Rayner v Australia and New Zealand Banking Group Ltd - [2002] WASCA 229

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE FULL COURT (WA)

CITATION: RAYNER & ANOR -v- AUSTRALIA AND NEW ZEALAND BANKING GROUP LTD [2002] WASCA 229

CORAM: WALLWORK J
MURRAY J
PARKER J

HEARD: 19 JUNE 2002

DELIVERED : 19 JUNE 2002

PUBLISHED : 16 AUGUST 2002

FILE NO/S: FUL 203 of 1999

BETWEEN: DAVID KENNETH RAYNER
SUSAN JOY RAYNER
Appellants
AND
AUSTRALIA AND NEW ZEALAND BANKING GROUP LTD
Respondent

Catchwords:

Practice and procedure - Mortgagee obtains summary judgment - Appellant unsuccessful on appeal and on application to review appeal judgment - Application to stay judgment pending special leave to appeal to High Court - Factors to take into account

Legislation:

Nil

Result:

Application to stay judgment dismissed

Category: B

Representation:

Counsel:

Appellants: In person, Mr D K Rayner
Respondent: Mr M J Hawkins

Solicitors:

Appellants: In person
Respondent: Clark Whyte

Case(s) referred to in judgment(s):

Bryant v Commonwealth Bank of Australia (1996) 70 ALJR 306
Commissioner of Taxation (Cth) v Myer Emporium Ltd (No 1) (1986) 160 CLR 220
Cox v Simeon, unreported; FCt SCt of WA; Library No 5063; 7 September 1983
De L v Director General, Department of Community Services New South Wales (1996) 136 ALR 201
Hamersley Iron Pty Ltd v Lovell (No 2) (1998) 20 WAR 79
J C Scott Constructions v Mermaid Waters Tavern Pty Ltd (No 2) [1983] 2 Qd R 255
Jennings Constructions Ltd v Burgundy Royale Investments Pty Ltd (1986) 161 CLR 681
McAdam v Robertson [1999] 73 SASR 360
Rayner & Anor v Australia and New Zealand Banking Group Ltd [2001] WASCA 396
Rayner & Anor v Australia and New Zealand Banking Group Ltd [2002] WASCA 82

Case(s) also cited:

Nil

WALLWORK J: The appellants in this matter applied for a stay of proceedings from a judgment of a Master of this Court delivered on 30 November 1999. The Master ordered that summary judgment be entered against the appellants arising from their default under mortgages pursuant to which they had agreed to pay monthly instalments of principal and interest.
The respondent is the owner of the assets of Town & Country Bank Ltd including the two relevant mortgages by the appellants. The mortgages were registered on the 6 May 1992. They were described respectively as the first mortgage and the second mortgage. The first mortgage secured $96,210 and the second $34,000.
The respondent issued a writ on 15 August 1999 claiming that the appellants were in default under the mortgages for not maintaining the monthly payment of instalments. It was pleaded in the statement of claim that the respondent's rights under the mortgages included a right to take possession of the property the subject of the mortgages, being the appellants' home at 61 Hawford Way, Willetton and that the appellants refused to deliver up possession to the respondent.
The appellants filed a defence in which amongst other things, they asserted that the respondent was in breach of the Trade Practices Act 1974 (Cth) and had exerted extreme coercion on them and placed them under enormous duress. It was also pleaded that the respondent had been grossly negligent and had breached various obligations including the provisions of the Consumer Credit Code and the Fair Trading Act of Western Australia.
Having been served with the defence, the respondent applied for summary judgment on 24 November 1999. The appellants were not legally represented. Mr Rayner conducted the case for himself and Mrs Rayner.
The learned Master held that there was no merit in the defences which had been advanced by the appellants and on 30 November 1999 ordered that summary judgment be entered against them. The appellants appealed on the grounds that the learned Master had made a "grievous error", had been guilty of bias and prejudice and had denied the applicants natural justice.
On 7 December 2001 the appeal was unanimously dismissed by the Full Court of Western Australia. The reasons for the Court were given by Anderson J. Murray J and Einfeld AJ agreed with those reasons.
Anderson J said that it was not clear from the material before the Court but it appeared that the appellants contended that they were induced to include an amount in one or other of the relevant mortgages by unconscionable conduct on the part of officers of Town & Country. The male appellant had described that conduct as "harassment", "coercion", "duress", "making all sorts of threats" and the like. Anderson J said that the male appellant's affidavit fell well short of disclosing a prima facie case of unconscionable conduct. His Honour said that Mr Rayner had also alleged misleading or deceptive conduct comprising for the most part alleged deficiencies in the statements of account which had been rendered from time to time with respect to the relevant mortgages. There were other complaints made by Mr Rayner including that the mortgages had been granted upon a "false valuation" of the mortgaged property. Anderson J said that he understood that allegation was to the effect that the valuer had placed an inflated value on the property so as to enable an advance to be made against the security of the property in accord with the lender's "lending ratio criteria".
Anderson J held that the appellants had failed to demonstrate that the learned Master had been wrong to conclude that no arguable defence had been raised. His Honour was of the opinion that the appeal should be dismissed and that the order for summary judgment and the consequential orders should stand.
On 20 March 2002 a differently constituted Court comprised of Anderson, Wheeler and Miller JJ heard an application by the appellants for the Court to review the decision delivered on 7 December 2001. In that case the reasons of the Court were given by Wheeler J. Anderson and Miller JJ agreed with those reasons.
Wheeler J applied the reasoning of the Full Court of South Australia in McAdam v Robertson [1999] 73 SASR 360. Her Honour said that Mr Rayner had contended at the review hearing that the earlier Full Court had had regard to the wrong documents in making its decision; that the first Court had had regard to his grounds of appeal dated December 1999 rather than the document headed "Grounds of Appeal" which had been filed by him on 16 July 2001. He contended that there was a material difference between the two documents and that the Court's reliance on the earlier rather than the later document meant that he had not been fairly heard. He further contended that, in any event, the first Court had been plainly in error in its recital of the law. He also contended that that Court had been "disaffected" with him by reason of a somewhat intemperate reference to the Master which had appeared in the earlier of the two appeal documents.
Wheeler J said that if it was assumed that the first Full Court should have had reference to the second grounds of appeal document, it was her view that there was no material difference between the two documents. Her Honour said that, in his oral argument Mr Rayner had described as the nub of his case his allegations that the appellants had been under great pressure from the respondent when the security in question had been entered into. Her Honour said that it was not easy to discern from the various affidavits filed on the appellant's behalf precisely what that "pressure" had consisted of. There had been a great many generalised allegations of a "scam" of some sort in which the respondent was alleged to have participated. Her Honour said that the evidence in support of that allegation, at times strayed very far from the subject matter of the claim. That there had been nothing in the finding of the first Full Court, or in the reasons of the Court, which provided any basis for the appellant's submissions that there had been a "misapprehension in a significant respect as to the facts or the law" (McAdam v Robertson (supra) per Doyle CJ at [38]).
Her Honour said that it appeared to her that Mr Rayner was seeking to persuade the Court that the earlier decision was one in relation to which it should change its mind. In all the circumstances she had formed the view that the application to review should be dismissed.
In so far as the application for special leave to appeal to the High Court was concerned, Wheeler J formed the view that there was no reasonable prospect of success with such an application. In her Honour's view the Court should not take the exceptional course of granting the appellants' stay pending that application. Her Honour noted that it remained open for the appellants to seek such a stay from the High Court if they wished to do so.
From the reasons for judgment of the Master on the application for summary judgment it appears that the essential complaints of the appellants were that there had been an argument between the parties concerning a demand from the Bank dated 20 January 1988. The demand stated that the appellants' account was overdrawn to the extent of $17,585.63. The appellants considered that that debt had been discharged when an earlier mortgage (C2416110) had been discharged on 13 January 1988. There was an argument between the appellants and the Bank as to whether the money was owing.
The appellants contended that the Bank had acted negligently in the discharge of the mortgage. They did not accept that the debt was owing. They also alleged that there had been unconscionable conduct by the Bank between May 1986 and May 1992; that they had been subject to a "bombardment of actions" by officers of the Bank aimed at recovering the Bank's position and the ever escalating debt without the Bank going public. Those actions had allegedly included unpleasant threatening phone calls, threatening letters and bank officers allegedly attending at the property and making all sorts of threats in an aggressive manner. There were other alleged harassments referred to. The appellants contended that the conduct of the Bank had finally resulted in them surrendering to the Bank's pressure. They alleged that the Bank's actions were manifestly a breach of the provisions of the Trade Practices Act.
The appellants further alleged before the Master that between May 1982 and the commencement of the proceedings by the Bank, the Bank had engaged in "systematic, deliberate and calculated misleading and deceptive conduct"; that the Bank had deliberately withheld relevant and necessary financial information. They claimed that all alleged arrears of payments, fees charged, and interest thereon, were in breach of the Trade Practices Act; also that the Bank had relied upon a false valuation which did not truly represent the value of the mortgaged property. They contended that the valuation was inflated and not a true representation of a fair market price and that it had been arranged by the Bank to ensure that the debt to equity ratios for the first and second mortgages were maintained and to ensure that the loan did not breach the Bank's lending ratio criteria. They further contended that the Bank had breached its own lending criteria in manipulating income levels to show that the appellants would be able to meet their repayment obligations in respect of the two mortgages. They alleged that the Bank's conduct had been deliberate, calculated and systematic.
The learned Master considered that the appellants' evidence of negligence was inherently incredible and should not be believed. He was also of the opinion that the defence relied upon by the appellants of unconscionable conduct by the Bank between May 1986 and May 1992 had no substance. The learned Master also considered that alleged misconduct by the Bank, said to relate to attempts to enforce a security and not to the formation of a contract, could not as a matter of law amount to unconscionable conduct which would vitiate the contract; neither did it amount to a breach of the Trade Practices Act.
With respect to the alleged unconscionable, misleading and deceptive conduct between May 1992 and the commencement of the proceedings, the Master said he could not see that any of the matters raised by the appellants under those headings constituted an issue of law or fact which needed to be decided; that the appellants had raised no issue of fact or law which needed to be decided at a trial and that there was no other reason why a trial should be conducted. He said he would award summary judgment to the respondent and the appellants would be required to give up possession of the land within a specified time.
Nothing advanced to this Court has persuaded me that the decision of the Master is affected by material error in fact or law.
In Hamersley Iron Pty Ltd v Lovell (No 2) (1998) 20 WAR 79 Ipp J, with whom Pidgeon J agreed, comprehensively discussed the decided cases concerning the Full Court's responsibilities in dealing with an application for a stay pending leave to apply to the High Court. His Honour said that such an application has to be dealt with in a principled fashion - De L v Director General, Department of Community Services New South Wales (1996) 136 ALR 201 at 203.
I will not repeat what Ipp J said had been decided by previous decisions but amongst other things his Honour said that the general principle is that a stay being the exception, the applicant must show special circumstances - J C Scott Constructions v Mermaid Waters Tavern Pty Ltd (No 2) [1983] 2 Qd R 255 at 258 per Derrington J. Ipp J also referred to dicta of Burt CJ in Cox v Simeon, unreported; FCt SCt of WA; Library No 5063; 7 September 1983 which had emphasised that special grounds must be shown before a stay will be ordered. He said that whilst those authorities concerned stays of execution pending appeals from a single judge to the Full Court of a State, the position was no different in regard to an appeal from the Full Court of a State to the High Court.
Ipp J referred to the reasons of Dawson J in Commissioner of Taxation (Cth) v Myer Emporium Ltd (No 1) (1986) 160 CLR 220 where Dawson J said at 222‑223:
"It is well established by authority that the discretion which it (O 70 r 12) confers to order a stay of proceedings is only to be exercised where special circumstances exist which justify departure from the ordinary rule that a successful litigant is entitled to the fruits of his litigation pending the determination of any appeal…special circumstances justifying a stay will exist where it is necessary to prevent the appeal, if successful, from being nugatory…"
Ipp J also referred to the reasons of Kirby J in Bryant v Commonwealth Bank of Australia (1996) 70 ALJR 306 at 308 where Kirby J said:
"Repeatedly, the Court has emphasised that the jurisdiction to grant a stay is exercised only in very exceptional circumstances. It is 'extraordinary'".
Ipp J referred to the dicta of Brennan J that:
"A stay to preserve the subject matter of litigation pending an appeal for special leave to appeal is an extraordinary jurisdiction and exceptional circumstances must be shown before its exercise is warranted."
In Jennings Constructions Ltd v Burgundy Royale Investments Pty Ltd (1986) 161 CLR 681, Brennan J said at 685:
"In exercising the extraordinary jurisdiction to stay, the following factors are material to the exercise of this Court's discretion. In each case when the Court is satisfied a stay is required to preserve the subject matter of the litigation, it is relevant to consider first, whether there is a substantial prospect that special leave will be granted; secondly whether the applicant has failed to take whatever steps are necessary to seek a stay from the Court in which the matter is pending; thirdly whether the grant of a stay will cause loss to the respondent; and fourthly where the balance of convenience lies."
In this case, it is my opinion that there is not a substantial prospect that leave to appeal will be granted. I agree with the reasons of Wheeler J published on 15 April 2002 in which her Honour amongst other things said:
"So far as the application for special leave to appeal is concerned, the reasons which I have outlined above were the basis upon which I formed the view that there was no reasonable prospect of success in such an application and that the Court should not take the exceptional course of granting the Rayners a stay pending such an application although, as I noted

at the time of hearing, it remains open for them to seek such a stay from the High Court should they wish to do so."

For these reasons it was my view that a stay should not be granted but nevertheless, in order to enable the appellants to apply in the High Court for a stay of execution, this Court on 19 June 2002 ordered that no action be taken by the respondent to execute on the judgment until after the expiration of 28 days.
MURRAY J: On 19 June this Court heard and dismissed the appellants' application for a stay of execution of certain orders made against them pending the determination of an application which the appellants have made for special leave to appeal to the High Court.
I have had the advantage of reading in draft the reasons for that decision published by Wallwork J. I am in substantial agreement with them but wish to add a few observations of my own.
The matter has a considerable history. It commenced with an action for possession by the respondent arising out of the appellants' undoubted default under certain mortgages granted by them over their home in Willetton. The respondent applied for summary judgment. It succeeded before a Master of this Court, who gave judgment for the respondent on 30 November 1999 and ordered that they deliver up possession of their house.
The appellants appealed against that judgment. The appeal was not heard until 16 October 2001 but as I understand it, the order for possession was stayed in the meantime. On 7 December 2001, this Court (Murray and Anderson JJ and Einfeld AJ) unanimously dismissed the appeal: Rayner & Anor v Australia and New Zealand Banking Group Ltd [2001] WASCA 396. The stay therefore came to an end. We were told that it had been ordered conditionally upon the appellants making payments in respect of the loans of a total of $1135 per month as from 31 January 2000. The only payments made, we were told, were payments of $50 on each of 15 June 2000, 14 July 2000, 15 August 2000 and 19 September 2000.
It seems that the application for special leave to appeal against the decision of the Full Court has not yet been determined. I have examined the proposed grounds of the application and the argument which the appellants propose to advance in support of the application for special

leave. In my opinion, the application for special leave has no prospect of success.

However that may be, it seems that that application was not the first challenge to the judgment of the Full Court which the appellants attempted. Initially it seems they made an application to this Court that it should review the decision delivered on 7 December 2001 and in the meantime a stay of the original order should be granted. Both applications were unanimously dismissed on 20 March 2002 by the Court constituted by Anderson, Wheeler and Miller JJ: Rayner & Anor v Australia and New Zealand Banking Group Ltd [2002] WASCA 82.
As I understand it, the arguments advanced in support of the present application for a stay pending the determination of the application for special leave to the High Court are effectively those advanced unsuccessfully to the Full Court on 20 March 2002.
The law is clear. I am content to rely upon the statement of the principles by Ipp and Anderson JJ with whom Pidgeon J agreed in Hamersley Iron Pty Ltd v Lovell (No 2) (1998) 20 WAR 79. The remedy of the grant of a stay is an exceptional one which will rarely be granted in the exercise of the Court's discretion. Prima facie the other party is entitled to proceed to execute the judgment it has obtained, in this case over two and a half years ago. If one assumes that the refusal of the stay will finally see the judgment executed and possession of the house resumed, the appellants' application nonetheless fails, in my opinion, at the first hurdle, because of the lack of any prospect of success in their application for special leave.

It is to be remembered, in my opinion, that the grant of a stay becomes even more exceptional and rare in a case such as this where there has been an unsuccessful appeal to the Full Court and special leave to appeal to the High Court from that decision is sought. It seems to me to have been a pointless exercise, effectively to renew before the court as presently constituted an application for a stay previously refused by the court differently constituted, albeit in the different context of an application to this Court to review its earlier decision on the appeal.
It was for those reasons that I joined in the orders made on 19 June.
PARKER J: It was for reasons which substantially accord with those now published by Wallwork J that I joined in the Order of the Court made on 19 June 2002 that a stay should not be granted pending the

determination of an application to the High Court for special leave to appeal.