| JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : O'DEA -v- SHIRE OF COOLGARDIE [2013] WADC 150 CORAM : DAVIS DCJ HEARD : 5 APRIL 2013 DELIVERED : 20 SEPTEMBER 2013 FILE NO/S : APP 100 of 2012 BETWEEN : DAMIEN ANDREW O'DEA Appellant
AND
SHIRE OF COOLGARDIE
Respondent
ON APPEAL FROM:
Jurisdiction : MAGISTRATES COURT OF WESTERN AUSTRALIA Coram : MAGISTRATE BOON File No : PE 2697 of 2011 Catchwords: Appeal - Magistrates Court - Second application to set aside default judgment - Magistrate refused to set aside judgment - Magistrate allowed amendment to amount of default judgment - Turns on own facts
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Legislation: Magistrates Court (Civil Proceedings) Act 2004 s 12, s 45 Result: Appeal dismissed
Representation: Counsel:
Appellant : In person
Respondent : Mr J F Park
Solicitors:
Appellant : Not applicable
Respondent : Park Linfoot Legal Solutions
Case(s) referred to in judgment(s):
ACN 076 676 Pty Ltd (in liq) v A-Comms Teledata Pty Ltd [2000] WASC 214
Allesch v Maunz [2000] HCA 40; (2000) 203 CLR 172
Australian Education Union v Department of Education and Children’s Services (2012) 285 ALR 27
Batchelor v Burke (1981) 148 CLR 448
Butler v Bennett [2007] WADC 107
Cardno BSD Pty Ltd v Water Corporation [No 2] [2011] WASCA 161
Carr v Finance Corp of Australia Ltd (No 1) (1981) 147 CLR 246
Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194
Collector of Customs v Agfa-Gevaert Ltd [1996] HCA 36; (1996) 186 CLR 389
Frigger v Forbes [2012] WADC 38
Gronow v Gronow [1979] HCA 63 ; (1979) 144 CLR 513
Haines v Bendall [1991] HCA 15; (1991) 172 CLR 60
Hall v Hall [2007] WASC 198
Hall v Nominal Defendant (1966) 117 CLR 423
Ho v Loneragan [2013] WASCA 20
Hungerfords v Walker (1989) 171 CLR 125
Knight v FP Special Assets Ltd (1992) 107 ALR 585
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Koutlakis v City of West Torrens [2009] SASC 140; (2009) 167 LGERA 117
Legge v Simonsen [2010] WADC 190
Parker v Transfield Pty Ltd [2000] WASCA 382
Pilbara Infrastructure Pty Ltd v BGC Contracting Pty Ltd [2007] WASCA 257
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355
Racovalis v Rescom Mortgages Pty Ltd [2010] VSCA 55; (2010) 28 VR 250
Rankilor v Circuit Travel Pty Ltd [2013] WASCA 148
Regan v Gibson [2010] WADC 144
Ruby v Doric Constructions (Australia) Pty Ltd [2013] WASCA 94
Ruby v Marsh (1975) 132 CLR 642
Starrs v Retravision (WA) Ltd [2012] WASCA 67
Tey v Optima Financial Group Pty Ltd [2010] WASCA 219
Tey v Optima Financial Group Pty Ltd [2010] WADC 98
WACO Kwikform Ltd v Q-Con Pty Ltd [2009] WADC 45
Western Australian Planning Commission v Narcom Holdings Pty Ltd [2011] WASC 259
Western Australian Planning Commission v Narcom Holdings Pty Ltd [2011] WASC 259 (S)
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1 DAVIS DCJ: The appellant, Mr O'Dea, has appealed from a decision of Magistrate Boon on 19 November 2012 to refuse to set aside a default judgment obtained against him by the Shire of Coolgardie (the Shire), and to permit the Shire to amend its default judgment. The application made by Mr O'Dea and refused by the magistrate was his second application to set aside the default judgment.
2 The amount of the default judgment as amended is $656.03. That sum is the balance of the Shire's original claim for rates and other items, after deduction of payments made by Mr O'Dea and a recalculation of what I will refer to as pre-judgment interest - namely, interest between the date of the filing of the Shire's general procedure claim in the Magistrates Court and the date of the judgment. The Shire sought pre-judgment interest at the maximum rate allowed for under s 6.51 of the Local Government Act 1995 (LGA), which is 11%. 3 Mr O'Dea has disputed the Shire's claim for and calculation of that interest, which amounts to $47.22. He has disputed the Shire's claim for an amount of $249.10 for legal costs incurred by the Shire in a previous recovery action against him in 2009, which did not culminate in any judgment, but was not continued with by the Shire, as service could not be effected. He has also complained about the magistrate's decision to allow the Shire to amend its default judgment. 4 Given the amount in issue in this appeal, I raised with the parties, when hearing argument on the interest component of $47.22, whether I should apply s 43(3) of the Magistrates Court (Civil Proceedings) Act 2004 (MCCPA). By that section, the appeal court may strike out an appeal if the likely costs of the appeal to the parties would be disproportionate to the amount of the claim in, or the nature of, the case which is the subject of the appeal. 5 Both parties were aware of this provision and subsequently, in written submissions which I directed to be filed following the appeal hearing, the Shire addressed this further. 6 The principles relating to s 43(3) of the MCCPA are set out in Tey v Optima Financial Group Pty Ltd [2010] WADC 98 [10] - [15], upheld on appeal Tey v Optima Financial Group Pty Ltd [2010] WASCA 219 [19] - [27]. 7 The likely costs of the appeal in this case will be disproportionate to both the amount of and nature of the claim and I could have exercised my discretion to strike out this appeal pursuant to s 43(3). I have considered, (Page 5)
however, that it is important for both parties that I address the merits of this appeal. This is partly because of the expectations of Mr O'Dea, but also because he has challenged the ability of the Shire to add legal costs of recovery to his account, and there are ongoing issues between Mr O'Dea and the Shire in relation to later recovery costs incurred by the Shire (not part of the default judgment the subject of this appeal). 8 In relation to the merits, as the Shire admitted when it applied to amend the amount of the default judgment, there were errors in its calculations of the amount owed by Mr O'Dea. This whole matter has had a long and unfortunate history. However, for the reasons which follow I do not consider that there is merit to Mr O'Dea's appeal grounds and his appeal must be dismissed.
The nature of this appeal 9 This appeal is brought pursuant to s 40 of the MCCPA which provides that the appeal shall be conducted in accordance with the rules of court made by the District Court: s 40(3)(b). The appeal is by way of a 'reconsideration of the evidence' that was before the Magistrates Court: District Court Rules 2005 (WA) (DCR) r 50(1). 10 An appeal from a decision of a magistrate involving a reconsideration of the evidence is in the nature of a rehearing: Legge v Simonsen [2010] WADC 190 [4] (Sleight DCJ); Regan v Gibson[2010] WADC 144 [7] (Derrick DCJ); Butler v Bennett[2007] WADC 107 [5] - [10] (Bowden DCJ). 11 An appellate court hearing an appeal by way of a rehearing can exercise its appellate powers only if satisfied there was some legal, factual or discretionary error on the part of the primary decision-maker: see Allesch v Maunz [2000] HCA 40 [23]; (2000) 203 CLR 172; Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission[2000] HCA 47 [14]; (2000) 203 CLR 194, 203; Butler v Bennett.
The materials on this appeal 12 Section 40(4) of the MCCPA requires me to decide the appeal on the material and evidence that were before the Magistrates Court. I have had regard to the Magistrates Court file and the transcript of the proceedings in the Magistrates Court. Both parties in this appeal referred me to relevant pages from that transcript. (Page 6)
13 The parties provided written submissions both before and after the appeal hearing, to which I have had regard in addition to the oral submissions made at the time of the hearing.
Background to the appeal 14 On 11 February 2011, the Shire issued a general procedure claim in the Magistrates Court against Mr O'Dea and others, claiming a total of $2,342.81. The description of the claim was as follows: The defendant is indebted to the claimant in the sum of $1,807.61 for rates, the subject of assessment number A155, the rateable address being 79B Bluebush Road, Kambalda 6442 for the period between 01/07/10 and 30/06/11 and $89 being costs for the proceedings in accordance with the provisions of Local Government Act 1995. The claimant also claims interest pursuant to s 6.51 of the Local Government Act 1995 at the rate of 11% per annum on $1,807.61 from 3 September 2010 until payment or judgment. The claimant also claims costs. 15 Following service of the claim on Mr O'Dea, and after he had not lodged a response to the claim or statement of defence within the prescribed time, the Shire applied for default judgment. The application was made by Magistrates Court of Western Australia Form 13. There were some amendments to the amount claimed to deduct the $89 costs as claimed and to reflect some payments that had been made by Mr O'Dea between the date of the issue of the general procedure claim and the date of judgment. 16 Default judgment was entered on 27 September 2011 for the total amount of $1,031.68. This included interest from 3 September 2010 to 27 September 2011 in the amount of $163.87 and costs on the claim of $446.20. 17 On 14 December 2011 Mr O'Dea applied to set aside the judgment. Based on what is contained in an affidavit he swore on 14 December 2011, he disputed the Shire's entitlement to an amount of $249.10 for legal fees which had been added to his rates notice in 2009. In par 13 of his affidavit he stated: … I dispute the council having entered amounts with respect to legal fees via Dunn and Bradstreet particularly on the 1 July 2009 a fee was entered in the amount of $249.10. I do not know and therefore cannot admit to having been advised of this fee being requested by the council to me. (Page 7)
18 Mr O'Dea disputed these legal fees 'particularly as there were no proceedings for recovery'. 19 It is apparent from what else is stated in his affidavit that Mr O'Dea also disputed other Dunn & Bradstreet fees from 19 May 2011 and 24 October 2011 which had been charged to his account by the Shire. These other costs are, of course, not part of the default judgment and to that extent are not relevant to this appeal, although Mr O'Dea has raised the same issue concerning these costs as he has in relation to the $249.10. 20 In response to Mr O'Dea's application to set aside the default judgment, the Shire filed an affidavit sworn by Chelsea Ann Butler, the rates officer at the Shire, on 16 January 2012. That affidavit annexed the Shire's rates notices, and correspondence between the Shire and Mr O'Dea concerning the outstanding rates and charges and an arrangement for payment which was made after the date of the issue of the Shire's general procedure claim. 21 It is fair to say that in that correspondence Mr O'Dea disputed the ability of the Shire to on-charge recovery costs for outstanding rates and charges. The Shire in response advised that it was entitled to on-charge the costs of legal action to recover outstanding rates, referring to s 6.55 and s 6.56 of the LGA, and to the statement on each and every rates notice that outstanding rates may be recovered by legal action and 'costs of legal action will be added to your account'. 22 Annexed to Ms Butler's affidavit (annexure CB15) were copies of extracts from Dunn & Bradstreet accounts relating to the Shire's recovery costs relating to Mr O'Dea from 2009 and 2011. From my review of this annexure I am satisfied that all the Dunn & Bradstreet charges relate to the issue of proceedings. The itemised costs in these accounts are for court fees, solicitors' fees (on the same date as the court fees), services fees and kilometre fees for service. 23 Ms Butler in her affidavit (par 14) explained that the amount of $249.10 costs related to legal proceedings (which I shall refer to as the 2009 recovery proceedings) commenced against Mr O'Dea for the Shire's unpaid rates. Those proceedings were 'discontinued' because the defendants could not be served. 24 The sum of $249.10 relating to the 2009 recovery proceedings first appeared on the rates notice issued on 13 August 2009 (annexure CB4). (Page 8)
25 Mr O'Dea's application to set aside the default judgment was heard by Magistrate Lane on 30 January 2012. Mr O'Dea appeared by audio link to South Australia, where he was then living and working. 26 Magistrate Lane dismissed Mr O'Dea's application to set aside the default judgment. 27 In Magistrate Lane's reasons for decision, given orally, her Honour first addressed the explanation for the delay which Mr O'Dea had given in his affidavit, which was the fact that he was busy and attending to Family Court proceedings (among other things). There was no doubt that he was aware of the general procedure claim. Magistrate Lane found that his reasons for delay were unacceptable. 28 Magistrate Lane also found there was no merit in the defence which related to the $249.10 costs of the 2009 recovery proceedings, stating in her reasons as follows: 29 Magistrate Lane concluded that Mr O'Dea had not satisfied the court on the balance of probabilities first, that there was a good reason for the delay in the failure to lodge the defence and secondly, that there was merit to his defence. 30 Mr O'Dea did not bring an appeal from the decision of Magistrate Lane dismissing his application to set aside the default judgment. Instead, over seven months later on 10 September 2012, he made a second application to set aside the judgment. 31 In support of the second application Mr O'Dea swore a further affidavit in which he set out the following grounds to have the default judgment set aside (par 4 of his affidavit sworn 10 September 2012): 4.1 It is an abuse of process to bring an action for which costs and arrears of rates already claimed were in respect to a previous action. (Page 9)
4.2 Judgment was irregularly obtained. 4.3 Judgment was obtained claiming costs outside court rules. 4.4 Judgment was obtained without notice to the defendant. 4.5 The judgment amount was for more than was owing at the time of the application for Default Judgment. 4.6 The Default Judgment application included an award of interest on interest. 4.7 By electing to bring an action in this Honourable Court, the Claimant elected against the right of self-help, accepting payments by agreement outside of the Courts processes is in itself an abuse of process. 4.8 The Defendant has a credible defence on the merits. 32 Mr O'Dea argued (in par 11 of his affidavit of 10 September 2012) that the amount of $446.20 in the default judgment for legal costs should have been restricted to the application fee and service fees for the general procedure claim in the Magistrates Court. He pointed out (par 15) that the $249.10 for legal costs for the 2009 recovery proceedings which were added to his unpaid rates related to an application which was discontinued. He also listed other legal fees for another action (PER/GCLM 2697/11) which had been added to his rates notices. He annexed a billing sheet showing payments that had been made to the Shire. He set out some general inquiries he had made with Dunn & Bradstreet in relation to its fees and how they were charged (pars 31 and 32), however it is not clear whether or if so, how, this related to the $249.10 from the 2009 recovery proceedings. He concluded by stating (par 34): I verily believe there are no outstanding council rates owing by the Defendant(s) in this action based upon payments I have already made and that the legal fees to which the Claimant refers are not entitled to be on charged to the Rates Billing system or recovered in any event save and except for those allowed within the Court rules or relevant Act. 33 On 9 October 2012 the Shire filed an application to amend the judgment obtained on 27 September 2011 in the amount of $1,031.68 to the lesser amount of $656.03. This application was supported by a further affidavit from Ms Butler sworn 18 September 2012. In that affidavit, she deposed to the fact that the default judgment amount of $1,031.68 was incorrect. It was acknowledged in Ms Butler's affidavit (par 14) that interest should have been claimed in the default judgment only from (Page 10)
11 February 2011 to 27 September 2011 at 11%, and not from 3 September 2010 to 27 September 2011. That reduced the interest to $47.22. The amount of the default judgment should have been: (a) the claim of $1,807.61 (being unpaid rates and service charges totalling $1,440.03, interest of $118.49 and the disputed legal costs of $249.10); (b) costs of $446.20 (relating to the costs of issuing and service of the current claim); (c) interest of $47.22 from 11 February 2011 (the date of the issue of the general procedure claim) to 27 September 2011 (the date of the default judgment). Annexed to Ms Butler's affidavit (Annexure CB3) was an interest schedule setting out the Shire's interest calculations; (d) less amounts paid by the defendant between 11 February 2011 and 27 September 2011 of $1,645. 34 The total amount for which default judgment should have been entered on 27 September 2011 was therefore $656.03 (par 15). 35 Mr O'Dea's second application to set aside default judgment and the Shire's application to amend the amount of the judgment were heard before Magistrate Boon on 19 November 2012. 36 At this hearing Mr O'Dea's principal argument related to the ability of the Shire to claim the costs of $249.10 in relation to the 2009 recovery proceedings and his interpretation of s 6.56 of the LGA (ts 10 - 15, 21 and 25). His argument was that absent an order for costs in the proceedings, the Shire could not add its costs to his rates notice (ts 13). He appeared to acknowledge that he had produced no new factual material in support of his argument, only legal authorities which had not been brought to Magistrate Lane's attention at the time of the hearing of his first application (ts 13 -14). 37 Mr O'Dea also challenged the pre-judgment interest originally claimed at $163.87, arguing that the claim for rates included a calculation of interest and the Shire was asking for interest on interest. 38 Finally, he challenged the costs awarded on the default judgment of $446.20. 39 In Magistrate Boon's reasons for decision given orally, she: (Page 11)
(a) went through the history of the matter, observing that the argument before Magistrate Lane was in relation to the legal costs (of $249.10) included in the Shire's rates notices; (b) observed that between the date of Magistrate Lane's decision (30 January 2012) and Mr O'Dea's present or second application to set aside judgment on 10 September 2012, nothing had happened; (c) recorded that she had been provided with decisions by both parties and for the purpose of her decision accepted that there may be authority which may support Mr O'Dea's argument in relation to the appropriateness of the legal costs claimed by the Shire. She observed 'there is an argument both ways in my view on the authorities' (ts 52); (d) recorded that the application to set aside the default judgment related to three items raised by Mr O'Dea: 40 In relation to the interest, Magistrate Boon referred to the Shire's affidavit in which it acknowledged there was something claimed which should not have been claimed and that part of the judgment that has been entered is incorrect and should not stand. She stated, at the end of her reasons when dealing with the Shire's application to amend the default judgment: I am satisfied, having heard further explanation, that it is not actually a claim of interest upon interest. That has been rectified now, so I will make orders in terms of the claimant's application. 41 In relation to the costs of the general procedure claim of $446.20, Magistrate Boon observed that these were allowable costs under the provisions of the MCCPA. She did not accept Mr O'Dea's argument in relation to this part of the disputed amount. (There is no issue in this appeal as to those costs on the summons of $446.20). 42 Finally, she addressed the amount of $249.10 costs relating to the 2009 recovery proceedings. Magistrate Boon observed that (Page 12)
Magistrate Lane had already heard argument in relation to that and did not accept the argument. Magistrate Boon stated (ts 53-54): My view is that what I am being asked to do here this afternoon is … to set aside the whole judgment so that Mr O'Dea can litigate this costs component of $249.10 in all of these circumstances where my colleague has already made a decision on that; where the judgment was entered back in September 2009 [sic]; where there had already been a prior application to set aside the default judgment; and where there really is not an adequate explanation for that delay since whatever happened in January. There was not an appeal. I am not satisfied that it is appropriate in these circumstances for me to substitute my view. I have not even gone into all of the merits. I accept there is authority on both sides, but it amounts to an appeal. It amounts to an appeal well out of time and I am simply not satisfied that it is appropriate in all of those circumstances for me, for this court as constituted, to set aside the whole judgment, to exercise my discretion in that manner. I am not satisfied that it is in the interests of justice to do that. It would amount to, in my view, a certain amount of forum shopping. The authorities that have been referred to by Mr O'Dea this afternoon were available. They could and should have been brought forward to Magistrate Lane. I do not know what she would have decided if they had been, but she decided the way she did and I am not prepared to substitute a different decision in those circumstances. 43 Magistrate Boon dismissed Mr O'Dea's application to set aside the default judgment and allowed the application by the Shire to amend the default judgment, observing that it was in Mr O'Dea's interests to allow the Shire's application.
Principles relevant to the setting aside of default judgment and a second application to set aside default judgment 44 It is apparent from Magistrate Lane's decision on Mr O'Dea's first application to set aside default judgment that she was aware of and applied the following principles relating to an application to set aside a default judgment, which apply to the provisions of the MCCPA: Frigger v Forbes [2012] WADC 38 [52] – [53] (Commissioner Gething). 45 A defendant seeking to set aside a default judgment must both provide a reasonable explanation as to how the judgment came to be entered and also present a credible defence demonstrating that, if the default judgment was set aside and the matter was argued on its merits, the defendant would have a real prospect of success: Parker v Transfield (Page 13)
Pty Ltd [2000] WASCA 382 [3] and [4]; Hall v Hall [2007] WASC 198 [61] – [67]. 46 The court has a discretion to set aside a default judgment. There are two fundamental principles relating to the exercise of the discretion. The first is that the discretion is unfettered and no hard and fast rules can be laid down as to how it is to be exercised. The second is that the discretion is to be exercised so as to do justice between the parties, having regard to the particular circumstances of the case: Hall v Hall [63]. 47 There are further principles relevant to Mr O'Dea's second application to set aside the default judgment, which will be important when I come to consider this appeal. 48 It was possible for Mr O'Dea to bring a second application to set aside the default judgment:Carr v Finance Corp of Australia Ltd (No 1) (1981) 147 CLR 246;Hall v Nominal Defendant (1966) 117 CLR 423,440 - 441 (Taylor J). 49 However, in Carr v Finance Corporation of Australia Ltd Gibbs CJ and Mason J each gave consideration to the fact that the likelihood of a second application being successful may, on the facts of a particular case, be more theoretical than real and, accordingly, the practical effect of the order may be to preclude a defendant from making another application to set aside the default judgment. As Gibbs CJ stated (248) a second application would be 'doomed to failure' if the issues of substance had been determined in the first application to set aside. 50 In Racovalis v Rescom Mortgages Pty Ltd [2010] VSCA 55; (2010) 28 VR 250 the Victorian Court of Appeal discussed the fact that if a second application to set aside default judgment is brought on the same basis as the first application, there may be an issue as to whether the second application is an abuse of process. As set out in Racovalis v Rescom [30] the considerations relevant to whether a second application to set aside a default judgment should be allowed will vary from case to case, but will usually include: (Page 14)
(d) the nature of that material and whether a fair trial can be held. 51 The evils of permitting a second application include the risk of conflicting decisions, the unnecessary vexing of respondents, judge shopping, the diminution of certainty in the conduct by litigants of their affairs and adverse consequences to the administration of justice: Racovalis v Rescom [30]. 52 The principles in Racovalis v Rescom were applied in Frigger v Forbes [141] – [144] by Commissioner Gething in considering s 18(6) of the MCCPA which allows the setting aside of a summary judgment. Commissioner Gething also stated: (a) the existence of a right to appeal from a decision of a magistrate to a District Court judge conveys an intention by Parliament that one magistrate ought not to effectively hear an appeal from a decision of another magistrate: [59]; (b) s 18(6) of the MCCPA does not give a magistrate the power to set aside a decision of another magistrate on a ground that would otherwise be a ground which could be the subject of an appeal: [61]. (c) 'The interpretation I have placed on MCCPA s 18(6) would apply equally to the identical provision in MCCPA s 17(3) and s 19(3)': [63]. 53 I respectfully agree with these principles from Commissioner Gething's judgment in Frigger v Forbes and consider that they apply to s 19(3) of the MCCPA, relating to a second application to set aside a default judgment. These principles are consistent with the observations of the High Court in Carr v Finance Corporation of Australia Ltd that a second application to set aside a default judgment would be 'doomed to failure' if the issues of substance had been determined in the first application to set aside. 54 Finally, this appeal concerns the exercise of the magistrate's discretion. On an appeal involving the exercise of a discretion there are established principles. These were stated in Gronow v Gronow [1979] HCA 63 ; (1979) 144 CLR 513, 534 - 535, (Aickin J), applied in Cardno BSD Pty Ltd v Water Corporation [No 2] [2011] WASCA 161 [104]: (Page 15)
Those principles have been stated in this Court on many occasions and are not in doubt. It is sufficient to refer to such cases as House v R, Evans vBartlam, Storie v Storie and Lovell v Lovell. Two short passages make the position clear. In House v R (1936) 55 CLR 499 at 504 - 505] Dixon, Evatt and McTiernan JJ said:
'The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.'
In Lovell v Lovell (1950) 81 CLR 513 at 519] Latham CJ said:
'But when the appellate tribunal is considering questions of weight it should not regard itself as being in the same position as the learned trial judge. In the absence of exclusion of relevant considerations or the admission of irrelevant considerations an appellate tribunal should not set aside an order made in the exercise of a judicial discretion (as to which see Sharp v Wakefield [1891] AC 173 at 179]) unless the failure to give adequate weight to relevant considerations really amounts to a failure to exercise the discretion actually entrusted to the court. The words used by their Lordships in the House of Lords in this connection are not always easy to apply, but they ought not to be read as denying the long established principle (which, indeed, is expressly recognized in the cases in the House of Lords) that on an appeal from an order founded upon the exercise of a discretion the appellate tribunal has no right to substitute its discretion for the discretion entrusted to the primary tribunal.' (citations omitted)
55 It is with these principles in mind that I turn now to consider Mr O'Dea's grounds of appeal. (Page 16)
Grounds of appeal 56 The notice of appeal sets out a number of grounds of appeal as follows: 1. the magistrate 'failed to take into consideration the effect of s 12 of the Magistrates Court (Civil Proceedings) Act 2004 'interest' on filing an application or amended application for default judgement [sic] where interest not entitled to be claimed'; 2. the magistrate 'failed to take into account the proposed defence of the Defendant which disputed an amount of $249.10 claimed in respect of a discontinued proceedings for want of prosecution that the Claimant was entitled to and its ongoing effect on interest calculations as to the amount owing by the Defendants, if any or at all'; 3. the magistrate failed to take into account that an irregularly entered default judgment should be set aside 'without further obligation to assess the merits of the defence'; 4. the magistrate made findings 'without a basis in fact or law'; and 5. 'In the Interest of Justice require that such Judgement [sic] should not be maintained on the Court record'. 57 Mr O'Dea is legally trained and at the time of the appeal hearing before me was working as a lawyer. Both in the Magistrates Court and in this court he represented himself. Although he is legally trained, his grounds of appeal were, in my view, not clearly drafted or properly particularised and his written submissions were very long and sometimes difficult to understand. Some of the written submissions, particularly those filed after the appeal hearing, were in some respects different from the arguments he has made before, both at the time of the hearing before Magistrate Boon and also the hearing of this appeal. 58 It is not possible, nor is it necessary, to set out fully all of Mr O'Dea's arguments and submissions. I will set out my understanding of the main issues in dispute, confined (as they must be) to his appeal grounds and based on my discussions with him during the appeal hearing and my review of his written submissions. (Page 17)
Merits of the appeal - ground 1 59 Having regard to what Mr O'Dea advised me during the course of the hearing, it is apparent his first ground of appeal relates to the Shire's claim for pre-judgment interest which, as originally claimed in the default judgment was $163.87, but as amended was $47.22. 60 There appears to be no dispute that the maximum amount of interest that a local government can charge under s 6.51 of the LGA and reg 70 of the Local Government Financial Regulations 1996 is 11%. 61 The ground of appeal was confined to the 'failure of the magistrate to take into consideration the effect of s 12' of the MCCPA. In his written submissions this ground was expanded upon by Mr O'Dea stating that the magistrate 'fell into appellable error when she accepted that despite the respondent claiming s 12 interest in default judgement the amendment was allowed to correct the amount of interest claimed separately from the originating summons to the date of judgement'. 62 Having looked at the transcript of the hearing before Magistrate Boon it is apparent that Mr O'Dea's arguments about the Shire's ability to claim 'interest on interest' related to the sum of $163.87 (ts 19 - 21 and 22) and this was closely linked to his opposition to the Shire's application to amend the amount of the default judgment (a matter which is the subject of appeal grounds 3 and 4). In essence, he argued that there should be no amendment and the default judgment should be set aside. 63 On appeal Mr O'Dea submitted that the Shire was not entitled to pre-judgment interest at all. There were a number of arguments he raised in support of this. 64 Mr O'Dea first raised s 12 of the MCCPA, as he had similarly raised before the magistrate, which provides as follows: 12. Pre-judgment interest may be awarded (1) If the Court gives judgment in favour of a claim for money, including a debt, damages or the value of goods, it may include in the judgment sum either - (a) interest, at a rate decided by the Court, on the whole or a part of the money for the whole or a part of the period that - (i) begins on the date when the cause of action arose; and (Page 18)
(2) Subsection (1) does not - (a) authorise the giving of interest on interest; or (b) apply in relation to any general damages in respect of pain and suffering or the loss of enjoyment or of the amenities of life awarded in relation to personal injury (including any disease or impairment of a person’s physical or mental condition) or the death of a person; or (c) apply in relation to any debt upon which interest is payable as of right whether by virtue of any agreement or otherwise; or (d) affect the damages recoverable for the dishonour of a bill of exchange. 65 Mr O'Dea first submitted that in the application for default judgment the Shire sought interest which was 'effectively categorised as Magistrates Court Act s 12 interest which was claimed as interest on interest or interest which is not allowed because the Respondent receives interest pursuant to Local Government Financial Management Regulations 1996 r 70 … and therefore the Default Judgment has been entered irregularly. Judgment was obtained in breach of the Magistrates Court Act.' 66 Mr O'Dea also submitted that interest after the date of the originating process (general procedure claim) is a new cause of action. His argument was that because s 12(2)(c) of the MCCPA provided that the local government was entitled to interest as of right, what the Shire was asking for was something which had accrued after the date of the summons. He argued that, because s 6.51 of the LGA expressly provides that accrued interest, for the purpose of its recovery, is taken to be a rate or service charge due and payable, interest which accrued after the date of the issue of the claim became a rate or service and thus there was no ability for the Shire to claim interest after the date of issuing the summons. Accordingly, he argued that the Shire was not entitled to pre-judgment interest on the basis of a decision of mine, WACO Kwikform Ltd v Q-Con Pty Ltd [2009] WADC 45 in which (Page 19)
I applied the principle that in an action for the recovery of monies falling due periodically and due at the date of the issue of the writ, it is not possible to amend to include a claim for a further payment which has fallen due since the issue of the writ: see WACO Kwikform v Q-Con [20] – [23] and the cases referred to therein. 67 Mr O'Dea repeated his argument that the Shire had calculated 'interest on interest', arguing that the interest schedule annexed to the affidavit of Ms Butler sworn 18 September 2004 (Annexure CB3) was not a calculation of simple interest. 68 He went further in the hearing of this appeal than he had before Magistrate Boon and raised another argument in relation to reg 71 of the Local Government Financial Regulations. He argued that the Shire had not calculated interest on a simple interest basis as it was required to under reg 71(2). His argument was the interest schedule annexed to Ms Butler's affidavit was 'defective in its entirety' because it does not conform with reg 71(2). 69 His reasoning is that the provision in r 71(2) states that the principal sum on which interest is calculated for a financial year may include interest accrued but not paid in a previous financial year, but is not to include interest accrued in the current financial year. Mr O'Dea has submitted that the pre-judgment interest claim is interest accrued in the current financial year and thus is prohibited. 70 In his latest written submissions filed after the appeal hearing it is now stated by Mr O'Dea that the Shire 'may not calculate interest on the principal sum because that principal sum is inclusive of interest and that has the effect of a calculation of interest on interest': par 4.2. It may be that he is saying that the part of the Shire's claim relating to accrued interest – namely the sum of $118.49 (see [33](a) above) – should not have had interest calculated on it before the end of the current financial year because to do so is to charge interest on interest. 71 I consider that all of Mr O'Dea's arguments are without merit, for the following reasons. 72 First, any suggestion that the pre-judgment interest was 'interest on interest', in respect of that part of the Shire's claim which related to interest, namely $118.49, has no merit because of the provision contained in s 6.51(3) to which Mr O'Dea has referred. By the operation of s 6.51(3) the outstanding amount of $118.49 interest was at the time that the Shire (Page 20)
filed its general procedure claim, for the purpose of recovery, taken to be a rate or service charge. 73 Secondly, in relation to s 12 of the MCCPAthis is similar in its terms to s 32 of the Supreme Court Act 1935 (WA). It is very similar to the statutory provisions in other States and Territories of Australia, the High Court and the Federal Court, which permit or require a court on entering judgment for the plaintiff in action for a debt or damages to include an amount by way of interest: see Supreme Court Act 1970 (NSW) s 94; Common Law Practice Act 1867 (Qld) s 72; Supreme Court Act 1935 (SA), s 30C; Supreme Court 1986 (Vic) s 60; Australian Capital Territory Supreme Court Act 1993 (Cth) s 53A; Supreme Court Act 1979 (NT) s 84; Judiciary Act 1983 (Cth) s 77MA and Federal Court of Australia Act 1976 (Cth) s 51A. 74 The statutory provisions were introduced to overcome the limitations at common law in allowing pre-judgment interest. At common law, in the absence of any agreement or statutory provision for the payment of interest, a court has no power to award interest as compensation for the late payment of a debt or damages: see the discussion of this in Hungerfords v Walker (1989) 171 CLR 125. By the statutory provisions, such as s 12 of the MCCPA and s32 of the Supreme Court Act in this State, the court is given a discretion to add a sum by way of interest to money judgments. The primary purpose of an award of pre-judgment interest is to compensate a successful plaintiff for the loss or detriment which the plaintiff has suffered by being kept out of his or her money since the commencement of proceedings: see Ruby v Marsh (1975) 132 CLR 642, 652 (Barwick CJ) 655 (McTiernan J); Batchelor v Burke (1981) 148 CLR 448, 455 (Gibbs CJ); Haines v Bendall [1991] HCA 15; (1991) 172 CLR 60, 66; Grincelis v House [2000] HCA 42; (2000) 201 CLR 321 [16]. 75 The purpose of the proviso in s 12(2)(c) of the MCCPA (equivalent to s 32(2)(b) of the Supreme Court Act) is to ensure that a litigant under the section remains entitled to interest which is payable as of right, whether by virtue of any agreement or otherwise. 76 As stated by the High Court in Hungerfords v Walker (148) when considering the equivalent provisions in s 30C(4) of the Supreme Court Act 1935 (SA): The provisions of s 30C(4) at (b) and (e) expressly recognise that interest may be recoverable at common law quite apart from the statute. (Page 21)
Subsection 4(e) states that s 30C 'does not limit the operation of any other enactment or rule of law providing for the award of interest' (our emphasis). It would be a strange result if, in the face of this provision, the court were to hold that the enactment of s 30C precluded the award of damages for loss of the use of money, in accordance with the logical development of a fundamental common law principle so as to accord with commercial reality, to a plaintiff deprived of the use of money paid away or withheld as a result of the defendant's negligence or breach of contract. Where a legislative provision is designed to repair the failings of the common law and is not intended to be a comprehensive code, the existence of that provision is not a reason for this court refusing to give effect to the logical development of common law principle. It would be ironic if a legislative attempt to correct defects in the common law resulted in other flaws becoming ossified in the common law. 77 Accordingly, when reading the provisions of s 12 of the MCCPA, while s 12(1) gives the court discretion to determine what rate of interest should be applied when awarding pre-judgment interest, subsection 12(2)(c) provides that a discretionary award of interest does not arise where interest is payable as of right. 78 A local government authority claiming pre-judgment interest pursuant to the statutory rate under the LGA is entitled to pre-judgment interest at that statutory rate, rather than a rate at the discretion of the court pursuant to s 12(1) of the MCCPA. 79 The general procedure claim in this case clearly set out that the Shire's claim for interest was based on the statutory rate under the LGA. When the Shire made its application for default judgment, it included a claim for interest, but it was not stated to be pursuant to s 12 of the MCCPA, rather it was stated to be at the rate of 11%. The Shire attached a schedule to its application with the calculation of interest based on the statutory rate under the LGA (albeit the calculation was incorrect). Judgment was not, as Mr O'Dea argued, obtained in breach of s 12 of the MCCPA. 80 For these reasons I consider that the argument by Mr O'Dea that the default judgment was irregular because the Shire sought interest which was 'effectively categorised as Magistrates Court Act s 12 interest' is misconceived. 81 Also applying the principles set out by the High Court in Hungerford v Walker, the amount claimed by the Shire for pre-judgment interest was not a claim for further payment of rates or charges and thus a new cause of action which had arisen since the issue of the claim. (Page 22)
The Shire was entitled to be compensated for having been deprived of the use of the money for which it was suing the defendants, and it was entitled to apply the statutory interest rate pursuant to s 6.51. It follows that the principles I discussed in WACO Kwikform Ltd v Q-Con Pty Ltd do not apply. A court award of interest on a money claim after the date of the originating process (general procedure claim) is a not new cause of action. 82 During the course of the appeal hearing, Mr O'Dea attempted to argue that the interest schedule prepared by the Shire, Annexure CB3, in fact increased the amount owed. I have reviewed the interest schedule. What the schedule does is to take the balance owing from time to time by Mr O'Dea and calculate the interest on that balance at the rate of 11%. There is no dispute that the payments made by Mr O'Dea are properly recorded in the schedule. 83 I have carried out my own manual calculations and I am satisfied that only simple interest on the balance outstanding from time to time has been charged. 84 For example, after the issue of the claim, a payment of $15 was received on 14 April 2011. The Shire calculated interest on the total of $1,807.61 for a total period of 50 days from 22 February 2011 (which is actually after the date of the issue of the summons on 11 February 2011) to 13 April 2011, the day before the $15 payment was made. The Shire's calculation of that interest was $27.24. My own manual calculation produces the same result. 85 The next payment made on 21 April 2011 reduced the balance again by $15. For the period of six days between 14 April and 21 April when the balance of Mr O'Dea's account stood at $1,792.61, interest was calculated by the Shire to be $3.24. That accords with my own interest calculation of simple interest for that period. 86 The total interest calculated on the reducing balance up to the date of the judgment totals $47.22. I am satisfied that all of the remaining interest calculations in the interest schedule have been done on a simple interest basis and there has been no 'interest on interest'. 87 Finally, in relation to Mr O'Dea's raising the Local Government Financial Management Regulations reg 71 for the first time at the hearing of this appeal, two recent decisions of the Court of Appeal in this State have addressed the question of whether a party can raise a new issue, not raised below, on an appeal. In both those decisions, Ruby v Doric Constructions (Australia) Pty Ltd [2013] WASCA 94 and (Page 23)
Rankilor v Circuit Travel Pty Ltd [2013] WASCA 148 the court refused to consider a point raised which was not raised below and raised in the appeal either on the day of the hearing or just before the hearing. Newnes JA (with whom Pullin JA agreed) set out the relevant principles in Rankilor v Circuit Travel: 67 This is not a ground of appeal raised before the primary judge. In my view, it is too late to raise it now. In Metwally (No 2)vUniversity of Wollongong (1985) 60 ALR 68; (1985) 59 ALJR 481, 483, the High Court said: 'It is elementary that a party is bound by the conduct of his case. Except in the most exceptional circumstances, it would be contrary to all principle to allow a party, after a case had been decided against him, to raise a new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had an opportunity to do so.' 68In Coulton v Holcombe (1986) 65 ALR 656, 661, the High Court referred to the importance of this principle in light of the public interest in: '[T]he finality of litigation, the difficulty of inducing an appeal court to consider new facts, the undesirability of encouraging tactical decisions not to present an issue at first instance: keeping it in reserve for appeal; and the need for vigilance to avoid injustice to a party having to meet new facts and new issues of law for the first time at the appeal court (8).' 69The principle applies both to points which were not taken at trial and also to the different stages of the appellate process: see Coulton v Holcombe, 660 - 661. 88 I am bound by the principles referred to in both Rankilor and Ruby v Doric Constructions and cannot entertain the new argument raised by Mr O'Dea which was not raised in the court below. (For the same reasons I do not propose to entertain any other new arguments raised by Mr O'Dea in the written submissions he has filed following the appeal hearing, which in substance he has not previously raised.) 89 In view of the findings I have reached, however, this makes no difference to the outcome of this ground of appeal. There has been no 'interest on interest' claimed by the Shire, for the reasons I have already given. (Page 24)
90 I find that Magistrate Boon was correct when she stated that the interest schedule now sets out the correct amount of interest. 91 There is no merit to Mr O'Dea's arguments in relation to the Shire's claim for pre-judgment interest in the sum of $47.22.
Merits of appeal - ground 2 92 This ground relates to the amount of $249.10 legal costs incurred by the Shire in the 2009 recovery proceedings against Mr O'Dea. This ground of appeal is that the magistrate 'failed to take into account' Mr O'Dea's proposed defence to these costs. 93 I have been informed in submissions from the Shire filed following the appeal hearing, that the Shire 'has now forgiven the $249.10 (without any admission of its ability to claim that amount for [Mr O'Dea]) included in the default judgment'. 94 However, it is still necessary to determine this ground of appeal because I have not been advised that the appeal has settled and the forgiveness of the Shire extends to part only of the default judgment. If there is merit to this ground, it would affect the calculation of pre-judgment interest and also lead to the setting aside of the whole of the judgment which, as is apparent from all of Mr O'Dea's submissions, he is keen to achieve. 95 Mr O'Dea's written submissions before the appeal hearing were to the effect that the magistrate fell into error 'when she accepted that the amount claimed with respect to previous legal proceedings 'legal costs' shall stand because she felt she could not substitute the decision of Magistrate Lane. Magistrate Lane did not expressly rule on the permissibility of the previous action and the entitlement to it she simply found that the respondent was entitled to all legal costs providing they brought the claim in a competent jurisdiction … therefore there is no risk of a conflicting decision.' 96 Before me during the appeal hearing there was an argument as to whether Mr O'Dea had raised new material in his affidavit before Magistrate Boon (following the principles in Racovalis v Rescom). I have compared the factual matters (as opposed to argument) set out in each of Mr O'Dea's affidavits, the first sworn 14 December 2011 in support of the first application to set aside the default judgment and the second sworn 10 September 2012 in support of the second application to set aside judgment. I have also considered the objections which were raised by the (Page 25)
Shire to Mr O'Dea's second affidavit. Confining the consideration to the evidence relevant to the Shire's legal costs of $249.10, I can discern no fresh or new material relating to the facts in Mr O'Dea's second affidavit. 97 During the course of the hearing of the second application before Magistrate Boon, she discussed with Mr O'Dea whether there was any new factual matter in his second affidavit and he effectively conceded that there was none (ts 13). 98 There were a number of legal authorities placed before Magistrate Boon which had not been placed before Magistrate Lane. However, these authorities were, as Magistrate Boon discussed with Mr O'Dea during the course of the hearing (ts 13 - 14) available to Mr O'Dea at the time of the hearing of his first application. 99 In the written submissions filed by Mr O'Dea after the appeal hearing he has submitted that there was new material raised in his second affidavit, being 'two independent issues' which as set out in that affidavit were: 100 In my view, that is not new material, only new legal argument. This is therefore not a case where new material was introduced on the second application to set aside default judgment. 101 Even if Mr O'Dea's second affidavit could be considered as having introduced new material, there are a number of difficulties with this ground of appeal. 102 First, it is apparent that in reality what Magistrate Boon was being asked to do was to set aside the decision of Magistrate Lane on a ground that could be the subject of an appeal. The issues of substance in relation to the $249.10 legal costs had been determined in the first application to set aside the default judgment and Magistrate Boon was effectively hearing an appeal from Magistrate Lane's decision. In these circumstances I consider that Magistrate Boon correctly proceeded on the basis that (Page 26)
Mr O'Dea's arguments about the $249.10 legal costs had been ventilated and decided upon by Magistrate Lane, and it was not appropriate for Magistrate Boon to substitute her view. The issue of the $249.10 legal costs had been determined in the first application and was therefore, in the words of Gibbs CJ in Carr v Finance Corporation of Australia Ltd, 'doomed to failure'. 103 Secondly, the decision as to whether or not to set aside the default judgment was in the discretion of the magistrate, applying the principles in relation to a second application to set aside default judgment as I have set out in [44] – [53] above. It is apparent from her reasons, as I have set out in [42] above, that Magistrate Boon applied these principles. 104 The magistrate had regard to the delay in making the second application (which delay was not explained by Mr O'Dea), considered that Mr O'Dea had produced legal authorities which had not been produced at the hearing before Magistrate Lane and determined there was no explanation for the new material not being provided on the earlier application. She considered the 'evils' of permitting the second application, in particular 'judge shopping'. In my view, there was no error by Magistrate Boon in her approach to the exercise of her discretion to refuse this second application to set aside the default judgment. 105 Thirdly, insofar as Mr O'Dea submits that the magistrate 'failed to take into account' his defence, it is clear that she did. What Mr O'Dea is in substance alleging is that the magistrate should have given more weight to his defence in relation to the costs of $249.10 from the 2009 recovery proceedings. An allegation that the magistrate failed to 'properly consider' or 'failed to take into account' a matter in this situation is not a proper ground of appeal: Cardno BSD Pty Ltd v Water Corporation [No 2] [106], [109]. 106 Even if Mr O'Dea is correct in his submission that the magistrate failed to 'properly consider' his defence, and this is a proper ground of appeal, this does not help Mr O'Dea because I consider that there is no merit to his defence, for the following reasons. 107 As I understand Mr O'Dea's argument, he maintains that the Shire cannot recover the costs of the 2009 recovery proceedings unless and until there is an order for costs or a judgment against him. (Page 27)
108 It is necessary to consider the provisions of s 6.56 of the LGA. This is contained in pt 6 of the LGA which deals with financial management. 109 Division 6 of pt 6 deals with rates and service charges. Payment of rates and service charges is dealt with in subdiv4 of Div 6. Section 6.43 provides that both rates and service charges are a charge on the land which is rated or in relation to which the service charge is imposed. The owner for the time being of land on which a rate or service charge has been imposed is liable to pay the rate or service charge to the local government: s 6.44. If there are two or more owners they are jointly and severally liable to pay the rate or service charge: s 6.44(2). Section 6.45 provides for the ability of a person liable for the payment of a rate or service charge to make payment by instalments, which may be set forth in the local government annual budget, and allows a local government to impose an additional charge including an amount by way of interest where payment is made by instalments. Section 6.49 allows a local government to accept payment of rates and service charges from a person in accordance with an agreement made with that person. 110 Section 6.51 permits a local government at the time of imposing a rate or service charge to resolve to impose interest on: (a) a rate or service charge (or any installment of a rate or service charge); and (b) any costs of proceedings to recover any such charge, that remains unpaid after becoming due and payable. (italics my emphasis) 111 The rate of interest that may be set by the local government is not to exceed the prescribed maximum rate: s 6.51(2). Accrued interest is, for the purpose of its recovery, taken to be a rate or service charge, as the case requires, that is due and payable: s 6.51(3). 112 Subdivision 5 of Div 6 provides for recovery of unpaid rates and service charges. By s 6.55, rates and service charges on land are recoverable by a local government from the owner at the time of the compilation of the rate record. Section 6.56 permits a local government to recover an unpaid rate or service charge, together with the costs of proceedings for recovery, in a court of competent jurisdiction: 6.56 . Rates or service charges recoverable in court (1) If a rate or service charge remains unpaid after it becomes due and payable, the local government may recover it, (Page 28)
as well as the costs of proceedings, if any, for that recovery, in a court of competent jurisdiction. (2) Rates or service charges due by the same person to the local government may be included in one writ, summons, or other process. (Italics my emphasis) 113 There is no case which deals specifically with this section and the meaning of the words 'as well as the costs of proceedings, if any, for that recovery'. 114 The starting point in interpreting the words of any statute is to look at the ordinary and grammatical meaning of the words of the provision, having regard to their context and legislative purpose: Collector of Customs v Agfa-Gevaert Ltd [1996] HCA 36; (1996) 186 CLR 389; Australian Education Union v Department of Education and Children’s Services (2012) 285 ALR 27 [26] (French CJ, Hayne, Kiefel and Bell JJ); see also Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 [69] – [70]. 115 The court must strive to give meaning to every word so that 'no clause, sentence or word shall prove superfluous, void, or insignificant, if by any other construction they may all be made useful and pertinent': Project Blue Sky [71]. 116 Mr O'Dea argued that the meaning of 'proceedings' in s 6.56 should be interpreted to mean judicial proceedings pronounced to judgment. 117 The word 'proceeding' in the Shorter Oxford English Dictionary, 6th ed, has its origin from the verb proceeds and its meaning includes 'the fact or manner of taking legal action; a legal action; an act done by authority of a court of law; a step taken by a party in a case.' 118 The ordinary and grammatical meaning of the word 'proceedings' is thus not confined to proceedings 'pronounced to judgment', but includes the taking of legal action and any step in the action before judgment. 119 It is significant, in my view, that s 6.56 does not confine the right to recovery to the local government to only rates and service charges. Applying the principles of statutory construction, in my view the addition of the words 'as well as the costs of proceedings, if any, for that recovery' in the context of permitting the local government to recover rates and charges, means that a local government may recover whatever costs it (Page 29)
may have incurred in proceedings to recover its rates and charges and it is not necessary for the proceedings to have been concluded to judgment. 120 That construction is, in my view, consistent with the provisions in s 6.51(1) giving a local government the ability to impose interest on 'any costs of proceedings to recover any such charge'. 121 The 'costs of proceedings … for that recovery' (s 6.56) and 'any costs of proceedings to recover' (s 6.51) could include solicitors' costs relating to the issue of a general procedure claim, court filing fees and the costs of service or attempts at service of that general procedure claim, and any further costs that may be incurred in the course of the action. 122 Legal proceedings could be commenced by a local government but not continued with for a number of reasons, including that after service of the originating process (the writ or general procedure claim) payment may be made by the ratepayer, or an arrangement made with the ratepayer to pay by way of instalments or, as in this case, service of the originating process was attempted but could not be effected within the time permitted by the court rules (which pursuant to r 7(4) of the Magistrates Court (Civil Proceedings) Rules 2005 is one year). 123 In my view the clear words and context of s 6.56 dictate that 'the costs of proceedings, if any, for that recovery', include any costs incurred in proceedings and do not require the local government to obtain a costs order or judgment against the ratepayer. 124 If, as Mr O'Dea has argued, a local government's recovery costs must be consequent upon a costs order or judgment, the words 'as well as the costs of proceedings, if any, for that recovery' in s 6.56 would be superfluous. This is because once a costs order is made in judicial proceedings the costs are recoverable as a judgment of the court, enforceable pursuant to the Civil Judgments Enforcement Act 2004. Section 3 of that Act defines 'judgment sum' to mean the 'amount of money ordered to be paid under a monetary judgment, whether or not the money is or includes costs or pre-judgment interest'. 'Monetary judgment' is defined to mean 'a judgment or an order of a court that requires or has the effect of requiring a person to pay money, whether or not the judgment or order contains any other requirements'. There would thus be no need to issue a claim for those costs in a court of competent jurisdiction. 125 The construction urged upon me by Mr O'Dea is also contrary to pt 6 of the LGA and the intent and purpose of s 6.51. His construction would (Page 30)
leave a local government which had commenced recovery proceedings, but in the meantime received payment from the defendant, without the means to recover the costs it had incurred in issuing the proceedings which led to the payment. That is, in my view, contrary to the express words and purpose of the section, in the context as they appear in the LGA. The intent is to allow a local government to recover its rates and charges and ensure that the local government is not out of pocket by reason of having to commence proceedings for recovery. 126 For the sake of completeness, I should record that I have reviewed the authorities which Mr O'Dea has relied upon in relation to this ground of appeal. 127 He relied on a number of authorities, but four in particular, one of which, Ho v Loneragan [2013] WASCA 20, he emphasised in the hearing before me. 128 Ho v Longeragan dealt with the issue of whether delivery of judgment was part of the proceedings for the purpose of determining whether an appeal was out of time. In had been held that the appeal against a decision of a magistrate in the Magistrates Court was out of time because it was lodged 24 days after the date of judgment, albeit only 17 days after it was received by the appellants in the post. The appeal was required to be lodged within 21 days after the date of judgment. The appellants ran an argument that the time for lodging the appeal ran from the time the judgment was received, as opposed to delivered. While ultimately the appeal was not successful, the Court of Appeal considered s 45 of the MCCPA and the requirement for judicial proceedings to be conducted in open court, stating that it was not open to the magistrate to give judgment by post because she was required to give judgment in open court: [30]. 129 Relying upon this, Mr O'Dea extrapolated that because giving judgment is part of judicial proceedings and pronouncing judgments should take part in open court pursuant to s 45, therefore I should interpret 'proceedings' to mean judicial proceedings pronounced to judgment. In my view, Ho v Longeragan does not support Mr O'Dea's submission. 130 Mr O'Dea also relied upon a decision of Edelman J in Western Australian Planning Commission v Narcom Holdings Pty Ltd [2011] WASC 259. This case involved an application for leave to appeal from a decision of the State Administrative Tribunal, which is confined to a question of law. The case involved the construction of the terms of (Page 31)
a planning policy. In the construction of the terms of the planning policy Edelman J applied the authorities relating to construction as I have set out, including Project Blue Sky, refusing to construe the terms of the policy in the way sought by the WA Planning Commission because to do so would make the words in a clause of the policy redundant: see [39] – [43]. 131 Mr O'Dea referred to the supplementary decision of Edelman J in Western Australian Planning Commission v Narcom Holdings Pty Ltd [2011] WASC 259 (S) where Edelman J stated [10] and [20]: 10 The question in issue is one of construction of s 105(12) of the SAT Act, which is the statutory provision by which the costs discretion is exercised in this case. One matter which is relevant to the construction of that provision is the regularised discretion by which costs decisions were generally governed when the SAT Act was enacted. The nature of the well recognised costs discretion is part of the 'existing state of the law' which is relevant to the question of construction: AB v Western Australia [2011] HCA 42 [10] (French CJ, Gummow, Hayne, Kiefel & Bell JJ) … 20 Secondly, the words 'costs of each other party' in s 105(12) are a general reference to costs. Although preconceptions about costs orders should not distract from the exercise of statutory construction, the reference to 'costs' as an undefined term invites consideration of the general approach to costs as the contextual background to the meaning of the use of the word 'costs' in the subsection: see above [10]. 132 These statements by Edelman J must be read in the context of the decision, which related to the costs of an appeal from the State Administrative Tribunal and an argument that the word 'costs' in the phrase in s 105(12) of the State Administrative Tribunal Act 2004, 'the costs of each other party are to be met by the decision-maker', should be construed as meaning 'indemnity costs'. It was held that it means party/party costs. I do not consider that assists Mr O'Dea. 133 The third authority relied upon by Mr O'Dea was Koutlakis v City of West Torrens [2009] SASC 140; (2009) 167 LGERA 117. This case involved the interpretation of s 184 of the Local Government Act 1999 (SA) relating to the entitlement of a local authority to sell land in order to recover outstanding rates. The Council in that case commenced the sale of land owned by Mr Koutlakis,but he obtained an interlocutory injunction to prevent the sale. After an unsuccessful mediation the matter went to trial and the Council obtained judgment for both outstanding rates (Page 32)
and the costs it had incurred in relation to the sale commenced pursuant to s 184. On appeal what had to be determined was whether the particular provisions of s 184 entitled the Council to recover its costs as a debt. It was held, on a construction of the particular provisions of s 184 of the South Australian Act, that the costs associated with a sale of property pursuant to s 184 could only be recovered after sale or if voluntarily paid before sale. Section 184 contained no right of action for a council to recover costs associated with that section as a debt. 134 In the hearing before Magistrate Boon, Mr O'Dea relied on Koutlakiswhere Layton J stated [55]: I therefore agree with the appellant that there are two basic approaches whereby a council may recover or recoup its legal costs in relation to an action taken to recover rates. I agree that one of the processes is through the avenue of s 178(3) which allows a council to recover as a debt outstanding rates, being the instalment amounts due quarterly, any fines or any interest to be recovered, together with, in accordance with s 183, any costs which may be 'awarded to or recoverable by the council in any court proceedings' undertaken for recovery. Namely, those costs provided for in the relevant court rules. 135 In his written submissions before me, Mr O'Dea relied on Koutlakis in which Layton J stated [49]: In coming to that conclusion his Honour had considerable regard for another rule of statutory construction which is relevant to the present case. Namely, there is a well established rule that legislation which imposes tax must be construed strictly, to the precise letter of the law and not any further: Commissioner of Stamp Duties (NSW) v Simpson (1917) 24 CLR 209. 136 I do not consider that either of these passages assists Mr O'Dea. Koutlakiswas dealing with the specific provisions in the South Australian Act and can be distinguished from this case. 137 In this State, s 6.56 of the LGA specifically provides that a local government can recover any costs of proceedings to recover its outstanding rates and charges, in a court of competent jurisdiction, along with the rate and service charges which remain unpaid. 138 The final authority relied upon by Mr O'Dea in the hearing before Magistrate Boon was Knight v FP Special Assets Ltd (1992) 107 ALR 585. That case dealt with the power of the Supreme Court of Queensland to make an order for costs against a non-party. Applying statements made by the High Court on that issue, Mr O'Dea argued that s 6.56 of the LGA (Page 33)
'confers a power on the court to decide issues in relation to rates, therefore, if that … jurisdiction is for the court then the rules in relation to costs reside in the court'. This case does not assist Mr O'Dea. 139 These last three authorities were raised at short notice and only provided to Magistrate Boon during the course of the hearing. In my view Magistrate Boon was generous when she stated 'there is authority on both sides'. There is no merit to Mr O'Dea's arguments in reliance of any of these authorities. 140 I do not consider that there is any merit in Mr O'Dea's arguments in relation to his proposed defence to the $249.10 legal costs. Even if I had found there had been a failure by the magistrate to properly exercise the discretion to set aside the judgment on Mr O'Dea's second application, so that it was then open to me to exercise the discretion afresh, I would not set aside the default judgment on this ground. 141 There is no merit to this ground of appeal.
Merits of appeal - ground 3 142 Although this did not form part of the oral reasons which she gave, in the course of the hearing in relation to the application to amend, Magistrate Boon was referred to the decision of Starrs v Retravision (WA) Ltd [2012] WASCA 67. 143 Based on Mr O'Dea's written and oral submissions the alleged error by Magistrate Boon here was to allow the Shire to amend its claim following Starrs v Retravision. 144 Mr O'Dea's argument was that the default judgment was irregularly obtained and, relying on decisions which pre-dated Starrs v Retravision, the irregularly obtained default judgment should have been set aside. The decisions he relied upon included Pilbara Infrastructure Pty Ltd v BGC Contracting Pty Ltd [2007] WASCA 257 and CAN 076 676 Pty Ltd (in liq) v A-Comms Teledata Pty Ltd [2000] WASC 214. 145 There is no doubt that the original default judgment entered in September 2011 was for an amount over and above what Mr O'Dea actually owed the Shire, and it also included a claim for interest which was wrongly calculated, incorporating interest which predated the issue of the general procedure claim. The difficulty for Mr O'Dea is that Starrs v Retravision, which is binding upon both me and Magistrate Boon, makes it clear that: (Page 34)
(a) not every irregularity in the means by which a judgment in default is obtained will necessarily entitle the defendant to have the judgment set aside as of right: [36]; (b) the court has power to amend an irregularly entered judgment which has been entered for more than the amount due: [46]; (c) in an appropriate case (particularly if it would be futile to set aside a judgment rather than vary it by substituting the amount now owing) the court may, in the exercise of its discretion, amend an irregularly entered judgment rather than set it aside: [36], [48], [75] and [76]; (d) the power can be exercised even where the application for an amendment is made after the defendant has applied to set it aside: [47]; 146 In my view this was an appropriate case where it would have been futile to set aside judgment rather than to vary it. 147 In my view there was no error made by Magistrate Boon in refusing Mr O'Dea's second application to set aside judgment. As I have found, she properly followed the principles relevant to the determination of an application to set aside judgment and the particular principles relevant to a second application. 148 Further, for the reasons I have given I do not consider that there is merit in Mr O'Dea's proposed defences. 149 It follows that, having found that she was not prepared to set aside the default judgment, it was open to Magistrate Boon, again in the exercise of her discretion, to amend the judgment, applying Starrs v Retravision. 150 There is no merit to this ground of appeal.
Merits of appeal - ground 4 151 This appeal ground is vague, simply stating 'the magistrate made findings without a basis in fact or law'. The written appeal submissions do not assist and seem to repeat the matters raised in ground 3 relating to the magistrate's decision to allow the Shire to amend its claim despite an irregularly entered judgment. (Page 35)
152 There is no merit in this ground for the reasons I have given in relation to the appeal ground 3.
Merits of appeal - ground 5 153 This appears to be a 'rolled up' ground of appeal which really repeats what has gone before. Mr O'Dea's written submissions read as follows: The learned magistrate fell into error when she found that the amended claim should be allowed, the learned magistrate made findings that the respondent was not entitled to legal costs for a claim under $10,000, she accepted that there was an error with respect to the default judgment in an overstatement of the amount owed and the claiming of section 12 interest, the learned magistrate allowed the respondent to have a further reply to the issue of interest but denied the opportunity for the appellant to argue the position with respect to interest and therefore in the interest of justice the judgment should not be maintained on court record. 154 As Mr O'Dea conceded during the hearing of the appeal (ts 49) ground 5 is really a repeat of his other grounds, particularly ground 1. However, he then attempted to argue that the magistrate erred by only looking at the $249.10 and not looking at the other grounds. Upon a close review of the magistrate's reasons I consider there is no merit to this. Magistrate Boon did look at the other grounds as I have already set out in these reasons [40] – [42]. 155 In the appeal hearing in relation to ground 5, there was also a complaint by Mr O'Dea that the magistrate made a 'fatal error' when in the delivery of her reasons she referred to the Shire's application to amend the amount of the claim and said 'I'm satisfied having heard further explanation that this is not actually a claim of interest on interest. That has been rectified now'. Mr O'Dea claimed that this was an error, but in light of the findings I have made in relation to the appeal ground 1, I find there was no error. |