Pascoe v Smirneos and Ors (No.2)
[2012] FMCA 462
•21 May 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| PASCOE v SMIRNEOS & ORS (No.2) | [2012] FMCA 462 |
| BANKRUPTCY – Practice and procedure – trustee’s writ for possession in aid of trustees for sale of property of bankrupt – writ executed by Sheriff – previous occupiers resuming occupation without authority – writ of restitution ordered. |
| Federal Magistrates Court Rules 2001 (Cth), r.29.07 Uniform Civil Procedure Rules 2005 (NSW), r.39.1(1)(g) |
| Maher v Commonwealth Bank of Australia (No.2) (2004) 211 ALR 656, [2004] FCA 1398 Pascoe v Smirneos & Ors [2010] FMCA 404 Perpetual Limited v Kelso & Anor [2008] NSWSC 906 |
| Ritchie’s Uniform Civil Procedure NSW, LexisNexis Butterworths, Sydney |
| Applicant: | SCOTT DARREN PASCOE, IN HIS CAPACITY AS TRUSTEE |
| First Respondent: | HELEN SMIRNEOS, A BANKRUPT |
| Second Respondent: | ANDREW SMIRNEOS |
| Third Respondent: | GEOFFREY REIDY, IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF PETER SMIRNEOS, A BANKRUPT |
| Fourth Respondent: | WESTPAC BANKING CORPORATION ABN 33 007 457 141 |
| Fifth Respondent: | NATIONAL LENDING PTY LIMITED ACN 119 336 631 |
| Sixth Respondent: | STEVE SMIRNEOS |
| Seventh Respondent: | PETER SMIRNEOS |
| Eighth Respondent: | BARBARA SMIRNEOS |
| File Number: | SYG 346 of 2010 |
| Judgment of: | Smith FM |
| Hearing date: | 21 May 2012 |
| Delivered at: | Sydney |
| Delivered on: | 21 May 2012 |
REPRESENTATION
| Counsel for the Applicant: | Mr B Skinner |
| Solicitors for the Applicant: | Kemp Strang |
| Counsel for the First and Second Respondents: | Mr P Beazley |
| Solicitors for the First and Second Respondents: | Beazley Singleton |
| Counsel for the Third Respondent: | No appearance by or on behalf of the Third Respondent |
| Counsel for the Fourth Respondent: | No appearance by or on behalf of the Fourth Respondent |
| Counsel for the Fifth Respondent: | Mr D Tucker |
| Solicitors for the Fifth Respondent: | Tucker & Cowen |
| Counsel for the Sixth, Seventh and Eighth Respondents: | No appearance by or on behalf of the Sixth, Seventh and Eighth Respondents |
ORDERS
The Applicant has leave for the issue of a Writ of Restitution to restore possession of the land comprised in Certificate of Title Folio Identifier 12/5/2166 being the land situated at and known as 124 Tennyson Road, Gladesville in the State of New South Wales (Property), to the Applicant and Mark Robinson, in their capacity as trustees for the sale of the Property.
The applicant has leave to issue that writ forthwith in terms of Form 62 approved for the purposes of the Uniform Civil Procedure Rules of NSW with such amendments as may appear necessary to a Registrar.
Orders 4 and 5 sought in the application in a case filed on 7 May 2012 are refused, without prejudice to any party who may wish to seek those orders in a later interim or other application to this Court or another Court.
The costs and expenses of the Applicant in relation to the application in a case are reserved, with liberty to apply.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 346 of 2010
| SCOTT DARREN PASCOE, IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF HELEN SMIRNEOS, A BANKRUPT |
Applicant
And
| HELEN SMIRNEOS, A BANKRUPT |
First Respondent
| ANDREW SMIRNEOS |
Second Respondent
| GEOFFREY REIDY, IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF PETER SMIRNEOS, A BANKRUPT |
Third Respondent
| WESTPAC BANKING CORPORATION ABN 33 007 457 141 |
Fourth Respondent
| NATIONAL LENDING PTY LIMITED ACN 119 336 631 |
Fifth Respondent
| STEVE SMIRNEOS |
Sixth Respondent
| PETER SMIRNEOS |
Seventh Respondent
| BARBARA SMIRNEOS |
Eighth Respondent
REASONS FOR JUDGMENT
(revised from transcript)
This is a matter in which the jurisdiction of the Bankruptcy Court was invoked by Mr Pascoe in 2010 in his capacity as trustee in bankruptcy of the property of Mrs Helen Smirneos. He sought orders for the appointment of trustees for sale of a property owned by him in that capacity with Mr Andrew Smirneos as joint owner, and for vacant possession to effect a sale. A creditor both of Mrs Smirneos’ estate and of Mr Smirneos, National Lending Pty Limited (“National Lending”), supported Mr Pascoe’s application, as a result of difficulties it had encountered in executing on a judgment they had against Mr Smirneos. Ultimately, I made orders on 7 June 2010, the terms and reasons for which can be found in Pascoe v Smirneos & Ors [2010] FMCA 404.
In short, I appointed Mr Pascoe and a colleague as trustees for sale on trusts in terms analogous to those found under the NSW Conveyancing Act, and gave directions as to a sale and the distribution of the net proceeds. My orders included a liberty to apply given to the trustees, the parties to the proceedings, and any person or persons claiming an interest in funds which I directed to be paid into Court. The liberty to apply did not imply an invitation to re‑litigate issues which were decided on a final basis by my judgment. No appeal was brought from my judgment.
My orders included an order that Mr and Mrs Smirneos and any occupants of the property should vacate the property within seven days, and allowed the issue of a writ of possession if this did not occur. The orders were entered, and subsequently a writ of possession was issued by a Registrar of the Court on 27 July 2010.
The Sheriff gave notice of an intention to execute, and this prompted an application by Mr and Mrs Smirneos as well as their sons, Steve and Peter, and Peter’s wife, Barbara, to stay the writ of possession. I gave a short interim stay on 19 August 2010, and on 23 August 2010 all those members of the Smirneos family appeared before me by way of a solicitor, Mr Beazley. Steve, Peter and Barbara were joined as the sixth, seventh and eighth respondents by consent. My previous order for possession was vacated, and in substitution thereof, I ordered by consent:
3.Order that the First, Second, Sixth, Seventh and Eighth Respondents and any occupants of the whole of the land comprised in Folio identifier 12/5/2166, known as 124 Tennyson Rd, Gladesville, in the State of New South Wales (“the Property”), vacate the Property on or before 9.00am on 10 September 2010.
I also ordered by consent that execution of the writ of possession which had already issued be stayed until 9 am on 10 September 2010. The Court noted the agreement of all members of the Smirneos family that meanwhile they would allow access to the premises by the trustees’ agents to prepare the property for sale, and their agreement to “vacate the Property during the times requested by the Trustee so as to enable the Trustees to open the Property for inspection”.
However, they did not vacate the premises, and it became necessary for the trustees again to instruct the Sheriff to execute the writ of possession. After the Sheriff gave a new notice to quit, a second urgent application for stay was made to me ex parte on 30 November 2010 by a solicitor, Mr Astar, acting for Mr Andrew Smirneos alone. I gave a short stay. On the return date of his application on 2 December 2010, I gave a further stay until 4pm on 18 January 2011. As I recall, I indicated that I was prepared to give the further stay, only because it was consented to by Mr Pascoe, and because further undertakings were given to vacate the property.
However, the property was again not vacated, and the Sheriff served a new notice of an intention to execute the writ on 24 February 2011. He did so on that date in the late morning, and gave possession to the trustees for sale.
Later on the afternoon of 24 February 2011, Andrew, Helen, Peter and Steve Smirneos appeared in front of me in person ex parte and without legal representatives, seeking further relief in relation to the writ of possession. They submitted an affidavit prepared with the assistance of another solicitor, Julie A Orsini. I declined to make any order interfering with the actions of the Sheriff, whether in the past or in the future if there were anything remaining to be performed, and adjourned the matter to the following day so that I could receive submissions from the trustees. However, there was no appearance by or on behalf of any member of the Smirneos family on 25 February 2011, and I dismissed their interim application in the absence of any person seeking further orders.
The matter then did not return to my list until today, when Mr Pascoe’s present application was referred to me by a Registrar in the course of my bankruptcy duty list.
His evidence shows that in February 2011 the trustees for sale received possession from the Sheriff, and their agents changed the locks and commenced to take steps to sell the property by way of auction and private negotiations. Their efforts were protracted by difficulties attracting and negotiating offers, and by the need to obtain valuations and expert advice about council notices. Their efforts have also in recent months become frustrated by the actions of Mr and Mrs Smirneos when resuming their occupation of the premises and being present during sales inspections, despite repeated requests that they vacate the property and remove their goods and chattels.
Mr Pascoe today moves on an interim application filed in the 2010 proceeding. It does not name all the Smirneos respondents who were joined to that proceeding, but nothing turns on this, as I shall explain. It seeks relief by way of orders for a “Writ of Restitution”, to allow the trustees for sale to regain vacant possession of the premises and to proceed with their efforts to sell the property.
Mr Pascoe also seeks other ancillary orders, attempting to deal with a dispute with National Lending in relation to the distribution of the net proceeds for sale, which may or may not raise issues arising under my liberty to apply. In addition, Mr Pascoe also seeks an order that the trustees for sale would be justified in disposing of chattels remaining on the property, on the basis that they have been effectively abandoned by Mr and Mrs Smirneos.
Mr Pascoe’s affidavit recounts the history of the matter, and the frustration of the trustees for sale’s efforts to sell the property with vacant possession, as a result of the unauthorised re‑occupation of the property by Helen Smirneos and Andrew Smirneos. There is evidence that they, and Mr Beazley as their solicitor, have been given notice that they should vacate the premises in correspondence sent to them in late last year and also this year. Today, they have been represented by a solicitor, Mr Beazley, who does not contest that they have resumed occupation of the premises without a Court order, and without the consents of the trustees for sale or of Mr Pascoe in his capacity as trustee of Mrs Smirneos’ bankrupt estate. Mr Beazley has not attempted to justify their actions by reference to any right of occupation asserted by them. His clients are present in Court. He informs me that Steve Smirneos, who apparently is outside the Court today, does not claim any right of occupation, and he also informs the Court that neither Peter nor Barbara Smirneos are in occupation, and that they do not currently claim any right of occupation.
Mr Beazley did not attempt to make any submissions opposing the right of Mr Pascoe to obtain a writ of restitution today. However, he sought an adjournment of the application, or a stay on the issue of such a writ, based on an affidavit he has filed. In this, he states that he is currently representing Mr Andrew Smirneos and Mrs Helen Smirneos in proceedings No.2011/172997 in the Supreme Court of New South Wales against Westpac Banking Corporation (“Westpac”), concerning the indebtedness of Andrew Smirneos to Westpac for which they claim security over the property. Westpac’s status as a potential secured creditor was recognised in the principal proceedings before me, and my orders made on 7 June 2010 recognised this status in my directions to the trustees for sale as to the distribution of proceeds of sale. Westpac was a party to those orders.
The Supreme Court litigation with Westpac appears to have been commenced after I made those orders, and after the matter last was in my lists on 25 February 2011. I do, however, have a vague recollection of being shown in the course of the previous listings at least one piece of correspondence from Mr Beazley asserting claims against Westpac. However, they had not been presented to me in opposition to my orders appointing trustees for sale and ordering vacant possession.
On the skimpy evidence before me today, the current status and merits of the Supreme Court proceedings are completely obscure. Mr Beazley frankly accepted that the litigation did not provide any reason for my now interfering with my previous appointment of trustees for sale and the directions I gave in 2010, nor justify Mr and Mrs Smirneos in their repossession of the property. Westpac itself has not appeared today, and it is unclear to me whether it has been formally served with today’s application.
Authorities concerning the writ of restitution explain that it is a writ recognised under the Uniform Civil Procedure Rules 2005 (NSW), as a “writ in aid of another writ of execution” within r.39.1(1)(g). The form of the writ and the basis for applying for it are indicated in forms 61 and 62 under those Rules. As the notes to the Rules in Ritchie’s Uniform Civil Procedure NSW suggest:
[39.1.35] Writs in aid of another writ of execution
Writ of restitution. Where, after entry of the sheriff under a writ of possession, or after the plaintiff has been put in possession by the sheriff, the defendant forcibly or by stratagem resumes possession of the property, the plaintiff may have a writ of restitution: Pitcher v Roe (1841) 9 Dowl 971. This is the normal procedure and not an application to commit for contempt: Alliance Building Society v Austen [1951] 2 All ER 1068. Application may be made ex parte. Similarly, where a plaintiff has entered under judgment which has been set aside the defendant may apply to set aside the writ of possession and ordering the plaintiff to vacate with leave then (or subsequently on ex parte application) to issue a writ of restitution: see cases cited in Halsbury’s Laws of England, 3rd ed, vol 16, para 104(n). Similarly, where possession has been wrongfully obtained — either under an irregular writ of possession, or in excess of the terms of the writ of possession (ibid).
The nature of the writ was discussed by Finkelstein J in Maher v Commonwealth Bank of Australia (No 2) (2004) 211 ALR 656, [2004] FCA 1398, in which his Honour pointed out that procedures in Victoria no longer make provision for a separate writ for possession. However, as I have noted, the New South Wales procedures recognise the separate and ancillary writ, and these procedures are to be applied in this Court in relation to orders enforceable in NSW (see Federal Magistrates Court Rules 2001 (Cth), r.29.07).
The writ was also described by Johnson J in Perpetual Limited v Kelso & Anor [2008] NSWSC 906 in the following terms:
19It is appropriate that I refer briefly to certain legal issues. The writ of restitution is a recognised procedure where, after entry by the Sheriff under a writ of possession, a defendant forcibly resumes possession of the subject land and the plaintiff seeks to have possession restored. It is a writ in aid of another writ of execution: r.39.1(1)(g), Forms 61, 62, Uniform Civil Procedure Rules: Ritchie’s Uniform Civil Procedure NSW, LexisNexis at [39.1.35]; Pitcher v Roe (1841) 9 Dowl 971; Alliance Building Society v Austen [1951] 2 All ER 1068.
20The use of a writ of restitution has been acknowledged in later cases. In Abram v National Australia Bank Ltd (Court of Appeal, 1 May 1997, BC9701553) Powell JA, at pages 54‑55, observed that re‑entry by a defendant, after the execution of a writ of possession by the Sheriff, constitutes a trespass with the plaintiffs’ remedy being an application for an order in the nature of a writ of restitution. Powell JA cited, in this respect, Pitcher v Roe and Alliance Building Society v Austen.
21In Maher v Commonwealth Bank of Australia (No 2) [2004] FCA 1398; (2004) 211 ALR 656 at 658 [6], Finkelstein J observed that there are cases where a defendant has retaken possession within a short period after possession has been taken where the Court would, upon application, issue a writ of restitution. His Honour cited Pitcher v Roe, Alliance Building Society v Austen and R v Elliott [1955] VLR 126.
His Honour was dealing in that case with an application by persons who had been obliged by default order to give vacant possession pursuant to the terms of a security, and had taken the law into their own hands by moving back after eviction by the Sheriff. His Honour noted that, in relation to their challenge to “the propriety of any conduct of the Plaintiff in respect of the enforcement of its security, it remains open to them to do so in other proceedings”. His Honour thereby, in my opinion, indicated that an application for a writ of restitution is focussed on enforcing the previous order for a writ of possession, and does not open up at large all the disputes between the unauthorised occupier and the beneficiary of the previous writ of possession.
In the present case, I am satisfied that Mr Pascoe has clearly established an entitlement to a writ of restitution in aid of his previously obtained writ of possession. His right to the writ is not opposed, and I consider that it is appropriate to recognise that right by immediately ordering the issue of a writ of restitution by the Registrar and its unhampered execution by the Sheriff. I consider that the need to uphold the authority of the Court and of its processes provides overwhelming justification for so ordering.
Taking into account the conduct of the Smirneos family reflected in the history recounted above, including their previous acceptance of the orders requiring them to vacate the premises, it appears to me that they might face applications for more drastic orders against them to enforce the Court’s orders, if in the future they continue to defy the orders of the Court. Nothing in my present judgment should foreclose the Court’s powers in that respect, which have not been invoked in the present matter.
I do not consider that their pending litigation with Westpac provides any reason for my withholding or staying a writ of restitution. If they have any basis for seeking to freeze monies which would otherwise be distributed to Westpac after the sale of the property by the trustees for sale, then this is a matter which they could pursue in other proceedings. Although it was not a matter for argument before me today, such relief by way of interim injunctions directed at Westpac might be available in the current Supreme Court proceedings, where the merits of the claims of Andrew Smirneos against Westpac might best be assessed. Alternatively, they might be able to seek further directions in relation to the trustees for sale in fresh proceedings commenced either in the Supreme Court or this Court.
In the course of today’s proceedings reference was made to a potential future dispute between the trustees for sale and National Lending, as to the extent to which Mr Pascoe’s overlapping costs in his two capacities should be accounted for as priority expenses of the trust for sale. However, I consider that it is premature to address this dispute in the present interim application. I consider that it would be better left until after the property has been sold, and when the final accounts of the trust for sale are being prepared, and distributions are being contemplated. I would hope that the parties would then be able to reach agreement as to those issues, without incurring the expense of more litigation. Particularly, since the actions of the Smirneos family since my orders on 7 June 2010 must already have considerably added to the expenses recoverable in priority over all other claimants, and since a sale has yet to occur.
I therefore would refuse the relief sought in paragraph 4 of the present interim application, but without prejudice to any future applications that might be brought concerning the same issue.
I consider a similar approach should be taken today to paragraph 5 of Mr Pascoe’s present application, concerning disposal of the chattels left on the property by Mr and Mrs Smirneos. This is appropriate, if only because I do not have time today to address the issues involved. Moreover, it appears to me that the trustees for sale should consider their rights under the relevant State legislation in relation to abandoned property. Prima facie, on the correspondence which is before me, and without having heard the parties, Helen and Andrew Smirneos appear to have been given more than enough notice that they should remove their chattels or face arbitrary disposal by the trustees.
For all the above reasons, I make the orders set out at the commencement of this judgment.
I certify that the preceding twenty-six (26) paragraphs are a true copy of the reasons for judgment of Smith FM
Date: 8 June 2012
0
3
0