Miller v Eurovox Pty Ltd
[2004] VSCA 211
•30 November 2004
SUPREME COURT OF VICTORIA
COURT OF APPEAL
No. 5219 of 2003
| PAUL ANTHONY MILLER and YVONNE MILLER | |
| Appellants | |
| v. | |
| EUROVOX PTY. LTD. (ACN 080 422 037) and EUROVOX HOLDINGS PTY. LTD. (ACN 080 422 028) | Respondents |
---
JUDGES: | BATT, BUCHANAN and VINCENT, JJ.A. | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 9 September 2004 | |
DATE OF JUDGMENT: | 30 November 2004 | |
MEDIUM NEUTRAL CITATION: | [2004] VSCA 211 | |
---
Practice and procedure – Contempt of court – Order served on appellants not endorsed pursuant to r.66.10(3) Supreme Court (General Civil Procedure) Rules 1996 – Significance of non-endorsement of Order – Necessary that formalities associated with order be strictly satisfied – No evidence appellants possessed knowledge or understanding of consequences that could follow breach of Mareva Order – Proceeding conducted on false premise – Inappropriate to ignore the falsity of a fundamentally significant premise when dealing with a penal application – Finding of contempt not invalidated.
---
| APPEARANCES: | Counsel | Solicitors |
| For the Appellants | Ms A. Richards QC with Mr. C. Mandy | Wilmoth Field Warne |
| For the Respondents | Mr. S.M. Anderson | Freehills |
BATT, J.A.:
In this appeal the court heard argument first on the appellants’ proposed ground of appeal A, which relied on an asserted failure by the respondents to endorse on the copy Mareva order made by Balmford, J. on 3 April 2003 the requisite notice to the appellants. That argument embraced whether the appellants should be allowed to prove, if necessary, non-endorsement and to rely on the ground as well as the merits of the ground, that is, the consequences of non-endorsement. At the conclusion of argument the court indicated to counsel that it was provisionally of the opinion that leave should be granted to amend the notice of appeal by adding the ground (which had been re-formulated during the course of argument so as to claim that the appellants could not be committed as a result of a finding of contempt, by reason of the absence of the requisite endorsement) and that the ground should be upheld, but that it gave no indication of what orders should be made in consequence. The court also made it clear that, if it changed its provisional opinion, the parties, and particularly the appellants, would be heard on other grounds still relied on. Argument was then heard on what orders should be made if the court remained of its provisional opinion. Counsel for the appellants submitted that the appropriate order to be substituted for that of the primary judge was that the defendants pay the costs of the plaintiffs on a solicitor/client basis (as the primary judge had ordered in fact) and that otherwise the plaintiffs’ summons of 30 January 2004 be dismissed. Counsel for the respondents stated that he did not seek a remitter to the primary judge, but, stressing the seriousness of the contempt of court that had been committed by the appellants, asked this Court to impose a substantial fine on each appellant and to order them to pay the respondents’ costs, both here and below, on an indemnity basis.
For the reasons given by Vincent, J.A., whose judgment I have had the benefit of reading in draft, I am still of the opinion indicated provisionally to the parties during the hearing. I would therefore allow the appeal. Further, I would, for the reasons his Honour gives, make the orders which he proposes. Since the primary
judge’s findings of contempt are confirmed it is inappropriate to order that the summons be otherwise (that is, except for the order as to costs) dismissed.
BUCHANAN, J.A.:
I agree with Vincent, J.A. that the appeal should be allowed and orders made as his Honour proposes.
VINCENT, J.A.:
The first appellant, Paul Anthony Miller (“Miller”) commenced employment with Eurovox Pty. Ltd. (“Eurovox”), an importer of automobile, navigational and communications equipment, in about 1972.
From 1997 to 11 March 2003, he was the managing Director of the company with primary responsibility for its relationship with its overseas suppliers.
On 3 April 2003, Eurovox and its holding company, Eurovox Holdings Pty. Ltd., instituted proceedings against Miller and his wife (Yvonne Miller, the second appellant) in the Commercial and Equity Division of the Court claiming that it was entitled to certain payments allegedly received by Miller (effectively as rewards or secret commissions) from overseas suppliers. A claim was also made for the repayment of amounts alleged to have been loaned to his wife and himself by Eurovox.
On the same day, the respondents issued a summons in the same proceeding seeking the grant of a Mareva Order and an Anton Piller Order. The summons was not served on the appellants and the matter came before Balmford, J. ex parte.
With respect to the application for the Mareva Order, relevantly, for present purposes, Balmford, J. ordered that:
“1.Until the hearing and determination of this proceeding or until further Order, each of the [Appellants], whether by themselves or by their servants or agents or otherwise howsoever, be restrained from:
…
(b)selling, transferring, dealing with or disposing of or otherwise encumbering or removing from Australia or causing to be removed from Australia any money, property, or other assets (including shares) each has whether held alone, jointly or in conjunction with others without the consent of the [Respondents'] solicitors or by Order of the Court;
(c)selling, transferring, dealing with or disposing of or otherwise encumbering all or any part of any property including the land described in Certificate of Title Volume 09854 Folio 819, being the land situated and known as 3-4 Lansell Close, Narre Warren in the State of Victoria, without the consent of the [Respondents’] solicitors or by Order of the Court;
…
2.Nothing in this Order shall prevent the withdrawal by the First or Second [Appellant] of his or her ordinary and usual living expenses, including legal advice for the purposes of this proceeding, up to a maximum combined amount of $1,000 per week, or the payment of such further sums as may be agreed in writing by the [Respondents’] solicitors or permitted by further order of the Court.”
Her Honour also made an Anton Piller Order, in relation to the principal residence of the appellants at Narre Warren. Both of these Orders were set out in a single document served upon the appellants on 4 April 2003. Attached to the served copy was a notice in the following form:
“TAKE NOTICE PAUL ANTHONY MILLER AND YVONNE MILLER
1.This Order orders you to allow the persons mentioned below to enter the premises described in the Order and to search for, examine and remove or copy the articles specified in the Order. The persons mentioned will have no right to enter the premises or, having entered, to remain at the premises, unless you give your consent to their doing so. If, however, you withhold your consent you will be in breach of this Order and may be held to be in Contempt of Court. The Order also requires you to hand over any of such articles which are under your control and to provide information to the Plaintiffs' solicitors, and prohibits you from doing certain acts. This part of the Order is subject to restrictions.
2.You should read the terms of the Order very carefully. You are advised to consult a Solicitor as soon as possible.
3.Before you, a Defendant or the person appearing to be in control of the premises, allow anybody onto the premises to carry out this Order, you are entitled to have the solicitor who serves you with this Order explain to you what it means in everyday language.
4.You are entitled to insist that there is nobody present who could gain commercially from anything they might read or see on your premises.
5.You are entitled to refuse to permit entry before 8:00am or after 6:00pm on any day.
6.You are entitled to refuse to permit disclosure of any documents which may tend to incriminate you (‘incriminating documents’) or to answer any questions if to do so may tend to incriminate you. It may be prudent to take advice because, if you so refuse, your refusal may be taken into account by the Court at a later stage.
7.You are entitled to refuse to permit disclosure of any documents passing between you and your Solicitors for the purpose of obtaining advice (‘privileged documents’).
8.You are entitled to seek legal advice, and to ask the Court to vary or discharge this order, provided you do so at once, and provided that meanwhile you permit the independent solicitor (who is a solicitor acting independently of the Plaintiff) and two of the Plaintiff’s representatives, to enter but not start to search.
9.If you, a Defendant, disobey this Order you may be found guilty of Contempt of Court.
10.If any person with knowledge of this Order procures, encourages or assists in its breach, that person will also be guilty of Contempt of Court.”
It is, I think, clear that the Notice was directed specifically to the obligations of the appellants under the Anton Piller Order and it is to be observed that, whilst reference is twice made to the possibility that non-compliance might attract a finding of contempt of court, there is nothing to indicate what the potential consequences of such a finding might be.
However, there is an affidavit before the Court, sworn on 16 April 2003, by Joel Ruffles, the independent solicitor appointed to supervise the implementation of the Anton Piller Order, in which he stated (inter alia) that he attended the appellants' home at Narre Warren, on 4 April 2003, and -
“23At the dining room table, I explained in as simple terms as possible the meaning of the Orders, in particular, paragraphs 6, 7, 8 and 9 of the Orders.[1] I also explained each of the matters contained in the notice annexed at page 7 of the Orders.
24.As part of my explanation of paragraph 2 of the notice annexed at page 7 of the Orders, I stated words to Mr and Mrs Miller to the following effect:
‘You have a right to obtain legal advice in relation to this matter and I suggest you do so immediately, prior to permitting any inspection of these premises. I suggest you try to contact your lawyer to discuss the matter right now.’”
Mr Ruffles at no stage suggests that he specifically drew to the attention of either of the appellants the possibility that imprisonment might result from a breach of the terms of the Mareva Order, nor is it even clear that there was any attention at all directed to that Order.
[1]Paragraphs 6, 7, 8 and 9 relate solely to the Anton Piller Order.
There is no implied criticism of Mr Ruffles as his role was related to the requirements of the Anton Piller Order. He advised the appellants to secure legal advice, and waited for a lengthy period of time as they endeavoured to do so. At one stage, he said in his affidavit:
“30I also suggested to Mr Miller that when he next spoke to a lawyer he refer to the phrase ‘Anton Piller Orders’ as stated in the heading of paragraph 6 of the Orders. I said to Mr Miller it would be a shorthand way of making it clear to his lawyer what was happening.”
I need not set out in detail the history of the matter after that time. It is sufficient to state that, on 7 May 2003, Smith, J. varied the terms of the Mareva Order to permit, inter alia, the withdrawal of $2,000 per week for living expenses by the appellants and, on 21 May 2003, Coldrey, J. further varied them to provide for a permissible weekly withdrawal of $3,000.
On about 2 October 2003, the funds available in the Commonwealth Bank account of the appellants, and from which the permitted withdrawals were made, were exhausted. It also appears that at that time, neither of the appellants were in receipt of an income.
Although the appellants may reasonably have anticipated, in view of the history of the matter, that any request made to the respondents would be refused, it can be safely assumed that they were aware that they could apply to the Court for a further variation of the Order, as they had adopted that course on two other occasions. However, for reasons upon which it is not necessary to dwell and with a clear appreciation that they were acting in breach of its terms, they chose to address their financial difficulties in a different and impermissible way.
On 24 November 2003, an account was opened with the Bank of Melbourne in the name of Yvonne Miller and, on 12 December 2003, the appellants refinanced the mortgage on a property at Metung which was clearly subject to the Mareva Order. The amount for which the property was encumbered was increased, with the prior mortgagee being paid out. The balance of the moneys obtained in this manner was paid into the new account and applied not only for what might normally be regarded as “ordinary and usual living expenses”, but to the satisfaction of outstanding liabilities that included the repayment of loans made to them by members of their extended families and fees due to a marina operator for boat parking at Metung.
The solicitors, acting on behalf of the respondents, first became aware of these activities when they received a letter from the initial mortgagee of the Metung property, stating that they no longer held any interest in the property and that there was another current registered mortgagee.
In consequence, on 30 January 2004, the respondents took out a Summons seeking, among other orders, that the appellants be dealt with for contempt of court[2]. Eventually that matter came before Hansen, J. who, on 1 March 2004, found both guilty of contempt and imposed a sentence of imprisonment, for two months, in each case.
[2]An application of this kind is made pursuant to Rule 75.06(2).
The appellants obtained a stay of his Honour’s orders for imprisonment and costs and instituted an appeal against the whole of his Honour’s decision on a number of grounds, all save one of which were directed to the penalty imposed. That ground, abandoned shortly before the hearing, contained the bare assertion that the judge had erred in finding that each of the appellants had committed a contempt of court[3]; a claim that, on its face, was obviously unpromising as a ground of appeal, particularly in view of their stance at the hearing which was encapsulated in the following extract from their counsel’s submissions:
[3]At one stage, in this matter, the argument was advanced that Hansen, J. fell into error in referring to criminal contempt. However, it was later accepted that nothing turned on this claimed distinction, the existence of which I regard as dubious in any event.
“I thank my learned friend for reading out the various concessions and admissions made by the Millers. They are here in court today. They are remorseful. The purpose of those admissions and concessions was to not show disrespect to the court by trying to suggest that they didn’t understand the terms of the orders. That is the reason for those admissions, to show further respect to the court and to save the court’s time, and I would ask your Honour to take that into account. They do recognise the seriousness of these matters.”
He then said:
“My task is really to persuade you that what had occurred is not the kind of defiance that merits a strong general deterrence component in your penalty, and that is really what the distinction between civil and criminal contempt is about. Is it something that warrants that general deterrence component?”
Counsel approached this issue by reference to the asserted difficult financial situation in which his clients found themselves:
“The moneys they draw (sic) down come from a bank account, the Commonwealth Bank account, and in October the bank account runs out. What should they have done? It’s conceded, on affidavit, that they should have sought a variation. That is the area that gives me the most difficulty, your Honour, satisfying you that what they did was not contumacious. But, you do need to take that into account. What has motivated them isn’t an attempt to render futile the object of the Mareva injunction. What has motivated them is something that a Mareva entitles them to do. What has motivated them is the needs of the household, which is seven people.”
There was no suggestion that the terms of the Order may have been ambiguous or uncertain, nor was it suggested that the appellants suffered under any misconception concerning their obligations under the Order or that they may not have appreciated that they were acting in breach of its terms. At the hearing of the appeal, however, an application was made for leave to add further grounds, namely:
“Proposed Ground A: That, as a matter of law, the Appellants [could not be committed as a result of a finding] of contempt as the Order served on the Appellants was not indorsed as required by Rule 66.10(3) of the Supreme Court (General Civil Procedure) Rules 1996.
Proposed Ground B: That, as a matter of law, the Appellants were not guilty of contempt in any of the respects contended for by the Plaintiffs as their impugned conduct was within the terms of the Order, and in particular paragraph 2 thereof.
Proposed Ground C: That, as a matter of law, the Appellants were not guilty of contempt in any of the respects contended for by the Plaintiffs, as the order as varied was nonsensical and incapable of being complied with on its terms; further and in the alternative, the Order was unclear and ambiguous on its terms.
Proposed Ground D: (As a ground under Ground 1, further or in the alternative, as a further ground): The Learned Judge erred in rejecting the submission that if the Appellants ‘had applied for a further variation of the order, a variation would have been granted to permit a re-finance to be undertaken to raise funds for the purpose of living and legal expenses.’
Proposed Ground E: That in all the circumstances the sentence imposed on each of the Appellants was manifestly excessive.”
The Court decided to hear argument on the merits of Proposed Ground A and to reserve the question whether leave should be granted. After hearing submissions on this question, the Court advised that it was minded to give leave to amend the Notice of Appeal to add Proposed Ground A and to uphold that ground as reformulated in the course of discussion. Counsel for the appellants then said that in view of that intimation she would not persist with Proposed Grounds 6B and 6C.
Counsel for the respondents informed us that in the event that the Court upheld Proposed Ground A, he did not seek to have the matter remitted but that the Court should impose a penalty. I should make clear that the Court indicated that if, after further consideration, we changed our view, the position of the parties would, in effect, be protected. It was accepted by both sides that the Court should deal with the question of penalty on the basis of the written submissions before us.
The Court then heard arguments concerning the appropriate order for costs. Counsel for the appellants submitted that her clients should pay the costs of the respondents before Hansen, J. on a solicitor/client basis and that the costs of the appeal should follow the event. Counsel for the respondents argued that his clients should not be left out of pocket and he sought the costs incurred before Hansen, J. and on appeal on an indemnity basis. I now turn to Proposed Ground A.
Rule 66.10 reads in part:
“(1) A judgment[4] shall not be enforced by committal or sequestration unless—
[4]Under r.66.01 “judgment” includes order.
(a) a copy of the judgment is served personally on the person bound; …
...
(3) A copy of a judgment served under this Rule shall be indorsed with a notice, naming the person served, that the person served is liable to imprisonment or to sequestration of property if—
...
(b) where the judgment requires the person bound to abstain from doing an act, the person disobeys the judgment.
...
(6) The Court may dispense with service under this Rule.”
Hansen, J. was alert to this requirement and, at an early stage of the hearing before him, enquired whether the endorsement was present. His Honour was assured by counsel that it was[5], and not disabused of this belief by counsel appearing on behalf of Mr and Mrs Miller.[6] Not until much later does it appear that any check was made to confirm that this was the case. When this was done, it became apparent that the assurance given to his Honour was incorrect and that there was no endorsement of the kind required by r.66.10(3) on the served copy. It is, I think, safe to assume that the legal representatives on both sides had either overlooked this requirement or had acted on the basis that there had been compliance with the rule. It is, to put it mildly, unfortunate that, the matter having been brought to their attention by his Honour, no one took the simple step of looking at the documents.
[5]“HIS HONOUR: [Counsel], sorry, but the orders were served on Mr and Mrs Miller,
were they?
COUNSEL:Yes, they were, sir.
HIS HONOUR: They contain the endorsement under the rules?
COUNSEL:Yes, they do, your Honour. None of that is, I might say, controversial because - - -
HIS HONOUR: No, I understand that. I just wanted to ask you.
COUNSEL;Yes, your Honour, they were served.”
[6]The solicitors for both sides were also present at the hearing before Hansen, J.
Be that as it may, the fact remains that the endorsement was not present. What then is the significance of its absence?
Counsel for the respondents argued that it should be treated as a technical defect in the circumstances. In his submissions, he emphasized the seriousness of the appellants’ conduct, which involved the taking of a number of steps to evade the effect of the Court’s orders, and argued that they must be taken to have been well aware of the character of their behaviour and that there could be serious repercussions if they were detected. The presence of an endorsement was hardly necessary, he submitted, to bring to the mind of any reasonably intelligent person the possibility that there could be severe sanctions for the breach of an order of the Court. What had occurred, counsel contended, was that opportunistic advantage had been taken, at the appeal level, of an inconsequential defect, in circumstances in which the appellants had acted in blatant disregard of orders of the Court designed to provide a degree of protection to parties with whom they were in conflict in a civil proceeding. He pointed out that no argument had been advanced before Hansen, J. that the absence of the endorsement may have influenced the conduct of either of the appellants or that they did not appreciate that a sentence of imprisonment could be imposed upon an individual who committed contempt of court and, accordingly, submitted that the respondents were never provided with an adequate opportunity to address them. In that circumstance, he argued that the Court should not receive the evidence that the endorsement was not present or grant leave to add any of the proposed grounds.
There is, of course, a great deal of force in those contentions.
The status and enforceability of orders of the Court must be maintained if our system of civil dispute resolution is to possess efficacy and the respect of the community. As a general proposition, those who treat such orders with the contumelious disregard demonstrated in the present case must anticipate that they will be subject to significant sanctions, including, where appropriate, incarceration. The principles of general and specific deterrence are applicable to such situations in order to protect not only the rights created or vindicated by court orders but also the status of such orders and the very viability of the process itself.
The Rules of the Court require the presence of an endorsement pointing out the serious potential consequences that may follow a breach of an order of the kind present here in order, inter alia, to emphasize the seriousness with which such conduct can be expected to be viewed, and, specifically, that a sentence of imprisonment or the sequestration of property may follow.
By reason of the penal character of r.75.11 of the Rules for contempt of court, it is necessary that there be strict proof, satisfying the criminal standard, of the conduct constituting the contempt.[7] In so far as a finding of contempt is based upon non-compliance with an order of the Court, it will be necessary, save perhaps in the case of some technical or inconsequential defect, also to establish to the same standard that the formalities associated with the order have been strictly satisfied. A defect may be regarded as inconsequential in this sense, if it can be demonstrated, by some other means, that the person charged was well aware of their obligations under the order and the possible consequences of breaching it.
[7]Witham v. Holloway (1996) 183 C.L.R. 525.
Kaye, J., after reviewing a number of authorities dealing with this matter, in Clifford v.Middleton[8] concluded:
“Order 52, r.4, provides that in proceedings for attachment a copy of any affidavit intended to be used in support of the application shall be served with the notice of motion. Attachment proceedings, being penal and affecting the liberty of the subject, are of a criminal character, so that the utmost strictness in procedure and proof is demanded: Hall and Co. v Trigg; Re Bramblevale Ltd.; Comet Products UK Ltd. v Hawker Plastics Ltd., and Oswald on Contempt. An application to attach a party arising out of disobedience of the Court’s order which, if it requires him to perform an act, must be endorsed with a memorandum in the form or to the effect prescribed by O.41, r5. The purpose of the endorsement is to warn the party of the consequences which might befall him should he fail to perform the act directed. It follows that a party will not be attached for disobedience of a mandatory order unless he has been served with a copy of the order, although personal service may be dispensed with if it is shown that he has evaded service: Re Tuck; Murch v Loosemore; Gordon v Gordon and Taylor v Whelan.
…
In my opinion, the power to relieve a party from the consequences of non- compliance with the Rules of the Court where the liberty of the subject is in jeopardy should not be exercised unless the evidence shows that the requirements of and purpose for the particular rule have been fulfilled in a manner otherwise than in the form provided.”[9] (Footnotes omitted.)
[8][1974] V.R. 737 at 739.
[9]At 741.
There is no need, in the present situation, to consider any possible distinction between proceedings for attachment and those for committal for contempt of court. Whatever may be the theoretical differences between them, it can be readily seen that they can have no practical consequence in the present context. This view was implicit in the judgment of Nettle, J. in Primelife Corporation Ltd. v. Newpark Pty. Ltd.[10] which related to an application under r.75.05 for contempt arising from non-compliance with an order of a Master. In that case, the copy of the order was not endorsed in accordance with r.66.10. His Honour followed the approach adopted by Kaye, J., referring to the matter as an “attachment” proceeding.
[10][2004] VSC 106.
In the present case, although I accept, as counsel for the respondents submitted, that it is unlikely that there would be many in the community who were not aware that the sanction of imprisonment could be imposed for the deliberate breach of a court order and quite unlikely that the appellants would be among them, the matter cannot be dealt with on that basis.
There is no material before the Court upon which the inference could be properly drawn beyond reasonable doubt that, in the absence of the endorsement, the appellants possessed any knowledge or understanding of the consequences that could follow a breach of the terms of the Mareva Order. In that situation, the failure to comply with the Rules could not properly be regarded as inconsequential. This question was, of course, not explored by his Honour following the assurance given to him that the endorsement was present. However, I do not consider, as a practical proposition, that it would have been open to him to dispense with compliance, in any event. The possibility that the respondents would have been able to adduce the evidence that the appellants were aware that a sentence of imprisonment could be imposed for the breach of the Mareva Order appears to me to be remote as there was nothing in the material, before the Court, for that inference to be drawn.
Whilst it is well recognized, as counsel for the respondents submitted, that in general a party is bound by the way in which it conducts its case at trial, it is equally well recognized that appellate courts will permit new issues to be raised on appeal where the interests of justice so require. This is one of those situations. The proceeding before Hansen, J. was conducted not only on a false premise, but was on one which possessed fundamental importance in the determination of the availability of the sanction of imprisonment for breach of the Order. It would be quite inappropriate for this Court to ignore the falsity of a fundamentally significant premise relied upon by a judge when dealing with an application of a penal character because that falsity was, presumably by oversight, not recognized by those acting on behalf of the concerned parties at the time.[11]
[11]I am uncertain as to whether the material before his Honour included a copy of the Order as served on the appellants. If it were necessary for this Court to receive new evidence to confirm the undisputed fact that the copy served did not contain the necessary endorsement, I would unhesitatingly do so in the interests of justice.
To so hold does not invalidate the finding of contempt, but it follows that the sentences of imprisonment imposed on the appellants should not be permitted to stand. Whether or not the Court would still have a power to fine is not clear. Nettle, J. addressed this question in Primelife,[12] in the following passage:
“The court has power to impose a fine for contempt of court in the case of a civil contempt, if it is thought appropriate to do so. But it is said in Williams Civil Procedure in Victoria that a fine may not be imposed if the order served is not indorsed in accordance with r66.10(3). Although the rule does not refer to fines, and it would appear that the sanctions of committal and fine are used in contradistinction in r75.11 of the Rules, the thought seems to be that there is no power to fine unless there is power to commit. Hence, if committal is prohibited by r66.10(3), so too must be the imposition of a fine.
As a matter of fairness that view has a degree of appeal about it. It is difficult to see why a subject should any more readily be subjected to a fine than to committal or sequestration without the warning for which r66.10(3) provides. But a different view of the matter has been taken in New South Wales and in the Federal Court and I think that I should follow it. With some diffidence I conclude that there is power to fine even if an order has not been indorsed in accordance with the rule.” (Footnotes omitted.)
[12]Supra at [34] and [35].
Whilst his Honour’s concern about the possible unfairness of this approach is understandable, it is apparent, in my view, that a clear distinction is made in the Rules between the penalties of committal and sequestration on the one hand, and the imposition of a fine on the other. Order 66.10 is applicable only to the enforcement of orders by sequestration or committal. Under Order 75.11 contempt may be punished, in the case of a natural person, by committal to prison or a fine or both. It does not seem to me that the absence of the endorsement required, if the order is to be enforced by possible imprisonment, would remove the power of the Court to impose a fine.
The question than arises as to the proper course to be adopted in the matter before us.
I do not consider that in the circumstances the matter should be returned for further hearing by Hansen, J. I should add that counsel for the respondents understandably indicated that he did not seek the adoption of that course which would (inter alia) protract the process and involve the incurring of additional costs by his clients that may not ultimately be recovered. Were it not for the fact that the appellants have had to face, for a number of months, the prospect of imprisonment, I would have proposed that the determination of an appropriate monetary penalty be considered by this Court.
Accordingly, I propose that:
(i)leave be granted to add the reformulated ground A and that otherwise the application for leave to add grounds be refused,
(ii)the appeal be allowed,
(iii)the finding that each of the appellants was in contempt of court be confirmed, and
(iv)the sentence of imprisonment in each case be set aside.
42In the circumstances, I would not substitute any penalty in lieu thereof.
With regard to the appropriate order for costs in the circumstances, the appellants appeared before Hansen, J. for their admitted serious and deliberate breach of an order of the Court. The finding that they had committed a contempt of the court has been upheld. Understandably, counsel for the appellants has accepted that in that situation an order for costs against them on a solicitor/client basis should be made. I regard that proposal as reasonable in the circumstances.
However, I would make no order in favour of either party for the costs of the appeal which has become necessary by reason of the failure of both to direct attention to the Rules of the Court.
---
60