National Australia Bank Ltd v Joyce
[2012] WASC 224
•22 JUNE 2012
NATIONAL AUSTRALIA BANK LTD -v- JOYCE [2012] WASC 224
Pending Appeal
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2012] WASC 224 | |
| Case No: | CIV:2016/2012 | 22 JUNE 2012 | |
| Coram: | EDELMAN J | 22/06/12 | |
| 26 | Judgment Part: | 1 of 1 | |
| Result: | Injunctions ordered | ||
| B | |||
| PDF Version |
| Parties: | NATIONAL AUSTRALIA BANK LTD DENNIS WAYNE JOYCE TRYSTAN DALE JOYCE RYAN JOYCE QUIDOR PTY LTD ACN 009 107 082 (CONTROLLERS APPOINTED) NEAMER PTY LTD ACN 009 107 091 (CONTROLLERS APPOINTED) |
Catchwords: | Equity Injunctions Interlocutory injunctions Bank in possession of properties by its agents as mortgagee in possession Agents also acting as receivers of the properties Receivers and agents prevented from entry to the properties and put out of possession by means including threats of serious physical violence Equity Injunctions Interlocutory injunctions Test for interlocutory injunctions Whether applicant must prove 'inadequacy of damages' Practice and procedure Challenge to the jurisdiction of the court Relevance of the existence of the seal of the court on the chamber summons |
Legislation: | Constitution Act 1889 (WA), s 2 Constitution of the Commonwealth of Australia, covering cl 5, s 106 Rules of the Supreme Court 1971 (WA), O 67 r 4, r 6, O 72 r 2 Supreme Court Act 1935 (WA), s 15 |
Case References: | AB Hassle v Pharmacia (Australia) Pty Ltd (1995) 33 IPR 63 Apple Inc v Samsung Electronics Co Ltd [2011] HCATrans 341 Aquila Steel Pty Ltd v AMCI (IO) Pty Ltd [2010] WASC 410 Attorney-General (WA) v Marquet [2003] HCA 67; 217 CLR 545 Australian Broadcasting Corporation v O'Neill [2006] HCA 46; (2006) 227 CLR 57 Australian Communist Party v The Commonwealth [1951] HCA 5; (1951) 83 CLR 1 Beecham Group Ltd v Bristol Laboratories Pty Ltd [1968] HCA 1; (1968) 118 CLR 618 Boyd v Wild Hibiscus Flower Company Pty Ltd (No 2) [2012] FCA 74 Chan v Batemans [No 2] [2011] WASC 111 Eastland Medical Systems Ltd v Sims [2010] WASC 33 Howship Holdings Pty Ltd v Leslie (1996) 41 NSWLR 542 Instyle Contract Textiles Pty Ltd v Good Environmental Choice Services Pty Ltd (No 2) [2010] FCA 38 Johnson v Cetin [2011] WASC 344 Marley New Zealand Ltd v Icon Plastics Pty Ltd [2007] FCA 851 Medrad Inc v Alpine Medical Pty Ltd [2009] FCA 949; (2009) 82 IPR 101 O'Connell v The State of Western Australia [2012] WASCA 96 Pino v Prosser [1967] VR 835 Plenty v Dillon [1991] HCA 5; (1991) 171 CLR 635 Prout v La Rosa [2007] WASC 63 Re Wakim; ex parte McNally [1999] HCA 27; (1999) 198 CLR 511 Samsung Electronics Co Ltd v Apple Inc [2011] FCAFC 156 Singh v Friedman [2012] WASC 141 Twinside Pty Ltd v Venetian Nominees Pty Ltd [2008] WASC 110 Union Steamship Co of Australia Pty Ltd v King [1988] HCA 55; (1988) 166 CLR 1 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CIVIL
- Plaintiff
AND
DENNIS WAYNE JOYCE
First Defendant
TRYSTAN DALE JOYCE
Second Defendant
RYAN JOYCE
Third Defendant
QUIDOR PTY LTD ACN 009 107 082 (CONTROLLERS APPOINTED)
Fourth Defendant
NEAMER PTY LTD ACN 009 107 091 (CONTROLLERS APPOINTED)
Fifth Defendant
(Page 2)
Catchwords:
Equity - Injunctions - Interlocutory injunctions - Bank in possession of properties by its agents as mortgagee in possession - Agents also acting as receivers of the properties - Receivers and agents prevented from entry to the properties and put out of possession by means including threats of serious physical violence
Equity - Injunctions - Interlocutory injunctions - Test for interlocutory injunctions - Whether applicant must prove 'inadequacy of damages'
Practice and procedure - Challenge to the jurisdiction of the court - Relevance of the existence of the seal of the court on the chamber summons
Legislation:
Constitution Act 1889 (WA), s 2
Constitution of the Commonwealth of Australia, covering cl 5, s 106
Rules of the Supreme Court 1971 (WA), O 67 r 4, r 6, O 72 r 2
Supreme Court Act 1935 (WA), s 15
Result:
Injunctions ordered
Category: B
Representation:
Counsel:
Plaintiff : Mr J C Vaughan
First Defendant : No appearance
Second Defendant : In person
Third Defendant : In person
Fourth Defendant : No appearance
Fifth Defendant : No appearance
(Page 3)
Solicitors:
Plaintiff : Clayton Utz
First Defendant : No appearance
Second Defendant : No appearance
Third Defendant : No appearance
Fourth Defendant : No appearance
Fifth Defendant : No appearance
Case(s) referred to in judgment(s):
AB Hassle v Pharmacia (Australia) Pty Ltd (1995) 33 IPR 63
Apple Inc v Samsung Electronics Co Ltd [2011] HCATrans 341
Aquila Steel Pty Ltd v AMCI (IO) Pty Ltd [2010] WASC 410
Attorney-General (WA) v Marquet [2003] HCA 67; 217 CLR 545
Australian Broadcasting Corporation v O'Neill [2006] HCA 46; (2006) 227 CLR 57
Australian Communist Party v The Commonwealth [1951] HCA 5; (1951) 83 CLR 1
Beecham Group Ltd v Bristol Laboratories Pty Ltd [1968] HCA 1; (1968) 118 CLR 618
Boyd v Wild Hibiscus Flower Company Pty Ltd (No 2) [2012] FCA 74
Chan v Batemans [No 2] [2011] WASC 111
Eastland Medical Systems Ltd v Sims [2010] WASC 33
Howship Holdings Pty Ltd v Leslie (1996) 41 NSWLR 542
Instyle Contract Textiles Pty Ltd v Good Environmental Choice Services Pty Ltd (No 2) [2010] FCA 38
Johnson v Cetin [2011] WASC 344
Marley New Zealand Ltd v Icon Plastics Pty Ltd [2007] FCA 851
Medrad Inc v Alpine Medical Pty Ltd [2009] FCA 949; (2009) 82 IPR 101
O'Connell v The State of Western Australia [2012] WASCA 96
Pino v Prosser [1967] VR 835
Plenty v Dillon [1991] HCA 5; (1991) 171 CLR 635
Prout v La Rosa [2007] WASC 63
Re Wakim; ex parte McNally [1999] HCA 27; (1999) 198 CLR 511
Samsung Electronics Co Ltd v Apple Inc [2011] FCAFC 156
Singh v Friedman [2012] WASC 141
Twinside Pty Ltd v Venetian Nominees Pty Ltd [2008] WASC 110
Union Steamship Co of Australia Pty Ltd v King [1988] HCA 55; (1988) 166 CLR 1
(Page 4)
Table of Contents
Introduction ...............................................................................................................................5
Service and attempted service of the defendants and their notice of this application................6
The authority of this court ..........................................................................................................8
The challenge to this court's jurisdiction ................................................................................9
The decision to proceed on 22 June 2012.................................................................................11
Principles governing the grant of a mandatory interlocutory injunction..................................11
(1) There may not be a separate requirement for inadequacy of damages.....................12
(2) The assessment of evidence in an interlocutory injunction application is not a trial13
(3) The relevance of mandatory orders (compelling action) sought in an injunction....13
The evidence............................................................................................................................14
The facilities provided by the Bank......................................................................................14
The securities provided to the Bank .....................................................................................15
(1) The charge ............................................................................................................15
(2) The guarantees......................................................................................................15
(3) The mortgages ......................................................................................................15
Default under the Facilities and the Charge .........................................................................16
Appointment of Receivers and Managers to Connemara.....................................................16
Enforcement proceedings under the Guarantees ..................................................................17
Entry into possession by the Bank and interference with the Bank's possession.................17
Application of the criteria for the grant of an injunction..........................................................19
Is there a serious question to be tried?..................................................................................19
Will the Bank suffer an injury for which damages are inadequate?.....................................21
Does the balance of convenience favour the granting of an injunction?..............................22
Conclusion...............................................................................................................................24
(Page 5)
- EDELMAN J:
Introduction
1 The plaintiff in this application is National Australia Bank Ltd (the Bank). The Bank is a mortgagee in possession of properties, which appear to be mainly farming properties, described in sch A to these reasons (the Properties). It has appointed receivers over the Properties and it claims debts of around $70 million.
2 On 8 June 2012, the Bank filed a writ of summons and statement of claim. The claim is essentially for declarations that the Bank is lawfully in possession of the Properties and has a lawful right to sell the Properties. The Bank also seeks injunctions restraining the defendants from interfering with its rights. In broad terms the injunctions seek to restrain the defendants from entering the Properties or from restricting the Bank's employees and agents from their unrestricted rights of entry or exercise of their powers of sale.
3 The first defendant, Mr Dennis Joyce, is the father of the second and third defendants, Messrs Trystan and Ryan Joyce. The fourth defendant, Quidor Pty Ltd (Controllers Appointed) (Quidor), and the fifth defendant, Neamer Pty Ltd (Controllers Appointed) (Neamer) are companies in which ASIC records show that Mr Dennis Joyce is the sole director, secretary and shareholder.
4 There are various facility agreements relevant to this application. The facility agreements were entered into between the Bank and Connemara Holdings Pty Ltd (Connemara) between 2008 and 2010. The director and secretary of Connemara is Mr Dennis Joyce. The shareholders are Messrs Dennis and Trystan Joyce.
5 Although these proceedings are interlocutory, the nature of the injunctions sought by the Bank mirror some of the final relief which it seeks against some defendants. The injunctive relief sought is also of a mandatory (compelling) nature. As I explain below, it has been said that an interlocutory mandatory injunction should be granted only if the court has a high degree of assurance that the plaintiff will succeed at trial, although ultimately the question is one of the balance of convenience. Consequently, the reasons which follow set out the facts and background to this matter, and the authorities, in more detail than might otherwise be the case.
(Page 6)
6 My conclusions are that the injunctions sought by the Bank should be granted. The Bank has a very strong prima facie case for its entitlement to possession as a mortgagee in possession. And the balance of convenience is strongly in favour of the Bank. The injunctions sought are in the most accurate sense described as quia timet (because he fears). The Bank's employees and agents have been threatened with serious physical violence.
Service and attempted service of the defendants and their notice of this application
7 I have been provided with copious affidavit evidence concerning service and attempted service of the defendants with (i) the chamber summons for this interlocutory injunction; (ii) the writ of summons indorsed with a statement of claim in these proceedings; (iii) a certificate of urgency and memorandum of conferral; (iv) a number of affidavits in this action. The following is a very brief summary of that evidence.
8 On 13 June 2012, Quidor and Neamer were served.
9 On 14 June 2012, Mr Trystan Joyce was served. Mr Trystan Joyce identified himself to the process server. The process server read him the names of the documents to be served but Mr Joyce refused to take the documents when they were handed to him; they were placed on the ground as close as possible to him at the gate of the property where he spoke to the process server. This amounted to effective service.1
10 On 14 June 2012, a process server for the Bank went to the address of Mr Dennis Joyce but found packages on the doorstep and mail addressed to Mr Joyce in the letterbox. A neighbour said that she knew Mr Dennis Joyce but had not seen anyone at the property for at least three weeks.2
11 Between 14 June 2012 and 18 June 2012 process servers for the Bank visited the residential and business addresses of Mr Ryan Joyce on 38 occasions. On various occasions at different properties the following occurred: a process server was told by Mr Trystan Joyce that Mr Trystan Joyce did not know where Mr Ryan Joyce was; a process server was told by a workmate of Mr Ryan Joyce that Mr Ryan Joyce was at lunch (he did not return before 2.45 pm); an unknown male said that Mr Ryan Joyce
(Page 7)
- was not there and he was not sure when he would be back; and at another property, fresh footprints and tyre tracks were seen. On 18 June 2012 a process server telephoned Mr Ryan Joyce and was told by Mr Ryan Joyce that he was 'up north'. Mr Ryan Joyce attended the hearing before me on 19 June 2012.
12 Mr Ryan Joyce was served outside court on 19 June 2012. He had previously identified himself to the process server and the documents to be served upon him had been described to him previously by the process server. After he left court he refused to accept the documents and they were placed as close as possible to him and he was correctly told that he had been served.3
13 Between 12 - 16 June 2012, emails and letters were also sent to Messrs Dennis, Trystan and Ryan Joyce. Mr Trystan Joyce acknowledged in open court that he had received emails sent to his email address by representatives of the Bank on 18 June 2012.4
14 The email address for Mr Dennis Joyce to which correspondence was sent was the same email address as the one from which the following email was sent to a solicitor acting for the Bank on 28 May 2012 (reproduced below without alteration):
Dear Sir,
On 14 May 2012 your client was sent a letter revoking your clients Power of attorney as agent or principal (please see attached document). It also informed your client that they have no legal or lawful authority to act. It has been brought to my attention that your client may be continuing to act despite my instructions. The purpose of this email is to ensure you properly advise your client in relation to these matters and to seek from you a written confirmation and acknowledgement from your client that they are not entering into deceptive and fraudulent activities.
I demand that you acknowledge this email and provide a response by 5pm Tuesday 30th May, 2012
Regards
Dennis Joyce
15 Although I consider that it is likely that Mr Dennis Joyce was aware of this application, he was not served and he did not attend the court on 19 June 2012 or today, 22 June 2012. At the hearing this morning counsel
(Page 8)
- for the Bank provided a revised injunction, seeking orders only against Messrs Trystan and Ryan Joyce and Neamer and Quidor.
The authority of this court
16 Although no appearance had been entered for any of the defendants, and although Mr Ryan Joyce had refused to accept service of the documents, Mr Trystan Joyce and Mr Ryan Joyce appeared before me on 19 June 2012. Mr Trystan Joyce claimed that he had not received the documents which were the subject of the proceedings.5
17 The proceedings on 19 June 2012 were adjourned until today. The reason for the adjournment was that Mr Trystan Joyce and Mr Ryan Joyce said that they had been sent by email at midnight the previous night 300 pages of documents. The documents included the Bank's submissions, the annotated statement of claim, and an affidavit of Mr Alistair Ronald Fleming sworn on 18 June 2012. The proceedings were adjourned to give Mr Trystan Joyce and Mr Ryan Joyce the opportunity to consider those documents and submissions and to obtain legal advice if they wished to do so. I indicated to them that although there were many pages of documents involved, the Bank's position was succinctly set out and summarised in its written submissions and statement of claim.
18 On 19 June 2012, Mr Trystan Joyce and Mr Ryan Joyce sought leave to appear with a McKenzie friend. The McKenzie friend from whom they sought assistance was a person who described himself as Mr Harley. Mr Harley was initially granted leave to appear as the McKenzie friend of Messrs Trystan and Ryan Joyce. This was not opposed by the Bank. But it soon became apparent that Mr Harley wished to render assistance to Messrs Trystan and Ryan Joyce in order for them to raise hopeless arguments concerning whether the court was exercising jurisdiction under its constitutional seal or its corporate seal.6
19 Messrs Trystan and Ryan Joyce persevered in those submissions this morning (22 June 2012). It was the only matter they raised in response to the submissions of the Bank. Their submission is addressed below.
(Page 9)
The challenge to this court's jurisdiction
20 Messrs Trystan and Ryan Joyce made only one submission. They essentially submitted that the court had no authority to act 'either under its constitutional seal or its corporate seal'.
21 Mr Ryan Joyce referred to the seal of the court affixed to the chamber summons in this proceeding. He referred to covering cl 5 of the Constitution of the Commonwealth of Australia that
This Act, and all laws made by the Parliament of the Commonwealth under the Constitution, shall be binding on the courts, judges, and people of every State and of every part of the Commonwealth, notwithstanding anything in the laws of any State; and the laws of the Commonwealth shall be in force on all British ships, the Queen's ships of war excepted, whose first port of clearance and whose port of destination are in the Commonwealth.
22 Mr Ryan Joyce also quoted from the decision of Kirby J in Re Wakim; ex parte McNally7that a 'legislature cannot, by preambular assertions, recite itself into constitutional power where none exists'. The submission appeared to be that the court has no power to act under either the constitutional seal or the corporate seal affixed to the chamber summons.
23 Mr Trystan Joyce joined in Mr Ryan Joyce's submissions. Mr Trystan Joyce refused to say anything further than to ask the court whether it was acting under its constitutional seal or its corporate seal.
24 Section 106 of the Constitution of the Commonwealth of Australia expressly continues the Constitution of each State of the Commonwealth, subject to the Commonwealth Constitution, continue as at the establishment of the Commonwealth until altered in accordance with the Constitution of the State.
25 At the time of Federation, s 2(1) of the Constitution Act 1889 (WA) dealt with the establishment of the Western Australian Legislative Council and Legislative Assembly and provided that it should 'be lawful for Her Majesty, by and with the advice and consent of the said Council and Assembly, to make laws for the peace, order, and good government' of the
(Page 10)
- Colony and its dependencies.8 Section 2(1) has never been amended, and the words 'peace, order and good government' confer plenary power.9.
26 Section 15 of the Supreme Court Act 1935 (WA) provides for the Supreme Court to use a seal and for the power of the judges of the court to make rules providing for the purposes for or occasions on which the seal may be used.
27 Order 67 r 4 of the Rules of the Supreme Court 1971 (WA)provides that the official seals to be used in the Central Office shall be such as the Chief Justice from time to time directs. There is no separate constitutional seal or corporate seal. Only one official seal exists, and the Chief Justice has directed its use.
28 The official seal of the court, commonly affixed to court documents in accordance with the direction of the Chief Justice, bears the Western Australian coat of arms depicting two kangaroos each holding a boomerang in one paw and a shield in the other. It also bears the words '[t]he seal of the Supreme Court of Western Australia'. In accordance with common practice, that seal was affixed to the chamber summons by the Central Registry of this court. The affixing of the official seal has the effect that the chamber summons can be received in evidence without any signature or other formality.10
29 Despite being given the opportunity to do so on numerous occasions, at no time did either of Messrs Trystan and Ryan Joyce identify how the 'seal' under which the court was said to be acting affected the jurisdiction of the court to hear the matter, or the power to make the orders sought.
30 The best that might be said of the submission is that it bore some resemblance to a more detailed argument made in O'Connell v The State of Western Australia.11 In that case, Mazza JA (with whom Martin CJ and Buss JA agreed) considered two arguments relating to issues which were asserted by the appellant to be constitutional issues:
(i) that the passage of the Acts Amendment and Repeal (Courts and Legal Practice) Act 2003 (WA) (which, in broad terms, changed references to the Crown or her Majesty in a large number of statutes, including the District Court Act 1969 (WA), to the
- Governor or the State) 'purported to dissolve the indissoluble Federal Commonwealth; under the Crown of the United Kingdom by removing the Sovereign'; and
- (ii) that since the Department of the Attorney General has an Australian Business Number (ABN) the courts in this State have effectively become corporations and that the judiciary is no longer a separate and independent arm of government.
31 His Honour addressed that submission in detail, concluding that the arguments were hopeless and had no reasonable prospect of succeeding.12 The same must be said of the submission, if it were a submission, in this case.
The decision to proceed on 22 June 2012
32 I am also satisfied that Messrs Trystan and Ryan Joyce were aware of the nature of the proceedings against them and that they had had sufficient time to consider the application. Although numerous affidavits were filed, and although I consider the documentary evidence in some detail below, Messrs Trystan and Ryan Joyce appeared articulate and intelligent. And I had pointed out to them on 19 June 2012 the Bank's arguments in support of the injunctions are succinctly summarised in its ten pages of submissions.
33 Further, the decision by Messrs Trystan and Ryan Joyce on 19 June 2012 at the first return of the injunction application, and at the hearing today, to make submissions only (and repeatedly) in relation to the seal of the court reinforced my conclusion that there would be no benefit to them in delaying these proceedings any further.
34 If the defendants do wish to obtain legal advice it remains open for them to do so. I have set out these reasons in as complete a form as possible in the time available to assist the defendants if they do decide to seek legal advice.
Principles governing the grant of a mandatory interlocutory injunction
35 Counsel for the Bank referred to the principles governing the grant of a mandatory interlocutory injunction as summarised by Beech J in Twinside Pty Ltd v Venetian Nominees Pty Ltd.13
(Page 12)
36 The useful summary of Beech J has been relied upon again, and again.14 As a broad summary, the three broad questions which have often been asked are (1) whether the plaintiffs have established a serious question to be tried in the sense that if the evidence remains as it is there is a probability that at the trial of the action the plaintiff will be held entitled to relief; (2) whether the plaintiffs will suffer irreparable injury for which damages will not be an adequate remedy; (3) whether the balance of convenience favours the granting of an injunction.
37 I will also generally apply that approach. However, three points should be mentioned.
(1) There may not be a separate requirement for inadequacy of damages
38 As I mentioned in Johnson v Cetin,15 there is controversy over whether the adequacy of damages is a separate element of this test.
39 The requirement for damages to be an inadequate remedy was not mentioned as a separate requirement in Beecham Group Ltd v Bristol Laboratories Pty Ltd.16 Nor was it mentioned by Gummow and Hayne JJ in Australian Broadcasting Corporation v O'Neill,17 although it was regarded as a requirement in that case by Gleeson CJ and Crennan J.18
40 In Samsung Electronics Co Ltd v Apple Inc19.the Full Federal Court has suggested a reconciliation between the approaches of the different joint judgments in O'Neill. The reconciliation was to treat the question of the adequacy of damages as one of the matters which would ordinarily need to be addressed in the court's consideration of the balance of convenience and justice rather than as a distinct and antecedent consideration. An application for special leave to appeal from the decision in Samsung was dismissed.20 This reconciliation approach has
(Page 13)
- also been taken in five other decisions of the Federal Court,21 and in the Supreme Court of Victoria.22
41 In this case, I have considered the potentially more stringent test which requires the adequacy of damages as a separate requirement because this is the manner in which the Bank presented the case. It does not make a difference to my conclusion in this case because I am satisfied that damages are not adequate. It may even be that there will be very few cases where there will be a difference. The balance of convenience will not often favour an applicant who would be in as good a position if he or she were confined to damages rather than an injunction.
(2) The assessment of evidence in an interlocutory injunction application is not a trial
42 A second matter which must be mentioned in this case is that although it is important for the award of an interlocutory injunction to assess the strength of the plaintiff's case, the court does not 'undertake a preliminary trial and give or withhold interlocutory relief upon a forecast as to the ultimate result of the case'.23 However, as I explain below, it is necessary to assess the strength of the case.
(3) The relevance of mandatory orders (compelling action) sought in an injunction
43 In granting the interlocutory injunction in Twinside an observation of Beech J which is apposite to this case is as follows:
In some senses, the plaintiffs' application seeks interlocutory mandatory relief, in that it seeks an order compelling the defendant to undo its re-entry and permit the plaintiffs back into possession of the premises ... In some cases, it is said that an interlocutory mandatory injunction should be granted only if the court has a high degree of assurance that the plaintiff will succeed at trial. However, ultimately the question is as to the balance of the risk of injustice. In considering that balance the court must take into account the nature and consequences of the particular injunction sought [12].
(Page 14)
The evidence
44 Apart from affidavits of service or attempted service, the Bank filed seven affidavits in support of this application. They are as follows:
• Stuart Alexander Trail sworn on 8 June 2012.
• James Gerard Thackray sworn on 7 June 2012.
• James Wesley Corbitt sworn on 8 June 2012.
• Kenneth Graeme Hancock sworn on 8 June 2012.
• James Gerard Thackray sworn on 15 June 2012.
• Alistair Ronald Fleming sworn on 18 June 2012.
• Stuart Alexander Trail sworn on 19 June 2012.
This was the only evidence before me on this application.
45 The summary below derives from this affidavit evidence. Due to the need for delivery of these reasons quickly, I have not made reference to the affidavits or paragraphs from which the evidence below is derived.
The facilities provided by the Bank
46 In 2008 and 2009 the Bank entered into various facility agreements with Connemara Holdings Pty Ltd (Receivers and Managers Appointed) (Connemara). In the agreements, including 2009 variations, the Bank agreed to provide Connemara with the following facilities (the 2009 Facilities):
(a) 'Farm Management Account Overdraft' with a facility limit of $12,250,000 (First Overdraft Account);
(b) a 'Bill facility - Acceptance and Discount – Floating Rate' with a facility limit of $14 million (Floating Bill Facility);
(c) a 'Bill Facility - Acceptance and Discount – Fixed Rate' with a facility limit of $10 million (Fixed Bill Facility); and
(d) a 'Bill Facility - Acceptance and Discount - National Flexible Rate' with a facility limit of $12,900,000 (Flexible Bill Facility).
47 On 8 April 2010 the facility limits in the First Overdraft Account and the Floating Bill Facility were decreased to, respectively, at $10,950,000
(Page 15)
- and $4 million. The Bank also agreed to provide Connemara with two separate facilities (the 2010 facilities):
(e) a ''Farm Management Account Overdraft' with a facility limit of $9,200,000; and
(f) a 'Bank Guarantee Facility' with a facility limit of $2,768,296.58.
The securities provided to the Bank
(1) The charge
48 On 16 April 2008, Connemara granted to the Bank a fixed and floating charge over all its present and future assets. The charge secured Connemara's obligations under the 2009 Facilities (the Charge).
(2) The guarantees
49 On 17 June 2009 and 20 April 2010, Messrs Dennis and Trystan Joyce, Quidor, and Neamer jointly and severally executed two guarantees and indemnities in favour of the Bank (the Guarantees).
50 In the Guarantees each jointly and severally guaranteed, respectively, the payment obligations of Connemara to the Bank under the 2009 Facilities (the 2009 Guarantee) and the 2010 Facilities (the 2010 Guarantee).
51 The limit of the 2009 Guarantee was $70,150,000. The limit of the 2010 Guarantee was $11,968,297.
(3) The mortgages
52 On 28 June 2007, Neamer granted the Bank a mortgage, subsequently registered, over four properties which it owned (the Neamer Mortgage). Those four properties are items 11 - 15 in sch A to these reasons.
53 On 14 May 2008, Mr Dennis Joyce granted the Bank a mortgage, subsequently registered, over ten properties which he owned, set out in items 1 - 10 of sch A to these reasons (the Dennis Joyce Mortgage).
54 On 14 April 2008, Quidor granted the Bank a mortgage, subsequently registered, over the property which it owned, set out in item 16 of sch A to these reasons (the Quidor Mortgage).
(Page 16)
55 On 23 February 2009, Mr Dennis Joyce granted the Bank a mortgage, subsequently registered, over a property which he owned, set out in item 19 of sch A to these reasons (the Second Dennis Joyce Mortgage).
56 On 23 February 2009, Quidor granted the Bank a mortgage, subsequently registered, over the property which it owned, set out in items 17 and 18 of sch A to these reasons (the Second Quidor Mortgage).
57 Each of the mortgages relevant to this application, from Neamer, Mr Dennis Joyce (two), and Quidor (two) secured all amounts which the respective person was, or may become, actually or contingently liable to the Bank including in respect of the Guarantees. Each included liabilities to the Bank under one or both of the 2009 Guarantee and the 2010 Guarantee. And each gave the Bank various broad powers including a power to take possession of the property mortgaged and a power to sell the property in the event of a default for more than one day.
Default under the Facilities and the Charge
58 On 5 January 2012, Rural Liquid Fertilisers Pty Ltd served upon Connemara a statutory demand for payment of debt. Connemara failed to comply with the statutory demand by 27 January 2012. This placed Connemara in default of the 2009 and 2010 Facilities, as well as in default of the Charge for Connemara becoming insolvent (see Charge cl 12(g)(i)).
59 On 1 March 2012, the Bank issued a notice of default and demand to Connemara under the Charge. In that notice of default, the Bank certified that the total amount owing as at 1 March 2012 was $72,104,808. The Bank also referred to the default by Connemara under the Charge and explained that the default was also an 'event of default' under the Facilities; and said that the total amount owing was now repayable.
60 In the notice of default, the Bank also referred to its right under cl 13.1(c) of the Charge to appoint a receiver, and the Bank demanded immediate payment of the debt of $72,104,808.
Appointment of Receivers and Managers to Connemara
61 On 2 March 2012, the Bank appointed Mr James Thackray and Mr Shaun Fraser as receivers and managers of Connemara (the Receivers).
62 In a letter on the same day, Mr Dennis Joyce and Mr Trystan Joyce signed and acknowledged the valid and effective (i) service of the notice
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- of default; and (ii) appointment of the receivers and managers to Connemara.
63 In the 2 March 2012 letter, Mr Dennis Joyce and Mr Trystan Joyce also (i) acknowledged and agreed that the defaults described in the notice of default had occurred and continued; and (ii) consented to the Bank taking any steps to exercise its rights under the securities (ie the Mortgages) including appointment of receivers and entering into possession of any properties held by them and the Bank exercising a power of sale. And they signed acknowledgments that each of them
waives any right to challenge, dispute or oppose in any way the appointment of the Receivers or any exercise by the Bank of any rights, interests and remedies available to it under the Securities [ie the Mortgages] and at law.
Enforcement proceedings under the Guarantees
64 On 30 March 2012, the Bank commenced enforcement proceedings under the Guarantees. The Bank issued notices of demand to each of Messrs Dennis and Trystan Joyce, Neamer, and Quidor. None complied with the demands.
65 Notices of default and intention to exercise a power of sale were issued by the Bank on 13 April 2012 to each of Messrs Dennis and Trystan Joyce, Neamer, and Quidor. There was no compliance with these notices either.
66 As at 31 May 2012, Messrs Dennis and Trystan Joyce, Quidor, and Neamer are jointly and severally liable to the Bank for approximately $65 million under the Guarantees.
Entry into possession by the Bank and interference with the Bank's possession
67 On 20 April 2012, the Bank exercised its right as a mortgagee in possession to enter the properties described in sch A to these reasons. On the same day the Bank, as mortgagee in possession, appointed the Receivers as its joint and several agents (Agents).
68 From 20 April 2012 until 4 May 2012, the Bank, through its Agents, was in possession of, and occupation of, the properties.
69 On 4 May 2012, Mr Ryan Joyce sent an email to one of the Bank's Receiver's and Agents, Mr Thackray, and copied to Mr Trail, a director in
(Page 18)
- the strategic services division of the Bank. In the email, Mr Ryan Joyce said:
We have locked and sign posted all gates to the property and any attempt to access the site without invitation or prior appointment will be deemed as trespassing and those person/s will be forcibly removed and prosecuted accordingly. AUTHORITY High Court of Australia, Plenty v. Dillon (1991) 171 CLR 635 F.C. 91/004
Please inform all agents for the bank of the dispute so they may act accordingly.
Kind Regards
Ryan Joyce
71 On 8 May 2012, Mr Thackray discovered that the gates to the entrances of the property at item 3 of sch A to these reasons (the Varley Property) had been chained and padlocked closed. A large sign warning of trespass had been hung on the gate. Mr Thackray saw a Connemara employee gain access to the property. But he was approached by Mr Ryan Joyce who said to him '[g]et off the property'. When Mr Thackray asked to speak with Mr Ryan Joyce, he received the reply '[i]f you don't go right now I am going to go inside and get a baseball bat'. Mr Thackray politely explained that he did not want any violence. Before he had departed from the property, Mr Ryan Joyce also asserted that 'I do not need to explain myself to you, get off the property. I will not leave until I see an order from the High Court'.
72 Later that day the police were called. But the police did not feel able to remove Mr Ryan Joyce from the property. When Mr Thackray returned to the Varley Property with the police, Mr Ryan Joyce drove his car directly at Mr Thackray's car, swerving only when he was 2 - 3 m away. Mr Ryan Joyce performed the same seriously threatening manoeuvre with other employees of Mr Thackray's firm, Mr Corbitt and Mr Hopa.
(Page 19)
73 This was not the only threatening behaviour by Mr Ryan Joyce in relation to the properties. On 7 May 2012, Mr Corbitt, who is an accountant assisting the Receivers and Agents, had visited the Varley Property. He was told by Mr Ryan Joyce that if he came on the property 'I will remove you with force'.
74 On 11 May 2012, another attempt by Mr Corbitt to enter the Varley Property was rebuffed by Mr Ryan Joyce. After a discussion between the police and Mr Ryan Joyce on that occasion, the police advised Mr Corbitt not to enter the property.
75 The Receivers and Agents had an offer for the purchase of the Properties on 23 May 2012. The purchaser wanted immediate occupation of the properties in sch A to these reasons. It appears that the purchase did not take place. Another offer has been made by the purchaser.
Application of the criteria for the grant of an injunction
Is there a serious question to be tried?
76 The relief sought by the Bank in its Statement of Claim includes the following:
1. A declaration that the Bank lawfully entered on to and took possession of the MIP Properties as mortgagee in possession.
2. A declaration that the Bank is entitled to exercise a power of sale in relation to each of the MIP Properties.
3. A declaration that, absent the consent of the Bank or its Agents, none of the defendants are entitled to enter on to or remain on any of the MIP Properties.
4. An injunction requiring that the defendants do forthwith provide the Bank, its Agents and their employees & agents with unrestricted access to the MIP Properties.
5. An injunction requiring that T Joyce and R Joyce do forthwith leave the MIP Properties, removing any personal belongings, but otherwise leaving in place all machinery, plant & equipment and other property located on the MIP Properties (including, for the avoidance of doubt, all keys to machinery and gates).
6. An injunction restraining T Joyce and R Joyce from entering on to the MIP Properties.
(Page 20)
- 7. An injunction restraining the defendants from interfering with, obstructing or disturbing the possession of the MIP Properties by the Bank or its Agents.
8. An injunction restraining the defendants from interfering with, obstructing or disturbing the sale of the MIP Properties by the Bank or its Agents.
77 It can immediately be seen that the injunctions orders sought against Messrs Trystan and Ryan Joyce, Quidor and Neamer closely reflect the final orders sought against them:
1. The time for service of the summons be abridged to authorise service of it at any time before its return.
2. Each of the second, third, fourth and fifth defendants immediately provide the plaintiff, its agents, and their employees and agents with unrestricted access to the properties described in Schedule A (Properties).
3. Each of the second and third defendants do forthwith leave the Properties, removing any personal belongings, but otherwise leaving in place all machinery, plant and equipment and other property located on the Properties (including, for the avoidance of doubt, all keys to machinery and gates).
4. Until trial or further order each of the second, third, fourth and fifth defendants be restrained and an injunction is hereby granted restraining those defendants by themselves and by their officers, servants, agents or otherwise from entering on to the Properties.
5. Until trial or further order each of the second, third, fourth and fifth defendants be restrained and an injunction is hereby granted restraining those defendants by themselves and by their officers, servants, agents or otherwise from interfering with, obstructing or disturbing the possession of the Properties by the plaintiff or its agents.
6. Until trial or further order each of the second, third, fourth and fifth defendants be restrained and an injunction is hereby granted restraining those defendants by themselves and by their officers, servants, agents or otherwise from interfering with, obstructing or disturbing the sale of the Properties by the plaintiff or its agents.
7. The parties have liberty to apply.
78 From the uncontradicted affidavit evidence I have described above, I am satisfied that the Bank has a strong claim that it will be entitled to the rights it claims in the Statement of Claim, including possession and sale of
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- the Properties, as a mortgagee in possession, and that the Receivers and Agents were properly appointed. The case is primarily documentary and, from my consideration of all the documents so far, there is no apparent basis upon which these rights can be impugned. In written submissions the Bank said that it was not aware of any right which any of the defendants have or assert to have to possession of the Properties.
79 There is a serious question to be tried.
80 I should add that in addition to the 2 March 2012 letter which was signed by Mr Dennis Joyce and Mr Trystan Joyce, Neamer and Quidor also entered into a Deed of Forbearance with the Bank on 18 November 2011 in which the Bank had previously agreed to forbear exercising various rights under the Facilities and in which each of Mr Dennis Joyce and Mr Trystan Joyce, Neamer and Quidor acknowledged and agreed that they had 'no defence, set-off, or counter-claim (and hereby waive any such defence, set off or counter-claim) to the Bank's claims against them pursuant to the Facilities and the Securities'.
Will the Bank suffer an injury for which damages are inadequate?
81 As I have explained above, the better approach to this issue may be that it is not a separate question but is part of the consideration of the balance of convenience. In any event, I am satisfied that there is a real likelihood that the Bank will suffer an injury for which damages are not adequate recompense if injunctions are not granted to protect its asserted rights.
82 In Boyd v Wild Hibiscus Flower Company Pty Ltd (No 2)25Foster J, explained the meaning of the term 'adequacy of damages':26.
That question involves an assessment by the Court as to whether the plaintiff would, in all material respects, be in as good a position if he were confined to his damages remedy, as he would be in if an injunction were granted...
83 The evidence which I have described above strongly supports the conclusion that damages are not an adequate remedy for the Bank. This is so for two central reasons.
84 First, there is a potential sale of all of the Properties by the Bank. An offer was made to the Receivers by a potential purchaser on 23 May 2012 and another offer on 14 June 2012 with proposed settlement on 26 June
(Page 22)
- 2012. The Agents are not currently able to deliver vacant possession of the Properties and the Bank therefore risks losing the benefit of that sale.
85 If the sale does not occur then interest will continue to accrue on the debt to the Bank in circumstances where it appears that there is a little or no prospect of the Guarantors being able to repay either the capital or the interest.
86 Secondly, whilst they are out of possession, the Receivers and Agents are not able to discharge their duties including, for example, monitoring the Properties to ensure that the plant and equipment (including air drills, air seeders, boom sprayers) are stored correctly.
Does the balance of convenience favour the granting of an injunction?
87 The question of the balance of convenience is not an entirely independent question from the issue of serious question to be tried, and the strength of the Bank's case. The stronger an applicant's case, the more the balance of convenience will tilt in its favour. As I have explained above, there is no apparent defence to the Bank's claims that it be entitled to the exercise of the rights asserted.
88 Although the purpose of interlocutory injunction is often said to be to preserve the status quo until the hearing of the main action and although the status quo is the situation immediately before the issue of the writ seeking the permanent injunction, it has also been emphasised that the status quo can be disturbed by an interlocutory injunction and that 'the truth of the matter is that no real principles can be laid down'.27.
89 Although the Bank is not currently in actual possession, it was in actual possession of the Properties until 4 May 2012. After that date, it was prevented from exercising its rights to possession, including by threats of violence. For centuries it has been entirely unexceptional for a status quo to be disturbed by compulsive orders for possession before trial where a plaintiff's case is that he was prevented from entry by force or the threat of force. This notion goes as far back as the Roman possessory interdicts.
90 Without the injunctions sought by the Bank, it will be deprived of its apparent proprietary rights to possession of the Properties and the plant and equipment, over which there is no evidence that the defendants have any right to possession.
(Page 23)
91 In contrast, even if some right to possession, or even possibly arguable right to possession, by the defendants could be identified there is no apparent prejudice to the defendants in the grant of the injunctions. Messrs Dennis, Trystan and Ryan Joyce had previously vacated the Properties by consent between 20 April 2012 and 4 May 2012 and there is no evidence that they suffered any prejudice during that time.
92 Further, the Bank also offers an undertaking as to damages in the usual form.
93 There is only one matter, properly raised by counsel for the Bank, which might have militated (slightly) against the grant of the injunctions. This is the short delay in bringing the chamber summons. However, once all the facts are understood there was no real delay at all.
94 The Bank and its Agents were shut out of the Properties on 4 May 2012. The chamber summons was brought on 8 June 2012. However, even apart from the time taken for preparation of the supporting affidavits, in the intervening period the Bank was waiting for a complaint that had been lodged against the Bank to be dealt with by the Financial Ombudsman Service (the FOS).
95 On 27 May 2012, Mr Ryan Joyce emailed Mr Stuart Trail (of the Bank) and said that a complaint against the Bank had been lodged with the FOS on behalf of Mr Dennis Joyce and Connemara Holdings. He said that as 'a result all recovery action by the bank is to cease immediately'. He provided a reference number with the FOS for the dispute.
96 After the FOS did not hear further from Mr Ryan Joyce or Mr Dennis Joyce by 3 June 2012, the FOS closed the dispute. However, on 4 June 2012, Mr Ryan Joyce and Mr Dennis Joyce provided further information to the FOS in relation to the FOS Complaint. This was treated by the FOS as a request for the FOS to re-open the dispute.
97 On 7 June 2012 the FOS expressed its final view to Mr Ryan Joyce and Mr Dennis Joyce that, despite the further information they provided on 4 June 2012, the dispute was outside of the Terms of Reference. The chamber summons was then brought on 8 June 2012.
98 The only remaining question is whether the injunctions sought should be made against all of Messrs Trystan and Ryan Joyce, Neamer and Quidor. Although the overt acts and threats of violence have come from Mr Ryan Joyce, Mr Trystan Joyce has also been photographed in occupation of one of the properties over which the Bank asserts its rights
(Page 24)
- as a mortgagee in possession. Every indication from the evidence is that he will not leave the properties unless compelled to do so.
99 As for Neamer and Quidor, although these companies are controlled by Mr Dennis Joyce (who was not able to be served), the companies were served in these proceedings and they are inextricably connected with the exercise of the Bank's rights. It is appropriate that the injunctions extend also to them.
Conclusion
100 An assessment of all the evidence in an application for an interlocutory injunction does not involve the court conducting a preliminary trial of the matter. This point applies with even greater force where the only evidence before the court is provided by the Bank, and the application has proceeded in the absence of the defendants (although all but one of them were served with the application). Although there is no apparent defence to the documentary case presented by the Bank, no final conclusions can, or should, be reached on any of the evidence, particularly in the absence of any contradictor. However, as I explained in the introduction to these reasons, the nature of the relief sought (as mandatory relief which also mirrors some of the final orders sought against some defendants) required close attention to the case which the Bank will make at a final hearing of the matter. The apparent strength of that case supports the injunctions sought here.
101 I will make orders 1 - 7 as sought by the Bank and set out above at [77]. The Bank also seeks its costs of the application against the second, third, fourth and fifth defendants. I will hear from the Bank and Messrs Trystan and Ryan Joyce (if they wish to be heard) as to that order.
102 I reiterate that if the defendants wish to obtain legal advice it remains open for them to do so and for their legal representatives to exercise the liberty to apply to this court in support of their rights. I have set out these reasons in as complete a form as possible in order to assist the defendants if they do decide to seek legal advice.
(Page 25)
- Schedule A:
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(Page 26)
Schedule A (cont …):
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1 Order 72 r 2 Rules of the Supreme Court 1971 (WA);Prout v La Rosa [2007] WASC 63 [13] - [16] (Blaxell J). See also Pino v Prosser [1967] VR 835, 839 (McInerney J); Howship Holdings Pty Ltd v Leslie (1996) 41 NSWLR 542, 544 (Young J).
2 See affidavit of Mr Darren Walker, sworn 19 June 2012.
3 See footnote 1 above.
4 ts 4.
5 ts 4.
6 ts 5.
7 Re Wakim; ex parte McNally [1999] HCA 27; (1999) 198 CLR 511, 602 [193], Kirby J citing the Australian Communist Party v The Commonwealth[1951] HCA 5; (1951) 83 CLR 1, 190 - 193, 205, 221, 244, 263, 278 - 279.
8 Attorney-General (WA) v Marquet [2003] HCA 67; 217 CLR 545, 557 [16] (Gleeson CJ, Gummow, Hayne & Heydon JJ).
9 Union Steamship Co of Australia Pty Ltd v King [1988] HCA 55; (1988) 166 CLR 1, 9 (the Court).
10 Order 67 r 6, Rules of the Supreme Court 1971 (WA).
11 O'Connell v The State of Western Australia [2012] WASCA 96.
12 O'Connell v The State of Western Australia [2012] WASCA 96 [92].
13 Twinside Pty Ltd v Venetian Nominees Pty Ltd [2008] WASC 110 [7] - [12].
14 Eastland Medical Systems Ltd v Sims [2010] WASC 33 [59] (Murphy J); Aquila Steel Pty Ltd v AMCI (IO) Pty Ltd [2010] WASC 410 [17] (Allanson J); Chan v Batemans [No 2] [2011] WASC 111 [99] (Simmonds J); Singh v Friedman [2012] WASC 141 [10] (McKechnie J).
15 Johnson v Cetin [2011] WASC 344 [47].
16 Beecham Group Ltd v Bristol Laboratories Pty Ltd [1968] HCA 1; (1968) 118 CLR 618.
17 Australian Broadcasting Corporation v O'Neill [2006] HCA 46; (2006) 227 CLR 57, 81-82 [65].
18 Australian Broadcasting Corporation v O'Neill [2006] HCA 46; (2006) 227 CLR 57, 68 [19].
19 Samsung Electronics Co Ltd v Apple Inc [2011] FCAFC 156 [61] (the Court).
20 Apple Inc v Samsung Electronics Co Ltd [2011] HCA Trans 341.
21 Marley New Zealand Ltd v Icon Plastics Pty Ltd[2007] FCA 851 [3] (Gordon J); Medrad Inc v Alpine Medical Pty Ltd[2009] FCA 949; (2009) 82 IPR 101, 109 [38] (Kenny J); Instyle Contract Textiles Pty Ltd v Good Environmental Choice Services Pty Ltd (No 2) [2010] FCA 38 [55] - [64] (Yates J); Boyd v Wild Hibiscus Flower Company Pty Ltd (No 2) [2012] FCA 74 [61] - [66] (Foster J).
22 AB Hassle v Pharmacia (Australia) Pty Ltd(1995) 33 IPR 63, 76 - 77 (Ashley J).
23 Beecham Group Ltd v Bristol Laboratories Pty Ltd [1968] HCA 1; (1968) 118 CLR 618, 622 (the Court).
24 Plenty v Dillon [1991] HCA 5; (1991) 171 CLR 635.
25 Boyd v Wild Hibiscus Flower Company Pty Ltd (No 2) [2012] FCA 74 [62].
26 Relying upon Spry The Principles of Equitable Remedies (8th ed, 2010) 383 - 389; 397 - 399; 457 - 462.
27 R Meagher, D Heydon, M Leeming Equity Doctrines and Remedies (4th ed, 2002) 774 - 775.
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