M, PJ v W, JW

[2014] SASC 87

SUPREME COURT OF SOUTH AUSTRALIA

(Civil: Application)

M, PJ v W, JW

[2014] SASC 87

Judgment of The Honourable Justice Bampton

4 July 2014

APPEAL AND NEW TRIAL - APPEAL - PRACTICE AND PROCEDURE - SOUTH AUSTRALIA - SECURITY FOR COSTS

Appellant appeals against the dismissal of a claim for a division of property pursuant to the Domestic Partners Property Act 1996 (SA) – order sought striking out grounds of appeal pursuant to Rule 295 of the Supreme Court Civil Rules 2006 (SA) – grounds 1, 2 and 3 of the grounds of appeal struck out.

PROCEDURE - COSTS - SECURITY FOR COSTS - POVERTY - LACK OF MEANS

Application by the respondent for security for costs of the appeal – Court’s power to order security for costs of an appeal under Rule 295(1)(g) of the Supreme Court Civil Rules 2006 (SA) – whether special circumstances exist – appellant’s impecuniosity and limited prospects of success justify the making of an order for security – appellant to provide security for costs.

Domestic Partners Property Act 1996 (SA); Supreme Court Civil Rules 2006 (SA) r 295, r 295(1)(g), r 295(3), r 282(2)(c), referred to.
Wride v Werner [2004] SASC 211; Durham v Durham (2011) 80 NSWLR 335; Ramstrom v Baldino [2014] SASC 29; Cowell v Taylor (1885) 31 Ch D 34; Citicorp Australia Ltd v Cirillo (2003) 228 LSJS 132; Poulet Frais Pty Ltd v The Silver Fox Company Pty Ltd (2005) 220 ALR 211; Sands v State of South Australia [2013] SASC 105; Fox v Percy (2003) 214 CLR 118; Hogg v Roberts (2003) 87 SASR 248; Diakos v Mason [2010] SASC 108; Melunu Pty Ltd v Claron Constructions Pty Ltd & Ors [2004] NSWSC 1064; Foxgold Pty Ltd v Paterson [2005] SASC 376; Cooper v Lees (2009) 267 LSJS 53, considered.

M, PJ v W, JW
[2014] SASC 87

Civil: Application

1. BAMPTON J:  This is an application by the respondent, W, for an order that grounds 1, 2, 3 and 11 of the notice of appeal be struck out and an order for security for his costs of the appeal.

   The appeal

2. The appellant, M, has appealed the decision of a District Court Judge refusing her an extension of time to institute proceedings for a division of property pursuant to the Domestic Partners Property Act 1996 (SA) (“the Act”) and dismissing her claim.

   The District Court proceedings

3. On 4 April 2014, following a 14 day trial, the Judge held that M and W were in a close personal relationship as defined by the Act from January 2004 until September 2008. He found that M had contributed within the meaning of s 11 of the Act; but that her claim should be dismissed on the basis that her contributions have been significantly recognised and compensated for. He further found that the parties had resolved and settled the claim as between themselves in or around November 2008 and he was not satisfied that an extension was necessary to avoid serious injustice to M.

   Power of the Court to strike out grounds of appeal and order security

4. Rule 295 of the Supreme Court Civil Rules 2006 (SA) sets out the Court’s powers incidental to an appeal.

5. Rule 295(3) provides that a single Judge has power to exercise the discretion to order security and “any other power incidental to the conduct or determination of an appellate proceeding”.  As submitted by W’s counsel, the striking out of a ground of appeal is incidental to the conduct of the appellate proceedings. 

6. Rule 295(1)(g) provides that if special circumstances exist the power to order that security be given for the costs of an appeal is enlivened

7. W complains that grounds 1, 2, 3 and 11 of the grounds of appeal disclose no appealable error and should be struck out.  He argues that the discretionary power to order security is enlivened by the existence of special circumstances, namely the impecuniosity of M.  By reason of her impecuniosity and the weakness of her grounds of appeal, W submits that the discretion to order security should be exercised in his favour. 

8. M opposes the orders sought and, in her affidavit sworn 11 June 2014,[1]  asserts that she is impecunious and that the reason she is impecunious “is substantially because of the conduct of W in accumulating wealth in his own hands during the course of the relationship and ensuring that they were not accumulated jointly”. 

   [1]    FDN 11.

   The grounds of appeal

9. Rule 282(2)(c) prescribes that the notice of appeal “must state in detail the grounds of the appeal”. 

10. Grounds 1, 2 and 3 of the notice of appeal state respectively that the trial Judge, erred in dismissing M’s claim, erred in refusing to grant an extension of time, and erred in dismissing the alternative claim in equity.  It is not sufficient to allege that a trial Judge erred in law or fact.  These three grounds of appeal do not identify the error that is complained of, or the respect in which it is alleged that the decision of the trial Judge was wrong.  The notice of appeal must identify errors that are capable of being corrected on appeal.[2]

    [2]    Wride v Werner [2004] SASC 211 at [33]-[35]; Durham v Durham (2011) 80 NSWLR 335 at 349.

11. M’s counsel agreed that grounds 1 to 3 of the notice of appeal are formulaic. He contended that grounds 4 to 13 effectively support ground 1, but that M is prepared to make any appropriate amendments. 

12. Ground 11 alleges that the Judge erred in finding that M’s contributions had been sufficiently recognised and compensated for.

13. M’s counsel argued that ground 11 raises an issue upon which an appeal court might well intervene.  It was submitted that the question in this case as to whether contributions to the relationship had been sufficiently recognised and compensated for is a factual consideration which gives rise to elements of fact, degree, opinion or judgment upon which an appellate court can form its own view and intervene if appropriate.  It was submitted that the appeal court will be taken to the evidence pertaining to Ground 11 and it will be required to make its own assessment of that evidence.

14. In my view grounds 1, 2, and 3 of the grounds of appeal fail to disclose any appealable error and should be struck out.  Ground 11 arguably raises a factual issue upon which an appeal court might intervene. I decline to strike out ground 11.

    Security for costs – the enlivening of the discretion

    Impecuniosity

15. M’s impecuniosity is a significant matter bearing on the existence of special circumstances.[3]

    [3]    Sands v State of South Australia [2013] SASC 105.

16. M alleges her impecuniosity has been substantially brought about by W’s conduct. In Ramstrom v Baldino,[4] the respondent to a security for costs application made a similar submission.  In that case, Nicholson J noted that that submission “is contradicted by the findings of the tribunal as they presently stand”.[5]  So too in this matter, M’s allegation is contradicted by the findings of the Judge as they presently stand.

    [4] [2014] SASC 29.

    [5] [2014] SASC 29 at [30].

17. The Court in Melunu Pty Ltd v Claron Constructions Pty Ltd & Ors[6] stated that a respondent making such a submission must establish a “real causal connection between the conduct” alleged to have caused the impecuniosity and the impecuniosity and that “mere general assertions, not supported by evidence, will not suffice”.[7]

    [6] [2004] NSWSC 1064.

    [7] [2004] NSWSC 1064 at [31].

18. M’s allegation is a mere assertion which has no foundation having regard to the trial Judge’s findings and reasons for judgment. 

    A weak case on appeal

19. In addition to impecuniosity, W also relies on M’s weak case on appeal to establish special circumstances. 

20. W contends that the grounds of appeal disclose only that M disagrees with the Judge’s assessment of the evidence.

21. The Judge gave lengthy and detailed reasons for his decision.  It is not necessary for the purposes of determining this application to analyse and dissect the reasons. However, it is clear His Honour has detailed his assessment of the evidence and conclusions regarding credibility.[8]  He said with respect to M:[9]

    The overwhelming impression the plaintiff gave in her evidence about her finances was of an intelligent, precise and shrewd financial operator.

    …

    Overall, while the plaintiff was an intelligent, well organised witness, in many respects her evidence was unsatisfactory and lacked credibility. There were many aspects of her evidence, as discussed, that were difficult to accept, inherently unlikely, or left the court with a sense of unlikelihood or unease. …

    And with respect to W, his Honour concluded:[10]

    Overall, the defendant was a more consistent, logical and impressive witness. On all the areas of major dispute the defendant’s evidence had the ring of truth about it, whereas the plaintiff’s did not.

    [8] [2014] SADC 58 at [341]-[346].

    [9] [2014] SADC 58 at [25], [342].

    [10] [2014] SADC 58 at [344].

22. The assessment of the evidence and in particular the “evaluation of witnesses’ credibility” was a matter for the Judge who had “advantages that derive from the obligation at trial to receive and consider the entirety of the evidence and the opportunity, normally over a longer interval, to reflect upon that evidence and to draw conclusions from it, viewed as a whole”.[11]

    [11]   Fox v Percy (2003) 214 CLR 118 at [23].

23. Like the respondent to an application for an order for security in Foxgold Pty Ltd v Paterson,[12] in order to succeed on appeal M “will have to overturn findings of credit made by the trial Judge based on his assessment of the witnesses”.

    [12] [2005] SASC 376 at [13].

24. Further, the Judge’s task in determining the claim for division of the property under the Act was to adopt a “reasonably broad and practical approach” whilst bearing in mind that the object of the Act is to divide property “in a way that is just and equitable”.[13] M’s prospects of success on appeal must be considered having regard to the jurisdiction conferred by the Act. The jurisdiction being exercised was a “wider, different and more flexible” power than the court has when applying equitable principles.[14]

    [13]   Hogg v Roberts (2003) 87 SASR 248 at [17]-[18].

    [14]   Cooper v Lees (2009) 267 LSJS 53.

25. Having considered the matter carefully, I find M’s appeal lacks substantial merit such that her prospects of success on the appeal are weak. 

    Conclusion on special circumstances

26. I am satisfied that special circumstances have been established and the Court’s power to award security has been enlivened.

27. It would be very rare for a plaintiff pursuing a claim for division of property under the Act to be burdened with an order to provide security at the trial stage. As stated by Bowen LJ in Cowell v Taylor:[15]

    The general rule is that poverty is no bar to a litigant; that, from time immemorial, has been the rule at common law, and also, I believe, in equity.  There is an exception in the case of appeals, but there the appellant has had the benefit of a decision by one of Her Majesty’s Courts, and so an insolvent party is not excluded from the Courts, but only prevented, if he cannot find security, from dragging his opponent from one Court to another.

    [15] (1885) 31 Ch D 34 at 38. Sulan J applied this reasoning in Citicorp Australia Ltd v Cirillo (2003) 228 LSJS 132 at 134-137.

28. In Diakos v Mason,[16] Kourakis J (as he then was) stated that when security is sought on appeal greater weight should be given to impecuniosity than it is given when sought at trial. He went on to say:[17]

    …  An order for security for costs by a trial Judge may deny a plaintiff the important right to a judicial determination of his or her claim for redress of a wrong.  However, the appellant has had the benefit of a judicial determination of the underlying controversy.  The statutory right of a further review by way of appeal is a safeguard against error, but the fact remains that the plaintiff has had his side of the controversy judicially determined and in fact determined adversely to him.  Moreover, the risk of injustice to an appellant if an order for security is prohibitive can be assessed with greater certainty on an appeal than at first instance.

    [16] [2010] SASC 108.

    [17] [2010] SASC 108 at [10].

29. I am satisfied that M’s impecuniosity, together with her prospects of success on appeal, warrant that the order for security should be made.

    Conclusion

30. W’s solicitor has deposed in his affidavit sworn 28 May 2014[18] that his estimate of solicitor and counsel fees for the appeal on a party/party basis is $27,183.08.  I consider that M should provide security in the sum of $25,000.

    [18]   FDN 6.

31. I make the following orders on W’s application:[19]

    1Grounds 1, 2 and 3 on the notice of appeal filed 24 April 2014 be struck out.

    2Unless and until the appellant provides a form of security to the value of $25,000 in respect of the respondent’s costs, the prosecution of the appeal is stayed.

    3The security is to be provided in a form acceptable to the Court and to the respondent.

    [19]   FDN 3.

32. I will hear from the parties as to any further orders.