Prime Capital Securities Pty Ltd v Hunter - [2024] WASC 159

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   PRIME CAPITAL SECURITIES PTY LTD -v- HUNTER [2024] WASC 159
CORAM:   MASTER RUSSELL
HEARD:   2 MAY 2024
DELIVERED          :   3 MAY 2024
FILE NO/S:   CIV 1657 of 2023
BETWEEN:   PRIME CAPITAL SECURITIES PTY LTD
Plaintiff
AND
COLIN ALEXANDER HUNTER
First Defendant
MARGARET JANE HUNTER
Second Defendant

Catchwords:

Practice and procedure - Application to set aside judgment - Judgment entered by consent where defendant self-represented - O 42 r 8 of the Rules of the Supreme Court 1971 (WA) - Whether entry of judgment by consent where self-represented defendants did not attend before a judge to give consent a procedural irregularity which may be regularised under O 2 r 1 of the Rules of the Supreme Court 1971 (WA)

Legislation:

Rules of the Supreme Court 1971 (WA) O 2 r 1, O 42 r 8, O 43, r 16

Result:

Application granted

Judgment entered by consent by self-represented defendants set aside

Category: B

Representation:

Counsel:

Plaintiff	:	Mr C Breheny
First Defendant	:	Mr D J Pratt
Second Defendant	:	Mr D J Pratt

Solicitors:

Plaintiff	:	Kennedy Vinciullo
First Defendant	:	Kean Legal Barristers & Solicitors
Second Defendant	:	Kean Legal Barristers & Solicitors

Cases referred to in decision:

Deveigne & Anor v Askar [2007] NSWCA 45
Doyle v The Commonwealth (1985) 156 CLR 510
East Metropolitan Regional Council v Four Seasons Construction Pty Ltd [2000] WASC 178; (2000) 22 WAR 37
Melglow Pty Ltd v Ballygrowman Pty Ltd [2016] WASC 383
Newcrest Mining Ltd v Thornton (2012) 248 CLR 555
Pilbara Infrastructure Pty Ltd v BGC Contracting Pty Ltd [2007] WASCA 257
R v S [2009] WASCA 11
Re Hoffman [2004] WASCA 238
Sonnet Holdings Pty Ltd v Dunn [2012] WADC 11
Strachan v The Gleaner Co Ltd [2005] UKPC 33; [2005] 1 WLR 3204
Tuff Trade Pty Ltd v Canningvale Properties (WA) (in liq) [2018] WASC 362

MASTER RUSSELL:

Introduction

The defendants, Colin Alexander Hunter and Margaret Jane Hunter, are the registered proprietors of 15B George Street, North Beach in Western Australia being Lot 2 on Strata Plan 28093 within Certificate of Title Volume 2030 Folio 169 (Property).
On 21 June 2023, the plaintiff, Prime Capital Securities Pty Ltd, issued these proceedings against the defendants seeking to enforce the terms of a guarantee and indemnity and a mortgage granted over the Property as security for a loan advanced to Nev.Trs Pty Ltd (Nev.Trs) on or about 28 January 2022.
A memorandum of appearance was filed for each of the defendants on 13 July 2023 through the court's electronic case management system (ECMS). Though the memorandum filed in each case says that the party is represented by a solicitor, they were not represented in the proceeding until 25 January 2024.
A statement of claim was filed on 9 August 2023. The plaintiff filed an application for summary judgment for possession of the Property on 14 August 2023. The summary judgment application was listed for hearing on 31 January 2023 but was vacated by consent orders made on 2 November 2023.
On 5 January 2024, the following orders were made pursuant to O 43 r 16 of the Rules of the Supreme Court 1971 (WA) (RSC) by the consent of the parties as recorded in a memorandum of consent orders filed on 21 December 2023:
1.Judgment be entered for the plaintiff.
2.The defendants give vacant possession of all that piece of land being Lot 2 on Strata Plan 28093 and being the whole of the land comprised in Certificate of Title Volume 2030 Folio 169 situate at and known as 15B George Street, North Beach, Western Australia, to the plaintiff.
3.There be leave to issue a Writ of Possession forthwith.
4.The defendants pay the plaintiff's costs on an indemnity basis.
The memorandum of consent orders was signed by the solicitors for the plaintiff and by each of the defendants in person.
By notice of motion filed on 25 January 2024, the defendants apply to set aside the judgment entered on 5 January 2024 pursuant to RSC O 2 r 1(2), RSC O 46 r 8, or the court's inherent jurisdiction (Application). They also sought orders staying or suspending enforcement of the judgment pending determination of the Application.
On 30 January 2024, orders were made pursuant to s 15 of the Civil Judgments Enforcement Act 2004 (WA) suspending the judgment pending the hearing of the Application and for the filing and service of affidavits and submissions.
When this matter came to my attention as a matter in the Master's List in March 2024, I called the matter on for hearing. I indicated to the parties that, subject to hearing from them, my preliminary view was that the judgment should be set aside because it had been entered by consent contrary to RSC O 42 r 8, in the absence of the self-represented defendants attending before a judge to give their consent in person. After hearing from the parties at a hearing in the Master's List on 12 March 2024, it was resolved that the parties would have further time and the opportunity to be heard at the special appointment already fixed to hear the Application on 2 May 2024.
Having considered the affidavits and submissions filed and having heard from counsel for each of the parties, I am satisfied that the orders made on 5 January 2024 were made contrary to the express rule in RSC O 42 r 8, and the judgment was entered irregularly. The defendants were, at that time, self-represented. Order 42 r 8 does not permit judgment to be entered by consent against an unrepresented defendant unless the defendant attends before a judge and gives their consent to judgment in person. The defendants did not do so.
For the reasons that follow, the judgment and orders made on 5 January 2024 should be set aside.

The evidence and submissions

The defendants rely on affidavits sworn by each of them on 23 January 2024. The second defendant, Margaret Hunter, refers in her affidavit to that sworn by the first defendant, Colin Hunter, and deposes that she 'shares the same beliefs and contents' of his affidavit. The defendants also rely on a written outline of submissions filed on 10 April 2024.
The plaintiff relies on an affidavit of its sole director, Paul James Scanlon, sworn on 4 March 2024 in opposition to the Application. It also sought to read and rely on an affidavit of Colin Hunter sworn on 26 March 2024, to which no objection was taken on behalf of the defendants, and that was also read. The plaintiff also relies on an outline of written submissions filed on 30 April 2024.
I do not repeat all of the parties' submissions in these reasons, or the evidence relied upon. They are set out in the submissions and the affidavits, which I have given due consideration. What follows are summaries of the plaintiff's claim, the defendants' position, the basis upon which the Application is made, the plaintiff's position and its opposition to the Application.

The plaintiff's claim

In the statement of claim, the plaintiff claims that it advanced $710,000 to Nev.Trs on or about 28 January 2022 pursuant to an agreement titled Loan, Security and Guarantee Deed. The date of the Loan, Security and Guarantee Deed is not pleaded. A copy of it is attached to the affidavit of Colin Alexander Hunter sworn on 23 January 2024 (First Colin Hunter Affidavit),[1] and bears a handwritten date of 31 January 2022.[2]
[1] First Colin Hunter Affidavit CAH-3.
[2] First Colin Hunter Affidavit CAH-3, page 31.
In its written submissions, the plaintiff says that the Loan, Security and Guarantee Deed was executed on or about 19 November 2019 and that on about 28 January 2022 it advanced $670,841.58 for the benefit of the borrower, Nev.Trs.
The plaintiff claims that:
(a)under the terms of the Loan, Security and Guarantee Deed the defendants:
(i)guaranteed the obligations and performance of Nev.Trs to repay the loan; and
(ii)as security for the guarantees, the defendants granted a mortgage in favour of the plaintiff over the Property;
(b)pursuant to the mortgage, upon default by Nev.Trs under the Loan, Security and Guarantee Deed, it was entitled to take possession of the Property. The terms relied upon are pleaded in par 5 of the statement of claim, which included that:
(i)interest on the facility would be paid by monthly instalments on the first day of each month (cl 5.1 and cl 17.1);
(ii)an event of default includes a failure to pay monies due by the due date (cl 8); and
(iii)if any instalment of interest was not paid on the due date, the plaintiff may, by written notice, cancel the facility and demand repayment of the secured money (cl 9.2);
(c)Nev.Trs defaulted on its obligations by failing to pay interest and fees due to the plaintiff in January, February and March 2023;
(d)on 22 March 2023, the plaintiff:
(i)gave Nev.Trs and each of the guarantors, including the defendants, notice of the default and demanded immediate payment of $30,908.08 from them to remedy the default; and
(ii)gave notice to each of the guarantors, including the defendants, that it may commence proceedings if the default was not remedied, exercise its power of sale in respect of the Property or take other action under the mortgage.
The plaintiff claims the defendants did not remedy the default, and it has commenced this proceeding against the defendants to enforce the guarantees and to recover possession of the Property.

The defendants' position in relation to the plaintiff's claim

It is accepted on behalf of the defendants that they signed the Loan, Security and Guarantee Deed, that there is a registered mortgage in favour of the plaintiff and an amount owing to the plaintiff.
It is submitted on behalf of the defendants that they entered into the Loan, Security and Guarantee Deed in reliance on representations by their son, Nevil Robert Hunter, as surety for a loan to his company, Nev.Trs.
The first defendant, Colin Hunter, deposes that he and the second defendant signed the document on 19 November 2021. He says that he did so at the request of his son, Nevil Hunter, who drove him and the second defendant to the notary public, Seng Fai Chan's, office and waited outside in the car for them. Colin Hunter deposes that he did not read the documents, he just signed them and did not receive any legal or financial advice in relation to it.
Colin Hunter deposes that, in October 2023, Nevil asked the defendants to sign, and they signed, what they now believe to be the Deed of Settlement and Forbearance (Deed of Forbearance) in relation to this proceeding. A copy of the Deed of Forbearance signed by the defendants is attached to the First Colin Hunter Affidavit and includes as annexures two memoranda of consent orders. He says that he and the second defendant were only asked by Nevil to sign the last page of the Deed of Forbearance. They were not asked to, and did not, read it. They trusted Nevil and signed it. Nevil signed as witness to their signatures on the Deed of Forbearance.
Colin Hunter deposes that Nevil Hunter asked him and the second defendant to sign the memoranda of consent orders about a week later, which they did. One of the memoranda they signed was filed on 21 December 2023 consenting to judgment being entered for the plaintiff, the defendants giving the plaintiff possession of the Property and paying the plaintiff's costs on an indemnity basis. Judgment was entered by consent under O 43 r 16 in those terms on 5 January 2024.
Colin Hunter deposes that he not meet with or discuss the Deed of Forbearance or the consent orders with the plaintiff. They were not explained to him by the plaintiff or Nevil, he did not receive any legal advice about them and was not aware of the effect of them.
The defendants were not represented in the proceeding until 25 January 2024 when they made the Application after getting legal advice when they learned judgment had been entered against them and orders made for possession of the Property. Colin Hunter says that he liaised with Nevil and Irwin Legal from time to time to keep in the loop, but he did not receive any legal advice from them in relation to the Deed of Forbearance or the consent orders.
Colin Hunter deposes that if he had known he and the second defendant would have to give up possession of the Property, they would not have signed the consent order. He says that neither he nor the second defendant were asked to attend before the court to give their consent to the orders made on 5 January 2024. He says if they had, and the orders had been explained to them, they would not have given their consent.

The Application

Defendants' submissions

The substance of the submissions and the evidence of the defendants is that, at the time of executing the Loan, Security and Guarantee Deed and the mortgage, they were unaware of the surrounding circumstances and Nevil Hunter did not portray the true effect or potential consequences of the documents they signed. Colin Hunter deposes that he believes that their son mispresented or omitted information relating to the loan and documents signed.
It was submitted on behalf of the defendants that the orders entering judgment for the plaintiff should be set aside because they were irregularly entered. The defendants, who were self-represented at the time, were not required to and did not attend court, as required by RSC O 42 r 8, to give their consent in person for the purposes of verifying that it was a fully informed consent.
The defendants referred to and rely on Newcrest Mining Ltd v Thornton (2012) 248 CLR 555, in which French CJ referred to RSC O 42 relating to the entry of judgment by consent and, stated, in relation to RSC O 42 r 8:[3]
… Where a defendant is self-represented no such order shall be made unless the defendant appears before a judge and gives his consent in person or unless his written consent is attested by a solicitor acting on his behalf. Those rules are calculated to ensure that an informed consent is given by the defendant. They do not require any assessment by the court of the merits of the compromise underlying the order.
[3] Newcrest Mining Ltd v Thornton (2012) 248 CLR 555 [15] (French CJ).
The defendants say that the failure of the defendants to appear before a judge and give their consent to judgment in person, as required by RSC O 42 r 8, is not a procedural irregularity that gives rise to the court's discretion to validate or waive under RSC O 2 r 2(1). Rather, it was a breach of a substantive express rule that was a condition precedent to the exercise of the court's power to enter judgment by consent against an unrepresented defendant. As such, it must be set aside.
The defendants do not cavil with what is put against them in the plaintiff's submissions, which I will turn to shortly. That is that the failure to comply with RSC O 42 r 8 is an irregularity. The defendants do take issue with the plaintiff's suggestion that it is an irregularity that can be rectified or regularised if it can be done without injustice.
The defendants submit that not all irregularities can be regularised or waived under RSC O 2. Where, as in this case, it involves a breach of a substantive express rule O 2 cannot operate to regularise the non‑compliance with O 42 r 8. It is not an irregularity that can be ignored or waived.
Counsel for the defendants referred to a number of authorities in support of those submissions. I do not repeat them here. I consider them and those relied upon by the plaintiff later in these reasons.
It was also submitted on behalf of the defendants in their written submissions that, in addition to the judgment being irregularly entered in breach of an express rule for the reasons articulated, order 3 of the orders suffers the same fate and is of no effect. This is because it purports to give the plaintiff leave to issue a writ of possession forthwith where writs of possession were abolished in Western Australia on and from 1 May 2005 as a result of the enactment of s 7(1) of the Civil Judgments Enforcement Act 2004 (WA).

Plaintiff's submissions

The plaintiff accepts that RSC O 42 r 8 was not complied with. It submits, in effect, that such non‑compliance is an irregularity, which should be rectified as doing so presents no injustice to the defendants.
The plaintiff's counsel referred to and relied on Pilbara Infrastructure Pty Ltd v BGC Contracting Pty Ltd,[4] in which the Court of Appeal after considering the history and operation of RSC O 2 r 1, stated:
The court may exercise the discretionary powers conferred by O 2 r 1(2) of its own motion. See Slade LJ in Metroinvest at 522. Like all judicial discretions unconfined by any express conditions, the discretion should be exercised judicially and, adopting the language of Lord Denning in Harkness, any irregularity should be rectified so long as it can be done without injustice.
[4] Pilbara Infrastructure Pty Ltd v BGC Contracting Pty Ltd [2007] WASCA 257 [52].
The plaintiff accepted that, on the authorities referred to by the defendants, there are cases in which RSC O 2 will not apply and cannot be relied upon to regularise an irregularity in circumstances where the court is not seized of jurisdiction. The plaintiff says this is not one of those cases.
Counsel for the plaintiff submitted that the irregularity in this case, a failure to comply with O 42 r 8, squarely falls within the category of irregularity contemplated by O 2 r 1 that the court has a discretion to cure. He submitted it was a failure to comply with the requirements of a rule, not an irregularity arising from a lack of power or jurisdiction to make the order.
The plaintiff submitted that, based on the authorities referred to, it is the type of irregularity that may be regularised if it can be done without injustice. Counsel for the plaintiff submitted that setting aside the judgment would not present any injustice to the defendants. He submitted there is no dispute that the defendants executed the guarantee and mortgage, that there was a default and that there is an amount owing. The plaintiff says that as Nev.Trs remains in default, the plaintiff is entitled to rely on the guarantee, which includes the right to take possession of the Property. There is no defence and the defendants are 'ultimately doomed to fail'.
The plaintiff also seeks to rely upon the Deed of Forbearance executed by the defendants which it is submitted they did in full knowledge of these proceedings, and it would not be just to permit them to resile from the terms of that deed. The plaintiff pointed to the terms of the Deed of Forbearance as set out in paragraph 21 of its written submissions.
The plaintiff accepted that entry of the judgment in the absence of personal appearance by the defendants constitutes non‑compliance with RSC O 42 r 8. However, it says it is clear from the terms of the Deed of Forbearance that the defendants agreed that if the payments under it were not made to the plaintiff, they would be in default and, in those circumstances, consented to judgment being entered against them in these proceedings, and to an order in favour of the plaintiff for possession of the Property.
The plaintiff says that even if the consent orders are found to be invalid as a result of the operation of O 42 r 8, the Deed of Forbearance remains valid and the defendants are bound by its terms.
The plaintiff also submitted that the evidence filed by the defendants does not provide any basis upon which the Loan, Security and Guarantee Deed or the Deed of Forbearance might be vitiated. It says the defendants understood the nature and effect of the Loan, Security and Guarantee Deed and mortgage, and their obligations under them, and have acknowledged that.
Further, it says that any of the matters that may have occurred between Nevil Hunter and the defendants were not known to the plaintiff, is not the plaintiff's fault and does not relieve the defendants of their obligations to the plaintiff pursuant to those deeds, for the reasons outlined in the plaintiff's written submissions.

The plaintiffs say that, in the circumstances, setting aside the judgment and requiring the plaintiff to enforce the terms of the Deed of Forbearance works an injustice to the plaintiff, and the administration of justice. It acknowledged that interest is accruing on the debt but submitted that, if the judgment is set aside it will be delayed in enforcing its security and realising the amount owed. It says it will only serve to delay the inevitable for the defendants, who it submits have no defence to the plaintiff's claim.
Counsel for the plaintiff accepted that this is not an application for summary judgment, but said this informs the exercise of the court's discretion in considering whether the judgment should be regularised under RSC O 2 r 1. It says there is no injustice to the defendants in doing so and the Application should be dismissed.

Disposition

RSC O 2

RSC O 2 provides, relevantly:
1.Non-compliance with rules
(1)Where in beginning or purporting to begin any proceedings or at any stage in the course of or in connection with any proceedings, there has, by reason of anything done or left undone, been a failure to comply with the requirements of these rules, whether in respect of time, place, manner, form or content or in any other respect, the failure shall be treated as an irregularity and shall not nullify the proceedings, any step taken in the proceedings, or any document, judgment or order therein.
(2)Subject to subrule (3) the Court may, on the ground that there has been such a failure as is mentioned in subrule (1), and on such terms as to costs or otherwise as it thinks just, set aside either wholly or in part the proceedings in which the failure occurred, any step taken in those proceedings, or any document, judgment or order therein or exercise its powers under these rules to allow such amendments (if any) to be made and to make such order (if any) dealing with the proceedings generally as it thinks fit.
…
2. Application to set aside for irregularity
(1)An application to set aside for irregularity any proceedings, any step taken in any proceedings or any document, judgment or order therein shall not be allowed unless it is made within a reasonable time and before the party applying has taken any fresh step after becoming aware of the irregularity
(2)An application under this rule shall be made by summons or motion, as the case may require, and the grounds of objection must be stated in the summons or notice of motion.

O 42 r 8

RSC O 42 r 8 provides:
8. Entering judgment by consent where defendant has not appeared or is self‑represented
Where the defendant has not appeared or has appeared in person, no such order shall be made unless the defendant attends before a judge and gives his consent in person, or unless his written consent is attested by a solicitor acting on his behalf, except in cases where the defendant is a barrister, or solicitor.
The 'no such order' relates back to O 42 r 7. It is an order for entering judgment.

The authorities

Counsel for the defendants commenced by referring to a decision of Banks-Smith J in Melglow Pty Ltd v Ballygrowman Pty Ltd,[5] relating to the exercise of the remedial power under RSC O 2 where orders had been made by consent extending a caveat in an action brought by originating summons under s 138C of the Transfer of Land Act 1893 (WA) where the originating summons had not been validly issued. The proceeding had been begun by a corporation otherwise than by a solicitor contrary to RSC O 4 r 3.
[5] Melglow Pty Ltd v Ballygrowman Pty Ltd [2016] WASC 383.
Whilst MelglowPty Ltd v Ballygrowman Pty Ltd addresses different provisions of the RSC than that under consideration in this case, it is instructive. Banks‑Smith J considered the authorities, history and role of RSC O 2 as follows:[6]
[6] Melglow Pty Ltd v Ballygrowman Pty Ltd [2016] WASC 383 [31] ‑ [33].
Order 2 - history and role
31.The starting point is to recognise the significance of O 2 of the RSC.
32The rule provides (relevantly):
Non-compliance with Rules
(1)Where in beginning or purporting to begin any proceedings or at any stage in the course of or in connection with any proceedings, there has, by reason of anything done or left undone, been a failure to comply with the requirements of these rules, whether in respect of time, place, manner, form or content or in any other respect, the failure shall be treated as an irregularity and shall not nullify the proceedings, any step taken in the proceedings, or any document, judgment or order therein.
(2)Subject to subrule (3) the Court may, on the ground that there has been such a failure as is mentioned in subrule (1), and on such terms as to costs or otherwise as it thinks just, set aside either wholly or in part the proceedings in which the failure occurred, any step taken in those proceedings, or any document, judgment or order therein or exercise its powers under these rules to allow such amendments (if any) to be made and to make such order (if any) dealing with the proceedings generally as it thinks fit.
33.As summarised by the Court of Appeal in The Pilbara Infrastructure Pty Ltd v BGC Contracting Pty Ltd [2007] WASCA 257; (2007) 35 WAR 412 [48]:
This order was in the rules when they came into existence in 1971. The order is in the same terms as the English O 2 r 1, which was introduced into the English rules in 1964. According to Lord Denning in Harkness v Bell's Asbestos and Engineering Ltd [1967] 2 QB 729 at 735 - 736:
This new rule does away with the old distinction between nullities and irregularities. Every omission or mistake in practice or procedure is henceforward to be regarded as an irregularity which the court can and should rectify so long as it can do so without injustice.
Lord Denning said at page 734 that the new rule was enacted so as to 'get over the decision in Re Pritchard (Deceased) [1963] Ch 502 [1963] Ch 502. In Metroinvest Ansalt v Commercial Union Cumming-Bruce LJ said at 518:
It is quite clear from Harkness v Bell's Asbestos and Engineering Ltd … that the mischief at which the revision of the rules was aimed was to remove the distinction between irregular purported proceedings which were ab initio a nullity from irregular proceedings which were not void ab initio. The content of Order 2 is designed to enable the court, whenever faced with anything done or left undone in proceedings which constitutes a failure to comply with the requirements of the rules, to exercise the powers conferred by the rules without having first to decide whether the jurisdiction conferred by the rules applies at all.
See also the discussion by Spender J in Re Zagoridis; Ex parte Q'Plas Group Pty Ltd (1990) 27 FCR 108 about the history of the rule.
Her Honour also considered the limits on the operation of RSC O 2, and gave examples where RSC O 2 will not assist a party seeking to regularise an irregularity as to do so would be contrary to a statutory provision or substantive express rule, as follows:[7]
34The broad, remedial power under O 2 cannot be invoked to cure a breach of statute or a substantive express rule.
35For example, it cannot assist a plaintiff who has obtained a default judgment irregularly. The court is bound to set aside an irregular default judgment.
36Order 2 will not assist a plaintiff who has failed to serve a stale writ without the stamp specifically required by O 7 of the RSC.
37It will not assist a plaintiff company that has sought to institute proceedings other than by a solicitor under O 4 r 3 of the RSC.
38It will not assist in statutory demand proceedings under the stringent regime provided for by s 459G of the Corporations Act 2001 (Cth).
39It is therefore important to assess the irregularity complained of in order to ascertain if O 2 may operate and, if so, whether the court's discretion should be exercised.
[7] Melglow Pty Ltd v Ballygrowman Pty Ltd [2016] WASC 383 [34] ‑ [37].
The defendant also referred to Deveigne & Anor v Askar.[8] In that case, the New South Wales Court of Appeal, in considering whether proceedings and orders were a nullity or an irregularity, stated, that the 'new English RSC O 2 r 1' (from which RSC O 2 finds its genesis) 'does away with the old distinction between nullities and irregularities'.[9]
[8] Deveigne & Anor v Askar [2007] NSWCA 45.
[9] Deveigne & Anor v Askar [2007] NSWCA 45 [138] - [139] (McColl JA, Hodgson and Giles JJA agreeing), and the authorities referred to.
McColl J, in referring to the 'wide and generous' approach to irregularity adopted in cases subsequent to the introduction of the 'new rule', stated:
141… It should be noted, however, that they are intended to deal with procedural irregularities, not jurisdictional errors of a fundamental kind, such as an ultimate decision made by a decision-maker who did not have the capacity to exercise the statutory power: Attorney General of New South Wales v World Best Holdings Ltd [2005] NSWCA 271; (2005) 63 NSWLR 557 at [97] per Spigelman CJ (Tobias JA agreeing).
Counsel for the defendant also referred to East Metropolitan Regional Council v Four Seasons Construction Pty Ltd.[10] In that case, though in a different context, Hasluck J stated that the power under O 2 is not to be regarded as, and is not, a dispensing power:
[44]… It is true that O2, in dealing with the effect of non-compliance with the rules, establishes that where at any stage there has been a failure to comply the failure shall be treated as an irregularity and shall not nullify the proceedings or any step taken in the proceedings, but this cannot be regarded as being of the same effect as a dispensing power. The High Court was quite explicit in Doyle (supra) at 518 that 'a Judge cannot dispense with the requirements of the rules of the court unless the rules give him power to do so'.
[10] East Metropolitan Regional Council v Four Seasons Construction Pty Ltd [2000] WASC 178; (2000) 22 WAR 37 [44].
The reference to 'Doyle' in the passage above is to Doyle v The Commonwealth,[11] in which the High Court stated:
... a judge cannot dispense with the requirements of the Rules of Court unless the Rules give him power to do so, and when a power is expressly conferred on the court subject to a condition, a judge cannot, by relying on inherent powers, escape from the necessity of ensuring that the condition has been fulfilled ...
[11] Doyle v The Commonwealth (1985) 156 CLR 510, 518.
Hasluck J went on in East Metropolitan Regional Council to refer to s 21(1) of the Supreme Court Act 1935 (WA),[12] which requires that the jurisdiction of the court is to be exercised in the manner provided for by the Act and the rules of the court.
[12] East Metropolitan Regional Council v Four Seasons Construction Pty Ltd [2000] WASC 178; (2000) 22 WAR 37 [47].
The Full Court agreed with Hasluck J's opinion expressed in the passages referred to in East Metropolitan Regional Council in Re Hoffman.[13] The Full Court added 'The Court may exercise its power under O 2 to excuse an irregularity, not to bless it.'
[13] Re Hoffman [2004] WASCA 238 [13] - [14].
Counsel for the plaintiff also referred to Strachan v The Gleaner Co Ltd,[14] a decision of the Privy Council, in which Lord Millett addressed the distinction between between irregularities and nullities. His Lordship said:
25The distinction between orders which are often (though in their Lordhips' view somewhat inaccurately) described as nullities and those which are merely irregular is usually made to distinguish between those defects in procedure which the parties can waive and which the court has a discretion to correct and those defects which the parties cannot waive and which give rise to proceedings which the defendant is entitled to have set aside ex debito justitae. …
…
27In the present case the validity of the proceedings themselves is beyond challenge. The only question is whether an order of a judge of the Supreme Court made without jurisdiction is a nullity, not in the sense that the party affected by it is entitled to have it set aside as a matter of right and not of discretion (of course he is) nor in the sense that the excess of jurisdiction can be waived (of course it cannot) but in the sense that it has no more effect than if it had been made by a traffic warden and can be set aside by a judge of co-ordinate jurisdiction.
[14] Strachan v The Gleaner Co Ltd [2005] UKPC 33; [2005] 1 WLR 3204.
The plaintiff referred to R v S,[15] in which Pullin JA and Newnes AJA, referred to the Court of Appeal having confirmed in Pilbara Infrastructure Pty Ltd v BGC Contracting Pty Ltd that O 2 r 1 'did away with the old distinction between nullities and irregularities.'
[15] R v S [2009] WASCA 11.
Counsel for the plaintiff also referred to and relied upon Stavrianou DCJ's decision in Sonnet Holdings Pty Ltd v Dunn,[16] which considered the operation of O 2 r 1 in relation to a consent judgment that was entered contrary to O 42 r 8, where the self-represented defendant was not represented and did not appear before a judge to give his consent in person. His Honour found there was non-compliance with O 42 r 8. He referred to the passage in Pilbara Infrastructure Pty Ltd v BGC Contracting Pty Ltd at [52], which has been referred to. The plaintiff relied on Stavrianou's categorisation of the non‑compliance in Sonnet Holdings as a serious irregularity.[17]
[16] Sonnet Holdings Pty Ltd v Dunn [2012] WADC 11 [19].
[17] Sonnet Holdings Pty Ltd v Dunn [2012] WADC 11 [20].
In noting the seriousness of the irregularity, Stavrianou J stated 'There is non-compliance with the express requirements of the order.' He went on to refer to other aspects of the circumstances that further highlighted the seriousness of the irregularity. The plaintiff submitted that by proceeding to consider whether the irregularity should be rectified, as opposed to whether it could be rectified, indicates that his Honour was satisfied that there was power to regularise an irregularity based on a failure to comply with O 42 r 8.
Ultimately, though Stavrianou DCJ stated he was not satisfied it would be just to regularise the judgment in that case, he stated the judgment was irregular and must be set aside.[18]
[18] Sonnet Holdings Pty Ltd v Dunn [2012] WADC 11 [37].
Counsel for the plaintiff submitted that a further decision of this court Tuff Trade Pty Ltd v Canning Vale Properties,[19] which considered the issue of compliance with O 42 r 8, 'adds to the confidence with which this court should find that a breach of O 42 r 8 is an irregularity which can be regularised should the circumstances of justice allow it.' He referred to the view expressed by Vaughan J at [54]:
54While, in my view, there is prima facie an irregular judgment, there is a difficulty in the third and fourth defendants' application so far as it is based on O 2 r 1(2) of the Rules of the Supreme Court 1971 (WA). Any such application must observe the requirements of O 2 r 2(1).
[19] Tuff Trade Pty Ltd v Canningvale Properties (WA) (in liq) [2018] WASC 362.
His Honour went on to state that counsel for the plaintiff had contended that the application had not been brought within a reasonable time, and that he did not need to assess that argument. That was because, O 2 r 2(1) conditions allowance of an application to set aside for irregularity on a particular circumstance, namely, that the application has been made before the party has taken any 'fresh step' after becoming aware of the irregularity. That had not occurred in that case.
Ultimately, Vaughan J did not rely on O 2 r 1 in reaching his decision to set aside the irregular judgment.[20] In that case, some of the defendants had not signed the orders by which judgment was entered against them by consent and had not appeared before the court. His Honour relied on the court's inherent jurisdiction to set aside any determination affecting a person, without the necessity of appeal, where he or she has not been given a reasonable opportunity of appearing and presenting his or her case.[21]

Analysis

[20] Tuff Trade Pty Ltd v Canningvale Properties (WA) (in liq) [2018] WASC 362 [57].

[21] Tuff Trade Pty Ltd v Canningvale Properties (WA) (in liq) [2018] WASC 362 [59].

It follows, in my view, on analysis of the authorities outlined, that RSC O 2 is directed at dealing with irregularities arising from non‑compliance with the rules of the court. It is a broad remedial power. However, as stated in Melglow Pty Ltd v Ballygrowman Pty Ltd, O 2 will not assist a party seeking to regularise an irregularity where to do so would be contrary to a substantive express rule, and it cannot be invoked to cure such a breach.
The text of RSC O 42 r 8 is clear and expressed in terms that, in my view, only allow judgment to be entered by consent against an unrepresented defendant if, relevantly, the defendant attends before a judge and give their consent in person. The language is in prohibitive terms.
8. Entering judgment by consent where defendant has not appeared or is self‑represented
Where the defendant has not appeared or has appeared in person, no such order shall be made unless the defendant attends before a judge and gives his consent in person, or unless his written consent is attested by a solicitor acting on his behalf, except in cases where the defendant is a barrister, or solicitor.
(emphasis added)
In all of the circumstances, and having regard to the authorities as outlined, the judgment is not merely irregular, it was entered contrary to the clear and express requirements of RSC O 42 r 8. The rule gives no power to dispense with its requirements. No order entering judgment shall be made unless the defendant attends before a judge and gives his consent in person. Neither of the defendants did that.
The judgment entered is irregular. The irregularity is not a procedural irregularity that gives rise to the court's discretion to validate or waive under RSC O 2 r 2(1). I accept the defendant's characterisation and submission to the effect that it was entered contrary to a substantive express rule, which is a condition precedent to the exercise of the court's power to enter judgment by consent against an unrepresented defendant.
As such, the judgment entered by consent contrary to O 42 r 8 must be set aside.
Having reached that conclusion, it is not necessary for me to consider whether to do so would cause any injustice. In any event, I do not consider the injustice contended for by the plaintiff of it being delayed in enforcing its security is such that would rail against exercising any discretion to set the judgment aside, in the circumstances.
As outlined, the plaintiff says there is no injustice to the defendants in allowing the judgment to stand, as they have no defence to the claim, have acknowledged the debt in the Deed of Forbearance, and the consent judgment is based on that deed. That is disputed by the defendants, who have raised issues as to whether the Deed of Forbearance is enforceable. They also say, as is the case, that the Deed of Forbearance forms no part of the plaintiff's pleaded case in this proceeding, amongst other matters.
I am not dealing with an application to set aside a default judgment or for summary judgment. Any such application, and resolution of those disputes, remains for another day.

Conclusion and orders

For these reasons, the orders made and the judgment entered by consent on 5 January 2024 should be and are set aside.
I will hear from the parties as to the final form of orders, and as to costs.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
AP
Associate to Master Russell
3 MAY 2024