who were friends of his at the time. He deposes that he has since been informed that Mr O'Brien is deceased and that Mrs O'Brien lives in Melbourne. He has no contact details for her. (Page 29)
147 In her affidavit of 12 February 2010 Cheryl Law deposes that this first agreement was drafted as a joint effort between herself, her husband and Nancy Hall and deposes that the signature on that document is Nancy Hall's signature. 148 In his affidavit sworn 15 February 2010 Graeme Harris deposes that, in 2000, at Ms Hall's request, he paid $24,000 to her local council for unpaid council rates on her property in Hazelmere because Ms Hall had told him that, if the rates were not paid, the council would sell her property. He deposes that, a little while later, Ms Hall told him that Mr Law would repay him the money she owed him because she did not have the money to pay him herself. He says that, on 25 October 2000, Mr Law did repay him the sum of $24,000. 149 There is no pleading or evidence that Mr and Mrs Law gave guarantees to Citibank for the payment of the loan. According to the deed, the loan was secured by a mortgage. There is no pleading or evidence before the court to the effect that Spunter Pty Ltd ever defaulted on its loan from Citibank causing the bank to call upon any guarantees that Mr and Mrs Law might have given. There is also no pleading or evidence before the court to the effect that any litigation seeking compensation for losses occasioned by a fire at the Railway Hotel ever commenced. 150 The statement of claim pleads that, pursuant to the agreement of 5 October 2000, the plaintiffs agreed, upon written authorisation from Ms Hall, to pay accounts incurred by her and, on receipt of such written authorisations, the plaintiffs made payments to Ms Hall from the Citibank loan. These said payments are described as annexed to the statement of claim as 'Schedule B'. 151 According to the deed, these written authorisations would be limited to accounts incurred by Ms Hall in pursuing her claim for compensation arising out of the fire at the Railway Hotel. According to the statement of claim, these authorised transactions are reflected in five photocopies of a 'Deed for Maurice and Cheryl Law', annexed to the statement of claim as 'Schedule B'. The statement of claim does not actually plead this second deed specifically and simply relies upon it as written authorisations by Ms Hall to make payments to third parties. (Page 30)
152 The typed parts of the five photocopies are identical. The terms of this short second deed are as follows: 1. I NANCY CLOONAN HALL OF LOTS 126 AND 127A HAZELMERE CIRCUS HAZELMERE IN THE SAID STATE OF WESTERN AUSTRALIA 6055 HEREBY UNDERTAKE TO PAY TO SPUNTER PTY LTD ACN 002 179 375 [MAURICE AND CHERYL LAW GUARANTORS] THE WHOLE OF THE MONEY BORROWED FROM SPUNTER PTY LTD ACN 002 179 375 [MAURICE AND CHERYL LAW GUARANTORS] PLUS INTEREST AT TEN PERCENTUM PER ANNUM AND/OR ACCORDING TO ANY VARIATION WITHIN THE PRIMARY ''LAW'' LOAN ARRANGEMENTS, PLUS ALL OUTGOINGS, AND EXPENSES AND A REMUNERATION TO BE AGREED IN RELATION TO THE SETTING UP AND ONGOING MAINTENANCE OF THE SAID FUNDINGS. 2. I NANCY CLOONAN HALL AUTHORISE THAT THE ''LAW'' LOAN ARRANGEMENT BE REPAID ALL MONEY OWED TO IT BY MYSELF [NANCY CLOONAN HALL] INCLUDING FUNDS ALREADY PAID TO MR GRAEME HARRIS AND EXPENSES [$25,359.06] FROM THE FIRST AND IF NECESSARY FURTHER MONEY ASSIGNED TO ME FROM WHATEVER SOURCE TO COMPLETE TOTAL REPAYMENT OF ALL FUNDS OWED TO THE ''LAW'' LOAN ARRANGEMENT AS SOON AS PRACTICAL. 3. SPUNTER PTY LTD ACN 002 179 375 [MAURICE AND CHERYL LAW, GUARANTORS] SHALL HAVE FIRST CALL ON MY ESTATE. 153 At the bottom of the deed are the words 'I NANCY CLOONAN HALL HERBEY REQUEST FUNDS FROM THE ABOVE LOAN TO BE PAID TO THE FOLLOWING': and there follows a series of entries, handwritten, recording various dates and amounts and recording details of payments by cheque with comments as to the purpose of the payment and the authorising signature, which on its face is the signature of Ms Hall. 154 The first copy records seven authorised transactions whereby Ms Hall requested funds to be paid in January and February 2001. A second copy records five authorised transactions from February to July 2001 and a couple of references to monies returned. The third copy records five payments in February 2001 and, at the bottom of the list, August 2000. The fourth copy records four transactions in April and February 2001. The fifth copy records six payments occurring in November and December 2000 and January 2001. (Page 31)
155 In his affidavit of 11 February 2010 Mr Law deposes that this second agreement was drafted between himself, Mrs Law and Ms Hall and they attended the premises of Duncan Harris in Baskerville and signed the deed in front of Mr Harris. 156 Mr Law deposes that, after the first two documents were signed, further funds were requested by Ms Hall as seen on the last three documents comprising the second agreement. He says these three documents were not witnessed by Mr Harris because it was simply a procedure for Ms Hall to list the creditors she required Mr Law to pay on her behalf and the practice was that she would orally request he pay creditors and he would then pay them on her behalf. 157 In his affidavit sworn 12 February 2010 Duncan Harris deposes that he was a witness to the signing of two documents on 4 November 2000 and says Mr and Mrs Law, whom he knew, introduced him to Nancy Hall who acknowledged herself as Nancy Hall and appeared to sign the documents willingly. He verifies her signature. 158 In her affidavit of 12 February 2010 Cheryl Law deposes that the second agreement was drafted as a joint effort between herself, her husband and Nancy Hall and was signed and witnessed at the premises of Duncan Harris on 4 November 2000. 159 The notations on many of these transactions suggest that the purposes of many exceeded what was agreed in the first deed. Were it not for the specific authorisation at the bottom of the deed and the signature against each transaction there would be no written contractual basis for them. A number relate to legal fees (which might relate to the fire at the Railway Hotel), but two relate to the purchase of the Colliefields Hotel, one to a deposit on a truck, another to three company registrations, another to 'locks and sensor light', another to 'security for car' and another to 'Collie Club valuation'. There are other transactions which do not necessarily relate to the subject matter of the first deed. 160 The additional affidavit of Mrs Law sworn 5 May 2010 deposes that, further to the initial loan reflected in the first agreement, Nancy Hall wanted money for further expenses including deposits on two hotels in Collie, although only the purchase of the Colliefields Hotel went ahead and the deposit on the Club Hotel was retrieved after the sale fell through. That is consistent with a transaction described in one of the five photocopied deeds annexed to the statement of claim, being a payment of $20,000 to a Neil Barnett on 16 March 2001 described as a 'dep for Collie (Page 32)
Hotel (Club) ', but followed by a further notation that those monies were returned in two instalments in May and July 2001. 161 Totalling up every transaction on the five deeds annexed to the statement of claim (but not transactions which were reversed) together with the funds already paid to Mr Graeme Harris of $25,359.06 referred to in the deed makes a total of $109,726.05. 162 Quite apart from these various written authorisations, the deed also refers to 'remuneration to be agreed in relation to the setting up and ongoing maintenance of the said fundings'. That is so vague as to be meaningless. What is clear is that the question of remuneration to someone for 'maintenance of the said fundings' had not been agreed at that point. There is no pleading in relation to just what might have been involved in 'maintenance of the said fundings'. 163 By par 9 of the statement of claim, the plaintiffs pleaded that 'from on or about 30 June 2000 the First, Second and Third Plaintiffs necessarily incurred costs and disbursements associated with' Ms Hall's insurance claim in relation to the fire at the Railway Hotel, her purchase of the Colliefields Hotel in Collie, town planning requirements associated with the proposed development of the Hazelmere property and expenses and disbursements associated with the Citibank loan, the preparation and stamping of the deed of 5 October 2000 and the payment of the $24,000 to Mr Harris. 164 Clearly some of these pleaded expenses predate the first deed of 5 October 2000. Clearly also, the purchase of the Colliefields Hotel in Collie and town planning requirements associated with the proposed development of the Hazelmere property were not agreed in that deed. Significantly, there is no pleading that Ms Hall actually agreed to these extra costs being incurred on her behalf. 165 They pleaded that, apart from a single payment of $610, Ms Hall had neglected or refused to pay the remaining sum owing, that sum being claimed as $144,871.47. The particulars of the sum are as follows: By agreement dated 5th October 2000 the Defendant agreed to indemnify and repay the First, Second and Third Plaintiffs expenses and disbursements in relation to all those items outlined in Schedules 'C' and 'D' attached to this Statement of Claim. 166 The total sum of $144,871.47 claimed by the plaintiffs represents the total of the transactions claimed in Schedules C and D. (Page 33)
167 Schedule C lists multiple transactions between 30 June 2000 and 1 August 2002, together with interest accruing, the total sum being $135,916.47. The items include legal fees to several lawyers, a Citibank valuation fee, accountancy fees, three company registrations, a deposit on a truck, a door lock and sensor light from Bunnings, security for a motor vehicle, vehicle repairs, mobile phone bills, a $20,000 deposit for Colliefields Hotel, payment to Dirk Arkeveld for 'survey, consultation, drawings etc re Hazelmere' and interest payments due 'for late settlement on Hotel'. Clearly, many of those transactions were not agreed in the deed of 5 October 2000. 168 Schedule C is simply a schedule of transactions – it is not signed or acknowledged in any way by Ms Hall. Although I have not checked every single one, it would seem that all or most of the 27 authorised transactions in the five photocopies of the second deed are to be found in Schedule C, with some differences as to dates. There are, however, 70 transactions included in Schedule C. 169 In his affidavit of 11 February 2010, Mr Law deposes that another part of his claim was for monies under Schedule C which itemised actual accounts which he paid on behalf of Ms Hall for her Kalgoorlie litigation matter, her purchase of Colliefields Hotel and other miscellaneous debts owed by her to third parties, which he deposes was 'pursuant to the first and second agreement'. 170 I can find no valid contractual basis pleaded for any transaction which does not fall within the scope of the first deed, and was not the subject of a specific written authorisation in the second deed. 171 Schedule D, which is not the subject of any pleading over and above that quoted above, appears to be a list of meetings attended and time spent plus fuel costs. My impression from the documents is that this is time said to have been spent by Mr Law, probably, attending to Ms Hall's affairs. Deputy Registrar Hewitt made the same assumption. 172 That is consistent with Mr Law's affidavit of 11 February 2010, which was before the deputy registrar, in which Mr Law deposes that another part of his claim against Ms Hall was for monies under Schedule D 'which itemised work that I did for the Defendant, charged on an hourly rate plus expenses, pursuant to the First and Second agreement, as agreed by the Defendant'. 173 Paragraphs 10, 11 and 12 of Mr Law's affidavit sworn 6 July 2010, in support of his appeal, however, give cause for concern. The affidavit (Page 34)
contains a lot of material which is really legal submissions, rather than facts, and the annexures are all misnumbered and renumbered, which makes it difficult to ascertain precisely which annexures Mr Law relies upon for his assertions. But the paragraphs appear to relate to the costs the subject of Schedule D. 174 Mr Law states that Deputy Registrar Hewitt misconstrued Nancy Hall's 'obligations to pay for additional costs to the second corporate plaintiff'. Mr Law goes on: 175 MFL5, which is not annexed, was described as 'page of … the LOAN DEED … which specifies the contractual obligations of the parties affecting the liability for costs of servicing the loans'. There is no pleading specifying what those costs might have been in any event, but it did not extend to solicitors fees and court costs. What these paragraphs quoted above reflect is a broad attitude of general entitlement which bears no connection to what was agreed between the parties. 176 Certainly there is no signature or acknowledgement of Schedule D by Ms Hall. I can see no means by which these items can be said to have been the subject of the deed of 5 October 2000. Many predate the deed. Others plainly relate to the purchase of the Colliefields Hotel. Another relates to the development of the Hazelmere property. It is apparent from the terms of the second deed that, as at 4 November 2000, no agreement had been reached concerning any remuneration for the 'setting up and ongoing maintenance of the said fundings' and there is nothing in that deed which contemplates Mr Law attending meetings for remuneration. There is no pleading which grounds a claim for generally attending meetings or performing other tasks at a rate of $45 per hour plus fuel costs. 177 On the basis of the pleadings overall, I can see no basis for any claim by Mrs Cheryl Law at all, there being no pleading to the effect that she guaranteed any loan, or that Spunter Pty Ltd defaulted on the loan from (Page 35)
Citibank and hence Citibank called upon a director's guarantee. For similar reasons, I can see no basis for any claim by Mr Law as guarantor. 178 The only claim which I had understood related to him personally was the claim encapsulated in Schedule D, which I gathered, upon looking at the schedule, related to his time, but was not the subject of any specific pleading grounding that claim. But if indeed it relates to Spunter Pty Ltd, I see no basis for it claiming any of the sums listed in Schedule D, again because there is no pleading grounding such a claim. |