Scandi Pty Ltd v Wright
[2000] VSC 188
•8 May 2000
| SUPREME COURT OF VICTORIA | |
| PRACTICE COURT | Not Restricted |
No. 5051 of 2000
| SCANDI PTY. LTD. | Plaintiff |
| v. | |
| HEATHCOTE McMICHAEL WRIGHT | Defendant |
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JUDGE: | BEACH, J. | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 5 MAY 2000 | |
DATE OF JUDGMENT: | 8 MAY 2000 | |
CASE MAY BE CITED AS: | SCANDI PTY. LTD. v. WRIGHT | |
MEDIUM NEUTRAL CITATION: | [2000] VSC 188 | |
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CATCHWORDS: Interlocutory injunction – Application to dissolve – New facts and circumstances – Application granted.
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APPEARANCES: | Counsel | Solicitors |
For the Plaintiff | Mr. Joseph Guss | Joseph Guss |
| For the Defendant | Mr. J. Delaney | Peter S. Lustig |
HIS HONOUR:
On 13 April 2000 two proceedings came before Gillard, J. concerning Unit 10, 58 Clarendon Street, East Melbourne.
The unit is owned by the present applicant, Heathcote McMichael Wright, who is a senior member of the Victorian Bar. I should add that I do not know Mr Wright personally, nor have I ever had any personal contact with him. However, he has appeared before me on some occasions over the years, but infrequently. I have no embarrassment in dealing with any matter in which he is involved.
It would appear that by a lease dated 26 March 1997 Mr Wright leased the unit to Scandi Pty Ltd, a company with which Joseph Guss is and has been associated, although my understanding is that the present directors are Mr Guss's son and daughter. The annual rent in respect of the unit was some $60,000. Scandi is now in receivership.
Because he was desirous of occupying the unit himself, in December 1999 Mr Wright caused a notice to quit to be served on Scandi pursuant to the provisions of s.258 of the Residential Tenancies Act. The notice required Scandi to vacate the unit within 60 days from the day on which the notice was given.
As it transpired the unit was in fact occupied by Mr Guss and his wife Sandra as licensees of Scandi.
At all events, Mr and Mrs Guss refused to vacate the unit and on 16 March 2000 Mr Wright made an application to the Victorian Civil and Administrative Tribunal for an order for the eviction of Scandi.
After a hearing which extended over some four days before a member of the Tribunal, on 3 April an order was made to the effect that Mr Wright was entitled to possession of the unit and was entitled to issue a warrant of ejectment. The Tribunal refused to grant a stay of the order.
The opposition to the making of the order came of course from Mr and Mrs Guss. The receiver of Scandi played no part at the hearing of the application and indeed consented to the Tribunal making the orders it did in the matter.
On 11 April Mr Wright obtained similar orders from the Tribunal against Mr and Mrs Guss. On that same day warrants were issued pursuant to each order and on 12 April they were executed.
Mr Wright took possession of the unit, changed the locks and denied Mr and Mrs Guss access to it. On 13 April Scandi Pty Ltd and Mr and Mrs Guss caused two originating motions to be filed in the court whereby they made application for leave to appeal against the decisions of the Tribunal.
That same day the two proceedings came before Gillard, J. Mr Guss, who appeared for his wife and who purported to also appear for Scandi, made application to His Honour for orders, the effect of which would permit him and his wife to go back into the unit pending the hearing of the applications for leave to appeal.
After a hearing which lasted some hours that day and into the following day, Gillard, J. made the following orders in each proceeding:
"The Court Orders that:
1.Until the hearing and determination of the application for leave to appeal the respondent be restrained from occupying or permitting any other person to occupy the premises situated and known as Unit 10, 58 Clarendon Street, East Melbourne or remove or deal in any way with the property of the appellants situated thereon, subject to the following conditions:-
(i)Joseph Guss and Sandra McInnes Guss pay to the respondents solicitors, Peter Lustig by 4.15 p.m. on 17 April 2000 any rent owing to date such rent to be held in trust until the hearing and determination of the appellants' application for leave to appeal.
(ii)The appellants issue and serve by 4.15 p.m. on 17 April 2000 a summons to a Master for the leave sought in the originating motion, returnable on 27 April 2000.
(iii)The appellants prosecute the application for leave to appeal expeditiously.
2.The respondent provide access on Saturday of each week commencing on 15 April 2000 between the hours of 9 a.m. And 11 a.m. To enable Joseph Guss and Sandra McInnes Guss to deal with their possessions situate on the premises in the company of a person nominated by the respondent.
3. Reserve liberty to apply.
4. Reserve costs."
His Honour's reasons for judgment run to some 14 pages and set out clearly the circumstances which prompted His Honour to make the orders he did.
It is clear from those reasons that His Honour had grave doubts as to whether it was arguable that the Tribunal had made any error of law in the matter, and only granted the injunctive relief he did, thereby preserving the status quo as it then was, because of the short period of time which His Honour anticipated would elapse before Mr Guss could make the applications for leave to appeal on his and his wife's behalf and on behalf of Scandi to a Master of the court.
That much is clear from the following passages on pp. 12 and 13 of His Honour's judgment.
"54.However, having indicated that, my provisional views are the grounds that Mr Guss relies upon do not really raise questions of law. The fact is that the material before the Court is incomplete in that the transcript has not been made available and, further, Mr Guss was required to detail his grounds of appeal orally without the benefit of fully considering the points he wished to make and putting them in writing.
58.The application for leave to appeal is to be made on summons which must be filed within seven days of the issue of the motion and the summons shall be served not less than 14 days before the date fixed for hearing. It can be seen that the hearing of the application could be at least 21 days away from the present day. If Mr Guss was successful in his application for leave to appeal, then no doubt a stay would be granted to ensure that his appeal would not be rendered futile by events overtaking it.
59.This is a matter of substance in this application which I emphasize is an application for relief for a short period to enable the appellants to properly present on adequate material their application for leave to appeal to a Master.
60.Coming to the balance of convenience, I have no doubt that the balance of convenience lies squarely and fairly in favour of Mr and Mrs Guss at this stage.
61.Whilst I am not persuaded on the arguments to date that Mr Guss has reasonable prospects of obtaining leave to appeal, I am very aware that this application has been made quickly, on insufficient and inadequate material, and the balance of convenience favours Mr and Mrs Guss being granted a short stay to enable the application for leave to appeal to be made.
62.I am prepared to grant relief which is a mixture of a stay and injunctive relief to preserve the status quo to enable the application to be made expeditiously. The relief is to be subject to conditions. I am not in a position to undo anything that has occurred to date which was in accordance with orders made. Therefore, it is not open to the Court to interfere with the issue and execution of the warrant of execution. However, the Court can and should freeze the situation at this stage to enable Mr and Mrs Guss to make their application for leave to appeal. In other words, to preserve the status quo for a short period to enable the applicants to apply for leave to appeal to a Master."
It is also clear of course from the content of paragraph 1 of His Honour's order.
As required by sub-paragraph (ii) of paragraph 1 of His Honour's order, on 17 April Mr Guss issued and served summonses in each proceeding seeking leave to appeal from the decision of the Tribunal to this court.
Again and in compliance with the orders, the summonses were returnable before Master Evans on 27 April.
On 27 April Mr Guss informed the Master that as he had not yet received a copy of the transcript of the proceedings before the Tribunal, he was unable to proceed with the applications and sought an adjournment of them.
Despite the opposition of counsel for Mr Wright, Master Evans adjourned each application to 12 May.
On 3 May counsel for Mr Wright appeared before me pursuant to the liberty to apply which had been granted by Gillard, J., seeking an order that the orders of Gillard, J., save for the order in respect of the rent of the unit be dissolved.
I communicated that fact to Gillard, J. who informed me that he would be embarrassed to deal further with the matter. His Honour requested me to attend to it.
Because of the late receipt by Mr Guss of the affidavit of Mr Wright sworn 1 May in support of his application, it was necessary to stand the matter over to 4 May.
On 4 May Mr Guss was still unable to proceed and so I stood the application over until 5 May.
The basis upon which Mr Wright makes his application for dissolution of the injunctions granted by Gillard, J. is that since the date of His Honour's orders, there has been a significant change in the circumstances in two respects.
In the first place when the matter was before Gillard, J. it had been brought on with such haste that there was no material before His Honour as to the hardship which would be caused to Mr Wright if he was prevented from occupying his unit. There is now such material before the court.
In the second place the applications by Mr and Mrs Guss and Scandi for leave to appeal have not been pursued as expeditiously as envisaged by Gillard, J. and there will now be further delays in the matter.
Two further points raised by counsel for Mr Wright are that the order granting Mr and Mrs Guss access to the unit has proved unworkable and that having regard to the financial situation of Mr Guss and his wife, there are concerns that the undertaking as to damages given to Gillard, J. on 14 April will prove to be worthless.
The hardship being caused to Mr Wright as a result of being deprived of the right to occupy his unit is set out in paragraph 13 of his affidavit of 1 May 2000 and paragraph 11 of his affidavit of 5 May. Those paragraphs read:
"13.This further delay in the prosecution of the Appellants' applications for leave to appeal is causing me great hardship.
(a)I anticipated taking possession of my unit on 23 February 2000 or very shortly thereafter, which is now over two months ago.
(b)In the interim I have been obliged to find temporary accommodation in a furnished apartment. I have now had to renegotiate the term of my accommodation on two occasions. I am not in a position to negotiate alternative and more suitable accommodation on a long term basis because of the uncertainty that exists regarding Clarendon Street. In any event, it is my desire to live at the Clarendon Street unit.
(c)My temporary accommodation is of insufficient size to allow me to have any more than my personal clothing, a few CDs and some books. In particular I do not have ready access to my personal files and records. Although I can arrange that access in advance it is most inconvenient. Apart from this I have none of my personal effects or possessions with me.
(d)I do not have access to my home library for the purpose of professional research at night.
(e)I am not at present receiving any rent from the Clarendon Street unit, and so the expense of my temporary accommodation, which in any event was greater than the rent I was receiving, has increased considerably. This is a frustrating and unnecessary expense. In addition, I am obliged to make monthly repayments on the mortgage I obtained to finance the purchase of the unit.
(f)Most of all, I feel I am living 'in limbo'. I have been through a fairly traumatic experience and wish to re-establish myself in permanent accommodation at my unit in Clarendon Street as soon as possible. I feel that only then will I be able to focus on the future. I am concerned that my present situation is affecting my professional performance."
The traumatic experience spoken of by Mr Wright in that passage is his fairly recent separation from his wife.
"11.More importantly, as my Affidavit sworn 1 May 2000 reflects, I need the premises in which to live. I was required under the Residential Tenancies Act to give 60 days notice in writing to the tenant, Scandi Pty Ltd. In view of my personal circumstances, that notice was given on 17 December 1999. In anticipation of the Unit being available for personal use on 23 February 2000, I moved to temporary accommodation on 8 February 2000 being a small furnished apartment. I have been forced to continue to live in that very unsatisfactory and unsettling environment for nearly three months because of steps taken by Mr and Mrs Guss on their own behalf and by Mr Guss purporting to act on behalf of Scandi Pty Ltd.
My personal position, should the Orders not be discharged is intolerable."
It is clear that had that material been before Gillard, J. on 14 April, it would have been relevant to His Honour's consideration of the balance of convenience. As it was not, it is my opinion that it can properly be said that the circumstances relating to the application for injunctive relief have changed although it does not necessarily follow from that finding that there should be any variation of His Honour's orders.
It is clear from the material to which I have referred that at the time Gillard, J. made his orders, His Honour envisaged that the applications for leave to appeal by Mr and Mrs Guss on the one hand and Scandi on the other would be heard and determined on 27 April. This of course has not occurred.
Whilst there is no appeal before me in respect of Master Evans' order granting the adjournment of each application, I do question whether such adjournments were necessary.
There has been no suggestion by Mr Guss, either before Gillard, J. or in the proposed notices of appeal to which I shall refer again shortly, of any absence of evidence before the Tribunal justifying the making of the orders it did, or any suggestion that having regard to the evidence before it, no Tribunal acting reasonably could have made the orders it did.
Why then was it so essential that the transcript of the proceedings be before the Master at the time Mr Guss made his applications?
The determinations of the Tribunal and the reasons for those determinations were before the Master as they were before Gillard, J. Surely if it was arguable that the Tribunal had made any error of law, that would be apparent from the determinations and the reasons.
At all events by virtue of the adjournment, the applications for leave to appeal were not made at the time Gillard, J. envisaged they would be, and again, in my view, that is a fresh circumstance.
As to the unworkability of the access order, I simply say that if one has regard to the affidavit material filed by the parties, that is clearly the case.
The evidence before the Tribunal was that by order of the Federal Court, Mr Guss has been declared bankrupt, although at the present time that order is stayed pending an appeal by Mr Guss to the High Court.
When giving evidence before the Tribunal, Mrs Guss swore that she had no idea of her taxable income.
In my opinion those facts are sufficient to cause one to doubt the value of the undertaking as to damages.
There are now two further aspects of this matter I wish to deal with.
Before stating his conclusions that he was not persuaded on the arguments put to him at that time by Mr Guss, that Mr Guss had reasonable prospects of obtaining leave to appeal, Gillard, J. carefully considered the arguments Mr Guss had put to him. That much is clear from His Honour's reasons for judgment.
I have read His Honour's reasons for judgment and agree with the views he expressed in the matter. I have also considered the reasons of the Tribunal for its decisions and can discern no arguable error of law in them.
When the matter was before Gillard, J., there was no proposed notice of appeal before His Honour which contained the grounds upon which Mr and Mrs Guss and Scandi were making their applications for leave to appeal. As Gillard, J. pointed out at p.12 of his judgment, Mr Guss was then required to detail his grounds of appeal orally without the benefit of fully considering the points he wished to make and putting them in writing.
Mr Guss has now had the opportunity to do that and has done so. I now have his draft notice of appeal before me.
When I asked Mr Guss of Friday last whether the grounds were any different from the grounds considered by Gillard, J., he initially stated that they were exactly the same. Later he added that they may have been refined a little.
I have considered the grounds contained in the notice of appeal and am satisfied that they are the same as those considered by and dealt with by Gillard, J.
I consider that it is strongly arguable that none of them would justify granting leave to appeal to Mr and Mrs Guss or Scandi.
The second aspect of the matter I wish to refer to is the situation of Scandi insofar as any application for leave to appeal by it is concerned.
As I have already pointed out, Scandi is in receivership. Its receiver consented to the orders being made against it by the Tribunal.
By what right therefore does Mr Guss have to make any application on its behalf? In my opinion, it is strongly arguable that he has none.
Further, as Gillard, J. pointed out at p.11 of his reasons for judgment, although not in the words I propose to use, if Scandi has vacated the premises as it has, what right have Mr and Mrs Guss to remain.
In my opinion the new circumstances to which I have referred, taken together with the other matters I have adverted to, are such that it is quite inappropriate that the injunctions granted by Gillard, J. on 14 April continue.
Great inconvenience has been caused to Mr Wright as a result of being deprived of his entitlement to occupy his own unit.
On the other hand, Mr and Mrs Guss were mere licensees of the unit and have been well aware for some time that Mr Wright has required possession of it.
I find it very difficult to accept therefore that in the time available to them they have been unable to find suitable alternative accommodation, particularly bearing in mind that they are apparently prepared to pay a weekly rental of the order of $1,200.
In each proceeding the order made in paragraph 1 of Gillard, J's orders, save for the conditions contained in that paragraph which are numbered (i), (ii) and (iii), and paragraph 2 of the orders are dissolved.
I order that in each proceeding Mr and Mrs Guss pay the applicant's costs of the applications save for those incurred on 3 May. In my opinion, it is appropriate that the parties bear their own costs of 3 May.
(Discussion ensued.).
I propose to stay the orders I have made today until 4 p.m. On Friday next.
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