Osman v Local Court (Civil Claims) Bankstown and Anor
[2004] NSWSC 1146
•30 November 2004
CITATION: Osman v Local Court (Civil Claims) Bankstown & Anor [2004] NSWSC 1146 HEARING DATE(S): 25 November 2004 JUDGMENT DATE:
30 November 2004JURISDICTION:
Common Law Division - Administrative Law ListJUDGMENT OF: Master Harrison DECISION: (1) The decision of the Assessor dated 5 July 2004 is affirmed; (2) The summons filed 8 October 2004 is dismissed; (3) The plaintiff is to pay the defendants' costs as agreed or assessed; (4) The stay of proceedings under judgment in the Small Claims Division of the Local Court in proceedings 988/03 is lifted. CATCHWORDS: Leave to appeal decision of Local Court Assessor Small Claims Division - jursidiction LEGISLATION CITED: Local Court (Civil Claims) Act 1970 (NSW) - s 39A; s 69(2A); s 69(4) PARTIES :
Khoder Osman
(Plaintiff)Local Court (Civil Claims) Bankstown
Fatmah Sayed
(First Defendant)
(Second Defendant)FILE NUMBER(S): SC 30085/2004 COUNSEL: N/A SOLICITORS: Mr Garry Neville Penhall,
Mr Philip Beazley,
Penhall & Co
(Plaintiff)
Beazley Singleton
(Second Defendant)
LOWER COURTJURISDICTION: Local Court LOWER COURT FILE NUMBER(S): 988/03 LOWER COURT
JUDICIAL OFFICER :Small Claims Assessor
IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
ADMINISTRATIVE LAW LISTMASTER HARRISON
30085/2004 - KHODER OSMAN v LOCAL COURTTUESDAY, 30 NOVEMBER 2004
JUDGMENT (Leave to appeal decision of
(CIVIL CLAIMS) BANKSTOWN & ANOR
Local Court Assessor Small
Claims Division – jurisdiction)
1 MASTER: By summons filed 8 October 2004 the plaintiff seeks, firstly a declaration that the judgment entered by the Assessor on 5 July 2004 in proceedings 988/03 was in excess of the jurisdiction of the Small Claims Division of the Local Court in the exercise of its powers under Local Courts (Civil Claims) Act 1970 (NSW) (the Act) and that accordingly the judgment is a nullity; secondly, an order in the nature of certiorari setting aside the judgment; thirdly, an order quashing the decision and judgment of the Local Court made in proceedings 988/03; fourthly, an order that leave be granted to extend the time for filing of the summons, and fifthly, an order that the execution of the judgment in proceedings 988/03 be stayed pending further order.
2 The plaintiff is Khoder Osman. The first defendant is the Local Court (Civil Claims) Bankstown. The second defendant is Fatmah Sayed. For convenience I shall refer to the parties by name. Mr Osman relied on two affidavits of Saba EL-Hanania affirmed 20 October 2004 and 25 October 2004 and an affidavit of Garry Neville Penhall affirmed 22 November 2004. Mr Sayed relied on an affidavit of Philip James Beazley sworn 22 October 2004.
3 At the outset, it may be helpful to make some brief comments concerning the remedy pursued by the plaintiff. Section 69(2A) of the Act allows an appeal to this Court from the Small Claims Division of the Local Court only on the grounds of lack of jurisdiction or a denial of natural justice. Section 69(2B) of the Act provides that an appeal against an interlocutory order does not lie to this Court except by leave. Section 69(4) of the Act provides that the court may determine an appeal by either (a) setting the judgment or order aside or (b) by varying the terms of the judgment or order or (c) by setting the judgment or order aside and remitting the matter for determination in accordance with the court’s directions or (d) by dismissing the appeal. The onus lies on the plaintiff to demonstrate that there has been a denial of natural justice.
Whether leave to appeal should be granted
4 The main issue raised in this appeal is whether the amount claimed was in excess of the jurisdiction of the Small Claims Division of the Local Court. The sum of money lent was $10,000.00. The issued turns on whether it was a term of the oral contract that interest was repayable at the rate of 17.15% per annum of whether the loan was for the sum of $10,000.00 plus interest determined in accordance with s 39A of the Act. Osman submitted that if the terms of the contract included repayment of $10,000.00 plus interest at 17.15% the Magistrate exceeded her jurisdiction and her determination is null and void.
5 The Assessor read statements by Fatmah Sayed, Hanan Osman dated 14 May 2004, Fatette Sayed dated 12 May 2004, Taufik Ashosh dated 24 June 2004 and Khoder Osman (undated). There was no statement provided by Abdul Osman, who was originally the second defendant in the proceedings in the Local Court. Prior to the hearing in the Local Court Fatmah Sayed settled the claim with Abdul Osman, which left Khoder Osman as the remaining defendant.
6 In the reasons for determination dated 5 July 2004 the Assessor commenced by saying:
- “…matter no. 988 of 03 Sayed & Osman that is Khoder Osman. I note that the plaintiff is seeking the amount of $10,000 plus interest at 17.15% on an amount that the plaintiff says was loaned to the defendants on or about 30 July 2002.”
7 Then the Assessor summarised the evidence. Relevantly she stated:
- “…she [Fatmah Sayed] had a telephone call from Khoder Osman that conversation happened in Arabic that it was suggested that Khoder at that stage asked if he could borrow the money again, the plaintiff says that she didn’t want to take it off her visa card as she would have to pay interest on the last occasion and there will be about 17% interest on the money. The plaintiff [Fatmah Sayed] said that the defendant had agreed that if she took it off the visa card that he will pay the interest. She then describes going to the bank withdrawing $9500 as a cash advance from the Westpac Gold Card having $500 already in her handbag and provided that to Khoder that $10,000 to Khoder in 2 cash envelopes.”
8 The Assessor also referred to the evidence of Fatmah (Sayed’s daughter), Fatette Sayed. Fatette Sayed heard her mother say to Khoder Osman “I will give you the money, I have to pay interest on it”. In her statement Fatette does not refer to repayment of interest being a term of the loan, nor does she refer to a specific interest rate. Hanan Osman, in her statement stated that Khoder telephoned Fatmah and said words to the effect that “Please Fatmah. I need the money again. If you help me out I’ll appreciate it and I’ll return it back to you in two weeks.” Hanan Osman did not mention interest at all in her statement. The thrust of Khoder Osman’s statement was that the loan was made to his brother, Abdul Osman and not to him. He did refer to the loan being $10,000.00 but did not make any reference to the payment of interest. Taufik Ashosh’s statement did not assist.
9 The Assessor concluded that she was satisfied that upon the balance of probabilities that the Fatmah Sayed had made out her claim and entered judgment in the amount of $10,000.00. In relation to interest, the Assessor found that on the plaintiff’s evidence it was about 17% and Fatette Sayed said that there was no mention of a numerical value given. The Assessor accepted that the loan was put on the MasterCard and that the amount of 17% was likely to have been stated and if not stated directly then it was known to be that the interest payable would be on the MasterCard interest rate. The Assessor ordered that interest be payable from 16 August 2002 at 17%.
10 The relevant portions of s 12 of the Act state:
“Limits of jurisdiction
…
(3) Subject to this Part, a court sitting in its Small Claims Division has jurisdiction to hear and determine actions for the recovery of any debt, demand or damage (whether liquidated or unliquidated) in which the amount claimed is not more than $10,000, whether on a balance of account or after an admitted set-off or otherwise.
(4) Subject to this Part, a court sitting in its Small Claims Division has jurisdiction to hear and determine actions commenced after the commencement of this section to recover goods that are detained, or to recover the assessed value of the goods, if the value of the goods together with the amount of any consequential damages claimed for the detention of the goods does not exceed $10,000.
(6) If the amount claimed in an action includes interest (being interest which the court could, under section 39A (1), order to be included in the amount for which it could give judgment) that interest is to be disregarded for the purposes of:(5) Nothing in subsection (3) or (4) prevents an action under the subsection from being heard and determined by a court sitting in its General Division.
(b) determining whether or not the court sitting in a Division has jurisdiction to hear and determine the action.(a) determining whether the maximum amount for which the action is authorised by this Act to be brought has been exceeded or not, and
- …”
11 The Small Claims Division of the Local Court has jurisdiction to hear actions for the recovery of debt in which the amount claimed is not more than $10,000.00. Interest awarded under s 39A(1) of the Act is to be disregarded in determining the maximum amount for which the action is brought. Thus, if the interest component of the Assessor’s decision falls within s 39A(1) of the Act the amount claimed is within the jurisdiction of the Small Claims Division.
12 Section 39A of the Act reads:
“Order for interest
(2) Where:(1) In any proceedings for the recovery of any money (including any debt, demand or damages or the value of any goods), the court may order that there shall be included, in the amount for which judgment is given, interest at such rate as it thinks fit on the whole or any part of that amount for the whole or any part of the period between the date when the cause of action arose and the date when the judgment takes effect.
(a) proceedings have been commenced for the recovery of a debt, a liquidated demand or liquidated damages, and
the court may order that interest be paid at such rate as it thinks fit on the whole or any part of the money paid for the whole or any part of the period between the date when the cause of action arose and the date of the payment.(b) payment of the whole or a part of the debt, demand or damages is made during the currency of the proceedings and prior to or without judgment being given in respect of the debt, demand or damages,
(3) This section does not:
(a) authorise the giving of interest upon interest,
(c) affect the damages recoverable for the dishonour of a bill of exchange.(b) apply in relation to any debt upon which interest is payable as of right whether by virtue of any agreement or otherwise, or
13 Ms Sayed submitted that the interest component of the loan fell within s 39A(3)(b) of the Act and because interest was payable as of right s 39B of the Act did not apply. According to Ms Sayed, it follows that the Assessor would have exceeded the $10,000.00 jurisdiction of the Small Claims Division. Ms Sayed submitted that the Assessor exercised her discretion to award interest in accordance with s 39A(2) of the Act and that being so, the Assessor had jurisdiction.
14 The Assessor did not make a finding that Khoder Osman had to pay 17.15% interest, the MasterCard interest rate. The Assessor referred to Fatette Sayed’s evidence and the lack of her mentioning a numerical figure for the interest rate. This finding was clearly open to her. While the next sentence of the Assessor’s determination is a little unclear, it is my view that the Assessor exercised her discretion and awarded interest at the rate of 17% from the date upon which the $10,000.00 was due to be repaid. Leave to appeal is refused. The decision of the Assessor dated 5 July 2004 is affirmed. The summons filed 8 October 2004 is dismissed.
15 The second defendant seeks costs on an indemnity basis as default judgment was set aside because of delay and upon the basis of correspondence between the parties’ solicitors as to the hopelessness of the plaintiff’s case. Costs are discretionary. Costs usually follow the event. The plaintiff is to pay the defendants’ costs as agreed or assessed.
The court orders:
(1) The decision of the Assessor dated 5 July 2004 is affirmed.
(2) The summons filed 8 October 2004 is dismissed.
(4) The stay of proceedings under judgment in the Small Claims Division of the Local Court in proceedings 988/03 is lifted.(3) The plaintiff is to pay the defendants’ costs as agreed or assessed.
Last Modified: 12/15/2004
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