Prior v Lakic (No 2)
[2017] VSC 659
•27 October 2017
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
PROPERTY LIST
S CI 2017 1163
| STEPHEN PRIOR | Plaintiff |
| v | |
| BOGDANKA LAKIC, ZDRAVKO LAKIC, BORIS LAKIC and NJEGOS LAKIC | First to Fourth Defendants |
| and | |
| THE REGISTRAR OF TITLES | Fifth Defendant |
---
JUDGE: | Digby J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 15 September 2017 |
DATE OF JUDGMENT: | 27 October 2017 |
CASE MAY BE CITED AS: | Prior v Lakic (No 2) |
MEDIUM NEUTRAL CITATION: | [2017] VSC 659 First Revision: 9 November 2017 |
---
PRACTICE AND PROCEDURE – Application for an adjournment of the Defendants’ Application to set aside judgment obtained in absence of the first to fourth defendants – Application for adjournment refused – Application to set aside judgment obtained in absence of the first to fourth defendants – Application to extend time within which to apply to set aside judgment – Relevant principles – Rules 3.02 and 49.02 of the Supreme Court (General Civil Procedure) Rules 2015
---
APPEARANCES: | Solicitors | |
| For the Plaintiff | Mr C Juebner of Counsel | Obst Legal |
| For the First, Second and Third Defendants | First, Second and Third Defendants appeared in person. | |
| For the Fourth Defendant | No appearance. | |
| For the Fifth Defendant | Letter from the fifth defendant to the plaintiff dated 6 April 2017 advised he did not intend to appear and that he had been joined for jurisdictional reasons only. |
HIS HONOUR:
Defendants’ Application to set aside judgment entered for the plaintiff on 28 April 2017
The first to fourth defendants, by Summons filed 18 May 2017 (dated 12 May 2017), seek to set aside Orders made in favour of the plaintiff on 28 April 2017 (the April 2017 Judgment) in this proceeding (the Defendants’ Application).
The Defendants’ Application is supported by the affidavits of Bogdanka Lakic (the first defendant):
(a) 12 May 2017 (First Bogdanka Affidavit);
(b) 2 June 2017, comprising 45 paragraphs (Second Bogdanka Affidavit);
(c) 2 June 2017, comprising 29 paragraphs (Third Bogdanka Affidavit); and
(d) 9 June 2017, titled ‘Affidavit of Documents’ (Fourth Bogdanka Affidavit).
Summary of the plaintiff’s proceeding in which the 28 April 2017 judgment was entered
The plaintiff commenced this proceeding by Originating Motion and Summons filed 31 March 2017 (the plaintiff’s proceeding) for orders, inter alia, that a transfer of land in respect of a property at 22 Lucerne Road, Ferntree Gully in the State of Victoria (the Ferntree Gully Property) from the first defendant to the second defendant be declared void and that the fifth defendant reject a transfer of land between the first defendant and the second defendant in respect of a property at 27 Maplewood Court, Cranbourne North in the State of Victoria (the Cranbourne Property).
The transfers referred to in the last preceding paragraph were sought to be impugned by the plaintiff because he alleged, and on 28 April 2017 in the plaintiff’s proceeding established, that those transfers were undertaken by the first and second defendants, and colluded in and facilitated by the third defendant and the fourth defendant, in a deliberate attempt to hinder, delay and defeat the plaintiff as judgment creditor in relation to his efforts to recover his entitlement in respect of a cost judgment in his favour against the first defendant dated 17 June 2016 in the sum of $178,692.65, and in relation to orders made by his Honour Judge Anderson in the County Court of Victoria on 14 February 2017 in favour of a third party in the sum of $32,050.56, and also in respect of the further likely costs order in this proceeding.[1]
[1]Prior v Lakic [2017] VSC 255, including at [30] and [37(a), (b) and (c)].
This conduct of the first to fourth defendants inclusive, gave rise to the orders made on 28 April 2017 in relation to the recovery of legal costs pursuant to a costs order of Macaulay J made on 17 June 2016[2] in proceeding S CI 2015 0118 (the original proceeding) which costs were taxed in the sum of $178,692.65 on 1 February 2017.[3]
[2]Affidavit of Howard Obst, 30 March 2017, Exhibit “HSO-1”.
[3]Ibid [10], Exhibit “HSO-4”.
Subsequent to the costs order made by Macaulay J on 17 June 2016, further costs in the sum of approximately $65,000 have been incurred by the plaintiff in taking steps in pursuing enforcement of the June 2016 costs order, including steps taken by the plaintiff to prevent the dissipation of assets by means of a freezing order and an injunction.[4]
[4]Ibid [35]-[38].
Costs orders in respect of the steps and associated further legal work referred to in the last preceding paragraph have not yet been made. However, the plaintiff’s solicitors have estimated that, in the overall position, the first defendant is likely to be indebted to the plaintiff in the sum of at least $245,000 (including the taxed costs order in the sum of $178,692.65) when costs orders are in due course made.[5]
[5]Plaintiff’s Submissions, 27 April 2017, [8]. The affidavit of Howard Obst, 30 March 2017, a sum of $65,000 is estimated in relation to ‘Enforcement Costs’, in relation to the following: (1) Freezing Order 18 August 2016, Garde J (HSO-15) Costs reserved; (2) Procurement of undertaking of first defendant 31 August 2016 (HSO-16); (3) Injunction Application before Riordan J, 13 October 2016 (HSO-25) costs reserved. The sum of $245,000 does not take into account the costs of the present proceeding, in which the plaintiff’s costs have been awarded on the standard basis and are to be taxed in default of agreement, Orders, 28 April 2017 and final Orders, 15 September 2017 (see T27.18-20 of final hearing).
In the plaintiff’s proceeding the plaintiff claimed that the first defendant, together with the second defendant, who is her husband, actively sought to dissipate assets in order to avoid the consequences of the costs order made by Macaulay J on 17 June 2016, and that the first and second defendants have also sought to avoid paying the judgments of Judge Anderson in an unrelated County Court proceedings.
Hearing of the trial on 28 April 2017
At the trial of the plaintiff’s proceeding on 28 April 2017 the first to fourth defendants failed to appear and also failed to provide any forewarning to the Court, or other parties, that they would not be attending the trial of the plaintiff’s Motion filed 31 March 2017.
The trial on 28 April 2017 proceeded in the first to fourth defendants’ absence, including on affidavit material which established that the first to fourth defendants had been properly served with the plaintiff’s process returnable on 28 April 2017.
The first to fourth defendants now assert that they were not ‘personally served’ with any notice of the hearing on 28 April 2017, and the first defendant also deposes that she was unable to attend on that day due to her medical condition.
Judgment entered on 28 April 2017 in the plaintiff’s proceeding
On 28 April 2017, in respect of the plaintiff’s Motion dated 31 March 2017, I ordered in substance that:
(a)The transfer of the whole of the first defendant’s interest in the Ferntree Gully Property dated 4 October 2017 was declared void.
(b)The second defendant was ordered to, within 14 days, provide to the plaintiff’s solicitor:
(i)a signed transfer of land conveying the Ferntree Gully Property to the first and second defendant as joint proprietors; and
(ii)the duplicate certificate of title for that property.
(c)If the second defendant failed to comply with the above order, the fifth defendant (Registrar of Titles) was to;
(i)cancel the relevant folio of the Register in respect of the Ferntree Gully Property;
(ii)create a new folio in respect of that property;
(iii)record the first and second defendant as joint proprietors on the new folio; and
(iv)produce a certificate of title for the new folio which the plaintiff’s solicitor shall retain until further order.
(d)The fifth defendant was to remove the caveat lodged over the Ferntree Gully Property by the third and fourth defendants.
(e)The fifth defendant was to reject the attempted transfer of the first defendant’s interest (save for 5%) in the Cranbourne North Property to the second defendant dated 4 October 2017.
(f)Other than insofar as necessary to comply with the relevant above orders, the first and second defendant were restrained from dealing with the Ferntree Gully Property without the plaintiff’s prior written consent or further order.
(g)The defendants to pay the plaintiff’s costs.
On 11 May 2017 I handed down my reasons for the judgment entered and the orders made on 28 April 2017 in which I granted the relief sought by the plaintiff in his Originating Motion.
Chronology of events subsequent to the 28 April 2017 Orders including multiple applications by the first to fourth defendants to adjourn their own application of 18 May 2017 to set aside the plaintiff’s judgment of 28 April 2017
Subsequent to 28 April 2017 and up to 15 September 2017 the following events occurred:
28 April 2017
The Hearing of the Plaintiff’s Summons
The return before Digby J of the plaintiff’s Summons on Originating Motion filed 31 March 2017.
There was no attendance at the hearing by the first, second, third, and fourth defendants.
The relief sought by the plaintiff by Originating Motion was granted, and Orders in the form noted above at paragraph 12(a)–(g) were made on the plaintiff’s application.
18 May 2017 The Defendants’ Application was filed 18 May 2017 seeking an order that the Order of Digby J on 28 April 2017 be set aside.
The Defendants’ Application is fixed for hearing on 2 June 2017.
The Defendants’ Application was initially only supported by the First Bogdanka Affidavit sworn 12 May 2017.
The defendants’ Summons was filed on 18 May 2017, however it is accepted by Counsel for the plaintiff[6] and the Court[7] that unsuccessful attempts were made by the first to fourth defendants on 12 May 2017 to file the relevant process.
2 June 2017
Hearing on 2 June 2017
The Defendants’ Application by Summons came on for hearing on 2 June 2017. The first, second and fourth defendants appeared in person. The third defendant did not attend the hearing.The defendants filed the Second and Third Bogdanka Affidavits, both sworn 2 June 2017.
No formal application for an extension of time has been made by the defendants pursuant to Rule 49.02(3) of the Rules of Court. However, in discussion during the hearing, the first to fourth defendants sought to further explain the delay in the filing of the first to fourth defendants’ Summons as being because the first defendant was in hospital during the relevant period,[8] and in that regard the defendants relied on paragraph [44] of the Second Bogdanka Affidavit sworn 2 June 2017 which refers to the first defendant being unable to function or attend Court from time to time as a result of extreme stress and pressure.
First Adjournment sought and granted
On 2 June 2017 the first to fourth defendants sought and were granted an adjournment of the hearing of the Defendants’ Application to enable the first to fourth defendants to put on further material and to consider the plaintiff’s Submissions dated 29 May 2017.[9]At the hearing on 2 June 2017, the plaintiff acceded to the adjournment, principally because the first to fourth defendants had late served the Second and Third Bogdanka Affidavits sworn 2 June 2017.[10]
Orders made 2 June 2017
That the Defendants’ Application made by Summons filed 18 May 2017 be adjourned to 23 June 2017.
It was further ordered that the first to fourth defendants file and serve any further material upon which they intended to rely in their application, by 4:00pm on 9 June 2017, and that the plaintiff file and serve any responsive material upon which he wishes to rely, by 4:00pm on 16 June 2017.
9 June 2017 In accordance with the Orders of 2 June 2017, the first defendant filed the Fourth Bogdanka Affidavit sworn 9 June 2017 together with the 52 documents referred to in that affidavit.
16 June 2017
In accordance with the Orders made 2 June 2017, the plaintiff filed further Submissions dated 16 June 2017.
21 June 2017
Second Adjournment sought
By email to the Court and the plaintiff’s solicitors on 21 June 2017, the first defendant advised that she was in poor health, and that the car accidents she was involved in had resulted in her ‘having, serious injuries including mental health issues’ and that she was in ‘no state to appear in court’.On the above bases the first defendant sought a further adjournment of the hearing of the Defendants’ Application, but did not request a specific adjourned hearing date.
Attached to the first defendant’s email dated 21 June 2017 were the following medical certificates in support of the application for the adjournment:
- Dr Hanson, dated 7 June 2017;
- Dr Brkic, dated 8 June 2017;
- Dr Brkic, dated 17 June 2017;
- Dr Piperoglou, dated 20 June 2017.
22 June 2017 By email to the Court and the first to fourth defendants, the plaintiff’s solicitors advised that the plaintiff did not consent to the adjournment sought by the first defendant and sought to have the Defendants’ Applications proceed on the listed date.
On the papers referred to above, by email of the same date the Court advised the parties that the further hearing of the Defendants’ Application was to be adjourned to 19 July 2017.
23 June 2017 By email to the Court and the plaintiff’s solicitors dated 23 June 2017, the first defendant advised that she would be away for medical treatment from 18 July 2017 until late August 2017, and requested the further hearing of the Defendants’ Application be listed at a later date.
By email on 26 June 2017 the plaintiff’s solicitors advised and requested: ‘Due to availability of counsel, our preference is for the matter to be listed on either of 13, 14 or 15 September 2017’.
26 June 2017 Second Adjournment granted
Orders of Digby J were made, ordering, inter alia:1. The adjournment of the further hearing of the Defendants’ Application to 15 September 2017;
2. that if the defendants were not in a position to deal with their application on 15 September 2017, all parties were required to attend and address the court:
(a) on the appropriateness of referral of the proceeding to judicial mediation, and
(b) on the first defendant’s ability to manage her affairs in relation to the proceeding for the purpose of Rule 15;
3. that if a further adjournment was sought by a defendant on the basis that their medical condition prevented them from proceeding with their application that:
(a) they were to file and serve any medical report they intended to rely by 4 pm on 7 September 2017; and
(b) as a requirement for reliance on any such medical report, that the defendant seeking the adjournment must arrange for the author of the medical report to attend the hearing on 15 September 2017, unless otherwise advised by the plaintiff.
7 Sept 2017 Third Adjournment sought
By email dated 7 September 2017 to the Court and the plaintiff’s solicitors, the first defendant attached the following documents:
1. A letter from the first defendant dated 7 September 2017 requesting a further adjournment of the Defendants’ Application on the basis of her medical condition. Further, the letter stated:
(a) that that the first defendant was ‘asking the court and the Plaintiff to be understanding of her health condition until she finds a solicitor to represent her and to seek further judicial review of these disputes’.
(b) that her prior legal representatives who had acted for her ‘from around 17 June 201 to around 25 August 2016’ in the original proceeding before Macaulay J had ‘promised’ to appeal that case, did not do so, and ceased acting for her.
(c) that she had tried to contact the Law Institute of Victoria to obtain assistance in relation to the matters against Victorian compensation lawyers and the plaintiff, however the lawyers ‘were not able to assist’ the first defendant.
2. A medical certificate of Dr Brkic dated 4 September 2017 in support of adjournment; and
3. The Second and Third Bogdanka Affidavits, which had been previously filed on 2 June 2017.
By email on 7 September 2017, from the fourth defendant’s email address, to the Court and to the plaintiff’s solicitors, the second defendant advised that he would not be able to attend the hearing on 15 September 2017 due to his medical condition, and attached the medical certificate of Dr Hanson dated 6 September 2017 in support.
By email on 7 September 2017 to the Court and the first to fourth defendants, the plaintiff’s solicitors advised that the plaintiff would be opposing the first defendant’s application for an adjournment.
12 Sept 2017 By email on 12 September 2017 to the Court and the first to fourth defendants, the plaintiff’s solicitors advised, inter alia, that if the first to fourth defendants intended to rely on the medical reports they had filed the first to fourth defendants would be required to ensure that the reporting doctor was available at the Court on the hearing date.
14 Sept 2017 By email to the Court and the plaintiff’s solicitors, the first defendant attached the medical certificate of Dr Hanson dated 13 September 2017 in support of her application for the further adjournment of the Defendants’ Application.
15 Sept 2017 The Defendants’ Application for a further adjournment and the Defendants’ Application made by Summons filed 18 May 2017 were heard. [6]Transcript 2 June 2017, T19.11-12; T19.15-17.
[7]Ibid T17.5-T19.10.
[8]Ibid T13.11-T14.6.
[9]Ibid T10.20-23; T14.6-17; T20.24-30.
[10]Ibid T19.11-17.
Basis of Defendants’ Application by Summons filed 18 May 2017
The Defendants’ Application, by Summons filed 18 May 2017, seeks to set aside the Orders made in favour of the plaintiff on 28 April 2017 (28 April 2017 Orders).
The first to fourth defendants’ Summons and related materials do not identify the relevant power available to the Court to make the orders they seek in their Summons of 18 May 2017, namely to set aside the 28 April 2017 Orders.
Nor do the defendants identify how they put, or argue, their applications, that is beyond their assertion that they were not notified of the impending trial on 28 April 2017 and their associated assertion that they were not afforded fair opportunity to defend themselves and, in the first defendant’s case, that she was too unwell to attend Court on 28 April 2017.
Relevantly however, on 7 April 2017, Ginnane J ordered as follows:
3.Pursuant to Rule 6.10 of the CPRs, the Plaintiff may serve any document required to be served on the First, Second, Third and Fourth Defendants as set out below, and such service is deemed to be effective on the second business day following dispatch of the relevant document:
(a) On the First Defendant, by sending the document by:
(i)prepaid ordinary post addressed to the First Defendant at the following address: 280 Ormond Road, Narre Warren South, 3805, Victoria; and
(ii)email to the following address: [email protected].
(b)On the Second Defendant, by sending the document by prepaid ordinary post addressed to the Second Defendant at the following address: 22 Lucerne Road, Ferntree Gully, 3156, Victoria.
(c)On the Third Defendant, by sending the document by:
(i)prepaid ordinary post addressed to the First Defendant at the following address: 280 Ormond Road, Narre Warren South, 3805m Victoria; and
(ii)email to the following address: [email protected].
(d)On the Fourth Defendant, by sending the document by:
(i)prepaid ordinary post addressed to the First Defendant at the following address: 280 Ormond Road, Narre Warren South, 3805, Victoria; and
(ii)email to the following address: [email protected].
4.The Plaintiff shall serve a copy of this order on the First Defendant, the Third Defendant and the Fourth Defendant by:
(a) by 5.00pm on 10 April 2017 hand delivering this order, together with a letter explaining that this order has today been made by the Supreme Court of Victoria, to 280 Ormond Road, Narre Warren South, 3805, Victoria and leaving such documents by the front door, alternatively if that is not possible, by leaving such documents in the letterbox; and
(b)emailing this order together with the said letter to the email address referred to at paragraphs 3(a)(ii), 3(c)(ii) and 3(d)(ii) above by 6:30pm on 7 April 2017.
5.By 5:00pm on 10 April, the plaintiff shall serve a copy of this order on the Second Defendant by hand delivering this order, together with a letter explaining that this order has today been made by the Supreme Court of Victoria, to 22 Lucerne Road, Ferntree Gully, 3156, Victoria and leaving such documents by the front door, alternatively if that is not possible, by leaving such documents in the letterbox.
7.On or before 21 April 2017, the First, Second, Third and Fourth Defendants shall file and serve any affidavits upon which they intend to rely in opposition to the relief sought by the Plaintiff in this proceeding.
8.The Plaintiff’s Summons on Originating Motion filed 31 March 2017 is adjourned to 28 April 2017.
Further, the sworn evidence relied upon by the plaintiff in relation to the Defendants’ Application, included:
(a) the affidavit of Howard Obst sworn 30 March 2017 (First Obst Affidavit);
(b) the affidavit of Howard Obst sworn 6 April 2017 (Second Obst Affidavit);
(c) the affidavit of Howard Obst sworn 19 April 2017 (Third Obst Affidavit) which established service on the first to fourth defendants of the 7 April 2017 Orders of Ginnane J, together with a letter explaining the effect of those orders on the first to fourth defendants in accordance with paragraphs [4] and [5] of the 7 April 2017 Orders;
(d) the evidence of Geoffrey Dunlop, Process Server, sworn 11 April 2017;
(e) the 7 April 2017 Orders of Ginnane J directed the first to fourth defendants to file any responsive materials by 21 April 2017 and adjourned the plaintiff’s Summons and Originating Motion to 28 April 2017.
Inferred basis of the Defendants’ Application by Summons issued 18 May 2017 to set aside the orders made on 28 April 2017
At no time have the first to fourth defendants, either in any written material, or orally in submissions, identified the basis upon which they seek to set aside the 28 April 2017 Orders, nor have they provided any cogent or comprehensible explanation why the 28 April 2017 Orders should be set aside.
However, in my view the 28 April 2017 Orders were final orders which decided and finally disposed of the substantive rights and entitlements of the plaintiff and the defendants. Accordingly, I consider that the first to fourth defendants’ Summons issued 18 May 2017 is, or is intended to be, an application brought on bases including pursuant to Rule 49.02(2) of the Supreme Court (General Civil Procedure) Rules 2015 (the Rules of Court).
Rule 49.02 of the Rules of Court provides as follows:
49.02 Absence of party
(1)If, when the trial of a proceeding is called on, any party is absent, the Court may—
(a)order that the trial be not had unless the proceeding is again set down for trial, or unless such other steps are taken as the Court directs;
(b)proceed with the trial generally or so far as concerns any claim for relief in the proceeding; or
(c)adjourn the trial.
(2)The Court may set aside or vary any judgment, order or verdict obtained where a party is absent at the trial.
(3)An application under paragraph (2) shall be made within 14 days after the trial.
The first to fourth defendants’ affidavit material in support of their application to set aside the judgment of 28 April 2017
The Defendants’ Application to set aside the Judgment of 28 April 2017 is made by Summons filed 18 May 2017 and is supported by the following affidavits of the first defendant:
(a) 12 May 2017 (First Bogdanka Affidavit);
(b) 2 June 2017, comprising 45 paragraphs (Second Bogdanka Affidavit);
(c) 2 June 2017, comprising 29 paragraphs (Third Bogdanka Affidavit);
(d) 9 June 2017, titled ‘Affidavit of Documents’ (Fourth Bogdanka Affidavit).
The first to fourth defendants also seek to rely on certain medical certificates,[11] including that of Dr Piperoglou dated 15 March 2017,[12] and the evidence of Dr Hanson who was called to give evidence on 15 September 2017.
[11]In support of second adjournment application: Dr Hanson, 7 June 2017; Dr Brkic, 8 June 2017 and 17 June 2017; Dr Piperoglou dated 20 June 2017. In support of third adjournment application: Dr Brkic, 4 September 2017; Dr Hanson, 6 September 2017 and 13 September 2017.
[12]The Report of Dr Piperoglou dated 15 March 2017 referred to in the First Bogdanka Affidavit and referred to in oral submissions by the fourth defendant, on behalf of Bogdanka at the hearing on 2 June 2017. However, it is noted that this report is not exhibited to any affidavit filed by the defendants.
Overview of the first to fourth defendants’ extensive affidavit material
The first defendant’s affidavit material refers to her family circumstances and her dealings which the first defendant asserts results in the second to fourth defendants wholly owning the relevant Ferntree Gully Property and the first defendant owning only 5% of the relevant Cranbourne North Property. The first defendant’s affidavits, particularly her affidavit sworn 9 June 2017, also exhibit a large number of unexplained correspondence documents and other materials.
The first defendant’s affidavits in essence also recounts a long chronology of legal proceedings with which the first to fourth defendants have been entangled for some time. The first defendant in particular deposes to her afflictions and dysfunctionality caused she contends by the undue stress and pressure created by the plaintiff which the first to fourth defendants, and the first defendant in particular, contend created circumstances in which the Orders of 28 April 2017 should not have been made. The first defendant also seeks to rely on the abovementioned medical certificates and the like, in that regard.
The first to fourth defendants affidavit material
First Bogdanka Affidavit
In the First Bogdanka Affidavit the first defendant deposes, in summary, to the following:
(a) that the plaintiff ‘failed to personally serve any documents’ in respect of the hearing on 28 April 2017, either to herself or the relevant members of her family who are also defendants to the proceeding;
(b) that she is in ill health, and has attached a medical report prepared by her psychiatrist;
(c) that the plaintiff’s solicitors are fully aware of her health issues, and the report has been provided personally to them on 21 March 2017;
(d) the first defendant also points to a separate proceeding in the County Court of Victoria before Judge Anderson where her illness has been taken into account;
(e) that the Ferntree Gully Property is not owned by her and that she ‘will be providing the court all relevant documentation’;
(f) that the plaintiff has placed excessive pressure and stress upon her and her family, resulting in additional visits to her doctors and psychiatrist;
(g) that she has always responded to all court summonses, and asserts that if she has been unable to attend a particular hearing or directions hearing, she has always provided a medical certificate;
(h) that she believes her family and her have not had a fair opportunity to be able to defend themselves in this matter and provide all relevant material and documentation.
Second Bogdanka Affidavit
In the Second Bogdanka Affidavit, in summary, the first defendant seeks to set out the background and key events of the original proceeding, and further makes a number of assertions of little or no relevance to the present application brought by the first to fourth defendants for the 28 April 2017 Orders to be set aside.
The first defendant deposes that since February 2017, she and her family have been under stress and pressure as a result of this litigation and she has not been able to function or attend court, and further as a result of these circumstances the first defendant believes no orders should be made against her family.[13]
[13]Second Bogdanka Affidavit, [44] and [45].
The first defendant also seeks costs from the plaintiff in relation to the freezing orders and the ‘orders made against her family’s assets’.
Third Bogdanka Affidavit
In the Third Bogdanka Affidavit, in summary, the first defendant asserts that she has no beneficial interest in the Ferntree Gully Property, the whole of the interest being held by the second, third and fourth defendants, and only a 5% interest in the Cranbourne Property with the remaining 95% being held by the second defendant.
In the Third Bogdanka Affidavit the first defendant, in summary, deposes to the following:
(a) That she was involved in three separate automobile collisions, the first in May 2000, the second on 26 January 2002, and the third on 12 September 2006. Further, the first defendant swears to ‘living separately’ from her husband for the past 16 years following and as a result of the first of those automobile collisions, as well as suffering other stress and pressures and further the second defendant has been her carer during that time.
The Ferntree Gully Property
(b) That in or around December 1999, the first and second defendants jointly acquired the Ferntree Gully Property for $130,000, funded by way of a cash deposit of $21,842 from the second defendant, a $16,000 cash deposit by the first defendant, and the balance funded by way of mortgage to the Commonwealth Bank.
(c) That in April 2003 she agreed with the second defendant that she would withdraw her deposit plus $2000 interest, and further that she was removing her interest from the Ferntree Gully Property and that she ‘would remove her name off the property when he wished’.
(d) That in or around November 2014, the second defendant notified Centrelink that they had ‘completely separated’.
(e) In relation to the Ferntree Gully Property and her family situation following May 2000 the first defendant deposes to the following:
(i) the mortgage was solely paid down by the second, third and fourth defendants and was discharged on 14 November 2010;
(ii) she did not make any financial contribution towards paying down the mortgage;
(iii) the second, third and fourth defendant paid all bills, utilities and outgoings;
(iv) she did not make any financial contribution towards the payment of bills, outgoings or household expenses;
(v) the second defendant was the primary carer of the third and fourth defendants while they were children;
(vi) in or around 2002, the second defendant stopped working in order to care for the first defendant, that she relied on him ‘for everything’ and further was provided free accommodation;
(vii) following the award of damages on 20 June 2014 of a net sum of approximately $668,000, the first defendant paid the second defendant $307,000 for caring for her for every day for 14 years.
(f) The first defendant swears that on the basis of the foregoing, the second, third and fourth defendants are entitled to the whole interest in the Ferntree Gully Property and that it was on this basis they sought the transfer of the Ferntree Gully Property.
The Cranbourne Property
(g) That on 31 March 2015, the second defendant solely purchased the Cranbourne Property for $339,000, funded by way of $32,000 deposit.
(h) That on 29 May 2015 she loaned the second defendant $16,022 to pay stamp duty, transfers and costs of the property during settlement, and that by agreement with the second defendant this loan, which reflected approximately 5% of the purchase price, would be secured.
(i) That the second defendant informed his conveyancer, in relation to the purchase of the Cranbourne Property that:
(i) the first defendant would fund payment of stamp duty, costs and transfer fees;
(ii) the remainder of the purchase price would be funded by the second defendant;
(iii) that the second defendant would be using his pension concession card for his transfer;
(iv) the second defendant wanted the first defendant placed on the title of the property with a 5% interest.
(j) That it was by error that she was added to the title of the Cranbourne Property as a joint proprietor. The first defendant deposes to having copies of cheques documenting the amounts she paid in relation to this property, and the first defendant states that the transfer sought by the second defendant on 4 October 2016 was to rectify this error.
Fourth Bogdanka Affidavit
The Fourth Bogdanka Affidavit listed a large number of documents which the first to fourth defendants assert to be relevant to the proceeding. The relevance of these documents and their import and probative effect is largely unexplained by the first to fourth defendants.
Plaintiff’s submissions
Objections to First Bogdanka Affidavit
The plaintiff, by his Submissions dated 29 May 2017, raised a number of objections to the content of the First Bogdanka Affidavit. However, at the hearing on 2 June 2017, Counsel for the plaintiff indicated that the plaintiff would not press those objections on the basis that the appropriate course in the circumstances, would be for the contested material to be admitted into evidence, and the plaintiff’s objections be considered in the process of the court considering what evidentiary weight and probity should be ascribed to such evidence. Accordingly, I received all of the first to fourth defendants’ affidavit and exhibited documentary evidence subject to the plaintiff’s objections and I have given that evidence the weight I consider that it warrants.
Source of power to set aside the judgment of 28 April 2017
The plaintiff’s submissions dated 16 June 2017 point out that the first to fourth defendants’ Summons filed 18 May 2017 does not identify the power sought to be relied upon to set aside the 28 April 2017 Orders. I have earlier noted that this is so.
The plaintiff also contends that the 28 April 2017 Orders are final orders, in that they finally decided the substantive rights between the parties. The plaintiff also notes in this regard that Rule 46.08 of the Rules of Court applies only to interlocutory orders, and therefore cannot be the source of power relied upon by the first to fourth defendants to set aside the 28 April 2017 Orders, which were final in nature, as I have earlier held.
The plaintiff submits that in respect of the Defendants’ Application the relevant power would lie under Rule 49.02(2) of the Rules of Court which empowers the Court to set aside or vary any judgment, order, or verdict obtained where a party is absent at the trial. Rule 49.02 of the Rules of Court provide as follows:
49.02 Absence of party
(1)If, when the trial of a proceeding is called on, any party is absent, the Court may—
(a)order that the trial be not had unless the proceeding is again set down for trial, or unless such other steps are taken as the Court directs;
(b)proceed with the trial generally or so far as concerns any claim for relief in the proceeding; or
(c)adjourn the trial.
(2)The Court may set aside or vary any judgment, order or verdict obtained where a party is absent at the trial.
(3)An application under paragraph (2) shall be made within 14 days after the trial.
Plaintiff’s objection to Defendants’ Application being out of time
The plaintiff also relies upon the requirement of the Rules of Court that an application under Rule 49.02 must be made within 14 days after the trial.[14] The trial in this proceeding occurred on 28 April 2017.
[14]Rule 49.02(3) of the Rules.
However, in this matter I accept that an attempt was made by the first to fourth defendants on 12 May 2017 to file the Summons to set aside the 28 April 2017 Orders but, as a consequence of some confusion about when the hearing of the Defendants’ Application could be made returnable, the filing of the first to fourth defendants’ summons was delayed until 18 May 2017.
Therefore, while the applicable date for calculating the period of time within which the Defendants’ Application to have the subject orders set aside may have been brought as of right places the defendants outside the time allowed, in that the Summons was filed on 18 May 2017, 18 days after the trial on 28 April 2017, the date on which the first to fourth defendants attempted to issue that process was 12 May 2017. If the first to fourth defendants’ attempt to issue the process on 12 May 2017 had been successful, and the first to fourth defendants prosecuted their application under Rule 49.02, such application would be within the time allowed by the Rules of Court.
Extension of time
The plaintiff notes that to date no formal application for an extension of time within which to issue their application filed 18 May 2017 has been made by the first to fourth defendants in this proceeding. However, the plaintiff submits in anticipation of such an application that the relevant principles are those referred to by Habersberger J in Vimplane Pty Ltd v Criss,[15] namely that the decision whether to extend time or not is discretionary and the overriding principle in exercising such discretion is what the interests of justice require. Further, the plaintiff submits there are four well-recognised factors for consideration in such an application, namely, the length of the delay, the reason for the delay, whether there is an arguable case, and the extent of any prejudice to the other party.
[15][2005] VSC 45 at [29].
Rule 3.02 of the Rules of Court provides power to extend any time fixed by the Rules of Court for taking some step, whether or not an application for the extension is made before the time expires.
Decision in relation to extending the time for the Defendants’ Application by Summons filed 18 May 2017
In the circumstances of this matter, there being minimal delay and I consider an acceptable reason for that minimal delay, namely difficulties apparently encountered by the defendants in relation to their communications concerning the mechanics of issuing their Summons when they sought to file that Summons on 12 May 2017 and there being no prejudice identified to the plaintiff arising from the short delay in the first to fourth defendants issuing their application to set aside the Judgment of 28 April 2017, coupled with the obvious prejudice to the defendants if time is not extended so as to permit their application to proceed, now and for then, the time within which the first to fourth defendants were required to issue their application to set aside the 28 April 2017 Orders will be extended to 4.30pm on 19 May 2017.
Further, I add to the earlier mentioned reasons for exercising my discretion in favour of a short extension of time for the issue of the first to fourth defendants’ Summons on 18 May 2017, that the first defendant has also submitted that she was hospitalised in the period leading up to when the Defendants’ Application was made.[16]
[16]Transcript 15 September 2017, T13.11-14.6.
In these circumstances I have decided to grant the first to fourth defendants an extension of time to regularise their Summons filed 18 May 2017 and to have the opportunity in the interests of justice to address their application of that date. I have however granted that extension of time on bases which do not include forming a view at this point as to whether the first to fourth defendants’ underlying substantive application is supported by a sufficient prima facie case on the merits, a topic the first to fourth defendants have not sought to address. It will however be necessary to deal with this aspect in relation to the defendants’ underlying substantive application in due course.
Plaintiff’s Material
The plaintiff relies upon the following evidence in opposition to the Defendants’ Application:
(a) the three affidavits referred to at [9] of the Reasons for Judgment dated 28 April 2017 namely the affidavits of Howard Obst sworn:
(v) 30 March 2017 (First Obst Affidavit);
(vi) 6 April 2017 (Second Obst Affidavit); and
(vii) 19 April 2017 (Third Obst Affidavit);
(b) the affidavit of Howard Obst sworn 29 May 2017 (Fourth Obst Affidavit); and
(c) the affidavit of Howard Obst sworn 1 June 2017 (Fifth Obst Affidavit), which relates to service of the plaintiff’s written submissions dated 29 May 2017.
Plaintiff’s submissions as to the applicable principles for the setting aside of judgment
The plaintiff points to the test in Vimplane in relation to the relevant considerations on an application to extend the time within which to apply to set aside a judgment where a party is absent at the trial and also in relation to the consideration of the Defendants’ Application proper to set aside the 28 April 2017 Order.[17] Those considerations include:
[17]Ibid at [34] referring to Rosing v Ben Shemesh [1960] VR 173 and Grimshaw v Dunbar [1953] 1 QB 408.
(a) The reason why the party failed to appear when the case was heard;
(b) Whether there has been any delay by the absent party in making the application;
(c) Whether the respondent party would be prejudiced by a new trial in any respect which could not be adequately compensated by a suitable award of costs and the provision of security; and
(d) A prima facie case on the merits.
Plaintiff’s submissions in relation to the Defendants’ Application under Rule 49.02
Failure to appear
The plaintiff submits that by reason of validly effected service, the first to fourth defendants can be taken to have been aware of the date of the trial, and further submits that on the evidence established in the Fourth Obst Affidavit, the first to fourth defendants received actual notice of the hearing on 28 April 2017 by service effected on 8 April 2017.
As to the first to fourth defendants’ failure to appear at trial, the plaintiff notes that at [5] of the Reasons for Judgment delivered on 11 May 2017, as was the case, that I found that the first to fourth defendants were served with the 7 April 2017 Orders of Ginnane J listing the hearing of the matter for 28 April 2017 on 8 April 2017 by substituted service.
The plaintiff relies on the Fourth Obst Affidavit in order to establish that the plaintiff’s solicitors complied with the orders for substituted service, and further submits that the evidence strongly supports to the conclusion that all the defendants were aware of the hearing on 28 April 2017 and had been duly served with all the materials relied upon by the plaintiff.
The plaintiff identifies the following matters in particular as establishing the above:
(a) the relevant Documents (Documents) being;
(viii) Originating Motion dated 31 March 2017;
(ix) Summons on Originating Motion dated 31 March 2017;
(x) Obst affidavits sworn 30 March 2017, 6 April 2017 and 19 April 2017.
(b) the Documents were delivered by tracked express post to the first, third and fourth defendants on 13 April 2017 to the address which the first defendant gave as her home address and which the third and fourth defendants gave as their address for service in the Ferntree Gully caveat;
(c) the Documents could not be delivered to the second defendant and were ultimately returned to the plaintiff’s solicitors on 24 May 2017;
(d) the Documents were emailed to the first, third and fourth defendants on 11 April 2017;
(e) the 7 April 2017 Orders of Ginnane J were hand-delivered by a process server to the address for service of each of the defendants;
(f) the 7 April 2017 Orders of Ginnane J noted 28 April 2017 as being the date for the hearing of the plaintiff’s Summons filed 31 March 2017;
(g) there is evidence that the first defendant was using the email address the subject of the substituted service order made by Ginnane J.[18]
[18]Refer reply email from first defendant to the plaintiff’s solicitor dated 4 April 2017 (Second Obst Affidavit, Exhibit “HSO-35”).
Defendant’s explanations for non-attendance on 28 April 2017 are inadequate
The plaintiff points to the following deficiencies in the Defendants’ Application as to why those defendants did not attend court:
(a) Despite the orders of 28 April 2017 affecting all the defendants, only the first defendant has put on affidavits. The plaintiff submits that accordingly, there is no direct evidence before the Court from the second, third or fourth defendants explaining why they did not attend on 28 April 2017 or why they failed to put material before the Court by 21 April 2017 as ordered by Ginnane J.
(b) The fact that the second defendant has not put on material is striking given that he personally served the First Bogdanka Affidavit and the Summons on the plaintiff’s solicitors.
(c) In respect of the first defendant’s explanation for her failure to appear on 28 April 2017, the plaintiff submits that the First Bogdanka Affidavit is ‘riddled with inconsistency’ and that its assertions are improbable and unpersuasive on the following bases:
(xi) despite the documents being emailed and either hand delivered or sent by tracked express post, there is no plausible explanation given as to which of the plaintiff’s materials were not received by the first to fourth defendants and only a ‘technical defence’ is raised, namely that she was not ‘personally served’;
(xii) the first defendant raises her alleged medical condition while also arguing she was not personally served and not aware of the hearing;
(xiii) no reference is made by the first to fourth defendants to the emailed documents sent to them by the plaintiff’s solicitor;
(xiv) because the first defendant lives with her sons (the third and fourth defendants) who also received service by email, no reference is made to this fact and it is probable in the circumstances that they would have together discussed the upcoming hearing;
(xv) given that the first defendant corresponds by email, it is surprising that the first defendant did not, at a minimum, send an email notifying of her intended absence.
The first defendant has not sought to explain why she and the other defendants did not foreshadow their intended non-attendance at trial on 28 April 2017 or seek to adjourn the hearing date of 28 April 2017. None of the defendants foreshadowed on or prior to 28 April 2017 that they would not attend Court to defend the trial of the plaintiff’s case.
No prima facie case on the merits
The plaintiff submits that the onus is on the first to fourth defendants to persuade the court that the judgment ought be set aside, and in all other respects in deciding whether there is sufficient merit to permit the proceeding to progress the test for summary judgment under the Civil Procedure Act 2010 ought be applied. Namely, whether the first to fourth defendants’ claim has any real prospects of success.
The legal principles applicable to the relief sought by the plaintiff by way of Originating Motion dated 31 March 2017, that is relief in the nature of orders under s 172 of the Property Law Act 1958 rendering a transfer of property voidable, orders rejecting a transfer of land under s 103 of the Transfer of Land 1958, and the removal of a caveat, were set out in the Reasons for Judgment.
The plaintiff submits that only the Third Bogdanka Affidavit touches on the merits, and further notes that there is no evidence on these issues, or any explanation as to why there is no evidence on these issues from the second, third or fourth defendants, and submits accordingly an adverse inference ought be drawn against the first to fourth defendants.
Further, the plaintiff contends that the Third Bogdanka Affidavit is entirely inconsistent with the affidavit sworn by her on 25 August 2016 in the original proceeding, in particular as to the first defendant’s interest in the Ferntree Gully and Cranbourne Properties.
The plaintiff notes that in the affidavit of 25 August 2016 the first defendant deposes to having a 50% interest in each the Ferntree Gully and Cranbourne Properties, worth $225,000 and $265,000 respectively, and now in the Third Bogdanka Affidavit deposes to having no beneficial interest in the Ferntree Gully Property and a 5% beneficial interest in the Cranbourne Property.
The plaintiff submits accordingly that these affidavits are inconsistent, and in the circumstances the Third Bogdanka Affidavit cannot be persuasive on the issue of establishing that the first to fourth defendants have a prima facie case, and further that this inconsistency suggests that the first defendant is prepared to make an affidavit to suit her circumstances at the relevant time.
The plaintiff also points to what he describes as further inconsistencies in the Third Bogdanka Affidavit, and submits that the following circumstances raise substantial doubts as to the true state of affairs:
(a) In relation to the assertion at paragraph [24], that the second defendant advised his conveyancer that he wanted the first defendant to be added to the title of the Cranbourne Property with a 5% ownership interest only. There is however no corroborating evidence proffered by the conveyancer.
Further, the plaintiff points to the Sale of Real Estate Nomination Form dated 29 May 2015 (included among the documents referred to in the Fourth Bogdanka Affidavit) signed by the first and second defendants which refer to the Cranbourne Property being conveyed into the joint names of the first and second defendants.
(b) In relation to the assertion at paragraph [12], that the first defendant surrendered her interest in the Ferntree Gully Property in April 2003, the plaintiff points to the fact that the transfer of land exhibited to the First Obst Affidavit[19] records the consideration as ‘pursuant to breakdown of marriage and declaration dated 4 September 2016’.
(c) In relation to the assertion at paragraph [23], that on 29 May 2015 the first defendant advanced a loan to the second defendant in the sum of $16,022 to enable him to settle the purchase of the Cranbourne Property, on the basis of which the first defendant says she acquired a 5% interest in the property, the plaintiff points to the fact that the transfer of land exhibited to the First Obst Affidavit[20] records the consideration as ‘pursuant to breakdown of marriage and declaration dated 5 June 2015’ and makes no reference to the sum of $16,022 or the loan transaction in any respect.
[19]First Obst Affidavit, page 111.
[20]Ibid page 96.
Hearing on 15 September 2017
At the hearing on 15 September 2017, Boris Lakic (the third defendant) spoke for himself and for the first and second defendants (his parents) and for the fourth defendant (his brother), and undertook to translate what was being said in the proceedings to the first and second defendants who were both present. The fourth defendant did not appear and did not communicate to the Court, via the other defendants or otherwise, why he was unable to attend on 15 September 2017 nor did the fourth defendant communicate what his position was on the Defendants’ Application.
Third adjournment sought
Defendants’ Application for a further adjournment of the hearing on 15 September 2017
On 15 September 2017, the first to fourth defendants sought a further and third adjournment of the Defendants’ Application on the basis that the first defendant was unable to conduct her case because of physical and mental incapacity,[21] and in this regard the first defendant relied on a medical certificate of Dr Geoffrey Hanson dated 13 September 2017. A further medical certificate dated 6 September 2017 relating to the second defendant was also relied upon.
[21]Transcript 15 September 2017, T2.14-23; see also T3.28-4.14.
Further, the first to fourth defendants sought an adjournment of the 15 September 2017 hearing so as to allow those defendants further time to engage a lawyer to assist them with the prosecution of their claim, alternatively the first to fourth defendants’ sought an order appointing a lawyer to represent them in their application.
The third defendant in his submissions on behalf of the first to fourth defendants stated that the first to fourth defendants had up to 15 September 2017 contacted numerous lawyers but had been unsuccessful in finding a legal practitioner to represent them in this matter.[22] They therefore sought to have a lawyer appointed by the Court.[23]
[22]Ibid T20.15-17.
[23]Ibid T21.3-4. There is no apparent basis for orders appointing a lawyer to represent the defendants in this matter.
I note that the issue of the first to fourth defendants’ unsuccessful efforts to engage a lawyer to represent them in prosecuting their present application was first raised in Court at the initial hearing of the Defendants’ Application on 2 June 2017.[24] However nothing effective has been achieved in this regard by the first to fourth defendants in the two and half months subsequent to 15 September 2017.
[24]Transcript 2 June 2017, T10.22-30; T14.13-17.
Medical material relied upon by the defendants in their 15 September 2017 adjournment application
In support of the adjournment application made at the hearing on 15 September 2017 the first to fourth defendants relied on two medical certificates of Dr Hanson, one in respect of the first defendant dated 13 September 2017, and one in respect of the second defendant dated 6 September 2017.
The first defendant also seeks to rely upon the medical certificate of Dr Mladen Brkic dated 4 September 2017 in respect of the first defendant. However, the first defendant has failed to arrange for Dr Brkic to attend the hearing on 15 September 2017, as required by the Order made 26 June 2017 in these proceedings. That Order required the attendance of any doctor sought to be relied upon as an expert witness. No submissions were made as to the non-attendance of Dr Brkic.
It was also asserted by the first to fourth defendants in the hearing on 15 September 2017 that Dr Michael Piperoglou was overseas and thus unable to attend the hearing.
The Medical Evidence in support of third adjournment application
Given the Orders made on 26 June 2017, in particular Order 3(b), only the medical evidence of Dr Hanson, who was called and available for cross-examination, was admitted on the defendants’ third adjournment application.[25]
[25]Transcript 15 September 2017, T14.18-15.6.
Evidence of Dr Hanson at the hearing on 15 September 2017
At the hearing on 15 September 2017 a medical certificate of Dr Hanson dated 13 September 2017 was admitted into evidence. That document certified that the first defendant has suffered and continues to suffer from numerous serious ailments, both physical and psychological in nature, and that Dr Hanson’s view was that the first defendant is unable to prosecute her case or represent herself in court.
The medical certificate of Dr Hanson dated 6 September 2017 certified that the second defendant was and is, as a result of suffering anxiety and chest pain, medically unfit for a court appearance from 6 September 2017 to and inclusive of 30 September 2017. However, in fact the second defendant attended Court on 15 September 2017.
At the hearing on 15 September 2017 Dr Hanson was cross-examined.
In relation to the first defendant, Dr Hanson’s oral evidence was at the outset in accordance with his medical certificate dated 13 September 2017, that is, his evidence was that the first defendant was unable to conduct her court case and represent herself in court due to the multiple physical and psychological ailments set out in the certificate of that date.[26]
[26]Ibid T8.12-T9.6.
Furthermore, initially, Dr Hanson gave evidence that in his opinion it would be extremely unlikely that the first defendant’s medical situation would improve to the point where she would be able to run her court case.[27]
[27]Ibid T9.19-25.
However, under cross-examination by Counsel for the plaintiff, and in response to my questions, Dr Hanson’s evidence changed substantially when questioned and tested. Dr Hanson gave evidence that the first defendant was able to understand what was going on in relation to her case and in relation to the case put against her. Dr Hanson also agreed, when questioned, that provided the hearing in Court proceeded slowly and afforded the first defendant time, by way of sufficient breaks, and there were shorter hearing sessions, the first defendant should be able to adequately follow what was going on in court in relation to relevant issues including providing necessary instructions.[28]
[28]Ibid T11.12-19; see also T12.1-3; T13.15-24 and T15.23-28.
When cross-examined by Counsel for the plaintiff, and when taken to his earlier medical certificate of 7 June 2017, Dr Hanson also accepted that provided matters in court proceeded slowly enough, and provided the first defendant was assisted by breaks during the hearing day, the first defendant would be able to follow what was occurring in court.[29]
[29]Ibid T11.12-19.
In relation to Dr Hanson’s opinion in his earlier 7 June 2017 medical certificate, Dr Hanson sought to distinguish between the first defendant’s ability to run her case and her ability to cope with attending court.[30]
[30]Ibid T11.3-9.
Dr Hanson also gave evidence that whereas in his 7 June 2017 medical certificate he opined as to the ability of the first defendant to attend court under certain circumstances, he was in that certificate envisioning the first defendant in the role of a witness rather than as running the case.[31]
[31]Ibid T13.5-14.
Under cross-examination Dr Hanson also initially gave evidence that he thought the first defendant would not be capable of running her case.[32]
[32]Ibid T15.13-15.
Ultimately however Dr Hanson accepted and confirmed that the first defendant was capable of understanding the matters in issue, both in relation to the Defendants’ Application and in relation to the related plaintiff’s proceeding, and was capable of understanding those matters sufficiently so as to be able to conduct her case.[33]
[33]Ibid T13.15-24.
Dr Hanson further accepted that during the hearing on 15 September 2017 the first defendant exhibited an appreciation of the court processes and an ability to think quickly and understand and attend to issues as they were arising at the hearing.[34]
[34]Ibid T15.29-T16.5.
I add in this regard my observations of the first defendant in Court on 15 September 2017. I am satisfied that to a comfortable level of satisfaction the first defendant in her participation in the hearing on 15 September 2017 exhibited that she understood the issues being addressed and was able to both react quickly to the plaintiff’s submissions, questions from the Court and the evidence being adduced and was also able to make astute decisions about how to instruct the third defendant to reply, including in relation to putting questions to the witness Dr Hanson.
In respect of the second defendant, Dr Hanson accepted he was not impaired in any way which would render him unable to prosecute his case, but rather the essence of Dr Hanson’s evidence was that the second defendant was medically unfit to come to court.[35] However, as I have earlier noted, the second defendant was in fact in attendance at Court throughout the Defendants’ Application on 15 September 2017, notwithstanding that Dr Hanson’s medical certificate of 6 September 2017 stated that the second defendant was unfit to attend Court in the period 6 September 2017 to 30 September 2017 inclusive. Dr Hanson’s oral evidence made no mention of the duration of the second defendant’s likely indisposition or his unforshadowed presence in court.[36]
[35]Ibid T17.11-26.
[36]Ibid T17.11-26.
On the basis of the above evidence, including my abovementioned observations of the first defendant’s conduct during the course of argument and evidence on 15 September 2017, I am satisfied that the first and second defendants are:
(a) capable of understanding and addressing the first to fourth defendant’s application and the plaintiff’s related proceeding; and
(b) capable of understanding and managing their affairs in relation to the Defendants’ Application and the related plaintiff’s proceeding.
The plaintiff’s position in relation to the Defendants’ Application for a further adjournment
The Defendants’ Application for a further adjournment was opposed by the plaintiff on the basis that the first to fourth defendants had been given sufficient time to address the preparation of their application to set aside the plaintiff’s judgment and sufficient time to look for and obtain legal representation.[37]
[37]Ibid T4.17-27.
The plaintiff also submitted that on the evidence of Dr Hanson at the hearing on 15 September 2017 it was clear in relation to the second defendant that he suffered no impediment preventing him from attending to his case and attending court. The plaintiff submitted in relation to the first defendant that Dr Hanson’s evidence was to the effect that provided the first defendant’s application proceeded slowly enough and allowing sufficient breaks to the first defendant, she would be able to deal with the application.[38]
[38]Ibid T18.26-T19.12.
Counsel for the plaintiff also stated on 15 September 2017 that the plaintiff would accede to proceeding with the hearing of the Defendants’ Application in a manner which would facilitate and assist the first defendant’s participation in the manner in the way outlined by Dr Hanson.[39]
[39]Ibid T19.13-15.
The plaintiff further observed in support of his opposition to the Defendants’ Application for an adjournment that it could be inferred that the first to fourth defendants have sufficient financial resources to pay for legal representation because they had initially mentioned during the course of the hearing on 15 September 2017 that the first defendant had recently been on an overseas vacation.[40]
[40]Medical Certificate of Dr Brkic, 4 September 2017 refers to the first defendant visiting Serbia and Montenegro and receiving ‘spiritual care and treatment’.
First to fourth defendants’ Submissions on the Defendants’ Application
At the hearing on 15 September 2017, the first to fourth defendants sought to adjourn their application filed 18 May 2017.
However, at the hearing of their applications on 15 September 2017, the first to fourth defendants made no substantive submissions in support of their application to set aside the plaintiff’s judgment of 28 April 2017 in either written or oral form and they did not seek to explain which of the bundle of documents referred to in the Fourth Bogdanka Affidavit were specifically relied upon and how specific documents were relied upon.
Conclusions
Extension of time in relation to the issue of the first to fourth defendants’ Summons filed 18 May 2017 pursuant to Rule 49.02.
For the reasons I have outlined above I shall, pursuant to Order 3.02 of the Rules, extend the time, now and for then, within which the first to fourth defendants were able to make application to set aside the judgment of 28 April 2017, to 4.30pm on 19 May 2017.
Defendants’ Application for a third adjournment of the Defendants’ Application filed 18 May 2017
Ruling on 15 September 2017 by the first to fourth defendants’ for a further adjournment of the Defendants’ Application to set aside the judgment of 28 April 2017
I refuse the Defendants’ Application made on 15 September 2017 (earlier foreshadowed by the first to fourth defendants on 7 September 2017) for a further adjournment of the hearing of the Defendants’ Application of 18 May 2017, fixed to be heard on 15 September 2017.[41]
[41]Transcript 15 September 2017, T21.21; T22.9-16; T23.17-18.
On 2 June 2017 and 26 June 2017[42] I acceded to the earlier defendants’ adjournment applications in the interests of justice so as to ensure that the first to fourth defendants were afforded a fair and reasonable opportunity to be in a position to deal with their application to set aside the plaintiff’s judgment of 28 April 2017, and responses thereto by the plaintiff and also so as to afford the first to fourth defendants a fair and reasonable opportunity to obtain legal representation, if they desired to do so.
[42]The adjournment of the hearing of the first to fourth defendants’ Summons on 26 June 2017 was opposed by the plaintiff.
I reject the first to fourth defendants’ further adjournment application of 15 September 2017, including for the following reasons:
(a) I am not satisfied, for the reason I have outlined in relation to the defendants’ medical evidence, that the first to fourth defendants have presented any medical or other justification for not being in a position to prosecute their applications to set aside the Judgment of 28 April 2017;
(b) I am comfortably satisfied for the reasons outlined above in relation to the notice to the first to fourth defendants of the date for the hearing of 28 April 2017, that the defendants had been properly served and notified in respect of, and were aware of, the hearing of the plaintiff’s application on 28 April 2017;
(c) Further, I am satisfied that the first to fourth defendants, notwithstanding their notification and awareness of the date for the hearing of the plaintiff’s case on 28 April 2017, failed to communicate to the plaintiff or the Court that they did not intend to, or could not, attend Court on 28 April 2017, and failed to provide any proper and acceptable reason for their non-attendance;
(d) Furthermore, I am satisfied that in their application for a further adjournment to the hearing fixed for 15 September 2017, the first and the second defendants, and in substance as a result of the first to fourth defendants putting their position in unison via the third defendant, all the first to the fourth defendants, falsely asserted that they were unaware of the hearing date of 28 April 2017, until sometime after judgment had been handed down on that date;
(e) I am also, for the reasons outlined above, in relation to the medical evidence adduced by the first and the second defendants, comfortably satisfied that the first and second defendants were capable of understanding and managing their own affairs in relation to their subject application and the plaintiff’s related proceedings;
(f) In the circumstances of the history of this matter before and since 28 April 2017 I find that the first to fourth defendants have failed to comply with a number of interlocutory orders, including as to the timely filing of medical reports upon which they intended to rely and the first defendant has failed to honour the first defendant’s undertaking of 31 August 2016,[43] and in addition the defendants have unjustifiably sought to again adjourn their application returnable on 15 September 2017 and thereby the first to fourth defendants have failed to use reasonable endeavours to facilitate the efficient and timely prosecution of their application filed 18 May 2017 and to act promptly and minimise delay in this proceeding;
[43]Orders of Digby J made 26 June 2017 [3] – Orders required inter alia that the defendants file any medial report upon which they intended to rely at the hearing on 15 September 2015 by 4:00pm on 7 September 2017. Relevant breach: The defendants late filed, on 14 September 2017, the medical certificate of Dr Hanson dated 13 September 2017 (in respect of the first defendant). The first defendant also breached her undertaking provided to Zammit J: On 31 August 2016 the first defendant provided an undertaking to the Court that she would not, without giving 7 working days’ notice to Mr Prior and to the LPLC (Mr Prior’s Professional Insurer), in any way dispose of, deal with, encumber or diminish the value of her interest in the Cranbourne Property, such undertaking to be discharged and of no further force and effect upon Bogdanka paying Mr Prior’s costs in the Original Proceeding. First Obst Affidavit, [24] and [25]. Relevant breach: the first and the second defendants executed transfer of land dealing number AN149513D between the first and second defendants dated 4 October 2016 in respect of the Cranbourne Property by which the first and second defendants attempted to transfer their joint interest in the Cranbourne Property to the first defendant (as to 5%) and the second defendant (as to 95%) as tenants in common: First Obst Affidavit, [27], [28] and [29]. First Obst Affidavit at 9,[24]-11,[29]; Plaintiff’s submissions, 27 April 2017, [10(a)]. It is submitted at [6] of the plaintiff’s submissions, 16 June 2017 that the plaintiff relies upon the Obst affidavits, including the First Obst Affidavit, in opposition to the Defendants’ Application; The First-Third Obst Affidavits justifying the relief granted on 28 April 2017.
(g) the first to fourth defendants have no sufficient underlying prima facie case on the merits in respect of their application to set aside the Judgment of 28 April 2017, including because:
(xvi) the first to fourth defendants have failed to explain or cogently support their application of 18 May 2017;
(xvii) the material filed in support of the first to fourth defendants’ 18 May 2017 application is unpersuasive and inconsistent, including because the first to fourth defendants own affidavit materials are contradictory,[44] documentary material filed by both the plaintiff and the first to fourth defendants also contradicts material assertions in the first defendant’s affidavit material[45] and a number of material assertions in the first defendant’s affidavit materials are unsupported in any way.[46] In these respects I accept the plaintiff’s factual submissions referred to at [60], [61] and [62(a)-(e)] hereof;
[44]Reasons for Judgment [31] and [94 (g) (iii) and (iv)] and footnotes 47 and 48 hereof.
[45]Ibid.
[46]Ibid.
(xviii) in my view the core of the first defendant’s assertions, outlined at [31] above are persuasively undercut by the other and conflicting affidavits of the first defendant as to her beneficial interest in the properties,[47] and in respect of the Cranbourne Property persuasively undercut by the Sale of Real Estate Nomination Form which is signed by the first and second defendants and which prima facie contradicts the allegation that the first defendant was not intended to be a proprietor of that property;[48]
[47]Affidavit of Bogdanka Lakic sworn 25 August 2016 in proceeding S CI 2015 0118 at [4]; Third Bogdanka Affidavit at [18] and [28]; Plaintiff’s Submission, 16 June 2017 [35]–[38]; In the affidavit of 25 August 2016 the first defendant deposes to having a 50% interest in each the Ferntree Gully and Cranbourne Properties, worth $225,000 and $265,000 respectively. In the Third Bogdanka Affidavit, the first defendant deposes to having no beneficial interest in the Ferntree Gully Property and a 5% beneficial interest in the Cranbourne Property.
[48]The Sale of Real Estate Nomination Form is located in the bundle of documents accompanying the Fourth Bogdanka Affidavit. A copy of the Sale of Real Estate Nomination Form is in the Plaintiff’s Submissions, 16 June 2017 at [39]; the Bogdanka Affidavit of 25 August 2016 was relied on by the plaintiff, without objection by the first to fourth defendants, during the hearing on 15 September 2017, see T24.30-T25.6, and the Plaintiff’s Submissions, 16 June 2017 at [36]–[38]. Refer also to the first defendant’s 25 August 2016 affidavit in which the first defendant deposes to her assets and liabilities at [37] of the Plaintiff’s Submissions; Refer also to First Obst Affidavit at [23] and Reasons for Judgment at [21(d)].
(xix) I also accept the plaintiff’s submission that the consideration provided in relation to the transfer of the Ferntree Gully Property namely, ‘pursuant to breakdown of marriage and declaration dated 4 September 2016’ conflicts with the alleged agreement between the first defendant and the second defendant in 30 April 2003 deposed to in the Third Bogdanka Affidavit;
(xx) further, I also accept the plaintiff’s submissions as outlined at [56] to [60] above.
Accordingly, I am not satisfied that the first defendant’s affidavit material is persuasive even on a prima facie basis, nor I am I satisfied that any of the first to fourth defendants have any arguable prima facie basis nor real prospect of success for impugning the 28 April 2017 Orders.
Further ordinarily a judgment properly entered against an absent party will rarely be set aside where that party, being aware of the date of the trial, has failed to attend at court.[49] A different position is likely to obtain where a party is rendered incapable of deciding whether or not to attend court by reason of a psychiatric or other mental condition. Such matters, if established, may constitute sufficient cause for the setting aside of judgment. However, here I have found that there is no such incapacity in any of the defendants.[50]
[49]As observed by Habersberger J in Vimplane at [36] citing Adams v Cronin Unreported, Court of Appeal, 6 September 1996 per Winneke ACJ.
[50]Williams Civil Procedure Victoria Vol 1 [49.02.40]; Brygel v Stoneham Unreported, 4 April 1997; Vimplane at [36].
The plaintiff has been since at least about 26 June 2017 increasingly prejudiced by the first to fourth defendants’ failure to prosecute and conclude its application by Summons filed 18 May 2017, because the plaintiff has been unable to bring the Defendants’ Application to a conclusion and for that reason the plaintiff has suffered continuing uncertainty as to the outcome of the Defendants’ Application and its possible effect on the plaintiff’s judgment of 28 April 2017. These circumstances have also required the plaintiff’s repeated attendance to these unresolved matters since about 18 May 2017.[51]
[51]Ibid T21.13-21; T22.9-21; T23.2-11.
As to the potential prejudice to the first to fourth defendants, I consider that the purported prejudice to them of the dismissal of their Summons filed 18 May 2017 is illusory because of lack of arguable merit of that application outlined above. Further if there be any prejudice to the first to fourth defendants, which I do not accept is the case, the conduct of the first to fourth defendants to which I have referred has been the cause of such prejudice or potential future prejudice.
Plaintiff entitlement to have Defendants’ Applications disposed of reasonably expeditiously
No justifiable reason to further adjourn in the circumstances
The first to fourth defendants have had ample time to engage or enlist legal assistance in the interim between when the first to fourth defendants’ Summons of 18 May 2017 first came before me and 15 September 2017.
In the circumstances, and on the basis of the evidence before me there was no justifiable reason to further adjourn the Defendants’ Application.
Insufficient underlying merit in defendants’ case
The first to fourth defendants bear the onus of persuading the court that the judgment of 28 April 2017 ought be set aside. It is also for the first to fourth defendants to appropriately prosecute their applications filed 18 May 2017. They have done neither.
Decision
Decision on the Defendants’ Application by Summons filed 18 May 2017
For the reasons I have outlined above, I dismiss the Defendants’ Application by Summons filed 18 May 2017 to set aside the properly entered Judgment in favour of the plaintiff of 28 April 2017.
Costs
The plaintiff applies for his costs of and in relation to the first to fourth defendants’ Summons filed 18 May 2017.
The first to fourth defendants raised no argument in opposition to the plaintiff’s application for costs.
I consider that in the circumstances costs should follow the event of the dismissal of the Defendants’ Application filed 18 May 2017, and I shall order the first to fourth defendants pay the plaintiff’s costs, including his reserved costs, in connection with the first to fourth defendant’s Summons filed 18 May 2017, on a standard basis.
Orders
Accordingly I propose to order:
1.Pursuant to Rule 3.02 of the Rules, leave is granted to the first, second, third and fourth defendants, nunc pro tunc, extending the time within which the first, second, third and fourth defendants can bring an application to set aside the judgment of 28 April 2017, to 4.30pm on 19 May 2017.
2.The first, second, third and fourth defendants’ Summons filed 18 May 2017 is dismissed.
3.The first, second, third and fourth defendants pay the plaintiff’s costs of and incidental to the first to fourth defendants’ Summons filed 18 May 2017, such costs to be taxed on the standard basis in default of agreement.
0
2
0