Marchesini v Grieger

[2015] SADC 89

DISTRICT COURT OF SOUTH AUSTRALIA

(Civil: Application for Review)

MARCHESINI v GRIEGER

[2015] SADC 89

Judgment of His Honour Judge Tilmouth

5 June 2015

MAGISTRATES - APPEAL AND REVIEW - SOUTH AUSTRALIA

Dismissal of an application to set aside a default judgment for essentially unliquidated claims, with no reasons given.  Application to set-aside judgment remitted to the Magistrates Court for further determination.

Magistrates Court Rules r 133(5); Magistrates Court (Civil Rules) 2013 (SA) r 61, r 62(1) & 62(2), r 101, 103(1), 887(1); Magistrates Court Act 1991 (SA) s 38, s 38(7)(d)(ii) & (iii); Cubelic v T & D Lock Pty Ltd [2009] SASC 397; Skorpos v Georgiadis [2013] SASC 165, referred to.
T v Medical Board (SA) (1992) 58 SASR 382; Papps v Police (2000) 77 SASR 210, applied.

MARCHESINI v GRIEGER
[2015] SADC 89

1. The present application for review by the applicant Paolo Marchesini, is effectively his third attempt to set aside a default judgment to enable him to file a defence to an action against him, instituted by the respondent Ms Grieger.

2. The circumstances bringing him into the District Court are these.  It appears that in the period following Mr Marchesini’s release from prison in December 2009, Ms Grieger provided accommodation for him in her Unit at O’Halloran Hill.  So far as can be judged from the submissions of the parties, this was a relatively informal arrangement.  During the period of over about two and a half months, it is clear that she provided financial support, as well as in the provision of food and other daily essentials.

3. On 11 September 2014 she issued a Summons out of the Christies Beach Magistrates Court claiming a total of $6,652.39.  This was made up of a loan said to have been made to Mr Marchesini on 7 August 2009 of $2,500, $3,000 for the sale of a Vitara Suzuki vehicle, $150.00 for a service fee on the vehicle, interest charged on a credit card for amounts she expended in his favour using the card of $232.59, and for living expenses in the period between 11 December 2009 and 3 February 2010 of $750.00.  There was an additional unspecified claim for $19.80 for a ‘final notice’.

4. The lower court record indicates this Summons was dispatched by post for service on Mr Marchesini on 12 September 2014.  He does not claim that he did not receive it.  Issued on the Magistrates Court Form 3, this document pointed out that:

   If you have a defence or counter claim you must come up within 21 days of service of this claim … file a defence and/or counter-claim.

   No such document was filed.

5. On 4 October 2014 Ms Grieger submitted a request to the Registrar of the Court to sign judgment in default of a defence, and to issue an Investigation Summons pursuant to R 133(5) of the Magistrates Court Rules 2013.  Such a Summons was personally served on Mr Marchesini on 26 October 2014.  A handwritten note on the Summons indicates that on 21 January 2015 he was summonsed to appear at 10:00am ‘to answer questions about you will pay the above total owing’.  An endorsement suggests he did not appear and a warrant for his arrest was issued.  The total amount owing had risen to $7,101.11, the increase being attributable to an issue fee of $51.50, a service fee of $35.75 and interest since the last process of $92.97.

6. It appears from another endorsement on the court file that the warrant of arrest was executed at the ‘MCELZ Registry’ on 23 January 2015.  On that date Mr Marchesini filed a statement and ‘proof of income’, no doubt in anticipation of the investigation hearing.  That hearing was adjourned to 11.00am on 4 March 2015.

7. The order note of 23 January 2015 further recorded that he had applied to set-aside the judgment and that the investigation summons was to await the outcome of that application.  The court file indicates this application was made on 27 January 2015 and scheduled for hearing on 23 February 2015, at 10.00am.  The court file of 23 February reads:

   Application dismissed … at 10.30am there was no appearance by the defendant, the 15 minute rule applies.  On the application by the plaintiff the defendant’s application to set aside judgment is dismissed.

8. The reference therein to a 15 minute rule derives from Forms 23A-23J of the Magistrates Court Rules which are endorsed for the purposes of various hearings, ‘if you fail to attend within 15 minutes of the appointed time, the action may be determined in your absence’, and from Rule 101 of the Magistrates Court (Civil Rules) 2013 (SA), quoted later.

9. There is no evidence on the lower court file that any such notice was given in this instance.  If anything the file suggests Mr Marchesini was simply advised of the hearing date in February on 23 January 2015, although his application to set aside the judgment filed on that day had precisely that endorsement at the foot of page 1.  His affidavit in support stated the grounds to set aside were that he ‘didn’t realise I had to dispute it in 21 days’ and ‘I believe I don’t owe the money’.

10. When the application to set aside came on before a Magistrate on 23 February 2015, Mr Marchesini did not appear, as indicated earlier.  And so, on 16 March 2013 he brought another application to set aside judgment, stating once again in his supporting affidavit that he did not believe he owed the money:

    as I have done painting work for her as a verbal agreement … I was away working at the time and completely forgot that I needed to attend court.

11. In the meantime when the Investigation Summons was called on for hearing on 4 March 2015, a note records, ‘… payment in full within 28 days’ and that he ‘would not fill out financial statement or co-operate with court proceedings and stated that he wanted legal advice to appeal’.

12. Both parties appeared personally before the same Magistrate on 30 March 2015 when the second application to set aside the default judgment was also dismissed.  There is no transcript of the proceedings on that date and no reasons were given by the Magistrate, except for an endorsement that the application was dismissed.  The application for review was lodged with the District Court Registry at lunchtime, that very day.

13. Both parties maintained during the application for review in the District Court, that the hearing of 30 March occupied some time.  Both stated that they gave the Magistrate various explanations about the underlying claims in the case of the plaintiff, and reasons for the failure to attend in the case of the defendant.  Apart from generalisations of this kind, it is not at all evident precisely what took place on this second application to set aside.

14. Quite apart from the fact that there is no transcript, the insuperable difficulty facing the court is that the failure to give any reasons is an error of law which usually vitiates the underlying decision: T v Medical Board (SA),[1] Papps v Police.[2]  This leaves the court in the position that is unable to ascertain the reasoning upon which the decision was based, denies the opportunity to review those reasons and denies the losing party knowledge of the reasons for the dismissal, so that in the end result justice is not manifestly seen to be done: Papps v Police.[3]

    [1] (1992) 58 SASR 382, 394 and 423.

    [2] (2000) 77 SASR 210, [33].

    [3] Above [34].

15. But there was more in this instance.  First of all, Mr Marchesini had put in issue the existence of the underlying debts.  He informed the District Court  - as I expect he informed the Magistrate - that whatever benefits were provided to him by Ms Grieger they were repaid in kind by doing paintwork around her house.  He is a painter by occupation.  There was accordingly a situation in which a defence was not doomed to fail or unmeritorious on its face, so that what must have motivated the Magistrate was the successive failure to appear.  It emerged during the course of the review that Mr Marchesini works as a contractor on the remote APY lands, where he spends four to six weeks at a time.  It appears that in the second application to set aside, that was the situation he was averting to.

16. Still further, except perhaps for the claim based on the alleged loan of $2,500, the other claims were for unliquidated damages.  Even then some estimate of the value of the painting work was necessary, to offset against the loan, if appropriate.  Rule 101 of the Magistrates Court (Civil) Rules furnishes the power for a Magistrate to give judgment:

    ... in the absence of a party without hearing any evidence where the party fails to attend within 15 minutes of the time fixed for an application.

17. There is a requirement to give reasons for a final judgment after the conclusion of a ‘contested hearing’ pursuant to MCCR 103(1) of the Magistrates Court (Civil) Rules 2013.  The power to set aside or vary a judgment, other than a final judgment, is furnished by the Magistrates Court (Civil) Rule 87(1).  However the court cannot set aside a judgment unless the party seeking the order establishes there is an arguable case on the merits and that there was a reasonable excuse for not having complied with the Rules concerning the filing of defences and counter-claims.  The court is further empowered when setting aside a judgment, to order the payment of costs thrown away, or the payment for security for costs.

18. A bare decision by a party to ignore a claim does not amount to a reasonable excuse for delaying and the arguable defence must contain sufficient particularity to enable the court to assess its genuineness: Cubelic v T & D Lock Pty Ltd.[4]  A misunderstanding about the time when a defence should be filed or a step taken, may amount to a reasonable excuse: Skorpos v Georgiadis,[5] depending on some of the circumstances.  This may have been the situation in this instance.  In this particular case, both limbs of the requirements to set aside were arguable and not at face value, plainly unreasonable.

    [4] [2009] SASC 397.

    [5] [2013] SASC 165, [16].

19. A second intractable problem is that a party signing judgment can only do so for a debt or a liquidated sum, as required by Rule 61 of the Magistrates Court (Civil) Rules.  In the case of signing judgment for liquidated damages, the Registrar is required to fix a hearing time and date for an assessment of damages, as required by Rule 62(1).  In that event the party signing judgment is required to serve an affidavit to be relied on and a written schedule of the costs sought, before the matter can be heard, as required by Rule 62(2).  As none of these steps were taken in this matter, it is doubtful whether judgment should have been entered at all in a liquidated sum, as it was. 

20. Putting these hurdles aside, the absence of reasons explaining why the application to set aside the default judgment was dismissed, is a fatal one. The power of remission vested in this court in reviews against decisions made in minor civil actions pursuant to s 38 of the Magistrates Court Act 1991 (SA), is only available in cases of default or summary judgments, as provided for in s 38(7)(d)(iii). This is such a case.

21. There will accordingly be an order rescinding the judgment dismissing the application to set aside the default judgment and remitting the matter for reconsideration by the Magistrates Court, pursuant to s 37(7)(d)(ii) of the Magistrates Court Act.  In light of Mr Marchesini’s persistent delay there will be an order pursuant to 6DCR-286(3)(d) of the District Court Civil Rules, that the appellant do pay the sum of $500 to the Registrar of the District Court on account of costs thrown away by Ms Grieger in court fees and costs so far, within 14 days of 26 May 2015, when the application for review was heard.  The Registry is hereby authorised to disburse that sum to Ms Grieger once so paid in.