Permanent Custodians Ltd v Kirk - [2007] SASC 404

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
PERMANENT CUSTODIANS LTD v KIRK & ANOR
[2007] SASC 404
Reasons of Judge Lunn a Master of the Supreme Court
19 November 2007
PROCEDURE
Summons under Part XVII of the Real Property Act for possession of land - held impermissible to seek summary judgment under 6R 232 in the action to circumvent requirement in s 193 of the Act that the summons was not be returnable for 16 days after its service - s 55A Notice not served in accordance with s 112 of the Law of Property Act - action summarily dismissed - several procedural irregularities - solicitors for plaintiff to show cause why they should recover any costs for the action from the plaintiff.

PERMANENT CUSTODIANS LTD v KIRK & ANOR
[2007] SASC 404

JUDGE LUNN: Regrettably these reasons record a disregard by solicitors of the Rules and the Practice Directions which the Court does not wish to see repeated.
On 2 November 2005 the defendants executed a mortgage over their property at Aldinga Beach to secure a loan of $269,900 made to them by the plaintiff. On 14 May 2007 Queensland solicitors acting for the plaintiff posted to the defendants a default notice demanding payment within one month of arrears of principal and interest and recoverable expenses totalling $3,623.73 (“the Notice”).
On 10 October 2007 the plaintiff by its Adelaide solicitors instituted this action by issuing a summons under Part XVII of the Real Property Act 1886 (“the RPA”) against the defendants seeking an order for the possession of the subject property. The summons was in accordance with Form 5 in Part 2 of the Supreme Court Practice Directions 2006, which is only to be used for claims under Part XVII of the RPA. At the same time an affidavit of Graham Roberts, the Queensland solicitor for the plaintiff, was filed deposing to the grounds for the claim to possession.
At the time of issuing the summons the plaintiff’s solicitors requested the Registry not to insert in the summons a return date for its hearing which would have been the usual and proper practice. Instead, the plaintiff’s solicitors issued an interlocutory application under 6R 232 seeking summary judgment for possession against the defendants. They requested that this application be made specially returnable for no later than 17 October 2007. When this request was referred to me I gave a return date for 16 October as I was mystified by the procedures which the plaintiff’s solicitors were employing.
The summons and the application were served on the defendants on Sunday 14 October. They attended in person on the return of the application on 16 October.
At the outset of the hearing on 16 October I asked the solicitor for the plaintiff (whose name appeared on the front sheets of the filed documents as the person who had settled them) to explain how the procedures which had been invoked were justified by the Rules of Court. He made no attempt to justify by reference to the RPA and the Rules, or otherwise, what he had done. He merely said that “he was acting on instructions”. This was not a satisfactory reply. While solicitors are free to employ novel and adventurous procedures they have to be ready to put forward some reasonable argument in support of what they have done when the matter comes before the Court.
It is not permissible for a plaintiff to bring an application for summary judgment under 6R 232 in proceedings under Part XVII of the RPA. I cannot find any authority for this proposition, but it is probably because it is so trite. Part XVII is a special statutory procedure to enable the equivalent of summary judgment to be obtained on claims for possession of RPA land where the defendant cannot show any reasonable ground to defend the claim. It is pointless and mischievous to invoke 6R 232 in proceedings under Part XVII to duplicate what is the procedural effect of Part XVII.
S 193 of the RPA, which is within Part XVII states, states:
The summons shall contain a description of the land, and shall require the person summoned to appear before the Court on a day not earlier than sixteen days after the service of the summons.
It is a peculiarity of summonses under Part XVII that by virtue of the statute their first hearing date cannot be earlier than 16 days after their service. If plaintiffs proceed under Part XVII, they cannot circumvent this restriction by seeking to have a summary judgment application made returnable for less than 16 days after the service of the summons. When I inquired of the plaintiff’s solicitor as to why he had requested that the summons be made returnable before 17 October he replied that the plaintiff wanted the matter dealt with quickly. I am sure the plaintiff does want the matter dealt with quickly, but so do most other plaintiffs in proceedings under Part XVII. If the plaintiff had not employed Part XVII, and had issued a summons and statement of claim for possession in the ordinary civil jurisdiction of the Court, any application for summary judgment in that action under 6R 232 would not have been made specially returnable and would have been dealt with in the ordinary course of the Masters’ Chamber lists, albeit substantially more than 16 days after service. The plaintiff here has attempted to misuse the procedures of the Court to obtain a priority in listing for itself over other plaintiffs to which it is not entitled.
This Court does not expect solicitors to request special and early hearings for applications unless they have properly arguable grounds to gain such priority over other litigants. It is a waste of the judicial resources of this Court to have to process spurious requests. Here nothing was put in the supporting affidavit, or to me at the hearing, to justify this plaintiff receiving a hearing of this summons other than in the ordinary course of the Court’s conduct of its business. Unjustified attempts at queue-jumping will not be countenanced by this Court.
In the course of considering this matter it has become clear that there is one fatal defect which means that the summons cannot succeed. The plaintiff’s solicitor conceded that s 55A of the Law of Property Act applied, but he submitted that the Notice was sufficient compliance with s 55A, even though it did not expressly refer to that section. Even if the Notice complies with s 55A, it has not been shown to have been effectively served. S 112 of the Law of Property Act requires that service by post be by registered post, and then it is only good service if the letter is not returned undelivered. Here the supporting affidavit merely says that the Notice was served in accordance with the terms of the mortgage. It makes no reference to registered post or to the letter not being returned. A letter accompanying the Notice from the plaintiff’s Queensland solicitors was endorsed “BY PRE PAID ORDINARY POST”. Proper service of the s 55A Notice has not been proved. Its proper service prior to the institution of the proceedings is a necessary pre-requisite to any order for possession being made. As this is a summary action I summarily dismiss it.
Paragraph 1.4 of the plaintiff’s interlocutory application sought an order:
1.4That, insofar as is necessary, the Plaintiff be granted dispensation from the requirements of s 55A of the Law of Property Act 1936 SA.
Nothing was said in the supporting affidavit about this paragraph of the application. Although it is common practice, it is not sufficient merely to include a request for dispensation without either in the application or the supporting affidavit specifying, and acknowledging, the default and giving a satisfactory explanation for it which would justify a dispensation being granted. S 55A is primarily for the benefit of mortgagors and not of mortgagees: Cooperative Building Society v Plane (1993) 170 LSJS 457 at 471. A professional lender such as the plaintiff, properly advised, should have been aware of the requirements of the Law of Property Act for service of the s 55A Notice and must take the consequences of non-compliance unless a proper explanation of the breach is put forward at the time the application for dispensation is sought. No dispensation is to be granted.
There were also a number of other elementary procedural errors by the plaintiff which does not encourage me to extend any indulgence to it. As I pointed out to the plaintiff’s solicitor at the hearing these were:
·A statement of claim was annexed to the summons. This is not required for a Form 5. The plaintiff’s solicitor’s explanation that it was to give the full version of the facts was nonsense as it contains nothing other than a cross-reference to the supporting affidavit and a statement of the orders sought.
·The supporting affidavit was in breach of Practice Direction 4.1.4 in that it was not sworn by a person who could swear to the facts of his/her own knowledge. The last paragraph of the affidavit sought “the leave of the Court pursuant to Rule 204 ….. to adduce as evidence on behalf of the plaintiff”. Rule 204 says nothing about evidence on affidavit. Rule 162(2) confines affidavits to matters of the deponent’s own knowledge. The exception to that rule for interlocutory proceedings does not apply here as the proceedings are seeking final, and not interlocutory, relief. In any event, no proper basis was outlined in the affidavit as to why some appropriate deponent could not swear of his/her own knowledge to the defendants’ current indebtedness to the plaintiff.
·Contrary to Practice Direction 4.1.4 there is no statement on whether the provisions of the Consumer Credit Code apply or not.
·Under 6R 133(3) the defendants were entitled to at least 2 clear business days’ notice of the hearing, which they were not given. They attended at some obvious inconvenience to themselves.
For the reasons set out above, there have been numerous and substantial procedural irregularities in the plaintiff’s conduct of this action. I intend to consider what orders should be made under 6R 13 on whether the plaintiff’s solicitors should be entitled to recover any costs for this action from the plaintiff. As I did not raise this matter with the plaintiff’s solicitor at the hearing, I will give the plaintiff’s solicitors the opportunity to be heard on the point if they so wish. If each of the plaintiff’s Adelaide and Queensland solicitors file an undertaking signed by a director/partner of the firm that they will not charge any costs or disbursements for this action against the plaintiff, I will not take the point further. If such undertakings are not filed by 6 December 2007, I will hold a further hearing on the point on 17 December 2007 at 9.15 am.
I have today made the following orders:
1Application FDN 2 dismissed.
2Action summarily dismissed.
3Plaintiff to pay to the defendants their costs of the action.
I invite the defendants to send a letter to me outlining their loss of income and travelling expenses for having to attend at Court on 16 October and any other expenses they have incurred as a result of this action. If they do this, I will consider making an order for a lump sum for the costs payable by the plaintiff to them.