Moira Shire Council v Sidebottom Group Pty Ltd
[2016] VSC 546
•15 September 2016
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
VALUATION, COMPENSATION AND PLANNING LIST
S CI 2015 01051
| MOIRA SHIRE COUNCIL | Applicant |
| v | |
| SIDEBOTTOM GROUP PTY LTD (ACN 102 558 869) and AUSTRALIAN RUBBER MANUFACTURERS PTY LTD (ACN 086 752 329) | Respondents |
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JUDGE: | Zammit J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 9 August 2016, 10 August 2016 |
DATE OF JUDGMENT: | 15 September 2016 |
CASE MAY BE CITED AS: | Moira Shire Council v Sidebottom Group Pty Ltd & Anor |
MEDIUM NEUTRAL CITATION: | [2016] VSC 546 |
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CONTEMPT APPLICATION – Civil contempt - Non-compliance with enforcement order – Breach of Court order – Capability of compliance – Casual or accidental and unintentional – Wilful disobedience – Supreme Court (General Civil Procedure) Rules 2015 (Vic) r 66.05, r 75.06 – National Australia Bank v Juric [2001] VSC 375 - Advan Investments Pty Ltd v Dean Gleeson Motor Sales Pty Ltd [2003] VSC 201 – Scott v Evia Pty Ltd [2007] VSC 15 – Pattison v Bell [2007] FCA 137 – Moira Shire Council v Sidebottom Pty Ltd & Anor [2015] VSC 577.
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APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr R Appudurai | Russell Kennedy |
| For the First Respondent | Mr A Baker | Simmons & McCartney |
| For the Second Respondent | No appearance |
HER HONOUR:
By summons dated 29 June 2016 (‘the contempt summons’) the applicant, Moira Shire Council (‘the Council’), applied pursuant to r 66.05 and 75.06 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) for an order for the committal of Shanan James Sidebottom (‘Sidebottom’), an officer of the first respondent, Sidebottom Group Pty Ltd (ACN 102 558 869) (‘Sidebottom Group’) for contempt of court constituted by breaches of orders of this court made on 4 November 2015 (‘the 4 November 2015 Order’) and on 10 March 2016 (‘the 10 March 2016 Order’). The Council filed an amended summons on 9 August 2016. Sidebottom is alleged to be in contempt from 20 November 2015 to date.
The Council made an application at the Victorian Civil and Administrative Tribunal (‘the Tribunal’) for an enforcement order against the respondents, Sidebottom Group and Australian Rubber Manufacturers Pty Ltd (‘ARM’), in respect of land situated at 7 and 25 Saxton Street West, Numurkah (‘the land’) for continuing non-compliance by the respondents in the storage of materials, principally tyres, and use of the land for recycling materials at two sites in Numurkah in contravention of the Moira Planning Scheme. The Country Fire Authority (‘CFA’) was joined to the enforcement proceeding before the Tribunal at its request and supported the making of an enforcement order.
In Moira Shire Council v Sidebottom Group Pty Ltd & Anor [2015] VSC 577, I set out a chronology of relevant events and will adopt that summary in these reasons. The Council has provided a chronology dated 5 August 2016 which is not disputed by Sidebottom. Accordingly, I will where convenient adopt parts of that chronology.
Chronology
On 15 June 2007, the Council issued a planning permit allowing the land to be used and developed for the purpose of a tyre recycling plant.
On 14 August 2009, the Council granted an extension of time to Permit TP0700182 to provide that the buildings and works were to commence by 15 June 2010 and to be completed by 15 June 2012.
On 17 September 2009, Permit TP0700182 was amended to allow for the use and development to occur in stages.
On 24 May 2010, the Council issued a further planning permit, Permit TP1000071, allowing the use and development of the land for the purpose of materials recycling (tyre recycling plant).
On 9 May 2012, the director of Sidebottom Group and ARM at the time, Mr John Bryan Cronin (‘Cronin’), wrote to the Council requesting an extension of time for two years for Permit TP1000071.
On 4 April 2013, the Country Fire Authority (‘CFA’) set out its concerns in relation to the storage of tyres on the land.
On 2 May 2013, a number of tyres at the land contained within an area of approximately 50m2 caught fire, causing disruption to the Numurkah community.
On 24 May 2013, the Council filed an application in the Tribunal for an enforcement order and an interim enforcement order under the Planning and Environment Act 1987 (Vic).
On 11 June 2013, Deputy President Dwyer made an interim enforcement order as follows:
1. The Respondents [sic], Australian Rubber Manufacturers Pty Ltd and Sidebottom Group Pty Ltd, must in respect of the land at 7 & 25 Saxton Street West, Numurkah:
(a) within 90 days, remove and lawfully dispose of all tyres that are being stored on parts of the land not designated on the endorsed plans to planning permit TP0700182 as being ‘Stock Tyre Storage’ areas to the satisfaction of the Council;
(b) within 90 days, ensure that any stockpiles of tyres on parts of the land designated on the endorsed plans to planning permit TP0700182 as being ‘Stock Tyre Storage’ areas are no greater than 10m x 10m wide and 4m high, with a vehicle accessible gap of 5m between piles, to the satisfaction of the Council and the Country Fire Authority;
(c) within 30 days, prepare an Emergency Management Plan to the satisfaction of the Council and the Country Fire Authority;
(d) within 30 days, provide fire water tanks at the land to be situated at locations approved by the Council and the Country Fire Authority. The tanks must have a combined effective capacity of 288,000 litres, have approved CFA Storz fittings and meet the requirements of AS2419.1-2005; and
(e) within 60 days, install sprinkler systems suitable for fire fighting purposes around the stockpiles of tyres that remain at the land, to the satisfaction of the Council and the Country Fire Authority.
…
On 30 September 2013, due to ongoing non-compliance with the interim enforcement order made on 11 June 2013, by consent a further enforcement order was made by Deputy President Dwyer, as follows:
1. Until further order, the Respondents [sic], Australian Rubber Manufacturers Pty Ltd and Sidebottom Group Pty Ltd, must in respect of the land at 7 & 25 Saxton Street West, Numurkah:
(a) within 15 days, remove and lawfully dispose of all tyres brought onto the land after 11 June 2013, to the satisfaction of the Council;
(b) within 120 days, remove and lawfully dispose of all tyres which were already on the land as at 11 June 2013 and stored on parts of the land not designated on the endorsed plans to planning permit TP0700182 as being ‘Stock Tyre Storage’ areas to the satisfaction of the Council;
(c) within 90 days, ensure that any stockpiles of tyres on parts of the land designated on the endorsed plans to planning permit TP0700182 as being ‘Stock Tyre Storage’ areas and no greater than 10m x 10m wide and 4m high, with a vehicle accessible gap of 5m between piles, to the satisfaction of the Council and the Country Fire Authority;
(d) within 45 days, submit an emergency management plan (prepared by a suitably qualified person) for approval by the Council and the Country Fire Authority;
(e) within 30 days, submit a fire fighting plan which sets out the method proposed to be use for fire fighting purposes around the stockpiles of tyres that remain on the land, whether by way of a sprinkler system or other suitable method, for approval by the Council and the Country Fire Authority. The plan must include the locations of fire water tanks (with a combined effective capacity of 288,000 litres) to be fitted with approved CFA Storz fittings and which satisfy the requirements of AS2419.1-2005; and
(f) within 15 days after the date on which the fire fighting plan is approved, commence implementation of that plan to the satisfaction of the Council and the Country Fire Authority.
2. Costs reserved.
3.Liberty to apply.
After ongoing non-compliance with the interim enforcement order made on 30 September 2013, an enforcement order application was set down for final hearing on 30 June 2014.
On 30 June 2014, a final hearing in the Tribunal was conducted and a final enforcement order was made on 2 July 2014 (‘the VCAT Enforcement Order’), varying the interim orders. The final enforcement order required compliance with, in brief summary:
(a) the first part of the first stage of the enforcement order, being the removal from the land of all combustible items (i.e. wood pallets, branches, unused plastic wraps), by 15 August 2014;
(b) the second part of the first stage of the enforcement order, being the provision of an emergency management plan and fire-fighting plan to the CFA, by 15 September 2014;
(c) the second stage of the enforcement order, being the removal and lawful disposal of all materials along the southern and western part of the tyre storage area as referred to as ‘A’ and ‘+ signs’ on the site plan, by 15 September 2014
(d) the third stage of the enforcement order, being the removal and lawful disposal of all rubber materials located along the eastern and northern part of the tyre storage area as referred to as ‘B’ and ‘horizontal lines’ on the site plan, as well as the creation of a bunding containment wall along the southern boundary, by 15 October 2014;
(e) the fourth stage of the enforcement order, being the removal and lawful disposal of all materials located along the southern part of the tyre storage area as referred to as ‘C’ and ‘triangle signs’ on the site plan, by 15 November 2014;
(f) the fifth stage of the enforcement order, being the removal and lawful disposal of all materials forming every second row of tyre stockpiles in the tyre storage area as referred to as ‘D’ and ‘wavelength signs’ on the site plan, by 15 December 2014; and
(g) the sixth and final stage of the enforcement order, being the removal and lawful disposal of all remaining materials, including, but not limited to, tyres, rubbers, bricks, scrap metals and other similar waste materials, by 22 January 2015.
On 5 January 2015, John Cronin was terminated as director of ARM. At this time Sidebottom was appointed the sole director and secretary of ARM, while Mr Raymond Sidebottom, Sidebottom’s father, was appointed the sole director and secretary of Sidebottom Group.[1]
[1]Affidavit of Shanan James Sidebottom affirmed 22 July 2015, 2 [4]-[5], Exhibits SS-2, SS-3.
On 18 February 2015, the Council’s solicitors wrote to Sidebottom Group and ARM advising that the certificate under s 122 of the Victorian Civil and Administrative Tribunal Act 1998 had been granted. It provided for a deadline of 4 March 2015 for full compliance with the VCAT Enforcement Order, failing which the enforcement order would be filed in the Supreme Court.
On 10 March 2015, the VCAT Enforcement Order was filed in the Supreme Court.
On 7 May 2015, Raymond Sidebottom was terminated as director and secretary of Sidebottom Group and Sidebottom was appointed the director and secretary of Sidebottom Group.[2]
[2]Affidavit of Shanan James Sidebottom affirmed 22 July 2015, 2 [4], Exhibits SS-2.
On 3 June 2015 an application on a summons was filed in this court with a directions hearing held on 24 June 2015.
On 6 October 2015 the application was heard in the Supreme Court and judgment was delivered on 20 October 2015 (‘the October judgment’).[3]
[3]Moira Shire Council v Sidebottom Group Pty Ltd & Anor [2015] VSC 577.
On 20 October 2015 orders were made and authenticated on 4 November 2015. The 4 November 2015 Order provided that:
1. Within 90 days of the date of this order, the first respondent must complete each and every action required of it under paragraph 11 of the enforcement order by the Victorian Civil and Administrative Tribunal on 2 July 2014 in proceeding P1249/2013 (enforcement order – a copy of which is attached to this order), other than the actions identified under the heading ‘First Stage’ in that paragraph.
2.The first respondent must otherwise complete the actions, identified in paragraph 1 of this order, subject to the requirements of paragraphs 3, 7, 9 and 10 of the enforcement order.
3.The further hearing of the application is adjourned to a date to be fixed, not before 7 days after the date for compliance under paragraph 1 of this order.
…
On 20 November 2015, the 4 November 2015 Order was served on Sidebottom Group and Sidebottom, including the endorsement pursuant to r 66.10(6).[4]
[4]Affidavit of Service of Patrick Dubuc affirmed 20 November 2015, Exhibit PD-1.
On 10 March 2016 this matter came before this Court for a further hearing and further orders were made dated 10 March 2016. Relevantly, in other matters the following was recorded:
A.The applicant has indicated that, in the event of non-compliance with this order, it will at the further hearing of this application seek an order that Mr Shanan James Sidebottom be committed to prison pending compliance with this order.
B.Following the expiry of the time for compliance with this order, the court will give further directions with respect to the future conduct of this application, including any directions relating to a committal hearing should the applicant seek an order for committal of Mr Shanan James Sidebottom and directions relating to the filing and service of any evidence or material upon which the parties seek to rely upon.
THE COURT ORDERS THAT:
1.Within 90 days of the date of this order, the first respondent must complete each and every action required of it under paragraph 11 of the enforcement order by the Victorian Civil and Administrative Tribunal on 2 July 2014 in proceeding P1249/2013 (enforcement order – a copy of which is attached to this order), other than the actions identified under the heading ‘First Stage’ in that paragraph.
2.The first respondent must otherwise complete the actions, identified in paragraph 1 of this order, subject to the requirements of paragraphs 3, 7, 9 and 10 of the enforcement order.
3.The further hearing of the application is adjourned to a date to be fixed, not before 7 days after the date for compliance under paragraph 1 of this order.
4.Pursuant to rule 66.10(6) of the Supreme Court (General Civil Procedure) Rules 2015, the applicant is not required to serve a copy of this order on the first respondent and on Mr Shanan James Sidebottom in his capacity as the sole director of the first respondent.
5.Costs reserved.
On 17 June 2016 this matter came before me again and orders were made that:
1.By 1 July 2016, the Applicant must file and serve a summons, pursuant to r 75.06 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) (“the Rules”), on Shanan James Sidebottom (the sole director of the First Respondent) giving notice of the application for committal of Mr Sidebottom to be heard on 9 and 10 August 2016.
2.Personal service of the summons pursuant to r 75.06(5) of the Rules is dispensed with, and service on Mr Sidebottom may be affected through the First Respondent’s solicitors by registered post at Attn: Grant McCartney, Simmons & McCartney Lawyers and Attorneys, PO Box 6491, Gold Coast MC, QLD 9726.
3.The requirements in paragraphs 1 and 2 (above) are in addition to prior service made upon the First Respondent and Mr Sidebottom made pursuant to r 66.10 of the Rules.
4.The hearing of the application for committal of Mr Sidebottom, pursuant to r 66.10 and r 75.06 of the Rules is fixed to commence on 9 August 2016 (estimate of two days).
5.For the avoidance of doubt, the First Respondent and Mr Sidebottom remain subject to the obligations contained in paragraphs 1 and 2 of the order made on 10 March 2016.
6.By 4:00 pm on 22 July 2016, the First Respondent and Mr Sidebottom must give notice in writing to the Applicant (marked to the attention of Ms Jorine Bothma, Manager Planning and Building – [email protected]) of any actions taken by them to comply with paragraphs 1 and 2 of the order made on 10 March 2016, including details (since the date of this order) of:
a. any removals of tyres;
b. the dates on which such removals occurred;
c. the quantities and the locations on the land from which such tyres were removed on each such date; and
d. the identity of the recipient, and the ultimate destination of such tyres.
7.In the event that notice is given, in accordance with paragraph 6, that removals of tyres has occurred, the First Respondent must allow an inspection of the land by officers of the Applicant upon the giving of 24 hours’ notice to Mr Sidebottom.
8.Any further affidavits upon which the First Respondent, or Mr Sidebottom, intends to rely must be filed and served by 4:00 pm on 29 July 2016.
9.Any further affidavits upon which the Applicant intends to rely must be filed and served by 4:00 pm on 4 August 2016.
10.The Applicant must file and serve its outline of submissions by 4:00 pm on 5 August 2016.
11.The First Respondent must file and serve its outline of submissions by 4:00 pm on 5 August 2016.
12.In the event that Mr Sidebottom elects to make any submissions, he must file and serve an outline of submissions by 4:00 pm on 5 August 2016…
On 29 June 2016 the Council filed a summons in accordance with paragraph 1 of the 17 June 2016 Order. The summons was served on Sidebottom by email, followed by registered post, to Grant McCartney, Sidebottom’s legal representative. Service was accepted by way of a reply email from Sidebottom’s solicitors on 29 June 2016.
On 22 July 2016 the Council received an email from Ms Brianna Sidebottom, in compliance with paragraph 6 of the 17 June 2016 Order and was advised that there had ‘been no change to the tyre stockpile’ since the inspection by the Council on 9 June 2016.
On 29 July 2016 the Council received affidavits sworn by Sidebottom and Ms Brianna Sidebottom by email on 1 August 2016.
The chronology highlights that more than three years have elapsed since the making of the interim order by Deputy President Dwyer on 11 June 2013 and that compliance by Sidebottom Group with any orders in that period has been minimal.
Rules 66.05 and 75.06 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic)
Rule 66.05 provides:
(1) This Rule applies where—
(a) a judgment requires a person to do an act and the act is to be done within a time fixed in the judgment or by subsequent order, and the person refuses or neglects to do the act within that time;
(b) a judgment requires a person to abstain from doing an act, and the person disobeys the judgment.
(2)Where this Rule applies, a judgment may, subject to Rule 66.10, be enforced by one or more of the following means—
(a) committal of the person bound;
(b) sequestration of the property of the person bound; and
(c) where the person bound is a corporation, without limiting paragraph (2)(b)—
(i) committal of any officer of the corporation; and
(ii) sequestration of the property of any officer of the corporation.
…
A judgment against a corporation may be enforced by sequestration of the property of the corporation or by committal of or the sequestration of the property of an officer of the corporation. The remedy against an officer is additional, not alternative, to the remedy of sequestration or of the corporation property. However, a judgment cannot be enforced against an officer unless the person entitled to enforce the judgment is also in a position to proceed against the corporation.[5]
[5]Iberian Trust Ltd v Founders Trust and Investment Co Ltd [1932] 2 AB 87; Benarbo v William Jane PartnersLtd [1940] 4 All ER 196.
Order 75 governs the procedure in contempt proceedings providing for specific rules. It sets out amongst other things the procedure that must be followed in relation to a party seeking an order that a respondent be adjudged guilty of, and punished for, contempt of court.
Order 75.06 provides:
75.06 (1)Application for punishment for the contempt shall be by summons or originating motion in accordance with this Rule.
(2) Where the contempt is committed by a party in relation to a proceeding in the Court, the application shall be made by summons in the proceeding.
(3) Where paragraph (2) does not apply, the application shall be made by originating motion which—
…
(4) The summons or originating motion shall specify the contempt with which the respondent is charged.
(5) The summons or originating motion and a copy of every affidavit shall be served personally on the respondent, unless the Court otherwise orders.
Contempt relevant legal principles
It is well established that a failure by a party to comply with an order made in a civil proceeding, constitutes a contempt of court. In this case one of the key issues is the onus of proof and who bears the onus in establishing the civil contempt. The other main issue is whether the order said to be breached is capable of compliance and whether evidence before the Court establishes this element beyond reasonable doubt.
A distinction has traditionally been drawn between ‘civil’ and ‘criminal’ contempt, but the conceptual basis for this distinction has been questioned by the High Court of Australia. In Witham v Holloway[6] Brennan, Deane, Toohey and Gaudron JJ describe the ‘long standing’ distinction as follows:
In general terms, the distinction between civil and criminal contempt is that a civil contempt involves disobedience to a court order or breach of an undertaking in civil proceedings, whereas a criminal contempt is committed either when there is a contempt in the face of the court or there is an interference with the course of justice. However, disobedience or breach of an undertaking amounts to a criminal contempt if it involves deliberate defiance or, as it is sometimes said, if it is contumacious.[7]
[6](1995) 183 CLR 525.
[7]Ibid 530 (citation omitted).
Emerton J in Legal Services Board v Forster (No 2)[8] said in relation to the description of the long standing distinction given in Witham v Holloway:
Their Honours observed that the basis of the distinction was said to lie in the difference between proceedings which are remedial or coercive in the interest of the private individual and proceedings in the public interest to vindicate judicial authority or maintain the integrity of the judicial process. However, this distinction is not a satisfactory basis for the distinction usually made between civil and criminal contempt, as there is not a true dichotomy between proceedings in the public interest and proceedings in the interest of the individual. Even when proceedings are taken by the individual to secure the benefit of an order that has not been complied with, there is a public interest aspect in the sense that the proceedings also vindicate the court’s authority. It is therefore necessary to recognise that punitive and remedial objects are ‘inextricably intermixed’ and the differences upon which the distinction between civil and criminal contempt is based are, in significant respects, illusory.
In Witham v Holloway, the High Court concluded that as all proceedings for contempt, whether for civil or criminal contempt, must realistically be seen as criminal in nature, all charges of contempt must be proved beyond reasonable doubt.[9]
[8][2012] VSC 633.
[9]Ibid [45]-[46].
In all cases of contempt the charge of contempt must be proved on the criminal onus, beyond reasonable doubt.
The underlying principle of providing for punishment for acts (or omissions) of civil contempt is to provide for the enforcement of orders of the Court and undertakings provided to the Court. Additionally, punishment serves to preserve respect for the Courts and the rule of law. As Tamberlin J observed in Australian Competition and Consumer Commission v Hughes:[10]
Ultimately, in the case of mandatory or prohibitory orders made by it, the sanction which the Court has in order to enforce its decisions is the power to punish for contempt. This is the way in which the Court preserves respect for its role and the rule of law. Without the enforcement of court orders the whole process of adjudication becomes a hollow exercise. If a losing party can defy the orders of the Court then such disobedience renders futile, in the perception of the community, the remedy secured by the successful party. Orders are not made simply to suggest or advise persons that they ought to keep to the law as proclaimed but to ensure that the law is carried out as determined by the decision pursuant to which the order is made. Defiance of court orders diminishes the authority of courts and removes the incentive of parties, if such conduct is left unpunished, to comply with the requirements of the courts.
[10](2001) ATPR 41-807.
To establish a charge of contempt of this nature, the plaintiff must establish the following five elements beyond reasonable doubt:[11]
[11]National Australia Bank v Juric [2001] VSC 375, [37]-[38] (‘Juric’); Advan Investments Pty Ltd v Dean Gleeson Motor Sales Pty Ltd [2003] VSC 201 at [31]; Scott v Evia Pty Ltd [2007] VSC 15 at [36]; Chan & Ors v Chan & Ors (No 2) [2007] VSC 24 at [22].
(a) an order was made by a Court;
(b) the terms of the order are clear, unambiguous and capable of compliance;
(c) the order was served on the defendant, or excused in the circumstances, or service dispensed with, pursuant to the Rules of the Court;
(d) the defendant had knowledge of the terms of the order; and
(e) the defendant breached the terms of the order.
In Advan Investments Pty Ltd v Dean Gleeson Motor Sales Pty Ltd,[12] Gillard J, after considering the English cases and the High Court’s decision in Australasian Meat Industry Employees’ Union & Ors v Mudginberri Station Pty Ltd,[13] identified the principle applying in Victoria to be that, given the requisite knowledge of the order, a civil contempt usually requires that the plaintiff establish that the alleged contemnor had knowledge of the terms of the order and that he or she deliberately committed an act or omitted to do some act which had the effect of breaching the order. Unless the terms of the order require otherwise, the plaintiff does not have to prove that the act or omission constituting the breach was accompanied by an intention to deliberately breach the order.[14] Neither do the proofs require that the contemnor be aware of the full terms of the order. It is sufficient if the contemnor knows the substance of the prohibition and knowingly acts in a manner contrary to it.[15]
[12][2003] VSC 201 (‘Advan).
[13](1986) 161 CLR 98 (‘AMIEU’).
[14]Ibid [51].
[15]Madeira v Roggette Pty Ltd (No 2) [1992] 1 Qd R 394, 403.
In Scott v Evia Pty Ltd,[16] Dodds-Streeton J concurred with the above, stating that:
The authorities therefore establish that it is generally unnecessary to prove that the contemnor committed the breach with an intention to disobey. If, however, the disobedience were “casual or accidental and unintentional” as distinct from “deliberate and voluntary”, then although it would prima facie give rise to liability, the Court might nevertheless decline to exercise the contempt jurisdiction. If it did exercise the jurisdiction, the casual or accidental and unintentional nature of the breach would be relevant to whether a penalty should be imposed, and if so, what it should be.
…
Gibbs CJ, Mason, Wilson and Deane JJ [in AMIEU[17]] also approved recent decisions which recognised that “any disobedience which was worse than causal, accidental or unintentional must be regarded as wilful.[18]
[16][2007] VSC 15 at [41] (‘Scott’).
[17](1986) 161 CLR 98.
[18]Scott [2007] VSC 15 [41], [47] (citations omitted).
Thus, any disobedience of an order which is worse than casual, accidental and unintentional will be regarded as wilful. This distinction is between the deliberate or intentional nature of the act constituting the breach of the order and a breach characterised by an element of defiance – contumacious disobedience.
Plainly, the task of persuading the court to exercise its discretion not to convict and punish a defendant notwithstanding the court finding that the defendant knowingly breached the terms of an order pronounced against him or her, would be a difficult one where there is evidence of contumacious disobedience of a court order.
In relation to the discretion of the Court to decline to exercise the contempt jurisdiction even in circumstances where the Court may be satisfied that the contempt has been established, it was observed by the Court of Appeal in Construction, Forestry, Mining and Energy Union v Grocon Constructors (Vic) Pty Ltd[19] that ‘such a discretionary outcome is more likely where the court concludes the contempt to be of a technical nature, as for example where the act or omission may be described as casual, accidental or unintentional’.[20]
[19][2014] VSCA 261.
[20]Ibid [142].
The evidence
The following affidavits were tendered into evidence:
(a) affidavits of Patrick Dubuc, development compliance officer, employed by the Council since 9 January 2012, affirmed:
(i) 6 March 2015;
(ii) 4 August 2015;
(iii) 24 September 2015; and
(iv) 20 November 2015.
(b) affidavits of Jacqueline Frances Miller, development compliance officer, employed by the Council since 1 October 2015, affirmed:
(i) 10 February 2016; and
(ii) 14 June 2016.
(c) affidavits of Shanan James Sidebottom affirmed and sworn:
(i) 22 July 2015 (‘the first affidavit’);
(ii) 18 September 2015 (‘the second affidavit’);
(iii) 5 October 2015 (‘the third affidavit’);
(iv) 6 October 2015 (‘the fourth affidavit’);
(v) 12 October 2015 (‘the fifth affidavit’);
(vi) 9 March 2016 (‘the sixth affidavit’);
(vii) 16 June 2016 (‘the seventh affidavit’);
(viii) 29 July 2016 (‘the eighth affidavit’); and
(ix) 8 August 2016 (‘the ninth affidavit’).
(d) affidavit of Brianna Sidebottom sworn 29 July 2016.
In addition, Sidebottom gave oral evidence and was cross-examined over two days.
When this matter first came before the Court, the Council relied on the affidavit of Patrick Dubuc sworn 6 March 2015 (‘Dubuc’s first affidavit’).
Mr Dubuc, the Council’s development compliance officer, had undertaken a number of inspections of the land. The inspections took place from 22 August 2014 and 9 February 2015. Mr Dubuc had taken aerial photographs of the land on 27 September 2013, 30 January 2014 and 6 March 2015. Aerial photographs[21] revealed little or no change to the condition of the land in relation to the removal of tyres as required under the VCAT Enforcement Order.[22]
[21]Exhibits PD10 and PD11.
[22]Affidavit of Patrick Dubuc affirmed 6 March 2015, [27].
The Council filed a summons on 3 June 2015 pursuant to r 66.05 seeking enforcement orders of the VCAT Enforcement Order within 30 days.
In the first affidavit Sidebottom deposed, inter alia that:
(a) from 23 May 2014 to 11 March 2015, a combined total of 717.7 tonnes of tyres or tyre materials were removed from the land and further land owned by Sidebottom Group in Katunga;[23]
[23]Sidebottom’s first affidavit, Exhibit SS8.
(b) as at 23 July 2015, approximately 5,650 tonnes of tyres remained on the land;
(c) he was of the opinion having reviewed Sidebottom Group and ARM financial records that the companies were not financially or logistically able to remove the 5,650 tonnes of tyres within the 30 days sought by the Council, without threat of insolvency;
(d) he estimated the total cost exposure for removal of the tyres from the land at approximately $788,175, based on the financial position of Sidebottom Group and ARM.[24] No information was provided about who would undertake the removal or supply the trucks required for that purpose;
(e) he had assessed that it would cost $2,011,400 for a retail contractor company, at market rates, to remove the tyres.[25]
(f) Sidebottom prepared a ‘logistically sustainable stage compliance timetable’ for the removal of the tyres from the land.[26]
[24]Ibid SS13.
[25]Ibid SS14.
[26]Ibid SS15.
On 18 September 2015 Sidebottom filed a second affidavit in support of the application. Relevantly, he deposed:
On behalf of the first respondent [Sidebottom Group] I humbly apologise to the court for the first respondent’s failure to comply with the VCAT enforcement orders dated 2 July 2014 (VCAT enforcement orders). The first respondent accepts that it is bound by those orders and is committed to complying with them, should it be granted an indulgence to do so. In this context, the first respondent respectfully seeks the court’s indulgence by way of a further time to enable it to comply (as expeditiously as possible) with the substance of the VCAT enforcement orders;
In the second affidavit Sidebottom deposed that:
(a) Sidebottom Group is a trustee of a unit trust, the ultimate beneficiaries of which are members of the Sidebottom family;
(b) Sidebottom Group is the registered proprietor of the land and that it holds the land pursuant to the trust;
(c) ARM was a company associated with the Sidebottom family and was registered by ASIC on 16 August 2015;
(d) the Sidebottom family intended for ARM to use the land for the purposes of developing a commercial tyre recycling plant. Initially Council approvals were in place for the collection and storage of tyres in the running of a pilot tyre recycling plant. ARM occupied the land on an informal undocumented basis and stockpiled many thousands of tyres on it in anticipation of a future high volume commercial recycling operations;
(e) Sidebottom had previously served as director and company secretary of Sidebottom Group and ARM until 24 January 2011 but ceased those roles and any involvement in the day-to-day operations of the companies from that time, with John Cronin, his brother-in-law, assuming those roles;
(f) there were protracted disputes with the Council over planning approvals for the use of the land for tyre recycling. The Council approvals were allowed to expire by Cronin;
(g) Sidebottom knew that the VCAT Enforcement Order was made, however he was not aware of the terms or that the order required, amongst other things, that the tyres be removed from the land;[27]
[27]Sidebottom’s second affidavit, [9].
(h) in early 2015 Cronin advised Sidebottom he no longer wanted to manage Sidebottom Group and ARM, but retained operational responsibility until he left after Easter 2015;
(i) in late March/early April 2015 Sidebottom assumed operational responsibility for Sidebottom Group and ARM;
(j) further action in compliance with the VCAT Enforcement Order taken since the swearing of his first affidavit on 22 July 2015 included:
(i) sending approximately two truckloads of tyres per week between 30 July 2015 and 18 September 2015 to Tyre Recycle Pty Ltd for processing, with each truckload containing approximately 15 tonnes of tyres;
(ii) CFA approval of Sidebottom Group’s amended emergency management plan and fire-fighting plan; and
(iii) the undertaking of enquiries in relation to the availability of tyre storage and tyre processing in Australia and the preparation of a timetable setting out the minimum time necessary to clear the tyres from the land.
(k) it was Sidebottom’s opinion that Sidebottom Group could comply with the substance of the VCAT Enforcement Order by 19 January 2017;[28]
[28]Sidebottom’s second affidavit, [37].
In his third affidavit, Sidebottom deposed that:
(a) Sidebottom Group’s primary function is to act as trustee of a unit trust, known as the Grain Unit Trust members of the Sidebottom Unit Trust. Members of the Sidebottom family are the ultimate beneficiaries. All of Sidebottom Group’s assets and liabilities are incurred in relation to its role as trustee of the trust;[29]
[29]Sidebottom’s third affidavit, [3].
(b) the primary asset of Sidebottom Group is the land. As at 6 October 2015, Sidebottom Group’s only source of income was generated by renting part of the land, located at 25 Saxton Street, to another company associated with and controlled by the Sidebottom family, Transpro Logistics Pty Ltd (‘Transpro’);[30]
[30]Ibid [5].
(c) the current rental payable by Transpro to Sidebottom Group as at 6 October 2015 was $14,322 per month including GST, at an annual rent of $171,864, including GST and from 1 March 2016 the rental payable by Transpro will increase to $14,751.66 per month including GST (at an annual rent of $177,019.92);[31]
[31]Ibid.
(d) Sidebottom Group’s only other major asset is a receivable of $57,288 in relation to rent payable by Transpro;[32]
[32]Ibid [8].
(e) as at 6 October 2015 Transpro’s accrued liability for rent amounted to $72,704 and it was agreed between Sidebottom Group and Transpro that the latter amount would be paid over the next six months;[33]
[33]Ibid.
(f) Sidebottom Group previously obtained finance from a private lender in the amount for a principal amount of $390,000 on an interest only basis. The loan is secured by a mortgage over the land. Sidebottom deposes that further finance was sought from the private lender but as at August 2015 the private lender stated no further advances were possible;[34]
[34]Ibid [11].
(g) Sidebottom Group owes $50,000 to an unrelated entity, DMJ Services No. 2 Pty Ltd. This is an unsecured loan that has no fixed repayment date, nor interest payment terms;[35]
(h) Transpro agreed to make capital contributions to Sidebottom Group in the amount of $745,000 over the period from 29 September 2015 to 19 January 2017. Sidebottom exhibited a letter from his mother, Marilyn Joy Sidebottom, also the sole director of Transpro, confirming Transpro’s preparedness to provide the capital contributions;[36]
(i) with the capital contribution from Transpro, Sidebottom Group would be able to fund the $971,508.50 required to dispose of the tyres by 19 January 2017.[37] Sidebottom also deposed that Transpro is the Sidebottom’s family operating business and is the primary source of the family’s income and that the Sidebottom family had no other source of funding to contribute to Sidebottom Group.[38]
[35]Ibid [12].
[36]Ibid [13], Exhibit SS33.
[37]Ibid [16].
[38]Ibid [17].
In effect, the 4 November 2015 Order and the 10 March 2016 Order extended the time for compliance with the VCAT Enforcement Order by a further 90 days until 2 February 2016 and 8 June 2016 respectively.
It was not disputed that there was non-compliance, and in any event it was substantiated in the affidavits of Jacqueline Frances Miller, sworn 10 February 2016 and 14 June 2016, and in the sixth and seventh affidavits of Sidebottom.[39] Non-compliance has continued since 17 June 2016 and was confirmed by Sidebottom is his eighth affidavit.[40]
[39]Sidebottom’s sixth affidavit, [8]; Sidebottom’s seventh affidavit, [3].
[40]Sidebottom’s eighth affidavit, [3].
In the sixth affidavit sworn 9 March 2016, Sidebottom deposed that the reasons for non-compliance included that:
(a)In mid-October 2015, Transpro sold a 15 tonne truck that the [Sidebottom Group] was using to transport the tyres for recycling for the amount of $110,000 with the intention of obtaining a larger 20 tonne truck…
(b)At or about the same time, Transpro brought a prime mover for the amount $95,000 and placed a $15,000 deposit for two B-double trailers (with increased capacity of 20 tonnes). The purchase price for the trailers was to be $45,000 in aggregate;
(c)Prior to the settlement of the trailers, an engine on one of Transpro’s other trucks blew up with a cost of $40,000 to rebuild the engine. This affected Transpro’s cash flow and delayed settlement on the trailers until just before Christmas 2015;
(d)On settlement, Transpro needed to modify the trailers to enable the cartage of tyres. This was not completed until late January;
(e)Since January 2016, Transpro has been unable to make the new truck and trailers available to the first respondent due to its own business requirements;
(f)In any event, the periods since the Supreme Court orders of 20 October and the date of this affidavit, there has been approximately one month where the soil of the land was softened by heavy rain in Numurkah, with the effect that tyres could not be safely moved from piles, bound for transport and loaded into the truck.[41]
[41]Sidebottom’s sixth affidavit, [11].
Sidebottom also deposed that, since assuming operation of Sidebottom Group after Easter in 2015, 387.04 tonnes of tyres had been removed from the land, with 127.04 having been removed since the hearing of 6 October 2015.[42] Additionally, Sidebottom outlined that he had made the following enquiries in relation to the removal of tyres:
[42]Ibid [12].
(a) contacting AusShredding Pty Ltd, a tyre shredding company located in Mildura. Sidebottom deposed that they were the only organisation he was aware of which have a mobile tyre shredder. Sidebottom deposed that no arrangement was entered with AusShredding Pty Ltd as their mobile tyre shredder was unavailable due to a long-term contract. He also deposed that the mobile tyre shredder could only be used on car tyres, not truck tyres;[43]
(b) making enquiries with Douglas Fitzpatrick in relation to leasing an old quarry in Wunghnu (part of the Moira Shire Council) as a secondary storage site for the tyres. Sidebottom deposed that an in principle agreement was reached with Mr Fitzpatrick in relation to entering a lease for the quarry, subject to obtaining the necessary council approvals. However, Sidebottom deposed that in early February 2016 he was contacted by Mr Fitzpatrick who advised he had changed his mind and would no longer offer the quarry as a secondary storage location for the tyres;[44]
(c) pursuing an opportunity with Angel Partners Pty Ltd (‘Angel Partners’) in relation to a proposed tyre recycling plant. Sidebottom deposed that in October 2015 he was approached by Mr Malcolm Ayoub of Angel Partners, who were proposing to build a tyre recycling plant in Moama, New South Wales. It was agreed that Sidebottom Group would act as a consultant on the project to Angel Partners and that, once operational, Angel Partners would process Sidebottom Group’s tyres on the land at no cost, bar the costs for delivering the tyres to the plant. The plant would have the capacity to process 20 tonnes of tyres per day and could store 1,000 tonnes of tyres on-site. Sidebottom detailed a number of actions that had been undertaken in relation to pursuing the proposal, but stated the timetable for the removal of the tyres from the land and disposal at the plant would be approximately 225 days from the date the plant became operational. No estimate was given as to when the plant would be operational.[45]
[43]Ibid [13]-[16].
[44]Ibid [17]-[22].
[45]Ibid [23]-[28].
In his seventh affidavit sworn 16 June 2016 Sidebottom deposed that since his affidavit of 9 March 2016 there has been minimal progress in complying with the 4 November 2015 Order and 10 March 2016 Order. The reasons include:
(a) his belief that the first respondent is no longer solvent and cannot retain a transport and logistics company to remove the tyres from the land. Sidebottom believes it would cost approximately $278,300 to remove the tyres and the current assets of Sidebottom Group are only $18,522.71 of which $66.01 is cash;
(b) he had prepared a projected balance sheet for the financial year ending 30 June 2016 which demonstrated:
(i) total current assets of $18,522.71;
(ii) total non-current assets of $738,000;
(iii) total current liabilities of $320,967.21;
(iv) total non-current liabilities of $440,000;
(v) net liability of $4,444.50.[46]
[46]Sidebottom’s seventh affidavit, [5].
(c) Sidebottom considers the principle cause of the insolvency of Sidebottom Group is a lack of income. Sidebottom says that in or about March 2016 Sidebottom Group renegotiated a lease with Transpro, whereby it would pay decreased monthly rent of $4,500 and in return Transpro would cover the transportation costs of removing, on semitrailer trucks, the tyres from the land. However, due to two of Transpro’s trucks requiring expensive repairs and not being in use, Transpro had not been in a position to contribute to the additional capital contributions referred to in his affidavit of 5 October 2015;
(d) as at June 2016, Sidebottom had contacted Keith Sutherland of Bent and Cougle Insolvency Administrators for the purpose of instituting administration or liquidation proceedings;
(e) continued inclement weather with the result that the land was waterlogged in June 2016 to such an extent trucks could not be moved on the land to load the tyres. He notes that there was a brief window of time in March and April 2016 that allowed for some rearrangement of some of the tyres on the land in preparation for removal however from early May 2016 to June 2016 the land was too wet for the tractor to manoeuvre itself to relocate the tyres on the property for removal; and
(f) the proposed tyre recycling plant deposed to in Sidebottom’s sixth affidavit had not received necessary approval to set up.
Sidebottom concluded:
While I concede that the first respondent is not in compliance with the orders of 20 October 2015, I respectfully request that leniency be shown as the non-compliance has not been due to any wanton disregard to the orders, rather the perfect storm with a number of unfortunate factors comprising against the first respondent.[47]
[47]Sidebottom’s seventh affidavit, [13].
In his ninth affidavit sworn on 8 August 2016, Sidebottom deposed that the information he had previously given in respect of Transpro was as manager. As manager, he was responsible for the day to day operation of Transpro, a position he had held since May 2015 to present.
Sidebottom as a witness
In addition to the nine affidavits tendered into evidence affirmed and sworn by Sidebottom from 22 July 2015 to 8 August 2016, Sidebottom gave oral evidence.
There were some aspects of Sidebottom’s evidence that gave me concern as to his credit. For example, in cross-examination, Sidebottom was asked if he lived at 25 Saxton Street, Numurkah to which he responded yes. He was then asked:
And you’ve lived there for several years? --- Yes.
By ‘several years’ shall we say, what, five, six, ten, or all your life? --- I’ve - I’ve not lived there all my life; I’ve lived other places.
Yes, but last five years? --- I’ve lived there the last – it would be at least 12 months.
And you were away for all of the other time, were you? --- I’m unsure of the question you’re trying to get at. …
You said you’d been living at 25 Saxton Street since 12 months, you say? --- Over 12 months.
Over 12 months? --- Yes.
So maybe at least since January 2015? --- I’d have to refer back to when I moved in and out of places…
Well you took over as director of the two companies, remember? --- Yes.
So that was in January 2015, wasn’t it? --- Yes.
And before that when was the last time you were living there? --- I’m unsure.
Really? --- Yes.
When was the first time you left that property to go and live somewhere else? --- I haven’t got a photographic memory, sorry…[48]
[48]Transcript of proceedings, Moira Shire Council v Sidebottom Group Pty Ltd & Anor (Supreme Court of Victoria, S CI 2015 01051, Zammit J, 9-10 August 2016) (‘T’) 34, Lines (‘LL’) L 31; T 35, LL 1-22.
In cross-examination, Sidebottom was asked about whether he knew about the tyre stockpile for several years. He answered no.[49] He was then asked:
You haven’t known that the tyres have been building up on the land for several years? --- I was not involved.
No, no, I’m not asking you whether you were involved. You have known that the tyres have been piling up on the site for several years? --- Visually, yes.[50]
[49]T 62, LL 7-9.
[50]T 62, LL 10-14.
After lengthy questioning, Sidebottom agreed in cross-examination that there was a large quantity of tyres on the land and that there had been a fire on the land in May 2013 where a pile of tyres caught fire.[51]
[51]T 62, LL 26-27.
These two examples demonstrate Sidebottom’s evasiveness and reluctance to answer what were straightforward questions.
The Council submits that Sidebottom’s evidence puts his credit into doubt. It was submitted that Sidebottom presented to the Court as someone who would say what he thinks needs to be said. It was submitted that Sidebottom was not candid with the Court and that the Court could not have any confidence that what Sidebottom said in the past or in evidence could be believed.
In particular, the Council submits that Sidebottom’s evidence in relation to his knowledge of what assets Transpro acquired upon its incorporation and from which business it acquired it from demonstrated that he volunteered only what he thought was required at any particular time.
Sidebottom was asked in cross-examination what he knew about the assets Transpro acquired at the time of incorporation. In particular, from what business the assets were acquired from. It was put to Sidebottom:
So is it fair to say that Transpro was created and then took over some earlier business of another entity? --- I only come on as manager. I’m not sure about those details you’re asking.[52]
…
So all the assets of Huntsman Group in terms of transport machinery and equipment got transferred over to Transpro? --- I believe it could have been, but I was not, ah, privy to those exact details.[53]
…
Is that what you say still? --- I was not privy to what – the assets that Transpro Logistics received.[54]
[52]T 41, L 31; T 42, LL 1-3.
[53]T 45, LL 20-23.
[54]T 106, LL 9-14.
In cross-examination, Sidebottom agreed that he was a sole director of Huntsman Group Pty Ltd (‘Huntsman’)[55] and that he became the sole director of Huntsman on 5 January 2015.[56]
[55]T 106, LL 17-18.
[56]T 106, LL 17-24.
It was then put to him in cross-examination:
Yes, and are you still telling this Court that you’re still unsure about what happened between the Huntsman Group’s business of transporting being transferred to Transpro? --- No I’m not unsure because it wasn’t transferred. I don’t agree with what you’re trying to insinuate.
All right, and it didn’t occur to you yesterday when you weren’t sure about the Huntsman Group to volunteer that you were a director? --- Yeah I wasn’t asked that question.[57]
[57]T 107, LL 6-13.
The Council submits that Sidebottom was guarded and ‘cagey’ in the way he gave his evidence.[58]
[58]T 110, LL 24-28.
Counsel on behalf of Sidebottom submitted that there were no successful attacks on Sidebottom’s credibility. It is submitted that it was put directly to him in cross-examination that the various plans he deposed to in relation to removal of tyres in the various affidavits were a concoction and that he denied that they were concoctions. It was never put to Sidebottom that he was lying. It was submitted that Sidebottom’s credit ought not to be an issue in this case.
In light of the manner in which Sidebottom answered various questions, particularly those relating to Transpro and its relationship with Sidebottom Group, as well as his knowledge of Huntsman, I find that Sidebottom withheld information he would have at his disposal. It beggars belief that he did not know that Transpro acquired its assets from Huntsman given he was operational manager of Transpro at the time and the sole director of Huntsman. While I consider it appropriate that some allowances be made given the nature of this proceeding and the serious consequences that may follow, on the whole I did not consider Sidebottom was a candid witness.
His credit also impacts on the bona fide of his affidavit evidence. In his third affidavit Sidebottom refers to Transpro and states that he obtained information about Transpro from a historical ASIC extract for Transpro Logistics Pty Ltd dated 5 October 2015 from his lawyers.[59] He also refers to receiving a letter from Marilyn Sidebottom as sole director of Transpro, in which Marilyn Sidebottom confirms Transpro will make capital contributions to Sidebottom Group in the sum of $745,000 from September 2015 to January 2017.[60] In the third affidavit, Sidebottom did not disclose he was Transpro’s operational manager or what knowledge and beliefs he had in relation to Transpro from the position of operational manager.
[59]Sidebottom’s third affidavit, [6]-[7].
[60]Ibid [13].
In his fourth affidavit, Sidebottom states that Transpro is a separate legal entity controlled by Marilyn Sidebottom as sole director and shareholder and then sets out further information about Transpro’s financial position.[61] Again, there was no mention that he was Transpro’s operational manager at the time.
[61]Sidebottom’s fourth affidavit, [4(c)].
In his sixth affidavit and seventh affidavits, Sidebottom deposes to the issues Transpro had with its existing trucks and the purchase of the trailers. Again, there was no mention that he was Transpro’s operational manager at the time.
It is not until the ninth affidavit that Sidebottom deposes to being Transpro’s operational manager.[62]
[62]Sidebottom’s ninth affidavit [4].
When one considers the silence about Sidebottom’s role as operational manager, and therefore knowledge of Transpro, along with his inconsistent evidence about what authority he had in relation to Transpro, it puts into question his evidence in relation to Transpro and its financial ability to initially assist and then withdraw its assistance to Sidebottom Group.
At the time Sidebottom gave evidence in respect of Transpro in his first eight affidavits, I consider that he had available to him more information about Transpro than he conveyed to the Court. That information would have enabled him to know if Transpro could meet the obligations which were required under the proposed plans provided to the Court.
Sidebottom was asked numerous times in cross-examination whether he informed the Court in his affidavits if there might be an issue about Transpro’s ability to make the capital contribution. His evidence was that information in the affidavits was provided at the time to the best of his knowledge on the information he had.[63]
[63]T 51, LL 5-6, 17-19, 24-25.
In relation to the payments by Transpro to Sidebottom Group, Sidebottom deposed in his 5 October 2015 affidavit that the current rent payable at the time was $14,322 per month and that from 1 March 2016 it would go up to $14,756.60, to a total of $177,019.92 per annum. Sidebottom agreed that Transpro and Sidebottom Group were family companies and that there were transactions between the family companies.[64]
[64]T 58, LL 27-28.
He was asked whether the practice between the family companies was one whereby rent was only collected if needed. Sidebottom’s evidence was that at the time of swearing his affidavit, 5 October 2015 to the best of his knowledge ‘yes’.[65] Sidebottom agreed in his affidavit that he informed the Court that given Sidebottom Group needed the money to comply with the order to dispose of the tyres, Transpro was to pay rent monthly to Sidebottom Group.[66]
[65]T 59, L 67.
[66]T 58, LL 8-11.
In relation to the capital contribution Transpro to Sidebottom Group, it was put to Sidebottom in cross-examination that at the time he swore the affidavit on 5 October 2015 he wanted the Court to accept that Transpro would make a capital contribution of $745,000 and that Sidebottom Group would in turn pay $512,000 to remove the tyres from the land. Sidebottom agreed that no money came from Transpro since the 5 October 2015 affidavit and that was because Transpro ran into financial difficulties.[67] Sidebottom agreed that at the time of making the 5 October 2015 affidavit he had knowledge as Transpro’s operational manager and he was director of Sidebottom Group. He also agreed that he had spoken to his mother, the sole director of Transpro and on that basis worked out the plan that was presented to the Court. Sidebottom maintained that at the time and to the best of his knowledge that was the plan that could be achieved.[68] There was no evidence to the contrary before the Court. There is no evidence to contradict or displace Sidebottom’s evidence as at 9 March 2016 about Transpro’s trucks and the repairs needed that put into jeopardy Transpro’s ability to assist with the tyre removal.
[67]T 68, LL 4-5.
[68]T 69, L 5.
Sidebottom agreed that the first time the Court was informed about the inability of Sidebottom Group to comply with the proposed plan for tyre removal was in the 16 June 2016 affidavit when Sidebottom deposed to that fact that Sidebottom Group was considering being put into administration.[69]
[69]Sidebottom’s sixth affidavit, [3].
It was put directly to Sidebottom:
You see, Mr Sidebottom, what I’m putting to you is each time you’ve made one of these affidavits you’ve concocted what you think the Court might believe for that moment in time? What do you say to that? -–- I disagree.
It’s just a matter of coincidence and bad luck, a perfect storm like you say, that each time you put together a solid plan it just doesn’t work out? Is that what you’re saying? --- Yes.
So what you’re saying to this Court is when you made the arrangement with Transpro about the contributions and the money back, that was well researched and at that time you really believe[d] it would work? --- Yes.
Then the next time you did another proposal you really believed that would work? Yes? --– Yes.
Each time you swore an affidavit you really believed it would work? --- Yes.
Yet every time you get hit with things from your blind side and really – yes?
--- I can’t predict the future.[70]
[70]T 77, LL 22-31; T 78, LL 1-8.
In summary, I consider Sidebottom was evasive and not candid on some matters. However, I do not consider his oral evidence, even on those matters he was evasive and lacked candour, displaces his affidavit evidence.
Legal submissions
The Council’s submissions
The Council seeks the committal of Sidebottom for contempt of court by reasons of Sidebottom Group’s failure to comply with the 4 November 2015 and 10 March 2016 orders of the Court.[71]
[71]Amended Summons filed 10 August 2016; Applicant’s Outline of Submissions dated 5 August 2016 (‘Applicant’s Submissions’), 1 [1].
In relation to the legal principles relating to contempt, the Council relies on the decision of Dodds-Streeton J in Scott, where Her Honour, in discussing the judgment of Brennan, Dean, Toohey and Gaudron JJ in Witham v Holloway,[72] observed that the High Court had:
… acknowledged the distinction traditionally drawn between the primary aims of civil contempt (to compel obedience in the interest of the private individual) and criminal contempt (to vindicate judicial authority and maintain the integrity of the judicial process in the public interest). They considered, however, that that dichotomy was also false, because the functions allocated to each category of contempt necessarily overlapped, and the positive and remedial objects of each category were “inextricably intermixed”. Their Honours concluded that the illusory nature of the differences, and the fact that the usual outcome of successful contempt proceedings was punishment “make it clear, as Deane J said in Hinch, that all proceedings for contempt ‘must be seen as criminal in nature’. The consequence is that all charges of contempt must be proved beyond reasonable doubt.”[73]
[72](1995) 183 CLR 525 (‘Witham’).
[73]Scott [2007] VSC 15 [32] (citations omitted).
In particular, the plaintiff relies on the principle enunciated by Dodds-Streeton J in Scott that ‘all contempts arising from a breach of a Court order are essentially criminal in nature’.[74]
[74]Ibid [35]; Applicant’s Submissions, 4 [13].
The plaintiff also refers to the judgment of Gillard J in Advan,[75] where it was held that, unless the terms of the order require otherwise, a plaintiff need only establish that the contemnor deliberately committed an act or omitted to do some act which had the effect of breaching the order. This is distinguished from any need to prove that the act or omission was accompanied by an intention to deliberately breach the order.[76]
[75][2003] VSC 201 (‘Advan’).
[76]Ibid [51]; Applicant’s Submissions, 5 [15].
Both parties agreed that there are five threshold elements that must be proven beyond reasonable doubt in a contempt matter, as enunciated by Gillard J in Juric and Advan.[77]
[77]Outline of Submissions of Mr Shanan Sidebottom dated 5 August 2016 (‘Sidebottom’s Submissions’) [20], citing Juric [2001] VSC 375 [37]; Fajloun v Khoury [2016] NSWCA 101 [1], [17], [124]; Humane Society International Inc v Kyodo Senpaku Kaisha Ltd [2015] 238 FCR 209 [9]; Legal Services Board v Forster (No 2) [2012] VSC 663 [49]; and Deputy Commissioner of Taxation v Gashi (No 2) [2011] VSC 351 [18].
The Council submits that these elements have been established in this case as follows:
That an order was made by the Court
The Council submits that this element is proved beyond reasonable date by the fact that:
(a) the VCAT Enforcement Order, once filed on 10 March 2015 in the Supreme Court, became an order of the Supreme Court;
(b) the 4 November 2015 Order was an order made by the Supreme Court;
(c) the 10 March 2016 Order was an order made by the Supreme Court.[78]
[78]Applicant’s Submissions, 5 [17].
No issue is taken with the satisfaction of this element by Sidebottom.[79]
[79]Sidebottom’s Submissions [31].
That the terms of the order were clear, unambiguous and capable of compliance
The Council submits that the VCAT Enforcement Order and the 4 November 2015 and 10 March 2016 orders are clear, unambiguous and capable of compliance. Further, the Council notes that there has been no submission to the contrary by Sidebottom.[80]
That the order was served on the alleged contemnor or excused in the circumstances, or service dispensed with pursuant to the Rules
[80]Ibid 5 [18]-[19]
The Council submits that the VCAT Enforcement Order was on Sidebottom Group following its filing in the Supreme Court and states that there is no allegation to the contrary from Sidebottom.[81]
[81]Ibid 5 [20].
The Council states that the 4 November 2015 Order was personally served on Sidebottom on 20 November 2015 and was also served on Sidebottom Group on that date.[82]
[82]Affidavits of Service of Patrick Dubuc affirmed 20 November 2015; Applicant’s Submissions, 6 [21].
In respect of the 10 March 2016 Order, the Council submits that paragraph [4] of that order stipulated that, pursuant to r 66.10(6) of the Rules, service on Sidebottom Group and Sidebottom was not required.[83]
[83]Applicant’s Submissions, 6 [22].
No issue is taken with the satisfaction of this element by Sidebottom.[84]
[84]Sidebottom’s Submissions [32].
That the alleged contemnor has knowledge of the terms of the order
The Council submits that it is beyond reasonable doubt that Sidebottom and the (Sidebottom Group) had, at all relevant times, knowledge of the terms of the orders in circumstances where:
(a) The VCAT Enforcement Order and the 4 November 2015 and 10 March 2016 Orders were served on Sidebottom and Sidebottom Group; and
(b) knowledge of the terms of the orders were readily apparent from the affidavits of Sidebottom.[85]
[85]Applicant’s Submissions, 6 [25].
Counsel for Sidebottom concedes that he had knowledge of the VCAT Enforcement Order from 3 June 2015 and the 4 November 2015 and 10 March 2016 Orders from the dates they were made.[86]
[86]Sidebottom’s Submissions [33].
That the alleged contemnor has breached the terms of the order
The Council submits that there has been substantial non-compliance by Sidebottom Group and Sidebottom with the VCAT Enforcement Order and the 4 November 2015 and 10 March 2016 Orders. The Council submits this is evident from:
(a) The findings of this Court in the earlier proceeding of Moira Shire Council v Sidebottom Group Pty Ltd & Anor [2015] VSC 577;
(b) the subsequent continued failure to effect any material removal of tyres from the land, including the failure to remove a single tyre from the land since 27 January 2016; and
(c) the continued failure to properly explore options for the removal of the tyres.[87]
[87]Applicant’s Submissions, 7 [29]-[36].
The Council submits that this non-compliance amounts to a breach of those orders by reason of the endorsement on the 4 November 2015 Order and the dispensation contained in the 10 March 2016 Order.[88]
[88]Ibid 6 [26]-[27].
Counsel for Sidebottom does not deny that, other than the disposal of the tyres as exhibited at SS-38, tyres remain on the land.[89]
[89]Sidebottom’s Submissions [34].
The Council submits that, to adopt the terminology used in AMIEU and Scott, the breach ought properly be characterised as worse than ‘casual, accidental or unintentional’ and therefore ‘wilful’.[90]
[90]Applicant’s Submissions, 6 [28]; AMIEU (1986) 161 CLR 98, 113; Scott [2007] VSC 15 [47].
The Council also submits that a Jones v Dunkel[91] inference should be drawn in respect of the failure of Sidebottom and Sidebottom Group to disclose material addressing what steps taken to comply with the orders, and what steps could have been taken. The inference the Council submits should be drawn is that any information would not have assisted Sidebottom Group’s case.[92]
[91](1959) 101 CLR 298.
[92]Applicant’s Submissions, 7 [33].
Sidebottom’s submissions
In respect of any potential order of committal pursuant to r 66.05 of the Rules for Sidebottom, as an officer of Sidebottom Group, counsel for Sidebottom relies on the unreported judgment of Eames JA in Grossi & Anor v Rae & Anor.[93] Inter alia, counsel for Sidebottom relies on Eames JA’s conclusion that ‘committal and sequestration would only be appropriate when the non-compliance was wilful’.[94]
[93](1997) (Unreported, Supreme Court of Victoria, Eames JA, S CI 1996 5868) (‘Grossi’).
[94]Ibid [5]; Sidebottom’s Submissions [10].
Counsel for Sidebottom submits that on the evidence before the Court, there has been no wilful disobedience of the 4 November 2015 or 10 March 2016 Orders. Rather, counsel submits that the reason that the tyres have not been completely removed from the land is due to Sidebottom Group not having the financial means to arrange their removal.[95]
[95]Sidebottom’s Submissions [23].
In relation to contempt under r 75.06 of the Rules, counsel for Sidebottom notes that, while the Rules do not make provision for it, the authorities show that contempt has historically been divided into two categories, being conduct that amounts to criminal contempt, and conduct that amounts to civil contempt.
Counsel for Sidebottom relies on Witham and subsequent authorities where it was noted that, regardless of the distinction between civil and criminal contempt, ultimately all charges of contempt must be proved beyond reasonable doubt.[96]
[96]Witham (1995) 183 CLR 525, 530, 534. See above at [35]-[36].
Counsel for Sidebottom also relies on the High Court case of AMIEU, where the majority noted that:
[t]he principal theoretical basis of the distinction is that disobedience to the process and orders of the court in civil proceedings is said to be a civil wrong, a matter between party and party, enforcement being for the private benefit or interest of the party seeking enforcement, whereas impeding the administration of justice is a public wrong. A secondary basis for the distinction is that the main purpose of sanctions for disobedience in civil proceedings is coercive rather than punitive.[97]
[97]AMEIU (1986) 161 CLR 98, 106.
Counsel submits that the approach to be followed from AMIEU is that:
(a) wilful disobedience can give rise to punishment for breach of an order; and
(b) wilful disobedience will be any deliberate act or omission in breach of an order which was worse than casual, accidental or unintentional.[98]
[98]Sidebottom’s Submissions [16]; AMEIU (1986) 161 CLR 98, 112.
The comments of Sir George Jessel MR in Re Clements[99] are also relied upon by Sidebottom, where it was observed that the jurisdiction in relation to contempt should be carefully exercised ‘with the greatest reluctance’, with regard had to whether any other methods of achieving justice are available in the circumstances.[100]
[99](1877) 46 LJ Ch 375.
[100]Ibid 385.
Counsel for Sidebottom submits that even if the Court is satisfied that a contempt has been committed by Sidebottom, it retains the discretion to decline to find Sidebottom guilty. Counsel relies on the case of Re Perkins; Mesto v Galpin & Ors,[101] where Brooking JA observed:
It is well accepted that although the court is satisfied that a contempt has been committed it may decline to make any order, in which case it will often describe itself as declining to exercise the jurisdiction to deal with contempts summarily.
…
Such a case was Davis v Baillie [1946] VLR 486, where Fullagar J. said at 493-4:
… I was much impressed by Mr. Nimmo's proposition that I had to deal with two questions (1) Was there a contempt? and (2) Was there a punishable contempt? Of course, if there is a clear contempt, the Court must consider whether it should punish, and, if it should punish, how it should punish. But often, I think, the Court does not ask itself two separate questions, but simply and quite properly, asks itself whether it ought to exercise its jurisdiction. And, as in all cases of discretion, the matters which should be taken into consideration cannot be exhaustively enumerated and defined à priori.[102]
[101](1998) 4 VR 505.
[102]Ibid 512-513; citing Davis v Baillie [1946] VLR 486, 493-4.
In summary, counsel for Sidebottom submits that the authorities provide that:
(a) there is no meaningful distinction in respect of civil and criminal contempt in respect of an appropriate punishment to be considered;
(b) the charges of contempt must be proved beyond reasonable doubt;
(c) each element of contempt, as outlined by Gillard J in Advan and National Australia Bank v Juric,[103] must be proved beyond reasonable doubt by the applicant;
[103]Juric [2001] VSC 375.
(d) the jurisdiction of the Court with respect to contempt ought to be carefully exercised;
(e) compliance with procedural steps must be rigorously insisted upon; and
(f) even where contempt has been established, the Court must consider whether to exercise its discretion to decline to find the respondent guilty of contempt.[104]
[104]Sidebottom’s Submissions [22].
In respect of the five elements of contempt, as noted earlier, counsel for Sidebottom does not raise any major issues in relation to the satisfaction of four of the five elements.
Counsel submits that the second element of the test from Advan and Juric, being that the order must be clear, unambiguous and capable of compliance, has not been proved beyond reasonable doubt, as it has not been established that the orders were capable of compliance.
Counsel refers to the Federal Court case of Pattison v Bell,[105] where Gray J, in discussing the capability of an alleged contemnor to comply with orders, observed that:
It would be unthinkable that a person should be found guilty of contempt of court for failing to do something that could not be done. In my view, it lies upon anyone making an allegation that a contempt of court has been committed by a failure to perform an act required by a court order to prove that the alleged contemnor could have performed the act.[106]
[105][2007] FCA 137.
[106]Ibid [34].
Counsel for Sidebottom submits that in the present matter, the Council has failed to adduce evidence that the orders were capable of being complied with. Particularly, counsel states that the Council could have compelled evidence of the financial position of Sidebottom Group, but failed to do so. As such, and in circumstances where Sidebottom’s evidence has consistently been that Sidebottom Group does not have the financial means to comply with the orders, counsel for Sidebottom submits that the second element has not been discharged.[107]
[107]Sidebottom’s Submissions [35]-[40].
In the alternative, should the Court find that Sidebottom has committed contempt of the Court, counsel for Sidebottom submits that the Court should exercise its discretion not to find him guilty for the following reasons:
(a) Sidebottom was not an officer of Sidebottom Group when the enforcement order was originally made in VCAT;
(b) Sidebottom has been frank and open with the Court since he became an officer of Sidebottom Group;
(c) there is no evidence of wilful defiance of the court orders. Rather, the tyres remain on the land due to Sidebottom Group’s inability to finance their removal; and
(d) Sidebottom has facilitated the removal of in excess of 300 tonnes of tyres since he was appointed director of Sidebottom Group on 7 May 2015.[108]
[108]Ibid [41].
Analysis
Broadly speaking, the parties are largely in agreement as to the legal basis for contempt. The key issue in this case is whether Sidebottom’s non-compliance with the orders is wilful or due to a ‘casual or accidental and unintentional’ breach.
Before addressing that question, an issue which arose is the date from which it is alleged Sidebottom Group breached the orders. The amended summons alleges Sidebottom to be in contempt from 20 November 2015 to the date of the summons and continuing.
Counsel for Sidebottom rightly notes that the 4 November 2015 Order required compliance within 90 days of 4 November 2015 and therefore Sidebottom Group could not have breached the order by 20 November 2015. The Council accepted that the breach was from 18 February 2016.[109]
[109]T 133, LL 22-23.
The uncontroversial evidence is that there has been and continues to be non-compliance with the 4 November 2015 Order from 18 February 2016 to date and with the 10 March 2016 Order to date and continuing.
In relation to the threshold elements which the Council must prove beyond reasonable doubt, as identified by Advan Investments Pty Ltd v Dean Gleeson Motor Sales Pty Ltd[110] I am satisfied of the following:
[110][2003] VSC 201.
(a) there was an order made by the Court. The VCAT Enforcement Order once filed in the Court became an order made by the Court. The 4 November 2015 Order gave Sidebottom Group an extension of time for compliance with the VCAT Enforcement Order until 20 November 2015. In effect the 10 March 2016 Order provided a further extension as did the de facto extension under the order made 17 June 2016;
(b) no issue was taken with service of the orders on Sidebottom;[111]
(c) Sidebottom became a director of Sidebottom Group on 7 May 2015. The uncontested evidence is that he became aware of the terms of the VCAT Enforcement Order from 3 June 2015 onwards. The contempt application is only in respect of the 4 November 2015 and 10 March 2016 Orders and therefore the Court is only concerned with Sidebottom’s acts or omissions subsequent to those dates. On a narrow view, which I will accept, it is from 20 February 2016, 90 days from the date of compliance with the 4 November 2015 Order; and
(d) Sidebottom has breached the orders by virtue of being an officer of Sidebottom Group. There is no denial that other than the disposal of the tyres as exhibited at SS38, the tyres remain on the land.
[111]Sidebottom’s Submissions, [32].
By 5 October 2015 in his third affidavit, Sidebottom deposes that on the basis of an agreement between Transpro and Sidebottom Group, Transpro would make a capital contribution to Sidebottom Group of $745,000 from 29 September 2015 to 19 January 2017. Transpro would then pay its accrued rental liability to Sidebottom Group in the sum of $72,704 over six months. Given the latter steps Sidebottom Group could fund the $971,508.50 required to dispose of the tyres by 19 January 2017.
Despite Sidebottom’s evidence, orders were made in light of the danger to the community that the tyres posed and I formed the view that the evidence before the Court in the affidavits did not satisfy me that the tyre removal could not be achieved in a shorter time frame. I did not consider Sidebottom Group’s financial position should be the overriding factor. I considered that there had been insufficient enquiries made by Sidebottom Group as to other measures that could be adopted for the removal of the tyres from the land and granted an extension of time for compliance from 4 November 2015 by 90 days.
The real issue in this contempt application is Sidebottom Group’s non-compliance from 4 November 2015 and whether the reasons deposed to are bona fide.
The Council points to the fact that the steps put forward in Sidebottom’s second and third affidavits have never been taken. That is, Transpro has not made a capital contribution, rental arrears have not been paid by Transpro to Sidebottom Group and rent payable from Transpro to Sidebottom Group has been significantly decreased.
This may well be the case but the proposal put forward by Sidebottom on behalf of Sidebottom Group was not accepted by the Court at the date of the hearing in October 2015. Therefore, whether the proposed steps occurred to some extent becomes less relevant. What was incumbent on Sidebottom Group was compliance with the 4 November 2015 Order within 90 days by whatever means it could achieve.
Relevantly, when the matter came back before the Court and the contempt application was a live issue, the reasons for non-compliance given by Sidebottom were in the main:
(a) Transpro had sold one truck that Sidebottom Group was using to move tyres and was in the process of purchasing two new trucks. Just prior to settlement of the new trucks, Transpro’s remaining truck blew up with a repair cost of $40,000. These events delayed settlement of the two B-double trailers (the trailers) until just before Christmas 2015;
(b) modifications to the trailers were not completed until late January 2016;
(c) Transpro had not been able to make the trailers available to Sidebottom Group due to its business requirements;
(d) there has been one month where the soil has been waterlogged on the land making access to remove the tyres not possible;
(e) Sidebottom made enquiries of tyre shredding and storage sites. However, the enquiries were not fruitful;
(f) Sidebottom Group is no longer solvent and Sidebottom estimates that the removal of the tyres from the land as at June 2016 would cost approximately $278,300;
(g) Sidebottom Group’s income has been affected by a decrease in Transpro’s rental down to $4,500 per month; and
(h) Transpro has not been able to make any capital contributions to Sidebottom Group.
Has the Council proven beyond reasonable doubt that Sidebottom Group could comply with the 4 November 2015 and 10 March 2016 Orders?
It was submitted and I agree, by counsel for Sidebottom, that the onus of proof rests with the Council to prove beyond reasonable doubt that the orders were capable of compliance. Mr Baker relied on the decision of Gray J in Pattison v Bell[112] where his Honour said in respect of the culpability of an alleged contemnor to comply with orders:
[112][2007] FCA 137, [35].
[33]Counsel for the applicant conceded that the onus lay upon him to prove these charges beyond reasonable doubt. He did contend, however, that on any issue as to whether either of the respondents lacked the capacity or the ability to comply with an order of the Court, the onus fell on that respondent to prove that lack of capacity or inability. This contention was based on somewhat obscure authority, Lewis v Pontypridd, Caerphilly, and Newport Railway Company (1895) 11 TLR 203. The judgment of the English Court of Appeal in that case, delivered by Lord Esher MR on behalf of himself and Lindley and Rigby LJJ, is apparently not reported in any mainstream series of law reports. It is reported, not verbatim but in indirect speech, in the Times Law Reports. Apparently, the defendant company in that case had been ordered forthwith to make a junction connecting its railway line with the plaintiff’s works, a junction it was obliged by Act of Parliament to create. Having failed to do the work, the company was prima facie in the position of having disobeyed a judgment. The company denied having wilfully disobeyed the judgment. Wilful disobedience was an essential element of the charge of contempt under the relevant rule of court applied in that case. Lord Esher MR’s judgment is reported relevantly as follows:
‘The directors said that the company had never been able to comply with the judgment, and therefore could not be said to have wilfully disobeyed it. If from the time when the judgment was given they had always been unable, through want of funds, to do the work, probably they could not be said to have wilfully disobeyed the judgment. But it was necessary for the directors to make that out. They said that they had never had any funds out of which they could do the work, because they had paid away all the money which they earned in the ordinary expenses of carrying on the railway. It might be that they were entitled to keep the railway going. But, in [Lord Esher MR’s] opinion, they were bound, so long as this obligation was lying upon them, to keep down their expenses to the lowest point possible. They failed to show that they could not have obeyed the judgment if they had used proper economy.’
[34]It is by no means clear from this report that Lord Esher MR was speaking about the legal onus of proof, when he was reported as saying that ‘it was necessary for the directors to make that out’. His Lordship may simply have been drawing attention to the obvious need for the company to rely on evidence available from within it if it wished to contest the issue of wilfulness in that case. In my view, it would be contrary to principle to cast onto an alleged contemnor the onus of proving lack of capacity or ability to comply with a court order. It would be unthinkable that a person should be found guilty of contempt of court for failing to do something that could not be done. In my view, it lies upon anyone making an allegation that a contempt of court has been committed by a failure to perform an act required by a court order to prove that the alleged contemnor could have performed the act. [Emphasis added].
Although not referred to in submissions, there are two further cases that provide some guidance upon the issue of capability of compliance. In the decision of the Supreme Court of NSW in Wyszynski & Anor v Bill,[113] White J raised the importance of the plaintiff in a contempt application having a positive duty to prove beyond reasonable doubt capability of compliance. In that case, the alleged contemnor was required under an order to provide a document within a certain time period. The alleged contemnor claimed in an affidavit to have previously destroyed the document during an anxiety attack, and therefore was incapable of complying with the order to produce it. In that case, the alleged contemnor’s evidence was not tested by the party bringing the contempt application. White J observed in that respect:
If the version of the events described by the first plaintiff in her affidavit is true it could not be said that she refused or neglected to comply with the Master's order. I have considerable scepticism about her version of those events. But the question is not whether I believe her evidence, but whether it raises a reasonable doubt as to whether she could comply with the order. There was no medical evidence to show that the behaviour which the first plaintiff described could not be the consequence of an anxiety attack. Because of the way the evidence emerged there was no cross-examination of the first plaintiff.
In the end the only basis on which I consider I might be justified in not finding that her evidence raises a reasonable doubt is the inference which I draw that the first plaintiff did not tell her legal representatives about the likely destruction of the document before the hearing on 17 November before the Master. However, because she was not cross-examined this was not a matter which could be put to her. It would be speculative to say that there could be no good reason for her not to have disclosed to her legal representatives the matters set out in her affidavit. In this somewhat unsatisfactory state of affairs I am not satisfied beyond reasonable doubt that the first plaintiff still possessed the document when the order for its delivery was made by the Master. Therefore I am not satisfied beyond reasonable doubt that she refused or neglected to comply with the Master's order.[114]
[113][2005] NSWSC 110.
[114]Ibid [60]-[61].
Further, in Davies v Building Systems Pty Ltd & Ors,[115] Brereton J of the Supreme Court of NSW stated the following in relation to proving impossibility of compliance with an order:
Impossibility is not always a clearcut matter. Often, mandatory orders in particular, and sometimes even prohibitory injunctions, require certain acts to be done by a particular time. Sometimes it may eventuate that doing the best they can, the party bound by the order is unable to have the works completed or the state of affairs reached within the time limited by the order. In such a case, the court would not commit for contempt a party that had used its best endeavours to achieve the required result. But it is not permissible in such a case for a party at the outset to make a judgment that it will not be able to comply within the time limited by the order, assert that it is impossible to comply within time, and throw up its hands and make no effort to comply. In such a case, impossibility can be a matter of degree and not a question that is clearcut as it might be where, for example, a relevant document is not in the possession, custody or power of a party bound.[116]
[115][2009] NSWSC 1282.
[116]Ibid [19].
Notwithstanding the above, Brereton J goes on to follow the approach of Gray J in Pattison that ‘in principle, it lies upon anyone making an allegation that a contempt of court has been committed by a failure to perform an act required by a court order to prove that the alleged contemnor could have performed the act.’[117]
[117]Ibid [22], [26].
Brereton J goes further and, expressed the view that the reference in the case law to ‘action or inaction that was not casual, accidental or unintentional’, included the concept of impossibility of compliance with an order. Therefore, it was His Honour’s opinion that in proving contempt has been committed, an applicant must demonstrate that the relevant action or omission leading to the contempt was not caused by impossibility of compliance.[118]
[118]Ibid [23]-[24].
However, Brereton J concluded that while the burden of demonstrating that compliance was possible falls on the applicant, he cautioned that the respondent still retains some evidentiary burden:
While I accept, following Gray J’s decision [in Pattison], that the onus of proving that the contemnor could have performed the act involved falls on the applicant, I also accept that to the extent that that requires modification of what Sir John Donaldson said in Heatons Transport — so that it might now be enough for the respondent to say that he ‘did his best’ — an order such as this at least imposes on a party bound by it an obligation to use their best endeavours to comply with it, and not simply to make no endeavour because of a view that they could not be assured of success in making that endeavour. While I accept that the onus of showing that the respondent could comply with the order falls on the applicant, that does not mean that the respondent bears no evidentiary onus on the issue. To the contrary, in cases of impossibility, there will ordinarily be some evidentiary onus on the respondent, at least to raise the issue and adduce some evidence on it.[119]
[119]Ibid [30].
In this case, the only evidence before the Court as to the reasons for non-compliance has been put forward by Sidebottom. He gave oral evidence and filed and relied on nine affidavits.
For the reasons I have already given, I do not consider Sidebottom gave his evidence in a straightforward manner. Having said that, it is another step to conclude or infer that what Sidebottom has deposed to in relation to Sidebottom Group’s inability to comply with the orders is not true. As operational manager of Transpro, Sidebottom is in a position to know the state of Transpro’s operational assets such as the trailers. There was no evidence before the Court to contradict this evidence. Sidebottom’s evidence is that Transpro has not since January 2016 been able to make trailers available to Sidebottom Group for removal of the tyres. When asked if the proposals he put to the Court were concoctions, Sidebottom disagreed.
Sidebottom’s evidence in relation to the state of Transpro’s trucks and trailers and its ability to assist Sidebottom Group was troubling. In cross-examination Sidebottom was asked why he did not put in additional information in his affidavits in relation to the alleged damage and repairs to the truck that was being used to remove tyres from the land for Sidebottom Group, such as insurance claim forms and expense and repair costs. Sidebottom’s evidence was that he was not the director of Transpro and did not have authority from Transpro to do so.[120]
[120]T 72, LL 29-30; T 73, LL 18, 22-23.
Earlier in cross-examination it was put to Sidebottom that when he swore his affidavits detailing what Transpro was prepared to do, he agreed he consulted Transpro’s director, his mother, Marilyn Sidebottom and had been given authority to put the information in his affidavits.[121]
[121]T 72, L 31; T 73, L 3.
I do not accept Sidebottom’s evidence that he did not have the authority to put evidence before the Court about Transpro’s trucks and trailers and the said damage to the truck, repairs and insurance claims because he was not a director of Transpro. His failure to give his evidence in a candid and truthful manner infects to an extent the evidence he has given in his affidavit about Transpro’s financial difficulties and the reason why it can no longer assist Sidebottom Group as originally contemplated to remove the tyres. However, I do not consider it goes far enough to allow me to make an inference that the affidavit evidence on this point can be disregarded.
The Council has failed to put any evidence before the Court to support its assertions that Sidebottom Group is capable of compliance with the order. The Council did not subpoena any of Transpro’s records, it did not challenge Sidebottom about the enquiries and information he deposed to about the availability of shredding facilities and the secondary tyre storage facility; there was no challenge to Sidebottom Group’s solvency or the projected balance sheet for the financial year ending 2016;[122] nor did it seek discovery of relevant documents.
[122]Sidebottom’s seventh affidavit, [5].
It is the Council’s position that given the failure by Sidebottom and/or Sidebottom Group to put before the Court any evidence as to the truth or accuracy of Sidebottom’s affidavit evidence and the way in which Sidebottom gave his oral evidence that I should not accept the reasons for non-compliance. It is submitted that Sidebottom has put forward a number of proposals for compliance and that no genuine effort has been made to implement the proposal. The Council would have the Court reverse the onus of proof in this application requiring Sidebottom Group to prove its ability to comply with the orders. The Council submitted that the failure to disclose further material or call witnesses such as Marilyn Sidebottom, including what the Court referred to in the October judgment, was because that information would not have assisted Sidebottom Group’s case. The Council submitted that the Court should make a Jones v Dunkel[123] inference in such circumstances.
[123](1959) 101 CLR 298.
Sidebottom is the operational manager of Transpro, so it cannot be said that no one was called from Transpro. I accept that Sidebottom could have called Marilyn Sidebottom, that she could have given evidence elucidating Transpro’s financial ability to assist Sidebottom Group and that her absence was unexplained. However, equally, matters were not put to Sidebottom in cross examination, the Council did not explain why it did not subpoena Marilyn Sidebottom, or relevant documents, or seek discovery from Sidebottom Group, in circumstances where the onus of proof rested with the Council.
In closing submissions counsel for the Council agreed that certain parts of Sidebottom’s evidence were not challenged[124] and that the Council could have issued subpoenas.[125] The Council then submitted that there was information it did not have on some matters[126] and that Sidebottom has volunteered information to the Court in his affidavits, inviting the Court to trust him that the information he put forward to the Court ‘will deliver’.[127] The Council submits that Sidebottom is not someone the Court can trust because he has made ‘serial offers’ to the Court and there has been no delivery, just excuses.
[124]T 130, LL 19-22.
[125]T 130, LL 24-25.
[126]T 130, LL 22-24.
[127]T 130, LL 26-29.
The Council submitted that if I accepted its submissions in relation to Sidebottom’s credit, that is that Sidebottom is not a truthful witness or he is ‘a cagey’ witness, then whether matters were put to Sidebottom or not was not relevant, because if the Court did not believe him, ‘that’s the ultimate answer’.
I accept that Sidebottom was evasive and that on some matters he was not candid with the Court. The issue however is whether I can disregard the entirety of his evidence and infer that he is not telling the truth on all matters.
Transpro, Sidebottom Group, Huntsman Group and a number of other companies are all part of the Sidebottom family business. It is a nonsense to suggest that Sidebottom did not have authority or the means to provide the additional information to the Court about Transpro.
In his seventh affidavit Sidebottom deposes that it was his belief that Sidebottom Group was no longer solvent. He contacted Keith Sutherland of Bent and Cougle Insolvency Administrators for the purpose of instituting administration or liquidation proceedings.[128]
[128]Sidebottom’s seventh affidavit, [7].
In his eighth affidavit Sidebottom deposes that the financial position of Sidebottom Group is that it is still trading with limited activity. His evidence in relation to his own personal financial circumstances for the financial year ending 30 June 2015 was that his taxable income was $19,227 and for the financial year ending 30 June 2016 $39,563.[129]
[129]Sidebottom’s eighth affidavit, [6], [7].
Sidebottom also deposed that Mr Keith Sutherland would not consent to be appointed as administrator or liquidator of Sidebottom Group on account of his potential financial exposure.[130]
[130]Sidebottom’s eighth affidavit, [17], Exhibit SS48.
There is no other evidence before the Court other than Sidebottom’s affidavit evidence in relation to Sidebottom Group’s financial position. It seems to me that despite Sidebottom’s credit being in issue there is sufficient evidence before the Court to suggest that Sidebottom Group’s financial position is such that meeting the financial burden of removing the tyres from the land is not possible.
The non-compliance with the orders was not due to a single act or omission. Compliance clearly required Sidebottom Group to engage in a number of steps, including finding finance to undertake the removal of the tyres, and locating a tyre storage or recycling plant that could take the tyres. The inclement weather was clearly a factor beyond Sidebottom’s control. Having said that, it did not excuse or prevent the removal of the tyres other than for approximately one month.
In regards to the finances, the evidence before the Court is equivocal. On the one hand, there is the evidence about Transpro’s initial ability to provide capital contributions and pay rental arrears. There are aspects of the evidence that are doubtful given the unreliability of Sidebottom’s oral evidence and the evidence of what he actually knew about Transpro at the time he gave the evidence of Transpro’s ability to assist.
Then there is Sidebottom’s evidence about Sidebottom Group’s poor financial status, assets and liabilities, and inability to finance the tyre removal. It is uncontradicted by any documentary evidence or any other witness. Sidebottom has been director of Sidebottom Group since May 2015. In relation to the availability of tyre recycling plants, secondary storage areas or shredding facilitated removal of tyres, Sidebottom’s evidence is uncontradicted. There were matters that could have been put to Sidebottom which were not. For example, why the land could not be sold in the same way that the Katunga land was sold and the proceeds used to finance the tyre removal.
As has been said, all proceedings for contempt must realistically be seen as criminal in nature. Thus the requirement that all charges of contempt must be proved beyond reasonable doubt. Here, I have not been presented with evidence to satisfy me beyond reasonable doubt that the 4 November 2015 and 10 March 2016 Orders were capable of compliance by Sidebottom Group in the circumstances that Sidebottom deposed to and gave oral evidence on, which were ultimately unchallenged. Sidebottom and Sidebottom Group’s conduct in attempting to comply with the orders would amount to something akin to 'unintentional' pursuant to Dodd-Stretton J in Scott, but this matter does not fit neatly into the labels formulated in prior case law. This is partly due to the facts of this matter.
This case involves orders which have a number of stages, not a single act. In order to comply with the 4 November 2015 and 10 March 2016 Orders, Sidebottom Group had to take a number of steps, including finding finances to fund the parties including Transpro, tyre storage and shredding providers. Compliance was also dependent on the availability of alternative tyre storage facilities or shredding facilities. Based on the evidence before me, Sidebottom attempted to comply with the orders, but it was not feasible due to a number of factors that arose. At its highest the non-compliance was therefore unintentional.
In the circumstances of this case, given the equivocal nature of the evidence on key issues, even if a contempt has been established, I do not consider it appropriate to exercise the discretion to find Sidebottom guilty of contempt.
Conclusion
In order to find Sidebottom has committed a contempt, I would need to be satisfied beyond reasonable doubt of the following facts that would have enabled Sidebottom to remove the tyres from the land in compliance with the orders:
(a) Transpro’s trucks are available for Sidebottom Group;
(b) Sidebottom Group is financially able to fund along with Transpro’s contributions, the cost of $278,300 to remove the tyres;
(c) that Sidebottom Group’s assets and liabilities are not those set out in Sidebottom’s seventh affidavit at paragraph [5];
(d) that the land was not waterlogged due to inclement weather, thereby prohibiting access to the land for the trucks;[131]
[131]Sidebottom’s ninth affidavit, [9].
(e) Sidebottom Group’s lack of income is not due in part to Transpro’s changed circumstances causing a decrease in rental payments from Transpro to Sidebottom Group from $14,000 per month to $4,500 per month;
(f) that Sidebottom was able to find a firm or individual to purchase the tyres and remove and process them;[132]
[132]Sidebottom’s eighth affidavit, [5], [10]-[16].
(g) that Sidebottom’s personal financial situation is not what he has deposed to by way of exhibiting his PAYG Summary from the ATO for the financial years ending 2015 and 2016 as $19,227 and $39,563 respectively;[133]
(h) that Sidebottom Group was able to secure capital through debt funding and the reasons set out in paragraphs [8]-[9] of his eighth affidavit are not true;
(i) the steps set out in the sixth affidavit in relation to the proposed tyre recycling plant are false.
[133]Sidebottom’s eighth affidavit, [7].
The difficulty is that Sidebottom’s evidence in relation to most of the above matters remained unchallenged and uncontradicted. The admissibility of any of Sidebottom’s affidavits was not challenged.
In this somewhat unsatisfactory state of affairs, I am not satisfied beyond reasonable doubt that Sidebottom Group could comply with the 4 November 2015 and 10 March 2016 Orders. Therefore I am not satisfied beyond reasonable doubt that Sidebottom Group, through its director, Sidebottom, neglected or refused to comply with the orders.
Regrettably, the tyres remain on the land and continue to pose a serious threat to the community. This is particularly troubling given the upcoming spring and summer. There is still no realistic proposal for the removal of the tyres. Sidebottom Group’s conduct is clearly unsatisfactory. There is an enforcement order which has lapsed. The parties must now reformulate the enforcement order. It may be that the Council requires disclosure or discovery of Sidebottom Group’s financial documents, identifying its assets or other relevant information before seeking further orders. I note that Sidebottom Group was able to comply with the VCAT orders in relation to the Katunga land by selling the property. It may be that such a step is available in relation to the land that is the subject of this hearing. Any further breaches by Sidebottom Group may culminate in a fresh contempt application against Sidebottom.
As noted in Australian Competition and Consumer Commission v Hughes, ‘defiance of court orders diminishes the authority of courts and removes the incentive of parties, if such conduct is left unpunished, to comply with the requirements of the courts’.[134]
[134](2001) ATPR 41-807
I will adjourn this matter for a brief period to enable the parties to consider the future steps for this matter.
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