Nichols Construction Pty Limited v Elphick (No 4)

[2016] NSWSC 1300

Supreme Court

New South Wales

Medium Neutral Citation:	Nichols Construction Pty Limited v Elphick (No 4) [2016] NSWSC 1300
Hearing dates:	14 September 2016
Decision date:	14 September 2016
Jurisdiction:	Common Law
Before:	Button J
Decision:	(1) The notice of motion of the applicant filed in court today is dismissed. (2) The applicant must pay the costs of the respondent of the proceedings before me today.
Catchwords:	REAL PROPERTY – possession of land – application for stay of execution of writ of possession – proceedings settled by way of deed of settlement – undertakings to court not complied with – stay refused
Cases Cited:	Nichols Constructions Pty Limited v Elphick [2015] NSWSC 940 Nichols Constructions Pty Limited v Elphick (No 3) [2016] NSWSC 818
Category:	Procedural and other rulings
Parties:	Nichols Constructions Pty Limited (Plaintiff/Respondent) Vickie Maree Elphick (Defendant/Applicant)
Representation:	Counsel: S J Philips (Applicant) A J McInerney SC with D Macfarlane (Respondent)   Solicitors: Hall Partners (Applicant) Wilson & Co Lawyers (Respondent)
File Number(s):	2014/333687

ex tempore Judgment

1. This matter came before me at 9 AM today in the Duty List as an application to stay a writ of possession for residential premises at Cronulla that is due to be executed at 10 AM today. In fact, my Associate had been notified by email at 3.38 PM yesterday by the solicitor for the applicant, Mrs Vickie Elphick, that it was proposed to make the application at 10 AM today. Due to the obvious temporal futility of any such proceedings, my Associate informed the parties that the matter would be listed at 9 AM today. She also requested that all documents to be relied upon be provided by 6 PM yesterday. That request has either been complied with or, I accept, strenuous efforts have been made to do so.

2. The matter came before me with a long and regrettably tortured history. To state things very succinctly, the respondent to the motion and the party enforcing the writ, Nichols Construction Pty Limited (Nichols), engaged some time ago in property development in Queensland with Mr Ken Elphick, the husband of the applicant. It seems that, regrettably, the development was not crowned with success, and litigation has arisen from it.

3. In December 2013, Mrs Elphick granted Nichols a mortgage over the property under discussion. Mr Elphick was a guarantor. The contention of Nichols is that no money whatsoever was ever paid pursuant to that mortgage.

4. In November 2014, Nichols commenced proceedings for possession founded upon the mortgage in this Court. Default judgment was obtained, but it was set aside by Harrison AsJ in 2015: see Nichols Constructions Pty Limited v Elphick [2015] NSWSC 940. Towards the end of that year, contrary to the submission of Nichols, the matter was referred to mediation.

5. The mediation was a success, in that the proceedings were settled by way of a deed dated 16 February 2016. That Deed was founded upon confidential undertakings given to the Court by Mr and Mrs Elphick. The confidentiality of those undertakings has been dissolved by an absence of compliance with them.

6. In a nutshell, the undertaking was that Mrs Elphick would make a repayment in a sum of many millions of dollars by 29 March 2016. If she did not, then both she and her husband gave undertakings that they would not claim any interest in the property. Taken as a whole, that is how I construe the Deed and the undertakings, in the very limited time available to me.

7. Consent orders were duly made in accordance with the Deed and the undertakings.

8. Judgment was subsequently given in favour of Nichols, including for possession, in light of the failure of any moneys to be paid in accordance with the Deed.

9. Contrary to the basal propositions put forward on behalf of Mrs Elphick today, it is not a case therefore of Nichols possessing a writ founded upon its rights as a mortgagee. Rather, it is a matter of Nichols possessing a writ derived from a judgment of this Court, itself founded on a Deed of settlement, itself founded on undertakings given by Mr and Mrs Elphick. It follows that, in my respectful opinion, to speak of paying out the mortgage or some sort of reliance on an equity of redemption is not to the point.

10. Separately, Mr Elphick has commenced proceedings this year – that is, after he gave his confidential undertaking – seeking to enforce asserted rights deriving from the property at Cronulla. On the material placed before me, it is difficult indeed to see how he is entitled to commence those proceedings, in light of his undertaking. It is noteworthy that McCallum J came to the same view in her judgment of 20 June 2016: see Nichols Constructions Pty Limited v Elphick (No 3) [2016] NSWSC 818.

11. Similarly, to the extent that Mrs Elphick seeks today to postpone a writ of possession, as I have said, on my reading, it is difficult to see how that is not a breach of her undertaking as well.

12. The application today is based on the proposition that the mortgage can be paid out. That in turn is based on evidence that funds may be available by way of loans founded on mortgages of other properties available to the Elphicks, along with the issue of a convertible note by a company seemingly associated with them in the sum of almost $4 million. There are a number of problems with those propositions.

13. First, McCallum J has already rejected a previous application for stay of a writ of possession, although it seems that logistically the result of events in the past is that a de facto stay occurred: see Nichols Constructions Pty Limited v Elphick (No 3).

14. Secondly, the offer of funds by way of further mortgages is conditional on a number of matters.

15. Thirdly, it is noteworthy that the notice of enforcement of the writ addressed to the occupiers from the Sherriff is dated 8 August 2016. In other words, if funds were available, the Elphicks have had well over a month in order to obtain them.

16. Fourthly, it is true that in some correspondence the New South Wales solicitor for Nichols made a fleeting reference to what he understood to be the payout figure of the mortgage. But to my mind that is of no great moment: the material placed before me shows that he did not partake in negotiations about any sum, but rather left that question to the solicitors for Nichols in Queensland. Furthermore, the material placed before me shows that, for quite some time, Nichols has made it clear that its right to possession is not based upon enforcement of a mortgage; rather, it is based upon a judgment of this Court that came into existence in the circumstances that I have outlined.

17. Fifthly, as I have said, the loan discussed is conditional. There is also very little detail about the proposed loan by way of the issue of a note.

18. It is true that the proceedings commenced by Mr Elphick earlier this year were adjourned recently by Garling J, and will be before the Court again shortly: see transcript of 23 August 2016. But, to my mind, that provides no basis for staying this writ. As I have said, the threshold question with regard to those proceedings seems to me to be how Mr Elphick can commence them at all. And, to the extent that an important part of those proceedings is the contention of Mr Elphick that Mrs Elphick was holding the property at Cronulla on trust for him, I do not consider that that assertion, seemingly recently made, should stand in the way of Nichols having possession today.

19. In short, having regard to the whole history of this matter – and placing most emphasis on the fact that the proceedings were settled in (to my mind) clear terms well over six months ago – I do not propose to stay the writ that is to be executed at 10 AM today. That includes rejecting the alternative position that the writ should be stayed for a period of 48 hours, for the simple reason that, logistically, that would constitute a de facto stay of 6 weeks.

20. I make the following order:

1. The notice of motion of the applicant filed in court today is dismissed.

[DISCUSSION WITH REGARD TO COSTS.]

21. I make the following further order:

(2)    The applicant must pay the costs of the respondent of the proceedings before me today.

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