Owners Strata Plan 37762 v Pham and Ors

[2007] NSWLEC 252

Reported Decision: 154 LGERA 150

Land and Environment Court

of New South Wales

CITATION:	Owners Strata Plan 37762 v Pham and Ors [2007] NSWLEC 252
PARTIES:	APPLICANT Owners Strata Plan 37762 FIRST RESPONDENT Dinh Phuong Dung Pham SECOND RESPONDENT Kiet Luu THIRD RESPONDENT Liverpool City Council FOURTH RESPONDENT Dinh Ky Pham
FILE NUMBER(S):	40358 of 2005
CORAM:	Pain J
KEY ISSUES:	Contempt :- order restraining use of spray booth on premises in strata plan without consent of Council - order requiring remediation of common property in strata plan - finding of wilful contempt - whether Pt 42 and/or Pt 55 of Supreme Court Rules apply
LEGISLATION CITED:	Land and Environment Court Act 1979 s 20(4), s 23 Land and Environment Court Rules 1996 Pt 6 r 1 Supreme Court Rules 1970 Pt 42, Pt 55
CASES CITED:	AMIEU v Mudginberri Station Pty Ltd (1986) 161 CLR 98 ; Auburn Council v Czopak [No 4] [2005] NSWLEC 439; Auburn Council v Zizikas and Anor [1999] NSWLEC 155; Bourke Shire Council v Dwyer (1993) 79 LGERA 185; Campbelltown City Council v Toth [2005] NSWLEC [2005] NSWLEC 89; Clifford v Middleton (1974) VR 737; Drummoyne v Lewis (1974) 1 NSWLR 655 ; Environment Protection Authority v Pannowitz [2006] NSWLEC 219; Environment Protection Authority v Waight [2003] NSWLEC 93 beria Trust Ltd v Founders Trust and Investment Co Ltd [1932] 2 KB 87; John Allan Witham v Holloway (1995) 131 ACR 201 ; Miller v Eurovox Pty Ltd & Anor [2004] VSCA 211 ; Owners - Strata Plan 37762 v Pham and Ors [2005] NSWLEC 500; Owners of Strata Plan 37762 v Pham and Ors [2005] NSWLEC 663; Pelechovski v The Registrar, Court of Appeal (NSW) (1999) 198 CLR 435 ; PFT McGirr v D Xenos [2006] NSWLEC 60; Primelife Corporation Ltd v Newpark Pty Ltd (2003) VSC 106 ; Randwick City Council v Athens and Anor (No 7) [2004] NSWLEC 213; Tweed Shire Council v Mannix (1983) 50 LGRA 369; Windsurfing Inc v Sailboards Pty Ltd (1986) 19 FCR 110
DATES OF HEARING:	26 April 2007, 27 April 2007, 30 April 2007
DATE OF JUDGMENT:	9 May 2007
LEGAL REPRESENTATIVES:	APPLICANT Mr P Tomasetti (Barrister) SOLICITORS Andreones Pty. Limited Solicitors FIRST, SECOND and FOURTH RESPONDENTS Mr Q Nguyen (Barrister) SOLICITORS Al Chi Hoang Solicitors and Barristers THIRD RESPONDENT N/A

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

Pain J

9 May 2007

40358 of 2005 Owners Strata Plan 37762 v Pham and Ors

JUDGMENT ON CONTEMPT

1 Her Honour: In Owners - Strata Plan 37762 v Pham and Ors [2005] NSWLEC 500 Cowdroy J made orders on 13 September 2005 providing that:

1. Development consent DA63/04 granted on 13 October 2003 by Liverpool City Council in respect of lot 5 in Strata Plan No 37762 is declared invalid.
2. The first and second respondents and each of them be restrained from using the spray booth within lot 5 in Strata Plan No 37762 without consent being lawfully obtained from Liverpool City Council.
3. The first respondent reinstate those parts of the common property which were altered pursuant to development consent DA63/04 to their condition extant prior to their alteration.
4. The operation of order 2 is postponed until 9 December 2005 and the operation of order 3 is postponed until 9 January 2006.
5. Unless a contrary order is sought by 9 December 2005, the first and second respondents pay the applicant’s costs of these proceedings.
6. The exhibits be returned.

2 As is clear from the orders set out above, time for compliance with the orders related to the First Respondent was extended to 9 December 2006 and for the Second Respondent to 9 January 2006 by Cowdroy J (Owners - Strata Plan 37762 v Pham and Ors [2005] NSWLEC 500). At [46], Cowdroy J stated his reason for extending time to comply with Order 2 was “that a reasonable period should be allowed to enable the second respondent to seek alternative arrangements for the conduct of his business or to seek a fresh consent”. Cowdroy J further extended the orders on 6 December 2005 (Owners of Strata Plan 37762 v Pham and Ors [2005] NSWLEC 663). In his ex tempore judgment, he further noted that the extension of time for compliance in the original orders was due to the Court being aware of proceedings commenced by the First and Second Respondents in the Consumer, Trader and Tenancy Tribunal (CTTT). He noted that the CTTT ordered the body corporate of the Applicant to consent to the First Respondent lodging a development application for the spray booth. The Applicant lodged an appeal against these orders in the Supreme Court of NSW, which granted a stay of the orders of the CTTT pending further order. Cowdroy J noted that if the CTTT’s decision was confirmed, the First Respondent would be able to lodge a development application for the spray booth. Thus he allowed until 6 March 2006 before the First and Second Respondents were restrained from using the spray booth, and 3 April 2006 for the First Respondent to reinstate the common property. I made further orders extending time for compliance by consent on 20 March 2006. On 10 May 2006 I made orders by consent:

3 No mention before the Court took place on 19 May 2006. The Applicant’s solicitor restored the matter to the Court list on 1 December 2006. The Supreme Court handed down judgment on the appeal from the CTTT in favour of the Appellant on 29 November 2006. A mention before Talbot J was held on 8 December 2006. The Court file records "[n]o action required. Final orders have been made on a previous occasion." The word "completed" is stamped under this record.

4 The Applicant filed a Notice of Motion on 23 March 2007 seeking declarations of contempt against the First and Second Respondents and against an additional respondent, the Fourth Respondent, who was not previously a party in these proceedings. A warrant for the arrest of the First, Second and Fourth Respondents is sought. A Statement of Charge was filed with the Notice of Motion. An Amended Statement of Charge was subsequently filed on 30 March 2007. A Further Amended Statement of Charge was filed with an Amended Notice of Motion on 13 April 2007. There is no dispute that these documents and supporting affidavits were served personally on each of the Respondents.

5 The Further Amended Statement of Charge filed with the Amended Notice of Motion provides:

1. On 20 December 2006 you, Kiet Luu, by yourself used the spray booth within lot 5 in Strata Plan No 37762 (within the meaning of the Court’s orders), without consent being lawfully obtained from Liverpool City Council.

2. On 22 December 2006 you, Kiet Luu, by yourself used the spray booth within lot 5 in Strata Plan No 37762 (within the meaning of the Court’s orders), without consent being lawfully obtained from Liverpool City Council.

3. On 25 January 2007 you, Kiet Luu, by yourself used the spray booth within lot 5 in Strata Plan No 37762 (within the meaning of the Court’s orders), without consent being lawfully obtained from Liverpool City Council.

4. On 31 January 2007 you, Kiet Luu, by yourself used the spray booth within lot 5 in Strata Plan No 37762 (within the meaning of the Court’s orders), without consent being lawfully obtained from Liverpool City Council.

5. On 14 February 2007 On 27 March 2007 you, Kiet Luu, by yourself used the spray booth within lot 5 in Strata Plan No 37762 (within the meaning of the Court’s orders), without consent being lawfully obtained from Liverpool City Council.

6. On 27 March 2007 you, Kiet Luu, by yourself used the spray booth within lot 5 in Strata Plan No 37762 (within the meaning of the Court’s orders), without consent being lawfully obtained from Liverpool City Council.

7. As at today’s date, you, Dinh Phuong Dung Pham, have failed to reinstate those parts of the common property which were altered pursuant to the development consent DA 63/04 to their condition extant prior to their alteration.

8. As at today’s date, you Dinh Ky Pham, have failed to reinstate those parts of the common property which were altered pursuant to the development consent DA 63/04 to their condition extant prior to their alteration.

6 The First Respondent owns Lot 5 in Strata Plan no 37762 (the premises) the subject of the original orders of Cowdroy J. The Second Respondent is the tenant of those premises and conducts a car repair business which includes the operation of the spray booth. The Fourth Respondent, to whom prayer 8 relates, is the father of the First Respondent. Her affidavit evidence is that all decisions in relation to the management of the premises have been delegated by her to her father. He was not joined as a party in these proceedings until the Amended Notice of Motion and Further Amended Statement of Charge dated 13 April 2007 were filed.

7 I note that the Second Respondent admitted the facts giving rise to each of the charges in prayers 1 to 5 of the Amended Statement of Charge. Prayer 6 relating to 27 March 2007 was not admitted. The First Respondent also admitted the facts giving rise to the charge in prayer 7. The Fourth Respondent also admitted the facts giving rise to the charge in prayer 8. The Respondents also do not dispute that they received the Court’s orders made on 10 May 2006.

Applicant’s evidence

8 Because the facts giving rise to the contempt charges are largely admitted by the Respondents I will set out only briefly the affidavit evidence of the Applicant in relation to the admitted facts. The Applicant relied on affidavits of Mrs Alice Leeming sworn 22 and 29 March 2007 and affidavits of Mr Bounma Sengmany sworn 22 and 29 March 2007. Mrs Leeming deposed that she is one of owners of Lot 1, while Mr Segmany deposed that he is one of the owners of Lot 6. An affidavit of Mr Graham Dawson, Environmental Planning Enforcement Officer employed by Liverpool City Council, the Third Respondent, sworn 5 April 2007, was also relied on.

9 Mrs Leeming stated that she and her husband operate a business from Lot 1, which is in proximity to Lot 5. She stated that from about 9 December 2005 to the present, she has seen the Second Respondent using the spray booth on Lot 5. She says she has also smelt fumes and seen particles and dust emanating from Lot 5. She deposes that she has seen persons working under the direction of the Second Respondent spray painting cars, and has seen the Second Respondent park cars which have markings showing repair of dents on the common property. She states that she took photographs in January and February this year. She states they show the Second Respondent taking delivery of a car and pushing it into Lot 5 which contains the spray booth. She states that further photos show work being done to the car and that the car had been repainted.

10 The contested date of charge in relation to the Second Respondent is 27 March 2007. In her second affidavit Mrs Leeming deposes that she saw the Second Respondent spray painting in the spray booth on 27 March 2007. She smelt extremely strong fumes on this day. She stated that the First Respondent put a hole in the roof of the whole Lot (common property) and built two chimney stacks. She took photos on 23 March 2007 which show these have not been removed. She states at par 10:

In my view, to reinstate the common property to its original condition, Ms Pham would need to remove the two chimney stacks and put back the roof with a new piece of flat metal to match the existing roof.

11 In his first affidavit, Mr Sengmany states that he is able to see activities occurring within Lot 5 and its surrounds daily as he and his wife operate a business from Lot 6 which adjoins Lot 5. He states that from about 9 December 2005 to the present, he has seen the Second Respondent and others “[w]orking on motor vehicles including spray painting, sanding, polishing and masking motor vehicles within lot 5 with the roller door open and in front of lot 5". He deposes that he has taken photographs of the activities on Lot 5 from his office at Lot 6 in December 2006 and January and February 2007, including spray painting motor vehicles and incidental activities. He states that he can identify the Second Respondent amongst these photographs.

12 Mr Sengmany further states that from about 9 December 2005 to the present, he has smelt fumes and seen sanding particles and dust coming from Lot 5. This prevents him from leaving his roller door, entry door or windows open.

13 In his second affidavit of 29 March 2007, Mr Sengmany deposes that on 27 March 2007 he heard the compressor in the spray booth running and saw the Second Respondent in the spray booth spray painting something, wearing a mask but no white suit. Mr Sengmany smelt very strong fumes. Further, Mr Sengmany states that "when the second respondent is using the spray booth I hear the spray booth compressor and I can smell the fumes when I am in my lot 6". Photographs attached to Mr Sengmany’s affidavit show the Second Respondent "in the spray booth spray painting something" on 27 March 2007 according to the affidavit.

14 The affidavit of Mr Dawson, Liverpool City Council officer, annexes correspondence from the Leemings to the Council describing the activities on Lot 5 and the Council's reply. Letters from the Council to the First and Second Respondents dated 14 March 2007 seeking compliance with the Court orders are also attached. Mr Dawson deposes that he attended Lot 5 on 12 March 2007, where the Second Respondent told him he was still able to legally use the spray booth but would be returning to the Land and Environment Court. Mr Dawson states that on 26 March 2007 the Second Respondent telephoned him and said that he and the Fourth Respondent had “engaged new legal professionals that will be looking at submitting a development application for the spray booth within 28 days".

15 The Applicant relied on an affidavit of Juliette Nairn, solicitor, sworn 23 March 2007 and a further affidavit of Ms Nairn sworn 11 April 2007. Correspondence is attached to these affidavits. Letters from the Applicant’s solicitor dated 7 June 2006 and 15 June 2006 were sent to the First Respondent and the Second Respondent respectively, stating that the Court’s orders were effective from 19 May 2006 and 18 June 2006. The Applicant’s solicitor also sent letters dated 5 December 2006 to the First and Second Respondents respectively. These letters set out the original orders of Cowdroy J and then stated "[t]here is no reason for the stay which was granted to continue”. The letters gave notice that at a directions hearing on 8 December 2006 the Applicant would seek orders that the use of the spray booth cease immediately and the premises be reinstated. These letters enclosed a letter sent by the Applicant’s solicitors on the same date to the solicitors acting for the Council stating that it was the Council’s responsibility to enforce the orders and requesting discussion of the action to be taken by the Council in this regard.

16 The Respondents’ evidence is that not all these letters were received. The Second and Fourth Respondent’s affidavit evidence is that the Applicant’s solicitor’s letters of 5 December were not received. It appears that the Applicant's solicitor’s letters to the First Respondent of 7 June 2006 and 5 December 2006 were sent to an incorrect address, as the street number appearing on those letters does not match that provided by the First Respondent in her affidavit. The address on the letter to the Second Respondent of 15 June 2006 matches that provided in his affidavit. The letter to the Second Respondent of 5 December 2006 has a slightly different street name.

Respondents’ evidence

17 Affidavits of the First, Second and Fourth Respondent sworn 5 April 2007 were relied on. The First, Second and Fourth Respondents gave oral evidence and were cross-examined. The First Respondent Ms Dinh Phuong Dung Pham stated that she is the owner of Lot 5 in the strata plan and is aware of court proceedings involving her as the owner. She stated that sole responsibility for managing the property has been given to by her to her father, who has "complete powers to do all things necessary and to act on my behalf, including acting on my behalf in all of the court proceedings involving me". She stated that she has given all documents relating to the premises or the proceedings to her father and has not received any documents relating to the premises or the court proceedings that she has not given to her father. In cross-examination she stated that her signature appeared on the consent orders dated 10 May 2006 for both herself and the Second Respondent.

18 The Second Respondent Mr Kiet Luu stated in his affidavit that he is the tenant of Lot 5, where he runs a panel beating and smash repair business. He is aware of the CTTT proceedings and the Supreme Court appeal which was decided on 29 November 2006 quashing the CTTT orders. He is aware the Fourth Respondent has lodged another application with the CTTT seeking another order for owner’s consent to building works.

19 In relation to the proceedings in this Court, the Second Respondent stated that he was aware of the original orders of Cowdroy J of 13 September 2005. He stated "I am aware that the reason for the postponement of the Orders, was that the Land and Environment Court knew of the CTTT proceedings, and hence that the orders by the CTTT may well render the orders by the Land and Environment Court redundant". He stated he thought that the further extension of the orders by Cowdroy J was due to the owners’ appeal from the CTTT to the Supreme Court.

15. I am aware that the matter then did return to the Land and Environment Court on 20 March 2006, where Justice Pain ordered another extension, given that the Supreme Court had reserved its decision. . .
16. I am aware that the matter then did return to the Land and Environment Court on 10 May 2006, where Justice Pain ordered another extension, given that the Supreme Court decision was still pending. . .

17. From May 2006 onwards, I was not contacted by the owners corporation with respect to the orders of the Land and Environment Court and the need for them to be further extended, nor was I asked to comply with those orders. I was not asked to refrain from using the spray booth during this time.

18. My understanding was that any orders by the Land and Environment Court was subject to the final decision by the Supreme Court as had been acknowledged by the extensions that had already been granted three times previously.

19. It was thus my understanding that the orders previously made by the Land and Environment Court would be suspended indefinitely and until further order, given that there was to come the Supreme Court decision.

20. Following the handing down of the Supreme Court decision, it was my understanding that the Land and Environment Court had to reconfirm orders previously made, given that they had to be extended and postponed on a number of times.
21. On 8 December 2006, I was made aware that the Land and Environment Court proceedings was relisted to ascertain what was to happen, given that the Supreme Court had handed down its decision on 29 November 2006. I recall afterwards being told by Mr Pham that after his inquiries: "no action has been taken. The final order has already been made". I took this to mean that nothing was ordered by the Land and Environment Court on 8 December 2006.
. . .

23. Hence from December 2006 onwards, the premises were continued to be used for spray painting and panel beating, as they had been for the past year with no complaint from the owners corporation. I did not receive any notice, correspondence or communication of any kind from the owners corporation that required me to cease using the spray booth, until I was served on 26 March 2007 with the notice of motion for contempt of court. I did not receive any notice, correspondence or communication of any kind from the Supreme Court or the Land and Environment Court requiring me to cease using the spray booth.

24. Had I known that the use of the spray booth and associated panel beating was unlawful and in breach of court orders, I would have immediately ceased using it. But this was not the case, given that I received no further correspondence from the court, or from the owners corporation.

20 At par 27 of his affidavit, the Second Respondent stated that throughout this time he thought he was to await further orders from this Court and was entitled to continue spray painting until he received them.

21 The Second Respondent’s affidavit and oral evidence in relation to 27 March 2007 was that although he was in the spray booth he was applying a particular finish to a car, a guide coat, which was not using the spray booth because it did not require the spray booth to be “turned on”, meaning that the ventilation system did not need to be switched on. It was not the type of spraying for which it is necessary to use the spray booth.

22 The Fourth Respondent, Mr Dinh Ky Pham, stated in his affidavit that he is the father of the First Respondent and has sole responsibility for managing the property on her behalf. He stated that after the extension of the orders by Cowdroy J:

15. The matter then did return to the Land and Environment Court on 20 March 2006, where Justice Pain ordered another extension, given that the Supreme Court had reserved its decision. . .

16. The matter then did return to the Land and Environment Court on 10 May 2006, where Justice Pain ordered another extension, given that the Supreme Court decision was still pending. . .

17. From May 2006 onwards, I or my daughter was not contacted by the owners corporation with respect to the orders of the Land and Environment Court and the need for them to be further extended, nor was I or my daughter asked to comply with those orders. I was not asked to refrain from using the spray booth during this time, nor am I aware was my daughter.

18. My understanding was that any orders by the Land and Environment Court were subject to the final decision by the Supreme Court, as had been acknowledged by the extensions that had already been granted three times previously.

19. It was thus my understanding that the orders previously made by the Land and Environment Court would be suspended indefinitely and until further order, given the Supreme Court decision to come.

20. Following the handing down of the Supreme Court decision, it was my understanding that the Land and Environment Court had to reconfirm orders previously made, given that they had to be extended and postponed on a number of times.
21. On 8 December 2006, I was aware that the Land and Environment Court proceedings was relisted to ascertain what was to happen, given that the Supreme Court had handed down its decision on 29 November 2006. I recall being at the Court at 9 a.m. At 9:45 I wondered what had happened to the case, as I had not heard the matter called. I was told that the matter had already finished.
22. I then proceeded to the reception, where I was told that: "No action has been taken. The final order has already been made". I took this to mean that nothing was ordered by the Land and Environment Court on 8 December 2006. . .
…


24. Hence from December 2006 onwards, the premises were continued to be used for spray painting and panel beating, as they had been for the past year with no complaint from the owners corporation. I or my daughter did not receive any notice, correspondence or communication of any kind from the owners corporation that required her to cease using the spray booth, until there was served on 26 March 2007 with the Notice of Motion for contempt of court. I or my daughter did not receive any notice, correspondence or communication of any kind from the Supreme Court or the Land and Environment Court requiring her2 to cease using the spray booth.

25. Had I known that the use of the spray booth and associated panel beating was unlawful and in breach of court orders, I would have immediately informed everyone concerned to stop. But this was not the case, given that I or my daughter received no further correspondence from the Court, or from the owners corporation, or from a subsequent inquiries to the Land and Environment Court detailed below.

23 Mr Pham stated that he attended the Court Registry and asked for final orders on three occasions. On these occasions he states that he was told by an unidentified person that the Court was awaiting the Supreme Court's decision or that he should wait for the Supreme Court decision. On a fourth occasion he states that he telephoned the Registry and was told by an unidentified person that when final orders could be found, they would be posted to him.

24 The First and Second Respondents were represented by lawyers in the proceedings before Cowdroy J. They were unrepresented in these proceedings from March 2006 to March 2007.

A. Part 42 and/or Part 55 of the Supreme Court Rules?

25 The first issue raised in the parties’ arguments is whether these proceedings should be considered under Pt 42 and/or Pt 55 of the Supreme Court Rules 1970 (the Supreme Court Rules). Under s 23 of the Land and Environment Court Act 1979 (the Court Act) this Court has power to make orders it considers appropriate. Section 20(4) of the Court Act provides for the enforcement of orders of this Court in Class 4 proceedings by the application of the Supreme Court Rules for enforcement. Part 6 r 1 of the Land and Environment Court Rules 1996 (the Court Rules) provides that Pt 42 and Pt 55 of the Supreme Court Rules apply.

26 Part 42 rule 6(1) states:

(1) This rule applies -
(a) where -
(i) a judgment requires a person to do an act within a time specified in the judgment, and
(ii) he refuses or neglects to do the act within that time or, if that time has been extended or abridged under Part 2 rule 3, within that time as so extended or abridged, and
(b) where a judgment requires a person to do an act forthwith or forthwith upon a specified event and he refuses or neglects to do the act as the judgment requires, and
(c) where -
(i) a judgment requires a person to abstain from doing an act, and
(ii) he disobeys the judgment.

27 Rule 6(2) provides:

(2) In a case in which this rule applies, a judgment may, subject to rule 8, be enforced by one or more of the following means -
(a) committal of the person bound,
(b) sequestration of the property of the person bound, and
(c) where the person bound is a corporation -
(i) committal of any officer of the person bound, and
(ii) sequestration of the property of any officer of the person bound.

28 Rule 8 states:

(1) Subject to the rules, a judgment shall not be enforced by committal or sequestration unless -
(a) a minute of the judgment is served personally on the person bound, and
(b) if the judgment requires the person bound to do an act within a specified time, the minute is so served before that time expires.
…
(3) A minute of a judgment served under this rule must bear a notice (naming the persons concerned) that the person served is liable to imprisonment or to sequestration of property if -
(a) where the judgment requires the person bound to do an act within a specified time, the person bound refuses or neglects to do the act within that time, or
(b) where the judgment requires the person bound to do an act forthwith or forthwith upon a specified event and the person bound refuses or neglects to do the act as the judgment requires, or
(c) where the judgment requires the person bound to abstain from doing an act, the person bound disobeys the judgment.

a minute of the judgment mentioned in paragraph (a) must be served on that person before the expiry of that time.

a minute of the order under Part 2 rule 3 must be served on that person before the expiry of that time as so extended or abridged.

the judgment may be enforced by committal of that person or by sequestration of his property notwithstanding that service has not been effected in accordance with this rule.

29 Part 55 rule 6 states:

(1) Where contempt is committed in connection with proceedings in the Court, an application for punishment for the contempt must be made by motion on notice in the proceedings, but, if separate proceedings for punishment of the contempt are commenced, the proceedings so commenced may be continued unless the Court otherwise orders.

(2) Where contempt is committed, but not in connection with proceedings in the Court, proceedings for punishment of the contempt must be commenced by summons, but, if an application for punishment of the contempt is made by motion on notice in any proceedings, the application may be heard and disposed of in the latter proceedings, unless the Court otherwise orders.


Parties’ arguments

30 The Applicant argued that its motion is pursuant to Pt 55 Contempt Division 3 - Motion or Proceedings for Punishment and seeks the punishment provided for in Pt 55 r 13, which is imprisonment or fine.

31 The Respondents’ counsel argued that this motion should be considered under Pt 42 of the Supreme Court Rules, Judgment and Orders: Enforcement as it is seeking to enforce Court orders. Relying on Tweed Shire Council v Mannix (1983) 50 LGRA 369 their counsel argued that as this is “civil” and not “criminal” contempt Pt 55 is not available. He also argued that it is clear that the service requirements of Pt 42 rule 8(1) and (3) have not been complied with and this is fatal to this Notice of Motion, relying on Bignold J in PFT McGirr v D Xenos [2006] NSWLEC 60.

Finding on Pt 42/Pt 55 Supreme Court Rules

32 There is no reference to contempt or Pt 55 in Pt 42. The introduction to Pt 42 in Ritchie’s Supreme Court Procedure NSW suggests that the series of rules in Pt 42 - 49 are the methods for enforcing court orders. There is no mention of Pt 42 in Pt 55. On one view the two parts address different circumstances, Pt 42 being concerned with enforcement of Court orders and Pt 55 with contempt. The contempt power of a court under Pt 55 is aimed at the protection of the administration of justice: see Ritchie’s Supreme Court Procedure NSW at [55.00] and the cases cited therein. Failure to comply with court orders can give rise to a finding of contempt, see Ritchie’s Supreme Court Procedure NSW [55.0.1] and the cases therein.

33 In Tweed Shire Council v Mannix Cripps J said at 375:

The fact that Pt 55 contains a power to fine and refers to punishment rather than enforcement would suggest to me that it is not appropriate to use Pt 55 for the purpose of enforcing contempt in procedure, ie ‘civil’ contempt. If, in addition, ‘criminal’ contempt is alleged, the statement of charge referred to in Pt 55 should, in my opinion, specify the contumacious conduct amounting to the commission of a crime committed by the respondent beyond disobedience of the court’s order.

34 Based on this passage the Respondents argued that if Pt 55 were to be relied on, the Amended Statement of Charge had to nominate contumacious behaviour and did not do so.

35 In Bourke Shire Council v Dwyer (1993) 79 LGERA 185 Talbot J considered that Pt 42 had not been complied with. He found wilful contempt of court had occurred and that the power to impose a fine could still apply. He does not refer to Pt 55.

36 Numerous cases in this Court since 1983 have considered motions seeking contempt orders under Pt 55 in relation to non-compliance with orders of this Court; see Campbelltown City Council v Toth [2005] NSWLEC [2005] NSWLEC 89, Randwick City Council v Athens and Anor (No 7) [2004] NSWLEC 213, Auburn Council v Czopak [No 4] [2005] NSWLEC 439, Auburn Council v Zizikas and Anor [1999] NSWLEC 155.

37 In McGirr there was express reliance on Pt 42 by the applicant on the motion seeking contempt orders. This changed to reliance on Pt 55 towards the end of the proceedings and the motion was not accepted by Bignold J on that basis. He dismissed the motion because there was a failure to comply with the service requirements of Pt 42 r 8. I do not consider this case represents binding authority that Pt 42 must be applied, exclusive of Pt 55, if enforcement of a Court order is being pursued. It is clear his Honour was mindful of the particular circumstances of the case which were essentially that there was only an outstanding costs issue between the parties.

38 I consider that these proceedings for contempt can be pursued under Pt 55. I do not accept the Respondents’ submission that there must be a higher “criminal” standard of contempt if there is to be reliance on Pt 55 and do not therefore apply the obiter findings of Cripps J in Tweed Shire Council v Mannix. Later cases such as AMIEU v Mudginberri Station Pty Ltd (1986) 161 CLR 98 (Mudginberri) suggest that civil contempt includes proceedings for failure to comply with court orders and such proceedings are able to proceed under Pt 55, as has occurred in this Court on previous occasions (see par 35).

39 The Respondents argued that the Amended Statement of Charge was defective because it did not state that the Applicant was seeking that a fine be imposed. No obligation to nominate the form of punishment sought is contained in Pt 55. There has been compliance with the procedural parts of Pt 55 in relation to commencement of the proceedings by motion (Pt 55(6)), the provision of a charge (Pt 55(7), evidence by affidavit (Pt 55(8)) and personal service (Pt 55(9)). I can determine whether contempt has been proved by the Applicant. That does not completely answer whether Pt 42 still has application given that it is directed to the enforcement of court orders by imprisonment or sequestration.

40 It is useful to consider various cases referred to by Bignold J in McGirr in relation to enforcement of court orders where penal sanctions can apply. Clifford v Middleton (1974) VR 737 considered attachment (of property) proceedings under the Victorian Supreme Court Rules. At 739 Kaye J stated:

Order 52, r4, provides that in proceedings for attachment a copy of any affidavit intended to be used in support of the application shall be served with the notice of motion. Attachment proceedings, being penal and affecting the liberty of the subject, are of a criminal character, so that the utmost strictness in procedure and proof is demanded: Hall & Co v Trigg [1897] 2 Ch. 219, at p. 222; Re Bramblevale Ltd., [1970] Ch. 128; [1969] 3 All E.R. 1062; Comet Products U.K. Ltd. v. Hawker Plastics Ltd., [1971] 2 Q.B. 67; [1971] 1 All E.R. 1141, and Oswald on Contempt, 3rd. ed., pp. 210-11. An application to attach a party arising out of disobedience of the Court’s order which, if it requires him to perform an act, must be endorsed with a memorandum in the form or to the effect prescribed by O. 41, r.5. The purpose of the endorsement is to warn the party of the consequences which might befall him should he fail to perform the act directed. It follows that a party will not be attached for disobedience of a mandatory order unless he has been served with a copy of the order, although personal service may be dispensed with if it is shown that he has evaded service: Re Tuck; Murch v. Loosemore, [1906] 1 Ch. 692; Gordon v. Gordon, [1946] P. 99, at p. 103; [1946] 1 All E.R. 247, and Taylor v. Whelan, [1962] V.R. 306, at p. 307.

41 Westpac Banking Corporation v Maher; The Queen v Maher And Anor (1995) VSC 7195, 7715 (Westpac Banking Corporation) also considered the Victorian Supreme Court Rules for attachment. In that case committal or sequestration of property was sought as a remedy and compliance with the relevant rules was considered necessary as a matter of fairness and common sense.

42 Drummoyne v Lewis (1974) 1 NSWLR 655 considered Pt 42 as these were the rules by which judgments may be enforced. Holland J considered the service requirements in Pt 42 r 8 were to be strictly enforced and were not complied with in that case. He stood the proceedings over for a month in order to give the plaintiff’s lawyers an opportunity to comply with Pt 42 r 8.

43 In Primelife Corporation Ltd v Newpark Pty Ltd (2003) VSC 106 Nettle J considered Pt 75.05 and Pt 66.06 of the Victorian Supreme Court Rules. These rules are described in the judgment as follows:

Rule 75.6 of the Rules of Court provides that where a contempt is committed by a party in relation to a proceeding in the court the application shall be made by summons in the proceeding. Rule 66.06 provides that where a person defaults in attendance in compliance with an order of the court for the purpose of giving evidence or for the production of a document, or for any other purpose, the court may make an order for the issue of a warrant to the Sheriff for the arrest of the person, and for his production before the court, and for the payment of costs. Rule 66.10 provides, however, that a judgment shall not be enforced by committal or sequestration unless a copy of the judgment is served personally on the person bound and it is endorsed with a notice naming the person served that he will be liable to imprisonment or to sequestration if he fails to comply. The order of the Master of 29 April 2002 was not indorsed in accordance with Rule 66.10.

44 Kaye J in Clifford v Middleton was adopted by Nettle J because attachment proceedings are penal and affect the liberty of a person and so warrant strictness of procedure and proof at [31]. Nettle J at [34] – [35] stated:

The court has power to impose a fine for contempt of court in the case of a civil contempt, if it is thought appropriate to do so. But it is said in Williams Civil Procedure in Victoria that a fine may not be imposed if the order served is not indorsed in accordance with r66.10(3). Although the rule does not refer to fines, and it would appear that the sanctions of committal and fine are used in contradistinction in r75.11 of the Rules, the thought seems to be that there is no power to fine unless there is power to commit. Hence, if committal is prohibited by r66.10(3), so too must be the imposition of a fine . [footnotes excluded]

As a matter of fairness that view has a degree of appeal about it. It is difficult to see why a subject should any more readily be subjected to a fine than to committal or sequestration without the warning for which r66.10(3) provides. But a different view of the matter has been taken in New South Wales and in the Federal Court13 and I think that I should follow it. With some diffidence I conclude that there is power to fine even if an order has not been indorsed in accordance with the rule.
13 Windsurfing Inc v Sailboards Pty Ltd (1986) 19 FCR 110 at 113.7 per Burchett J and Bourke Shire Council , Talbot J at 186.

45 Miller v Eurovox Pty Ltd& Anor [2004] VSCA 211 also considered the Supreme Court (General Civil Procedure) Rules 1996, r 66.10 and applied Kaye J in Clifford v Middleton.

46 If contempt is proved the issue will arise of what punishment should be imposed. Given that the charges of contempt are based on the failure to comply with Court orders and can also be considered as an action to obtain enforcement of those orders, it is important that if imprisonment and/or sequestration is sought that Pt 42 also apply in my view. For the reasons of fairness referred to in cases such as Clifford v Middleton, Westpac Banking Corporation, Drummoyne v Lewis and McGirr where a motion for contempt seeks to enforce court orders by imprisonment, as is the case here, it is preferable that Pt 42 be applied. The rules for service of court orders under r 8(1) and (3) must be then complied with subject to the Court exercising discretion to waive those requirements under Pt 42 r 8(6). The Applicant stated it does not rely on Pt 42. It follows that I do not consider I should imprison the Respondents if contempt is found.

47 If I make a finding of wilful contempt I can impose a fine by way of punishment under Pt 55 r 13, see Mudginberri at 112, Windsurfing Inc v Sailboards Pty Ltd Burchett J at 116 and 125, Bourke Shire Council v Dwyer, Primelife Corporation Ltd (2004) Nettle J (albeit reluctantly) at [34] - [35].

Action against Fourth Respondent (third party)

48 The commentary in Ritchie’s Supreme Court Procedure NSW at [55.6.1A] suggests the Applicant should commence fresh proceedings as against the Fourth Respondent as he was not a party to the original proceedings, or subject to the orders of Cowdroy J. The situation is similar to that in Environment Protection Authority v Pannowitz [2006] NSWLEC 219 where Lloyd J considered the matter could proceed, albeit reluctantly (at 15-16). The Fourth Respondent has not made any objection to the form of the proceedings and is legally represented on this contempt motion. I will consider the motion for contempt in relation to the Fourth Respondent despite his not being a party to the original orders of Cowdroy J.

B. Is contempt proved?
Parties’ submissions

49 The Applicants bear the onus of proof of contempt on the criminal standard of proof. The facts underlying the charges are generally admitted. The Second and Fourth Respondents gave similar reasons as to why they were not in contempt. Their counsel argued that there is no evidence of contempt because according to their affidavits they considered the effect of the extension of the orders until May and June 2006 was that these expired when those dates passed. It was also argued that the Court’s extension of the orders was for an indefinite period pending the outcome of the Supreme Court proceedings, an appeal by the Applicant against orders made in the CTTT. It was also stated that the Court’s extension of the orders was on the basis that there were Supreme Court proceedings on foot. The Second and Fourth Respondents also stated that nothing was received about compliance with the Court orders of 10 May 2007 until nine months later when a letter from Liverpool City Council dated 14 March 2007 was received, which required compliance with the orders within 28 days.

50 Reliance was also placed on letters from the Applicant’s solicitor dated 5 December 2006 which stated (erroneously) that a stay had been granted and that further orders were required for it to be lifted. The letters from the solicitor stated:

There is no reason for the stay which was granted to continue.
I therefore put you on notice that at the directions hearing on 8 December 2006 my client will be seeking orders to the effect that:

A stay to the Land and Environment Court orders was applied for by the defendants and was granted pending the outcome of a parallel Supreme Court appeal.

51 The letters misled the Respondents into believing that without a lifting of the stay, there would be no breach of the Court orders and so led them to believe the orders were stayed until further orders were made by the Court. The Respondents were self-represented at this time.

52 There is no evidence that the Second and Fourth Respondents were in deliberate or wilful disobedience of the Court’s orders, but rather any breach was due to an innocent misapprehension which resulted from the Applicant’s misleading actions. The First Respondent has delegated all management of the premises to her father including dealing with the Court’s orders. There was a reasonable excuse for the Respondents’ conduct.

53 The Applicant argued that there was contumacious contempt in the circumstances outlined in the evidence, relying on John Allan Witham v Holloway (1995) 131 ACR 201, as there was clear and deliberate disobedience of the Court’s orders. If the Court does not find the contempt is contumacious then it is wilful.

Finding on B - is there contempt?

54 Pelechovski v The Registrar, Court of Appeal (NSW) (1999) 198 CLR 435 identified three types of conduct, technical, wilful and contumacious, per Kirby P at [147]:.

The underlying purpose of the law on this form of contempt is to vindicate the due administration of justice. Contempts of the kind illustrated in this case may be technical, wilful without a specific intent to defy the authority of the Court and contumacious. In the last category a serious act of deliberate defiance of judicial authority is evidenced.

55 In Mudginberri at 113:

It follows that a deliberate commission or omission which is in breach of an injunctive order or an undertaking will constitute such wilful disobedience unless it be casual, accidental or unintentional. It is immaterial that the existence of the power to impose a fine for wilful disobedience to a court order may not have been explicitly recognised in 1903.

56 In John Allan Witham v John William Holloway (1995) 83 CLR 525, McHugh J at 538:

The phrase “contempt of court” dates from at least the 12th century. While it was not until the seventeenth century that the courts drew a distinction between civil and criminal contempts, the existence of the distinction has been firmly established since the middle of the last century. The distinction has been acknowledged or assumed in a number of decisions in this Court. Criminal contempt are acts or omissions that have a tendency to interfere with or undermine the authority, performance or dignity of the courts of justice or those who participate in their proceedings. Although criminal contempts take many forms, their characteristic attribute is an interference with the due administration of justice either in a particular case or as part of a continuing process. Defiance of the court or its procedures, publication of matters scandalising the court, actions calculated to prejudice the fair trial of a pending case, threats to parties or witnesses and misconduct within the court are examples of criminal contempts. Civil contempts, on the other hand, are concerned with failures to comply with judgments or orders of the courts. But civil and criminal contempt overlap. Thus, disobedience to the order of a court constitutes criminal contempt when the disobedience is contumacious. Defiance of the court’s order renders criminal what would otherwise be civil contempt. Where non-compliance with a judgment or order goes beyond merely breach and involves misconduct, civil contempt also has a “penal or disciplinary jurisdiction (that is) exercised by the court in the public interest”.

As identified in the cases referred to in Nigel Lowe and Brenda Sufrin, Borrie & Lowe The Law of Contempt (3rd ed 1996) 567-569, liability for breaching a court order is strict. Mens rea is not required in the sense that the Applicant need not prove there was a deliberate intention to disobey a court order or interfere with the administration of justice in order to succeed in obtaining a finding of contempt; see also Environment Protection Authority v Waight [2003] NSWLEC 93 per Pearlman J at [54] –[56].

57 The orders of the Court did not expire in, respectively, May and June 2006 as the Respondents’ counsel continued to state during his written and oral submissions. This was despite my observations to the contrary from the Bench during his submissions. Statements to similar effect in the affidavits of the Second and Fourth Respondents are also incorrect. The orders on 10 May 2006 were made by consent of both parties. The fact the parties may have agreed to consent orders because at that stage the Applicant was willing to await the outcome of the Supreme Court proceedings, and therefore agreed to a mention on 19 May 2006, is not the reason for the Court making the consent order on 10 May 2006. In the absence of further consent orders being filed by the parties the orders of Cowdroy J took effect when the periods in the consent order dated 10 May 2006 for extension for compliance expired. That is clear from the order on its face. It is also not disputed apart from the 27 March 2007 charge that the orders have not been complied with by the Respondents. There is clearly contempt by all the Respondents as the Court’s orders which are in force have not been complied with. In order to determine if that contempt is technical, wilful or contumacious it is necessary to consider the evidence further to determine whether there was a reasonable excuse for the Respondents’ non-compliance. Before doing so I will determine if I should make a finding of contempt in relation to the Second Respondent for 27 March 2007.

27 March 2007

58 The evidence relied on by the parties in relation to 27 March 2007 is set out above at par 10 and 13. Order 2 of Cowdroy J prohibits the use of the spray booth. It is not qualified in any way. The Second Respondent’s evidence is that he considers he only uses the spray booth when it is turned on which I understand means the ventilation system is required to be activated, and he has to wear a white protective suit. Applying the type of coating he was on 27 March 2007 did not require these measures to be taken and so did not amount to a use of the spray booth. I do not accept there is a distinction between different uses of the spray booth which can arise from Order 2. The evidence of Mrs Leeming and Mr Sengmany is clear that the Second Respondent was using the spray booth. The Second Respondent was in the spray booth wearing a face mask applying a type of coating to a car. That is a use of the spray booth. I find the Second Respondent was in contempt of the Court orders on 27 May 2007.

First Respondent

59 The First Respondent’s evidence is simply that she has delegated all decisions related to these Court proceedings to her father, the Fourth Respondent and he has been provided with all written material she has received in relation to this Court matter. No explanation is otherwise provided as to why she has not complied with the Court orders. The Court orders are made against her personally and the obligation to comply falls on her directly. In the absence of any explanation that it was necessary to delegate decisions to her father on, for example, incapacity grounds, I do not consider the First Respondent has provided any answer to the charge of contempt (prayer 7) filed against her. Her circumstances do not give rise to a technical breach only. The issue arises of whether the contempt is wilful or contumacious.

Second and Fourth Respondents

60 In determining whether the contempt was wilful or contumacious in relation to the Second and Fourth Respondents I need to consider whether their belief about the (non) effect of the orders was reasonable in the circumstances. As the Second Respondent in his affidavit makes similar statements to the Fourth Respondent and relies to a large extent on what the Fourth Respondent told him about matters from the time consent orders dated 10 May 2006 were made, I will focus on the Fourth Respondent’s evidence. The Fourth Respondent’s affidavit states that his (erroneous) understanding was that the Court orders were stood over indefinitely, pending the outcome of Supreme Court proceedings. He relies on the fact that the Applicant’s solicitor sent the letter to the First and Second Respondent dated 5 December 2007 which was inaccurate in referring to the stay of orders (see par 50 above). While on one view his evidence is self-serving in that the obligation to comply with the court orders fell on the First and Second Respondents regardless of any action by the Applicant or its lawyers, I accept his explanation for the period from 10 May 2006, when the consent order was made, up to the determination of the Supreme Court proceedings on 29 November 2006, as his belief that the stay of orders was in place was apparently shared by the Applicant’s lawyers in that period. The Supreme Court proceedings were determined on 29 November 2006 against the Respondents. It is reasonable to expect that the Respondents would then have considered the Court orders to be in effect. If there was any doubt that should have been dispelled by the proceedings before the Court on 8 December 2006 to the effect that the final order had already been made.

61 The Fourth Respondent also stated that he considered further orders from this Court were necessary before compliance would be required with the orders already made, also an erroneous assumption. He does not give any explanation for why that was his assumption. I consider the Second and Fourth Respondents should have been aware of the need to comply with Court orders after the Court mention on 8 December 2007 before Talbot J.

62 The Fourth and Second Respondents also relied on the fact that they were not legally represented from March 2006 until March 2007. They could have sought legal advice at any stage given that lawyers acted for them throughout the proceedings before Cowdroy J. Not having legal advice on its own is not a reason why contempt orders should not be made. I also do not give any weight to the evidence of the Fourth Respondent of what he was told by unidentified persons in the Court Registry, namely that the final orders awaited the outcome of Supreme Court proceedings. The information was said to come from an unidentified person, cannot be relied on as a statement of the correct legal position in relation to the orders and the statements allegedly told to the Fourth Respondent do not appear on the Court file’s cover.

63 The Respondents’ counsel argued that there was failure on the part of the Applicants in failing to communicate a requirement for compliance for nine months before commencing these contempt proceedings. Given that it was in the Respondents’ interests to have further consent orders made extending the time for compliance, I do not accept that submission. Compliance with Court orders is expected as an essential part of the administration of justice, the obligation to comply occurs regardless of other parties’ lack of enforcement action.

64 The issue arises of whether the contempt is wilful or contumacious. While I have indicated that the Respondents should have been aware since 8 December 2006 of the need to comply with Court orders, I accept on the Second and Fourth Respondents’ affidavit evidence that they have not deliberately defied the Court’s orders. I note their affidavit evidence that they would have taken steps to stop use of the spray booth if they had been aware the activity in the spray booth was unlawful. I give the benefit of the doubt to the Fourth (and First) Respondent as he does not state in his affidavit that he would have caused the reinstatement of common property as is required by Order 3 of Cowdroy J. I do not find there is contumacious contempt as identified in Witham v Holloway and Pelechovski. I consider the contempt proved of the Second and Fourth Respondents is wilful as identified in Mudginberri as it is not casual, accidental or unintentional. I make the same finding in relation to the First Respondent.

65 The Applicant is successful in obtaining a finding in relation to contempt and seeks costs of this motion. A declaration that the Respondents are in contempt is also sought. These matters can be considered at the time that sentence is handed down. The Respondents’ counsel has indicated that he wishes to put forward matters in relation to sentence if a finding of contempt is made. I have stated in par 47 above that punishment by way of imposition of a fine under Pt 55 is available to the Court to consider in this regard. I will stand the matter over for a short period to enable a hearing on sentence.