Re Cwalina (Filing of Writ and Statement of Claim)
[2024] VSC 349
•21 June 2024
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
S ECI 2024 03144
| PIOTR MACIEJ CWALINA and ZOFIA BOZENA MAJAK | Proposed Plaintiffs |
| v | |
| ALAN WESLEY ROSE, RUSSELL CRAIG BYRNES and PETER DAVIS | Proposed Defendants |
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JUDGE: | Gorton J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | On the papers |
DATE OF JUDGMENT: | 21 June 2024 |
CASE MAY BE CITED AS: | Re Cwalina (Filing of Writ and Statement of Claim) |
MEDIUM NEUTRAL CITATION: | [2024] VSC 349 |
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PRACTICE AND PROCEDURE – Whether writ and statement of claim should be accepted by the Prothonotary for filing – Where proposed writ and statement of claim would operate as a collateral attack on prior Court decisions – Where proposed writ and statement of claim do not properly plead material facts giving rise to a cause of action – Where writ and statement of claim would be an abuse of process – Prothonotary directed not to accept document for filing – Supreme Court (General Civil Procedure) Rules 2015 (Vic) r 28A.04 and Court’s inherent jurisdiction.
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APPEARANCES: | Counsel | Solicitors |
| For the Proposed Plaintiffs | N/A | N/A |
| For the Proposed Defendants | N/A | N/A |
HIS HONOUR:
A. Introduction
Piotr Maciej Cwalina and Zofia Bozena Majak wish to commence a proceeding in this Court against Alan Wesley Rose, Russell Craig Byrnes and Peter Davis. Mr Cwalina and Ms Majak are self-represented and the Prothonotary has not accepted a proposed writ and statement of claim prepared by them for filing. The Prothonotary, concerned that it may appear that he has a conflict of interest because (as is referred to further below) he has initiated proceedings for contempt of court against Mr Cwalina and Ms Majak, has sought a direction as to whether he should accept or not accept the writ and statement of claim for filing. I am satisfied that I have the power to make such a direction either under r 28A.04(5) of the Supreme Court (General Civil Procedure) Rules 2015 or the Court’s inherent jurisdiction to control and to avoid abuse of its process.
B. The preceding litigation
Mr Rose and Mr Cwalina owned properties as tenants in common at 1 Geofrey Street and 17 Helen Street in Frankston South that they developed into two lots with a house on each with funds, among other things, borrowed from the Commonwealth Bank of Australia secured by a mortgage over the Geofrey Street property.
Ms Majak was married to, but had separated from, Mr Cwalina. When the Geofrey Street property was bought in April 2006, Ms Majak was in a romantic relationship with Mr Rose. Their relationship ended in about October 2012 (or, Ms Majak contends, in October 2013). Ms Majak claimed interests in the properties and, on 22 December 2016, commenced a proceeding in this Court against Mr Cwalina and Mr Rose (proceeding S CI 2016 05260) in which she sought to establish those interests. She claimed that she had made various contributions to the properties or their development, that she had been promised a ‘project management fee’, and that Mr Rose had acted fraudulently. She also made claims against Mr Rose in respect of another development in New South Wales. Her claims were disputed. Mr Rose counterclaimed against Mr Cwalina. He alleged and sought to enforce his version of the arrangements between them, and Mr Cwalina alleged and sought to enforce his version of the arrangements between them.
By August 2017, Ms Majak’s claim against Mr Cwalina was resolved or otherwise disposed of with Mr Cwalina agreeing that he held 5% of his interest on trust for Ms Majak. Ms Majak’s claims against Mr Rose were transferred to the Family Court of Australia (there was already a proceeding in that Court between them relating to other properties). The proceeding in this Court continued as if commenced by Mr Rose’s counterclaim against Mr Cwalina. In August 2017, Davis Lawyers were retained to prepare and lodge the plan of subdivision and to attend to the partition of land.
In October 2017, Mr Rose and Mr Cwalina reached an agreement. The agreement provided that the Geofrey Street and Helen Street properties were to be subdivided and partitioned, Mr Rose was to become the sole registered proprietor of the Geofrey Street house, Mr Cwalina was to become the sole registered proprietor of the Helen Street house, and that Mr Cwalina would pay to Mr Rose 50% of the difference in value between the two properties. Consent orders were prepared reflecting this agreement, but were never in fact made.0F[1] Unfortunately perhaps, the parties did not do as that agreement anticipated. Mr Rose then contended that Mr Cwalina had failed to honour that agreement, and Mr Cwalina contended that the agreement was no longer binding because Mr Rose had repudiated it and also because he had terminated it by serving notice of termination in accordance with its terms. Mr Cwalina also contended that Mr Rose’s breaches were, at least, in part, due to the conduct of Mr Rose’s solicitor, Mr Russell Byrnes. Mr Cwalina contended that the parties’ rights were to be determined instead by a deed executed in May 2006 at or about the time of the initial purchase of the Geofrey Street property. Mr Rose denied signing that document.
[1]Majak v Rose [2021] VSC 599, [10]-[11].
In 2018 and 2019, the Family Court heard the dispute between Ms Majak and Mr Rose. Evidence was led as to the arrangements, alleged promises or assurances, and the financial and other contributions that were made surrounding the purchase and development of the Geofrey Street and Helen Street properties and other properties associated with Mr Rose that, Ms Majak contended, gave her an interest in the Geofrey Street and Helen Street properties (as well as the other properties). The proceeding also considered what orders should be made under s 90SM of the Family Law Act 1975 (Cth) for a distribution of property given the prior de facto relationship between them. Ms Majak, Mr Rose and Mr Cwalina all gave evidence. Ms Majak criticised the conduct of Mr Byrnes, Mr Rose, Mr Rose’s other solicitors and the obtaining of apprehended domestic violence orders. Mr Rose was ‘prepared to acknowledge a 5% interest in favour of’ Ms Majak over the Geofrey Street and Helen Street properties. In December 2019, the Court concluded that there was ‘no basis’ for Ms Majak’s claims that she had an equitable interest in ‘any of the properties in respect to which she claims such an interest’.1F[2] The Court considered the evidence of Ms Majak and Mr Cwalina to be unreliable but that Mr Rose was a credible witness. The Court concluded that there was ‘nothing in the evidence of’ Ms Majak that satisfied it that Mr Rose had ‘made any representations or done, or failed to do any act which could reasonably give rise to any assumption capable of founding an equitable interest in’ the Geofrey Street and Helen Street properties or that could estop Mr Rose from asserting his legal interest in those properties. The Court dismissed ‘that part of [Ms Majak’s] application in the Supreme Court of Victoria which ... was referred to the Family Court’. Indeed, the Court declined Mr Rose’s invitation to find that Ms Majak had a 5% interest in the Geofrey Street and Helen Street properties.2F[3]
[2]The Family Court used pseudonyms and is reported as [REDACTED]. I will redact the name and citation of this decision in the version of these reasons that are published other than to the parties.
[3]Although that concession was taken into account when orders were made adjusting assets under s 90SM of the Family Law Act 1975 (Cth).
The Family Court then exercised its powers under s 90SM of the Family Law Act 1975 (Cth) to ‘alter’ their interests in various properties having regard to Ms Majak and Mr Rose’s de facto relationship between March 2009 and October 2012. In doing so, the judge considered and dismissed allegations made by Ms Majak that Mr Rose had ‘wasted’ money to reduce their joint asset pool and misrepresented his financial position.
Ms Majak appealed but, in July 2021, the Appeal Division of the Family Court of Australia dismissed her appeal. It rejected her arguments that she had been denied procedural fairness and that the trial judge was wrong to find Mr Rose to be a credible witness and had otherwise erred in various factual findings.
The proceeding in this Court was heard by Tsalamandris J in August 2023. Mr Rose, Mr Cwalina and Ms Majak all gave oral evidence. In December 2023 her Honour:
(a) concluded that the parties were bound by the terms of the October 2017 agreement.3F[4] Her Honour rejected Mr Cwalina’s submission that Mr Rose had repudiated that agreement4F[5] and Mr Cwalina’s submission that the agreement had been terminated by notice;5F[6]
[4]Rose v Cwalina [2023] VSC 721, [176] (Tsalamandris J).
[5]Ibid [209].
[6]Ibid [214], [219].
(b) concluded that there was no substance in the allegations against Mr Rose’s solicitor, Mr Byrnes;6F[7]
(c) substantively enforced the October 2017 agreement by making an order requiring Mr Cwalina and Mr Rose to pay certain sums and meet certain expenses, to file signed partition documentation with the Land Titles office,7F[8] and providing, if necessary, for the judicial sale of the properties and the application of the proceeds of that sale. After being satisfied that some paragraphs of her order had not been complied with, her Honour on 31 January 2024 authenticated orders vacating some paragraphs of the earlier orders and explicitly providing for the judicial sale of the properties and the application of the proceeds; and
(d) extended an order previously that Mr Rose, Mr Cwalina and Ms Majak not enter the properties prior to the settlement.
[7]Ibid [247].
[8]Ibid [243].
On 31 January 2024, her Honour also directed the Prothonotary to charge Mr Cwalina with contempt of court for breaching the order that he not enter the properties. The charges relating to Mr Cwalina are presently listed for hearing on 8 August 2024.
Mr Cwalina applied to the High Court for a stay of the judicial sale. The High Court dismissed that application.8F[9] Mr Cwalina applied for an extension of time in which to apply for special leave to appeal against Tsalamandris J’s orders. The High Court dismissed that application on the grounds than an application for special leave would have no prospects of success.9F[10]
C. The proposed proceeding
[9]Cwalina v Rose [2024] HCASJ 16 (Edelman J).
[10]Cwalina v Rose [2024] HCASL 153 (Gordon and Steward JJ).
The proposed writ names Mr Cwalina and Ms Majak as the first and second plaintiffs, and Mr Rose, Mr Byrnes and Mr Davis as the first to third defendants. Mr Davis, it is alleged, is a solicitor who was engaged by Mr Cwalina and Mr Rose ‘to register the subdivision and partitioning of the properties ... according to a Consent agreement from 5 October 2017.’
The proposed writ is divided into parts headed: ‘A. Preliminary’; ‘B. Commencement of Proceedings SCI 2016 05260’; ‘Assets owned by the parties prior to engaging in property development projects’; ‘Counterclaim’; ‘Summons to transfer the proceedings under the cross-vesting jurisdiction’; ‘Common purpose in joint venture;’ ‘Application to remove caveat’; ‘Costs created in the NSW Court of Appeal’; ‘Injunctions against the Plaintiffs in respect of accessing Helen Street property’; ‘C. Misrepresentation of actions taken in respect of consent agreement’; ‘D. Deceitful costs application’; ‘E. Fraud on the Court’; ‘F. Unconscionability’; ‘F. Negligence of Davis Lawyers’; and ‘G. Relief claimed’.
The allegations in the proposed pleading relate to the purchase of and dealings with the two properties and the conduct of various persons in relation to them. The allegations of substance, putting to one side the narrative allegations, seem to be that:
(a) Ms Majak had or has a propriety interest in the Helen Street property;
(b) The Family Court’ dismissed Ms Majak’s claims to an interest in the Helen Street property because it relied on false assertions and submissions made by Mr Rose and Mr Byrnes;
(c) An appeal from that decision, or a decision of the Victorian Court of Appeal, was dismissed because Mr Rose failed to comply with his duty to the Court;
(d) This Court transferred Ms Majak’s claims to the Family Court as a result of misleading material contained in an affidavit sworn by Mr Rose, and that the ‘real reason’ for the application for transfer by Mr Rose was to prevent findings being made that his claims were an abuse of process or without a proper basis and to prevent its coming to light that he had acted dishonestly;
(e) Mr Byrnes acted dishonestly in the Supreme Court proceeding and sought ‘just to wear out’ Mr Majak;
(f) Mr Byrnes perverted the course of justice by misleading the Family Court;
(g) Mr Rose obtained a costs order in the Family Court on the basis of false allegations and in this Court by misrepresentation;
(h) Mr Rose knew that the claims made by him in the Family Court were an abuse of process;
(i) A restraining order made against Ms Majak in favour of Mr Rose in New South Wales was applied for as part of a ‘plan designed to alienate’ Ms Majak from assets ‘built primarily’ from her funds, and was made based on false statements, and this was a reason for which she lost her claim of a constructive trust;
(j) The injunction made that prevented Ms Majak from entering the Helen Street property was obtained without Mr Rose disclosing ‘the actual facts’ concerning the proceeding, including that the ‘restraining order’ was procured by misrepresentations;
(k) Mr Rose ‘misrepresented the issues that arose’ in the proceeding before Tsalamandris J;
(l) The costs order that Mr Rose obtained in the Family Court proceeding was ‘fraudulently obtained’ and obtained by acting ‘deceitfully’ and included costs that were ‘unnecessarily obtained’;
(m) Mr Rose and Mr Byrnes abused the processes of the Courts by ‘deliberately casting false aspersions’ on Mr Cwalina and Ms Majak and ‘misled’ the Court and this led Tsalamandris J to make the order for judicial sale;
(n) Mr Rose unlawfully placed a ‘vendor bid’ at the auction because Ms Majak did not also agree to that bid being placed; and
(o) Mr Davis, the solicitor who was involved in the sale of the properties, was negligent to assist Mr Byrnes with the sale in circumstances when he knew that Mr Byrnes’s conduct ‘was discreditable as a legal practitioner’ and had ‘fabricated evidence’ and took instructions for a sale by private treaty when Mr Cwalina did not agree to have the property sold in that way.
The relief that Mr Cwalina and Ms Majak seek includes orders that:
(a) Mr Rose and Mr Byrnes be restrained from authorising dealings in relation to Mr Cwalina’s interests in the properties and Mr Davis be restrained from providing conveyancing services to that end;
(b) Mr Davis (although they may have meant Mr Rose):
(i) ‘makes an application under the liberty to apply’ to provide ‘clarifications of misrepresentations of facts and court processes, that affected the decision of Justice Tsalamandris’ including that the orders for sale were ‘affected by misrepresentation’;
(ii) send a letter to the Family Court of Australia’ informing it that its dismissal of Ms Majak’s claim and the costs orders made were ‘affected by misleading submission’; and
(iii) make an application to the Family Court asking that it revoke its decision and transfer the matter back to the Supreme Court ‘to be considered together with the remaining issues between’ Mr Cwalina and Mr Rose; and
(c) Damages, including for not just the loss of the properties but also for deprivation of ‘basic human rights’, depriving Mr Cwalina of ‘the right to residency in Australia’, loss of liberty, ‘inducing arrest and prosecution’, being ‘legally responsible for bankrupting Ms Majak, and for preventing Mr Cwalina from recovering some funds advanced for the construction of the property.
Although not mentioned in their prayer for relief, the body of the pleading indicates that Mr Cwalina and Ms Majak also seek to have the ‘restraining orders’ (which I understand to be the injunction) and the order to sell the properties set aside, on the grounds that those orders were ‘obtained by fraud’.
The above is not intended to be a complete summary.
D. The proposed proceeding would be an abuse of process
I am satisfied that the proposed proceeding would be an abuse of process, and the Prothonotary should not accept the proposed writ for filing. The proposed proceeding would be an abuse of process both because of what it is trying to achieve, and because of the form in which it is presented.
The proposed proceeding is, in substance, a collateral attack on decisions that have already been made in this Court and in the Family Court. If the orders made in those proceedings were induced by fraud, or some other form of actionable misconduct that makes them unsafe, then the appropriate course is to seek to have those orders set aside in the appellate process. It is an abuse of process instead to commence a fresh proceeding and to contend in the fresh proceeding, in substance, that the decision reached in the earlier proceeding was wrong.10F[11] This is so for a number of reasons:
[11]A proceeding that has this effect is an abuse of process – see, eg, Rogers v The Queen (1994) 181 CLR 251,255-256 (Mason CJ), 286 (McHugh J). It has been accepted, in cases involving the immunity of counsel, that a collateral attack, or attempt to impugn, a prior undisturbed legal proceeding can be contrary to good policy because it undermines the system of justice and raises great practical difficulties, as to which see, eg: Rondel v Worsley [1969] 1 AC 191, 249-251 (Lord Morris of Borth-Y-Gest); D’Orta-Ekenaike v Victoria Legal Aid (2005) 223 CLR 1, 29 [77] (Gleeson CJ, Gummow, Hayne and Heydon JJ). See also, with respect to repeated interlocutory applications, D A Christie Pty Ltd v Baker [1996] 2 VR 582, 602-604 (Hayne JA), 611-612 (Charles JA).
(a) First, it creates a situation where one trial Court is asked to assess the correctness of orders made in another trial Court and so leads to a risk of inconsistent decisions in different Courts. That would bring the administration of justice into disrepute. In this respect, of course, the appellate process is different: not only does an appellate court sit above a trial court in a hierarchy, but the appellate process empowers the appellate court, if the appeal succeeds, to set aside orders it considers erroneous so there are not inconsistent decisions;
(b) Secondly, to permit collateral attacks in this manner would frustrate or sideline the appeal regime and the restrictions that the legislature and courts have imposed on that regime such as the nature of any appeal that is allowed and the procedural processes that have to be followed and time limits complied with in order to appeal; and
(c) Thirdly, associated with the second point, and most fundamentally, to allow collateral attacks in this way would be contrary to the public interest and the private interest of successful litigants in finality in litigation. The administration of justice would be brought into disrepute if an unsuccessful litigant were able simply to bring a fresh proceeding making the same arguments or seeking the same relief again or relief targeted at removing the effects of the orders made against them, or if a losing party could in effect start again by commencing another case directed at trying to achieve the same ends by alleging misconduct in the running of the earlier case.
This Court and the Family Court have comprehensively determined the rights that Mr Cwalina and Ms Majak have over the Geofrey Street and Helen Street properties arising out of the circumstances in which they were bought and developed and the contributions and assurances made by them and by Mr Rose and the other persons involved. By the proposed proceeding, Mr Cwalina and Ms Majak seek to litigate again issues that have already been litigated and decided against them or to establish that the earlier decisions in this Court and in the Family Court were wrongly decided for various reasons. This they cannot do outside the appellate process.
Additionally, the form of the pleadings in this case are embarrassing in the legal sense of that word. They do not set out the material facts, and only the material facts, together with particulars where appropriate, that establish an ascertainable cause of action. They read instead as a stream of generalised and hard to understand allegations of misconduct on the part of various people. The need to have clear pleadings in the case of allegations of fraud is well established. Pleadings in the form of the proposed document do not in any sensible way allow discrete issues to be identified for determination.
For both these reasons, I will direct the Prothonotary not to accept the proposed writ for filing.
E. Final Observations
I note the references to Ms Majak being bankrupt. That, too, is a matter that could prevent the writ from being filed. I have not decided this matter on that basis, because it is not clear whether Ms Majak has been discharged from her bankruptcy or if she has what effect that the bankruptcy would have on the claims that she refers to in the proposed proceeding.
Mr Cwalina and Ms Majak have been involved in extensive litigation in this Court, the High Court, the Family Court, and in the District Court and Supreme Court and Court of Appeal in New South Wales. For the avoidance of doubt, I have decided to direct that the writ not be accepted for filing because I consider the proposed proceeding would be an abuse of process, but I have not considered whether Mr Cwalina or Ms Majak are vexatious litigants or decided this matter on that basis.
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