Ridout Nominees Pty Ltd v Commonwealth Bank of Australia - [2003] WASCA 182

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

TITLE OF COURT : THE FULL COURT (WA)

CITATION: RIDOUT NOMINEES PTY LTD & ORS -v- COMMONWEALTH BANK OF AUSTRALIA [2003] WASCA 182

CORAM: PULLIN J

HEARD: 5 AUGUST 2003

DELIVERED : 5 AUGUST 2003

FILE NO/S: FUL 65 of 2000

BETWEEN: RIDOUT NOMINEES PTY LTD
First Appellant
CLOVERDALE PTY LTD
Second Appellant
RANLEIGH WARE PTY LTD
Third Appellant
PETER ALLAN RIDOUT AND CHRISTOPEHR JOHN RIDOUT (As Executors of the Estate of GEORGE EDWARD RIDOUT)
Fourth Appellants
DOROTHY ELMA RIDOUT
Fifth Appellant
PETER ALLAN RIDOUT
CHRISTOPHER JOHN RIDOUT
Sixth Appellants
JILLIAN RIDOUT
Seventh Appellant
LYNETTE RIDOUT
Eighth Appellant
VINERS SILVERWARE PTY LTD
ESTELLE GIFTS PTY LTD
WANATA HOLDINGS PTY LTD
KAMBEROO PTY LTD
KACANA PTY LTD
FERGAL PTY LTD
Ninth Appellants
AND
COMMONWEALTH BANK OF AUSTRALIA
Respondent

Catchwords:

Courts and Judges - Jurisdiction to order stay of execution

Practice - Stay of execution - Turns on own facts

Legislation:

Nil

Result:

Application for stay dismissed

Category: B

Representation:

Counsel:

First Appellant               :     In person
Second Appellant          :     In person
Third Appellant             :     In person
Fourth Appellants          :     In person
Fifth Appellant               :     In person
Sixth Appellants            :     In person
Seventh Appellant          :     In person
Eighth Appellant            :     In person
Ninth Appellants            :     In person
Respondent:     No appearance

Solicitors:

First Appellant               :     In person
Second Appellant          :     In person
Third Appellant             :     In person
Fourth Appellants          :     In person
Fifth Appellant               :     In person
Sixth Appellants            :     In person
Seventh Appellant          :     In person
Eighth Appellant            :     In person
Ninth Appellants            :     In person
Respondent:     Corrs Chambers Westgarth

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

Branch v Lawrence [2003] WASC 124
Hamersley Iron Pty Ltd v Lovell (No 2) (1998) 20 WAR 79
Inglis v Commonwealth Trading Bank of Australia (1972) 126 CLR 161
National Australia Bank Ltd v Baker [2003] WASC 6
Re Shaw (2001) 4 VR 103
Ridout Nominees Pty Ltd v Commonwealth Bank of Australia [2003] WASCA 158

Case(s) also cited:

Commonwealth v Bank of New South Wales (1949) 79 CLR 497
Federal Commissioner of Taxation v Myer Emporium Ltd (No 1) (1986) 160 CLR 220
Manfal Pty Ltd (in liq) v Trade Practices Commission (1990) 65 ALJR 256
McBride v Sandland (No 2) (1918) 25 CLR 369

PULLIN J: First I should deal with the application by Peter Allan Ridout ("Mr Ridout"), the first‑named fourth appellant, to allow Mr Shaw to address the Court. This was a subject which was addressed in my reasons for decision in the appeal Ridout Nominees Pty Ltd v Commonwealth Bank of Australia [2003] WASCA 158. Mr Shaw has confirmed today that he is the person who was involved in Re Shaw (2001) 4 VR 103.
In my opinion, Mr Shaw should not be given leave to appear as the advocate for the appellants in this case, and I reach that conclusion not only because I have a concern about Mr Shaw's arguments becoming embroiled in these proceedings, but also, and more importantly, because I am satisfied that Mr Ridout is quite capable of acting as an advocate on his own behalf. He has a good grip of the issues from his point of view and, of course, he knows the effect of the judgment on this property and what steps are being taken or not taken, to secure possession.
For those reasons, I decline the request that Mr Shaw be permitted to act as advocate generally for the appellants.
So far as the application itself is concerned, this is an application by the appellants for a stay of the judgment of the Full Court which was handed down on 22 July 2003 in the case I have already mentioned; that is Ridout v Commonwealth Bank (supra). The background to this application for a stay is as follows. In 1995, the Commonwealth Bank claimed that the Ridout group was indebted to the bank in the sum of just over $4,000,000. The bank made demand for payment from the principal debtors and guarantors within the Ridout group. In breach of the covenants in the security documents, the moneys demanded were not paid. Certain property was then sold by the bank, which reduced the debt slightly, and the bank then sued, seeking a determination of the amount due and judgment for that amount and a declaration as to its entitlement to possession of the properties over which the security was held.
The bank was entitled to possession under the mortgages, but in view of the Ridouts' contention that some of the security documents should be set aside, the bank sought a declaration of its right to possession from the Court. The Ridouts counterclaimed, seeking a decree setting aside some of the mortgages and guarantees on various grounds.
This matter then went to trial before Wheeler J, and after a lengthy trial the Ridouts' counterclaims were all dismissed; the bank succeeded in its action; judgment was entered in favour of the bank against certain members of the Ridout group in the sum of just over $4,000,000 plus interest; and it was declared that the bank was entitled to possession of Brantwood, Camballan and Marshalls, the three properties of particular interest.
An appeal was then instituted by the Ridouts. That resulted in a hearing over two days on 17 and 18 June 2003. On 22 July 2003, the Ridouts' appeal was dismissed by the Full Court of the Supreme Court, and on that same day Mr Ridout applied orally for a stay of execution to prevent the bank proceeding to recover its money by taking possession of the properties. That application for a stay was refused.
Undaunted by that history, another application for a stay is made before me today. There is an affidavit in support, which is sworn by Mr Ridout. There is very little by way of fact in it. It consists mainly of submissions, including propositions of law, some of which were advanced certainly on the appeal or on the application to amend the grounds of appeal, and some of which may be slightly new matters or indeed new matters.
I am also told that an application for special leave to appeal to the High Court against the decision of the Full Court of this Court has been instituted by the appellants, but the affidavit which has been filed does not refer to that, and no papers concerning that application have been put before me. I have been informed orally that such an application has been made. I have no details at all about what the grounds of the application are. I will have to simply assume that it is an attempt to argue that the grounds already advanced in one form or another before the Full Court, or in the application for leave to amend the grounds of appeal, or in this present affidavit, are to be advanced on the application for special leave to appeal.
The first question which arises is whether I have any jurisdiction as a single judge to make an order staying execution after a decision of the Full Court of the Supreme Court of Western Australia. That is a subject which has arisen in another case, Branch v Lawrence [2003] WASC 124, where I decided that a single judge does have jurisdiction to grant a stay in relation to a judgment of a single judge which has been the subject of an unsuccessful appeal, and so I do consider that I have jurisdiction to entertain the application.
I then turn to the merits of the application. The Full Court of this Court in Hamersley Iron Pty Ltd v Lovell (No 2) (1998) 20 WAR 79 sets out the relevant authorities and principles governing an application for a stay by a party seeking special leave to appeal to the High Court. That case makes it clear that a stay is not granted simply for the asking; that it is not normal to grant a stay; and that the jurisdiction to grant a stay is an extraordinary jurisdiction only to be exercised in exceptional circumstances. At 89 of that decision, one of the circumstances which would enliven the discretionary jurisdiction, and which will be exceptional, is if there is a real risk that it will not be possible for the appellants to be restored substantially to their former position if the judgment against them is executed.
I am satisfied that the discretionary jurisdiction is enlivened in this case because if the Ridouts obtain leave to appeal, do appeal, do succeed in the appeal, and in the meantime the bank has executed and sold off the properties to recover its money, then there is a risk, of course, that the appellants would not be able to rebuy the farm, to put them back in the position that they are presently in, which is in possession of the property, even though the subject of threatened sale.
Having said that, it is clear also that it is necessary to go on to consider the appellants' prospects of success on the application for special leave and where the balance of convenience lies. I have to deal with the appellants' prospects of success on its application for special leave to appeal to the High Court.
As I say, I do not have details of what is in the application, but I assume that all of the points that I mentioned before are raised, or at least some of them are raised, in the application for special leave to the High Court. In my opinion, there is little or no prospect that special leave would be granted if the arguments that have been advanced to date are advanced before the High Court.
Applications for special leave to the High Court are not granted as of right. A very large percentage of applications for special leave are refused because they involve no question of law of general importance, and in my view that is so in this case. In addition, there is another problem that the appellants face, and that is that this case is a mortgage action; that is, an action by a bank to recover money which it has lent and which it is trying to recover.
In mortgage actions, the general rule is that where a party seeks to restrain the exercise by a mortgagee of his rights under a mortgage instrument, then failing payment into Court of the amount sworn by the mortgagee as due and owing under the mortgage, no order should be made by the Court restraining the exercise of the mortgagee's rights under the mortgage. That is a principle that emerges from the High Court decision of Inglis v Commonwealth Trading Bank of Australia (1972) 126 CLR 161.
This is, of course, a general rule and does not apply in every case, but I see no reason why it should not be applied in this case. There has been no suggestion at all that the appellants can pay the more than $4,000,000 which is owing, into Court. If they could pay the amount which the bank now has an entitlement to by way of a judgment of this Court, then of course an application for a stay could be entertained, but in the absence of any payment into Court the High Court has made it plain that in these circumstances a stay should not be granted.
Inglis's case concerned an application for an injunction before trial and not an application for a stay of execution, but in National Australia Bank Ltd v Baker [2003] WASC 6, it was held that those principles also apply in relation to an application to stay execution pending the hearing of an appeal.
For all of those reasons, I am of the opinion that the application should be dismissed, and I make that order dismissing the application.