Lunt v Briggs [No 4] - [2010] WASC 380

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL

CITATION: LUNT -v- BRIGGS [No 4] [2010] WASC 380

CORAM: CORBOY J

HEARD: ON THE PAPERS

DELIVERED : 10 DECEMBER 2010

FILE NO/S: CIV 1501 of 2001

BETWEEN: WILLIAM TREVOR LUNT
Plaintiff
AND
PETER BRIGGS
First Defendant
NEW RESOURCE HOLDINGS PTY LTD
Second Defendant

FILE NO/S :CIV 1974 of 2001

BETWEEN :WILLIAM TREVOR LUNT
Plaintiff
AND
NEW RESOURCE HOLDINGS PTY LTD
First Defendant
NEW RESOURCE HOLDINGS PTY LTD
Second Defendant

Catchwords:

Costs - Application to cancel property (seizure and sale order) - Indemnity costs of the application - Turns on own fact

Legislation:

Civil Judgments Enforcement Act 2004 (WA), s 15(5), s 15(5)(e), s 59, s 60(1), s 60(2), s 61, s 80, s 103, s 103(2), div 2 pt 4
Civil Judgments Enforcement Regulations 2005 (WA), reg 38
Transfer of Land Act 1893 (WA), s 133

Result:

Plaintiff to pay the costs of the application on an indemnity basis

Category: B

Representation:

CIV 1501 of 2001

Counsel:

Plaintiff:     Mr B W Duckham
First Defendant             :     Mr S P Paonni
Second Defendant         :     Mr S P Paonni

Solicitors:

Plaintiff:     B W Duckham & Co
First Defendant             :     Vincent Partners
Second Defendant         :     Vincent Partners

CIV 1974 of 2001

Counsel:

Plaintiff:     Mr B W Duckham
First Defendant             :     Mr S P Paonni
Second Defendant         :     Mr S P Paonni

Solicitors:

Plaintiff:     B W Duckham & Co
First Defendant             :     Vincent Partners
Second Defendant         :     Vincent Partners

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

Brookvista Pty Ltd v Meloni [2009] WASCA 180
Colgate‑Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225
Flotilla Nominees Pty Ltd v Western Australian Land Authority [2003] WASC 122; (2003) 28 WAR 95
Lunt v Briggs [2009] WASC 134
Lunt v Briggs [No 3] [2010] WASC 219
Lunt v New Resource Holdings Pty Ltd [No 2] [2010] WASCA 169
Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129

CORBOY J:

Introduction

The defendant, Mr Briggs, successfully applied to cancel a property (sale and seizure) order (the PSSO) that had been issued under the Civil Judgments Enforcement Act 2004 (WA) (the Act) to the plaintiff, Mr Lunt. Mr Briggs sought the costs of the application on an indemnity basis. I directed that the parties file written submissions, with the question of costs to be determined on the papers.
I have decided that Mr Lunt should pay the costs of the application on an indemnity basis for the following reasons.

The Suspension Order and the circumstances in which the PSSO was made

This matter has a protracted history, only a fragment of which is relevant to these reasons. That fragment is sufficiently captured in the judgment delivered by EM Heenan J on 1 July 2010 in Lunt v Briggs [No 3] [2010] WASC 219.
His Honour's judgment expressed the reasons why he set aside orders that had been made by consent and which provided that:
(a)Mr Lunt was not entitled to proceed to enforce the judgments delivered in CIV 1501 of 2001 or CIV 1974 of 2001 until judgment in appeal CACV 60 of 2009 had been handed down;
(b)New Resource Holdings Pty Ltd (a company associated with Mr Briggs) was not entitled to enforce the judgment delivered in CIV 1489 of 2001 until judgment in appeal CACV 78 of 2008 had been handed down.
EM Heenan J held that the orders staying enforcement of the various judgments had been agreed on a shared assumption that the appeals that had been commenced would be prosecuted expeditiously and according to the timetable prescribed by the Supreme Court (Court of Appeal) Rules 2005 (WA). According to Mr Lunt, that assumption had not been realised and so he applied to set aside or modify the order that conditioned his entitlement to proceed to enforce the judgments in his favour.
The parties appeared on the application on several occasions, his Honour observing that the interlocutory proceedings 'were becoming bogged down and were themselves generating a series of hearings and controversies requiring time and effort out of all proportions to any possible utility' [17]. The disputation noted by his Honour no doubt reflected the animosity between the parties that was readily apparent from the papers that I have reviewed ‑ and see Lunt v Briggs [2009] WASC 134 [18].
It appears from his reasons that EM Heenan J formed a tentative view that Mr Lunt's application to vary or set aside the stay order that applied to him raised questions that were more appropriately dealt with by the Court of Appeal. Nevertheless, he determined that the most efficient way of proceeding was for both stay orders to be set aside leaving 'the field free for any applications for renewed orders suspending enforcement of any of the three judgments to be dealt with on the merits and subject to such terms and conditions as may be appropriate either as directed by the court or with the consent of the parties' [30]. His Honour also considered that setting aside the consent stay orders would provide 'the opportunity, although not the obligation, for the parties to apply for any further orders suspending enforcement of any of the judgments to the Court of Appeal' and that this would have the advantage that any application would be heard and determined by the court seized of the various appeals [30].
On 8 July 2010, Pullin JA made the following order on the application of Mr Briggs and New Resource Holdings:
Subject to order 2, the respondent [Mr Lunt] will not be entitled to proceed to enforce the judgments in CIV 1501 of 2001 or CIV 1974 of 2001 until the judgment in appeal CACV 60 of 2009 has been handed down.
The parties referred to the order made by Pullin JA as the 'Suspension Order' and I will do likewise.
The Suspension Order was made after the consent stay orders had been set aside but prior to EM Heenan J publishing his reasons. Consequently, Pullin JA made further orders that:
(a)Mr Lunt would be entitled to have Suspension Order discharged in the event that Mr Briggs and New Resource Holdings did not proceed with their appeal within the time limits set down by the rules or by the court;
(b)each party had liberty to apply to discharge the Suspension Order after reasons for decision were published by EM Heenan J.
Pullin JA noted that special circumstances were required to justify a suspension order. In this case, the special circumstances were constituted by the agreement between the parties that was reflected in the consent stay orders. He considered that there was no evidence that the agreement had been breached. Although there had been delays in the appeals being heard, they were progressing to a hearing under his supervision and he had previously extended the time for completing interlocutory steps: Lunt v New Resource Holdings Pty Ltd[No 2] [2010] WASCA 169 [3].
Mr Lunt did not apply to discharge the Suspension Order after EM Heenan J published his reasons and it remains in place.
On the day after Pullin JA made the Suspension Order, the court issued the PSSO to Mr Lunt. The making of the order is an administrative act. The application for the PSSO had been made in April 2010 (see par 5 of the affidavit of Sam Peter Paonni made on 1 September 2010 and the application dated 19 April 2010). The stay orders that had been made by consent were operative at the time that the application for the PSSO was made.

Steps taken by Mr Lunt in respect of the PSSO

On 13 July 2010, the PSSO was registered against the title to land owned by Mr Briggs and his wife (see attachment 'SPP 9' to the affidavit of Mr Paonni made on 31 August 2010 and the letter dated 6 September 2010 from Landgate to Mr Duckham and others being attachment 'SPP 2' to the affidavit of Mr Paonni made on 6 September 2010). The land against which the PSSO was registered was the City Beach residence of Mr and Mrs Briggs (the City Beach Land).
By letters ostensibly dated 12 July 2010, Mr Lunt wrote to Mrs Briggs and to the daughters of Mr and Mrs Briggs enclosing copies of the application to register the PSSO and referring to earlier correspondence said to have been dated 20 and 21 May 2010 respectively. Attachments 'SPP 1' to 'SPP 3' to the affidavit made by Mr Paonni on 31 August 2010 are copies of letters bearing the dates 20 May 2009 (a letter to Mrs Briggs) and 21 May 2009 (letters to the daughters of Mr and Mrs Briggs). I infer from the contents of those letters and find that:
(a)the letters that were attachments 'SPP 1' to 'SPP 3' to Mr Paonni's 31 August 2010 affidavit were created and sent on about the dates they bear and not in May 2010;
(b)the letters are the letters to which Mr Lunt referred in his correspondence dated 12 July 2010 to Mrs Briggs and her daughters (that correspondence must, in fact, have been created and sent some time shortly after 13 July as it enclosed the completed application for registration of the PSSO against the City Beach Land which was dated 13 July).
The letters bearing the date 12 July 2010 to Mrs Briggs and her daughters stated that a copy of the PSSO 'providing for the disposal of 5 Ocean Court, City Beach should Peter Briggs default in settlement of judgment' was attached. The letters to the daughters also stated that it would be open to Mr Lunt to recover any shortfall from them if there were insufficient funds to clear the debt owing to him.
The letter of 20 May 2009 that was sent by Mr Lunt to Mrs Briggs enclosed a copy of the judgment of EM Heenan J (that is, [2009] WASC 134) and advised that Mr Lunt was arranging 'through the Supreme Court formal Orders for "Property Seizure and Sale" of your assets in the event that you fail to meet judgment by Monday 1st June 2009'. Mrs Briggs was not a party to the proceedings determined by EM Heenan J despite Mr Lunt's reference to her satisfying the judgment. The only explanation provided in the letter as to why she might be liable to meet the judgment was in the following passage:
You will be aware that his Honour has referred to the 'Briggs' related entities and in that regard the assets of Essex Securities Pty Ltd, New Resource Holdings Pty Ltd, York Heritage Pty Ltd and others will be subject to recovery action to satisfy judgment.
New Resource Holdings was a party to the proceedings and judgment was entered against it as well as against Mr Briggs. The other entities to which Mr Lunt referred were not parties and do not appear to have been mentioned in the reasons delivered by EM Heenan J, although reference was made to Essex Properties Pty Ltd.
The letter to Mrs Briggs also stated:
In so far as your daughters are concerned, I trust you will want to exclude them from exposure to bankruptcy arsing from the offices they hold but as it is necessary I advise them of the potential in the event that either you or your husband fail to meet judgment, I will write accordingly to them.
There was no further explanation as to how Mr and Mrs Briggs' daughters might be liable to meet the judgment against their father.
The letters of 21 May 2009 to each of Mr and Mrs Briggs' daughters enclosed a copy of the letter to Mrs Briggs and advised that in the event of 'payment default by either or both of your parents that I will seek remedy from you following your parents being placed in bankruptcy'. The letters contained no explanation as to how the daughters could be liable to Mr Lunt.
The City Beach Land was subject to a mortgage granted to St George Bank. On 2 August 2010, Mr Lunt wrote to a manager of that bank enclosing a copy of a further letter bearing the same date and sent to Mrs Briggs. The letter to Mrs Briggs, copied to St George Bank, was said to be for the purpose of updating Mrs Briggs on 'developments'. In summary, the letter advised that:
(a)The PSSO had been registered against the City Beach Land.
(b)The 'Perth sheriff' was 'in receipt of all documents for execution in due course'.
(c)An auctioneer had been appointed to conduct the sale of the City Beach Land and wished to arrange a suitable time for inspection in the company of the sheriff so that he might 'advise the Sheriff and myself on a likely market price, as any shortfall will be recoverable against the assets of your daughters Jodie and Heidi'.
(d)Mr Lunt was liaising with St George Bank and the Commonwealth Bank in respect to the debt due to them by way of their secured mortgage.
(e)A sign company had been engaged to prepare a small notice of A4 size for 'attachment at a prominent position on the dwelling recording the PSSO' and a 'large properly worded street sign advising of the proposed auction by the Sheriff'.
(f)The small notice was attachable immediately but Mr Lunt had 'undertaken' not to proceed with an auction until the Suspension Order was lifted. The auction was expected to be in the coming weeks.
(g)Mr Lunt regretted that it was necessary to take this action but Mr Briggs' appeal had no chance of success and Mr Lunt wished to be immediately ready to proceed with the auction when appropriate.
(h)A copy of the letter of 2 August 2010 had been sent to Mr and Mrs Briggs daughters so that 'they may be aware of the exposure faced by them'.
On 3 August 2010, St George Bank wrote to the sheriff's office regarding the PSSO (attachment 'SPP 11' to Mr Paonni's affidavit made 31 August 2010). The letter referred to the position of the bank as registered mortgagee of the City Beach Land and requested that any advertising undertaken by the sheriff should record its interest and clarify aspects of the proposed sale.
It appears from Mr Lunt's correspondence with Mrs Briggs and the St George Bank that he had caused the PSSO to be lodged with the Sheriff's office sometime prior to 2 August 2010 (and see par 6 of Mr Paonni's affidavit made 1 September 2010). That is not disputed by Mr Lunt.
On 27 August 2010, the manager of the St George Bank sent an email to Mr Briggs stating that the Bank noted that:
(a)the PSSO had been registered against the City Beach Land;
(b)the PSSO 'relates to a judgment debt against the Judgment Debtor in the sun of $980,266'.
The email further stated that each of those matters constituted an event of default in respect of the Bank's mortgage and that the Bank would issue notices of demand in due course (attachment 'SPP 12' to the affidavit of Mr Paonni made 31 August 2010).
On 30 and 31 August 2010 there was an exchange of correspondence between the solicitors acting for Mr Briggs and Mr Lunt respectively. In that correspondence:
(a)Mr Duckham asserted that the Landgate application form for registration of the PSSO against the title to the City Beach Land contemplated that registration could be effected notwithstanding that a suspension order had been made under the Act (see attachment 'SPP 13' to Mr Paonni's affidavit made 31 August 2010).
(b)Mr Paonni responded by contending that the form was irrelevant to the question of whether Mr Lunt had breached the Suspension Order. In a second letter, he advised Mr Duckham that St George Bank had issued a notice of default based on the registration of the PSSO against the title to the City Beach Land and requested that the registration be urgently withdrawn (attachments 'SPP 14' and 'SPP 15' to Mr Paonni's affidavit made 31 August 2010).
(c)Mr Duckham replied by advising that he had sought instructions and that 'such instructions will I suggest depend upon advice as the form of replacement security which will be available and offered' (attachment 'SPP 16' to Mr Paonni's 31 August 2010 affidavit). In a further letter (attachment 'SPP 18' to Mr Paonni's 31 August 2010 affidavit), Mr Duckham clarified his reference to replacement security, stating that:
[M]y recent communication was obviously referring to replacement security for the existing charge against the land claiming and in respect to the whole of the judgment and costs.
I repeat therefore that should you wish my client to remove the validly lodged charge that he will need advice in particular as to a replacement security for the judgment and costs.
On 31 August 2010, Mr Briggs applied for orders that the PSSO be set aside or cancelled; that Mr Lunt immediately indemnify Mr Briggs for any loss incurred as a consequence of the registration of the PSSO and that 'provision be made' for the costs of the application to set aside the PSSO.
In the first week of September there was correspondence between Landgate and Mr Lunt and Mr Duckham concerning the registration of the PSSO against the title to the City Beach Land. It appears that a procedural step had been omitted by Landgate in registering the PSSO and submissions were invited as to whether the registration could be maintained. Mr Duckham responded on the behalf of Mr Lunt contending that the registration ought to be maintained but also advising that a 'replacement dealing' had been lodged with Landgate. On 20 September 2010, Mr Lunt advised St George Bank that the original dealing registering the PSSO had been withdrawn but a replacement dealing had been lodged (see the affidavit of Mr Paonni made 6 September 2010 and the attachments to that affidavit).
On 6 September 2010, Mr Lunt wrote to Mr Briggs stating that he was prepared to withdraw the PSSO and its registration against the title to the City Beach Land 'after consideration' of the details of the full extent of borrowing secured by Mr Briggs and his 'related corporate entities' against the land and any available substitute security. He also required a statement of assets and liabilities and an offer of settlement. The letter concluded, 'as you are no doubt aware, I am in discussion with St George Bank and their solicitors Minter Ellison regarding their formal demands against you following the PSSO and therefore recognise the importance of having this matter resolved quickly in order that you do not [lose] your home' (attachment 'WTL 2' to the affidavit of Mr Lunt made 6 September 2010).

The application to cancel the PSSO

It is relevant to a submission made by Mr Lunt on the question of costs to note that the application to cancel the PSSO was first made before Newnes JA in CACV 60 of 2009. His Honour declined to determine the application, ruling that the Court of Appeal did not have jurisdiction and that the application should be referred to a judge of the general division to be heard as soon as conveniently possible.
At the hearing of Mr Briggs' application to cancel the PSSO, Mr Lunt submitted that:
(a)Section 15 of the Act contemplated that further steps could be taken by a judgment creditor notwithstanding the making of a suspension order under that section. In particular, s 15(5)(e) provided that a court may make any necessary ancillary or consequential order when making a suspension order including an order that, among other things, prohibited or restricted dealings with a judgment debtor's property while the suspension order had effect. It was said that this provision anticipated that there might be dealings with the judgement debtor's property notwithstanding a suspension order unless the order expressly prohibited or restricted those dealings.
(b)Mr Lunt had obtained an order for a 'means enquiry' under div 2 pt 4 of the Act. There had been delays in the means enquiry being held and 'the existence of the current means enquiry listed for hearing on 8 October 2010 supports the status of the preparation, filing and obtaining of the PSSO'.
(c)The PSSO was registered against the title to the City Beach Land pursuant to a Landgate form that contemplated registration notwithstanding the making of a suspension order ‑ the form requested the applicant to state whether a suspension order had been made. Mr Lunt had disclosed that the Suspension Order had been made and consequently, had 'proceeded properly' in obtaining registration.
(d)No effort had been made to enforce the judgment given the terms of the Suspension Order; indeed, Mr Lunt had acknowledged that he could not enforce the judgment until the Suspension Order had been discharged in his letter dated 2 August 2010 to Mrs Briggs. Implicit in that submission was the proposition that the Suspension Order would only have been contravened if the City Beach Land had been actually sold.
(e)Mr Briggs had declined to indicate his ability to pay the judgment sums ordered by EM Heenan J or to offer alternative security or to state the amount secured by the mortgage granted to St George Bank and had consequently, 'demonstrated a lack of candour to assist in the exercise of any discretion' conferred on the court to set aside the PSSO.

I ordered that the PSSO be cancelled under s 103 of the Act for reasons that were given during the hearing of the application, reserving only the question of costs. In summary, I considered that:
(a)The Suspension Order was cast in wide terms: Mr Lunt was not entitled 'to proceed to enforce' the judgments awarded in his favour. The notion of enforcing a judgment extended, in my view, to steps taken in preparation for a 'final' act of enforcement such as the sale of the judgment debtor's property. That was reinforced by the additional words in the Suspension Order, 'to proceed'. The Suspension Order was not confined to prohibiting steps such as the actual sale of the City Beach Land or the appointment of a liquidator to New Resource Holdings.
(b)The question of whether the Suspension Order had been breached was determined by reference to the order and not by matters such as the form used by Landgate in registering a PSSO or the scope of the powers conferred on the court by s 15(5) of the Act.
(c)Mr Lunt had breached the Suspension Order by serving the PSSO on the sheriff. A PSSO is an order that authorises the sheriff to seize and sell the judgment' debtor's property: s 59 and s 60(1) of the Act. The order must be served on the sheriff: s 60(2) and see reg 38 of the Civil Judgments Enforcement Regulations 2005 (WA). The sheriff is obliged to register the order on receipt: s 61. The sheriff is then empowered to take a number of steps to realise sufficient of the judgment debtor's property to satisfy the judgment creditor's judgment, including by s 80 to seize and sell land in which the judgment debtor has an interest.
(d)Mr Lunt had also breached the Suspension Order by registering the order against the title to the City Beach Land. Section 133 of the Transfer of Land Act 1893 (WA) governs the effect of registration of a PSSO against the title to land. In summary, the section protects the sheriff from dealings with a saleable interest in the land that are inconsistent with the sheriff's right to deal with that interest under the PSSO. The section also facilitates registration of a dealing by the sheriff and extinguishment of the judgment debtor's title to the saleable interest. Accordingly, in my view registration of the PSSO against the title to the City Beach Land was a step taken by Mr Lunt in proceeding to enforce the judgments awarded against Mr Briggs.
(e)Mr Lunt further breached the Suspension Order by engaging an auctioneer for the sale of the City Beach Land. Again, that was a step taken in the process of enforcing the judgments.
(f)Mr Lunt had attempted to intimidate Mr Briggs and his family since the issue of the PSSO - the correspondence to Mrs Briggs and her daughters and to St George Bank, the registration of the PSSO, the appointment of an auctioneer and the references to having a sign erected at the City Beach Land. He then attempted to extract alternative security and other advantages such as an offer of settlement as the price for withdrawing registration of the PSSO with knowledge that the registration had allegedly caused an event of default under the mortgage over the City Beach Land.
(g)Mr Lunt had 'used' the PSSO in breach of the Suspension Order. The breaches, in themselves, were sufficient to justify setting aside the PSSO. However, Mr Lunt's conduct as outlined in the previous paragraph amply demonstrated why the PSSO ought to have been set aside immediately on the hearing of Mr Brigg's application. A submission by Mr Lunt that I should decline to exercise the discretion conferred by s 103(2) of the Act because Mr Briggs had failed to provide information concerning his assets was rejected for those reasons.

The relevant principles

The circumstances in which an indemnity costs order may be made were recently considered by the Court of Appeal in Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129(S). I adopt without reproducing the summary of the relevant principles that appears at [10] of the court's reasons. The principles identified by the court included:
(a)An indemnity costs order may be appropriate in situations which are shown to involve some element of improper, or at least unreasonable, conduct by a party or the party's legal advisers: see Colgate‑Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225, 233 (Sheppard J) referred to by Pullin J in Flotilla Nominees Pty Ltd v Western Australian Land Authority [2003] WASC 122(S); (2003) 28 WAR 95 [9].
(b)An indemnity costs order will constitute an appropriate sanction marking the court's disapproval of improper or unreasonable conduct: see Brookvista Pty Ltd v Meloni [2009] WASCA 180 [32], Flotilla [25].
In the balance of the court's reasons, the emphasis was on whether the conduct in question could be characterised as being unreasonable or improper. I adopt that as the touchstone by which Mr Briggs' application for indemnity costs should be determined.
In Flotilla, Pullin J observed that:
(a)An order for indemnity costs will only be made if there is some special or unusual feature in the case to justify a departure from the ordinary practice of awarding party and party costs. In effect, the court has jurisdiction to make an indemnity costs order whenever justice requires such an order: [8].
(b)There ought not to be a significant gap in Western Australia between party and party costs and solicitor‑client costs having regard to the basis upon which the scale of costs is determined in Western Australia. That fact, together with the power of the courts to formulate special costs orders, ought to obviate the need for indemnity costs orders in many instances. However, there was still a place for indemnity costs orders; such orders would be appropriate in cases where there had been improper or unreasonable conduct on the part of a party or his legal advisers so that the order would be a mark of disapproval on the part of the court about that conduct even though there should not be much difference in the costs recovered under such an order compared with recovery under a properly formulated special costs order: [25].

The parties' submissions on costs

Mr Briggs submitted that indemnity costs ought to be awarded as the breaches of the Suspension Order were blatant and Mr Lunt persisted in registration of the PSSO despite being advised by Mr Briggs, through his solicitor, that registration was a contravention of the order. Further, Mr Lunt had sought to use the fact of registration of the PSSO to advance his position. Finally, Mr Lunt had used the PSSO in a way that constituted an abuse of process ‑ it was used to 'harass' Mr Briggs' wife and daughters and to 'put pressure' on Mr Briggs to pay the judgment; to 'work around' the Suspension Order and to obtain security for the judgment when an application for security had been dismissed by EM Heenan J in May 2010.
Mr Lunt submitted that:
(a)the PSSO had been issued by the court with knowledge of the Suspension Order;
(b)Mr Lunt had pointed out on several occasions that he had no intention of enforcing the PSSO and had intended to abide by the Suspension Order;
(c)the steps taken by Mr Lunt had to be considered against the background of s 15(5)(e) of the Act, which contemplated the 'co‑existence of a suspension order and a restriction on a Judgment Debtor dealing with assets';
(d)the application to set aside the PSSO had initially been made to the 'wrong court' and the costs of the appearance before Newnes JA should be paid by Mr Briggs and set off against any costs awarded for the hearing before myself;
(e)the question of whether Mr Lunt had breached the Suspension Order had been a moot prior to my ruling given that the PSSO had been issued by the court after the Suspension Order had been made and also because of the wording of the Landgate form for registration of the PSSO and the terms of s 15(5) of the Act;
(f)none of the special or unusual features identified by Pullin J in Flotilla were present - for example, by registering the PSSO, Mr Lunt had merely done what he was impliedly permitted to do as evidenced by the Landgate form and the registration of the PSSO was not the sole event of default relied on by St George Bank in issuing its notice.

Mr Lunt's affidavit of 14 September 2010

Mr Lunt filed three affidavits in opposition to the application by Mr Briggs to set aside the PSSO. One of those affidavits, made on 14 September 2010, contained Mr Lunt's explanation as to why he took the steps that he did following the making of the Suspension Order and the issue of the PSSO. It is necessary to briefly summarise the contents of that affidavit as they bear upon why I consider that indemnity costs should be awarded against Mr Lunt.
In his affidavit, Mr Lunt stated that:
(a)He wrote to Mrs Briggs as she was a director of New Resource Holdings. He believed that it was necessary that she be 'fully acquainted as to the overall position', especially as he recalled that Mr and Mrs Briggs each gave evidence at the trial conducted before EM Heenan J that Mr Briggs did not discuss his business affairs, including the litigation between himself and Mr Lunt, with Mrs Briggs. With that in mind, Mr Lunt 'thought it simply prudent to respectfully inform her of matters of fact' and this he did by letters dated 20 May 2009, 12 July 2010 and 2 August 2010.
(b)In those letters, he pointed out that he would only 'pursue matters in the event of default by her husband'. He also pointed out the existence of the Suspension Order and that he would only act 'when appropriate'. In his letter dated 2 August 2010, he had advised that the Perth sheriff was in receipt of all documents for execution 'in due course', that he had 'undertaken' not to proceed with the auction until the Suspension Order was lifted and that he wished to be ready to proceed with the auction 'when appropriate'.
(c)He had informed the auctioneer that the auction would not take place immediately and that it might not occur at all.
(d)He had advised the sign company that the signage would not be required immediately and no firm order for signage was placed for the manufacture of the signs.
(e)In his discussions with the sheriff, 'he and I understood that nothing could take place while a suspension order was in existence' and no fees were paid or requested with respect to the possibility of engaging or requiring his services.
(f)Orders had been made for a means enquiry under the Act but there had been non‑compliance with those orders and at a hearing on 20 August 2010, Pullin JA acknowledged that Mr Briggs and New Resource Holdings had not demonstrated an ability to meet any order for costs.

Was Mr Lunt's conduct improper or unreasonable?

I consider that Mr Lunt's conduct in connection with the PSSO following the making of the Suspension Order was improper and unreasonable and warrants the sanction of indemnity costs on Mr Briggs' application to set aside the order.
The scope of the Suspension Order was not, in my view, ambiguous and the breaches of the order by lodging the PSSO with the sheriff and registering it against the title of the City Beach Land ought to have been obvious. I hesitate to conclude that the breaches were, by themselves, sufficiently egregious to warrant an indemnity costs order only because the circumstances in which the PSSO was issued are not entirely clear. It appears that the principal registrar may have been aware of the Suspension Order at the time that the PSSO was issued and that prior to the issue of the order, Mr Duckham had informed the Court Orders co‑ordinator that Mr Lunt did not intend to enforce the judgment (see par 14 of Mr Paonni's affidavit made 31 August 2010).
It does not seem to me that it was for the principal registrar to determine how the issue of the PSSO might be reconciled with the terms of the Suspension Order (and it may well be that the principal registrar did not have the terms of the Suspension Order before him when the PSSO was issued). However, Mr Lunt was bound by the Suspension Order and the relevant question for him was step, if any, he could take in relation to the PSSO once it had been issued. That was to be determined by reference to the terms of the Suspension Order and not merely by reference to the fact that the PSSO had been issued as an administrative act following the making of the Suspension Order. Nevertheless, I concede that there may have been some uncertainty created by the issue of the PSSO ‑ it may have been understood as an indication that Mr Lunt was free to take those steps that ordinarily follow on the issue of a PSSO despite the Suspension Order having been made.
However, in my view Mr Lunt's conduct in connection with the PSSO following the making of the Suspension Order was improper and unreasonable. I do not consider that the matters stated in his affidavit made on 14 September 2010 satisfactorily explain his conduct.
First, the correspondence to Mrs Briggs and her daughters in July and August 2010 cannot be properly characterised as merely informing them of 'matters of fact':
(a)That characterisation does not accurately reflect the tone of the correspondence, especially when read with the letters of 20 and 21 May 2009.
(b)There was no explanation in the affidavit as to why Mr Lunt considered that it was appropriate that he should communicate with Mr and Mrs Briggs' daughters at all or how they could be liable to him.
(c)There was also no proper explanation provided for Mr Lunt writing to Mrs Briggs - the evidence suggested that New Resource Holdings was represented by solicitors at all relevant times.
(d)Mr Lunt's statement that he pointed out that he would only pursue matters in the event of default by Mr Briggs ignores the references in the letter of 20 May 2009 to Mrs Briggs paying the judgment sums awarded by EM Heenan J.
(e)Mr Lunt's reference to aspects of the letter of 2 August 2010 to Mrs Briggs which indicated that he intended to abide by the Suspension Order was selective. The letter of 12 July 2010 stated that the PSSO provided for disposal of the City Beach Land if Mr Briggs defaulted in settlement of the judgment without any indication that Mr Lunt was not entitled to immediately proceed under the PSSO. The references in the letter of 2 August 2010 to 'execution in due course' and proceeding with an auction 'when appropriate' were ambiguous, while the references in the letter to registration of the PSSO against the title to the City Beach Land, the appointment of an auctioneer, liaising with St George Bank and the Commonwealth Bank in respect of debts due to them, preparation of signs advertising the proposed auction and the expectation that the Suspension Order would be lifted in the coming weeks suggested that steps were being taken for an auction of the City Beach Land in the immediate future pursuant to the PSSO.
(f)The statement in the letter of 2 August 2010 that Mr Lunt had 'undertaken' not to proceed with an auction until the Suspension Order had been lifted reinforced the impression conveyed by the letter that execution pursuant to the PSSO was a matter that rested with him.
Second, Mr Lunt's explanation in his affidavit of 14 September 2010 that he had informed the auctioneer that the auction would not take place immediately and might not occur at all and that he had not placed a firm order for signs also indicated that the letter of 2 August 2010 to Mrs Briggs, with copies to her daughters, was intended to do more than merely inform them of developments. The clear impression conveyed by the letter was that steps were being taken for the sale of the City Beach Land in the near future if Mr Briggs did not pay out the judgment sums that had been awarded by EM Heenan J. Mr Lunt's statements concerning the information he provided to the auctioneer and the sign company reinforce the conclusion that the letters were intended to place pressure upon Mr Briggs to pay the judgment sums ordered by EM Heenan J notwithstanding the pending appeals.
Third, Mr Lunt both directly and through his solicitor, Mr Duckham, sought to take advantage of the issue of the PSSO and its registration against the title to the City Beach Land when Mr Briggs protested that registration of the PSSO contravened the Suspension Order. I do not consider that to have been a reasonable response given that Mr Briggs had asserted that registration of the PSSO against the title to the City Beach Land was a contravention of a court order and that there was a reasonable basis for that assertion.
It is also relevant in this context that Mr Lunt sought to take advantage of the effect that registration of the PSSO apparently had on the position of St George Bank to add to the pressure he was seeking to exert on Mr Briggs to pay the judgment sums immediately. His letter of 6 September 2010 to Mr Briggs suggested that he was in a position, through the PSSO, to confer with St George Bank about defaults under the mortgage granted in respect of the City Beach Land and any step that might be taken by the Bank to realise on its security. Moreover, both events of default identified by St George Bank in its email to Mr Briggs referred to the PSSO.
As to the other matters raised by Mr Lunt in opposition to an indemnity costs order:
(a)A suspension order is directed to the judgment creditor. Section 15(5)(e) is directed to the position of the judgment debtor. The fact that the court is empowered to make ancillary orders to, for example, ensure that the judgment debtor does not deal with property in a way that is inconsistent with or may defeat the judgment creditor's rights provides no basis for suggesting that Mr Lunt was entitled to lodge the PSSO with the sheriff and to proceed to have it registered against the title to the City Beach Land. Section 15(5)(e) was irrelevant to Mr Lunt's position; his position was governed by the Suspension Order.
(b)Similarly, the form used by Landgate for the purpose of registering a PSSO was irrelevant. The question was whether Mr Lunt was entitled to proceed to register the PSSO given the terms of the Suspension Order, not what might be inferred from a form used by Landgate for administrative purposes.
(c)As to the costs of the appearance before Newnes JA, his Honour reserved the question of costs. As I have already indicated, the matter came before him as an application in CACV 60 of 2009. That was the basis on which his Honour accepted Mr Lunt's argument that the application had been commenced in the 'wrong' court. The question of the costs of the hearing before Newnes JA is a matter for the Court of Appeal in CACV 60 of 2009. However, I do not consider that the reason why Newnes JA referred the matter back to a judge in the general division provides a basis for concluding that Mr Briggs ought not to have the costs of the application that was heard before me or that those costs should not be indemnity costs. His Honour indicated that he had not formed a final view as to whether the Suspension Order had been contravened but it is clear from a review of the transcript of the hearing that he was surprised by the proposition that registering the PSSO against the title to the City Beach Land and purporting to appoint an auctioneer and arranging for signs were not steps taken to proceed to enforce the judgment. As his Honour observed, the dictionary defines the meaning of 'proceed' as to 'begin with, to begin or carry on with' (ts 29). His Honour's observations ought to have provided some guidance to Mr Lunt on the approach that should have been taken to Mr Brigg's application for cancellation of the PSSO on its referral back to the general division. I would add that what occurred following the setting aside of the consent stay orders does not reflect my understanding of the reasons why EM Heenan J considered that those orders ought to have been discharged.