Serbian Cultural Club "St Sava" Incorporated and Serbian Orthodox Church St Knez Lazar Incorporated (in liquidation) v Radovanov

SERBIAN CULTURAL CLUB “ST SAVA” INCORPORATED and anor v RADOVANOV
[2012] ACTSC 60 (4 May 2012)

REAL PROPERTY – mortgagee covenanting by deed to sign and hand over discharge of mortgage – failing to do so – unlikely to comply with order that he do so – order that Registrar sign discharge in mortgagee’s place – declaration that mortgagor entitled to possession of mortgaged land.

INJUNCTION – defendant entering on plaintiffs’ land – defendant denying access to land to agents of plaintiff – defendant threatening to assault persons entering on land – injunction granted restraining defendant from entering on land.

Court Procedures Rules 2006, r 2442

Vesic v Serbian Cultural Club of St Sava Incorporated; Bogunovic v Serbian Orthodox Church St Knez Lazar Incorporated [2002] ACTSC 119

No. SC 253 of 2011

Judge: Master Harper
Supreme Court of the ACT

Date: 4 May 2012

IN THE SUPREME COURT OF THE     )
  )          No. SC 253 of 2011
AUSTRALIAN CAPITAL TERRITORY           )

BETWEEN:SERBIAN CULTURAL CLUB “ST SAVA” INCORPORATED
First Plaintiff

AND:SERBIAN ORTHODOX CHURCH ST KNEZ LAZAR INCORPORATED (in liquidation)
Second Plaintiff

AND:STEVAN RADOVANOV
Defendant

ORDER

Judge:  Master Harper
Date:  4 May 2012
Place:  Canberra

THE COURT DECLARES THAT:

the plaintiffs are entitled to possession of block 5 and block 9 section 57 Mawson.

THE COURT ORDERS THAT:

the Registrar sign in the place of the defendant discharges of mortgage number 1142376 over block 9 section 57 Mawson by the second plaintiff to the defendant, and mortgage number 1142377 over block 5 section 57 Mawson by the first plaintiff to the defendant.

the defendant be restrained from entering the land comprised in block 5 and block 9 section 57 Mawson.

the defendant pay the plaintiffs’ costs.

each party have liberty to apply on 7 days notice.

This action was commenced by originating claim, accompanied by a statement of claim, on 21 April 2011. The proceeding arises out of a dispute within Canberra’s Serbian community. Both the plaintiffs are incorporated associations. The second plaintiff is in liquidation. I shall refer to the first plaintiff as the Club and the second plaintiff as the Church.
The Club is the registered proprietor as Crown lessee of block 5 section 57 Mawson. The Church is the registered proprietor as Crown lessee of block 9 section 57 Mawson. The blocks adjoin. A building has been erected so that it is partly on both blocks.
There are mortgages registered on the title of both blocks in favour of the defendant. The defendant was a founding member of both plaintiff associations.
There have been previous proceedings in this Court to which the present parties were parties. The earliest proceedings were commenced in 2001. Crispin J published reasons and orders on 22 November 2002: Vesic v Serbian Cultural Club of St Sava Incorporated; Bogunovic v Serbian Orthodox Church St Knez Lazar Incorporated [2002] ACTSC 119. The orders dealt with earlier disputes between factions within the Serbian community. Crispin J set out the history of the matter at some length in his reasons and it is unnecessary for me to summarise that history again.
On 24 December 2004 a deed of settlement was entered between the various parties to the earlier litigation, including the present plaintiffs and the present defendant. A counterpart of the deed bears the signature of the present defendant, witnessed by a Canberra solicitor not involved in the present action. The deed was expressed to effect a settlement of five sets of proceedings in this Court, five related proceedings in the Court of Appeal and one proceeding in the High Court of Australia. In the deed, the defendant covenanted and agreed “to forthwith remove and discharge any mortgage or obligation securing any alleged advance to the Club or to the Church by or in favour of [the defendant] or any member of his family”. The defendant agreed to “hereby absolutely and unconditionally release and discharge the Church and the Club from any claim whatsoever arising up to the date of [the] Deed”. The defendant further agreed to “execute and sign and do all such things as are necessary to give affect [sic] to the releases and discharges herein granted”.
In February 2007 the liquidator of the Church signed a transfer of the Church’s interest as registered proprietor of Block 9 to the Club. The transfer has not been registered. The plaintiffs say that it cannot be registered because no certificate of fitness for occupancy and use has been issued in respect of the building, and no certificate of compliance with the terms of the Crown lease has been issued. Further, the leases were “concessional” and a transfer requires the approval of the Australian Capital Territory which has not at this stage been granted.
The defendant has not provided to the plaintiffs signed discharges of the mortgages over the two blocks. The plaintiffs assert that they are entitled to possession of the blocks, and entitled to discharges of the mortgages. They seek declaratory relief, and orders which will have the effect of enabling discharges of the mortgages to be registered.
In their statement of claim, the plaintiffs further assert that they engaged a firm of surveyors to carry out preparatory work for redevelopment of the land, and to enable registration of the transfer. They say that the defendant refused the surveyors entry to the land, threatened employees of the surveyors with physical violence, and made a threat by telephone to kill one of the principals of the firm of surveyors. The plaintiffs assert that the defendant is in occupation of the land and building without their permission, and that he is preventing access to the land by persons who have the permission of the plaintiffs to enter.
On 13 May 2011, upon the plaintiffs giving the usual undertakings as to damages, I ordered that the defendant be restrained from denying or hindering access to the land to servants or agents of the plaintiffs including the surveyors. I further ordered that he be restrained from threatening or assaulting such persons.
In September 2011 I made a direction that the defendant file any defence or counterclaim by 4 November 2011. The defendant did not file a defence or counterclaim by that date. The matter came before me for further directions on 9 December 2011. I granted the defendant an extension of time to file a defence or counterclaim to 3 February 2012. I made further directions as to the future progress of the action. I directed that the hearing was to proceed on affidavit evidence. I directed that if the defendant wished to cross-examine any of the deponents of affidavits relied on by the plaintiffs, he was to give notice of the persons, and a brief outline of the issues he sought to raise, at least three weeks before the hearing. I directed that if the defendant had any objection to the contents of any of the plaintiffs’ affidavits, he was to file and serve a list of objections at least three weeks before the hearing. I directed that supplementary oral evidence could be given provided that the defendant filed and served a statement of such evidence at least three weeks before the hearing.
On 10 February 2012 I granted leave to the plaintiffs to approach the list clerk for a hearing date. The matter was listed for hearing for the fortnight commencing 23 April 2012, and came on for hearing in that list on 24 April.
At no time has the defendant filed a defence or counterclaim. On 24 April, Ms Patricia Orton, who had represented the plaintiff at earlier directions hearings with my leave, sought leave to appear. She informed me that the defendant was overseas seeking medical treatment, and was too ill to prepare for hearing or to attend Court. She said that he had applied to a provider of pro bono legal assistance, and that his application was under consideration. She did not inform me when or in what manner the application had been made. She handed me a draft document titled “defence and counterclaim”. This had not been previously seen by the solicitors or counsel for the plaintiffs. Its contents did not comply with the provisions of the Court Procedures Rules 2006 as to pleading. It did not purport to plead to any of the detailed assertions of fact contained in the statement of claim. The counterclaim did not plead a cause of action known to the law. I treated Ms Orton’s handing up of the document as an application to file it in Court which I refused. The defendant had made no attempt to comply with the provisions of the Court Procedures Rules or with my earlier directions as to filing and service of a defence and counterclaim. By the date of hearing it was clearly too late to do so, and in any event the document handed up was vexatious and embarrassing and would not have been acceptable for filing even if it had been lodged for filing at a time which complied with the directions.
The assertions made in the statement of claim are verified by affidavits read in the plaintiffs’ case. There is also evidence that both plaintiffs have entered a formal agreement with a developer for redevelopment of the two blocks, which , according to the evidence, the committee of the Club regards as in the interest of the Club and its members, and consistent with the objectives of the Club. Redevelopment of the site cannot proceed further until the mortgages in favour of the defendant are discharged.
I have given careful consideration to whether there would be any utility in my making an order requiring the defendant to sign discharges of the mortgages. I have no confidence that the defendant would comply with such an order, within a reasonable timeframe or at all. The defendant has shown little or no understanding of the processes of the Court, and has failed to comply with numerous directions which have been made during the course of the present action. I am satisfied that the effect of such an order would be that ultimately the plaintiffs would return and seek an order under r 2442 of the Court Procedures Rules appointing another person to execute the discharges. In these unusual circumstances I am satisfied that it is in the interests of justice to make an immediate order that the Registrar of the Court execute the discharges of mortgage in the place of the defendant.
The injunctions which I granted in May 2011 were interlocutory in nature. A permanent injunction restraining the defendant from entering the land is sought. Other injunctive relief is also sought, but it seems to me that an order restraining the defendant from entering the land should be sufficient, and is justifiable on the basis that the plaintiff will no longer have any interest in the land or entitlement to enter it. I recognise that the defendant remains a member of the Serbian community in Canberra, and that the redevelopment of the site may result in the establishment of facilities which will be open to members of the Serbian community. I propose to order that the parties have liberty to apply in case the orders I make may ultimately be seen as operating in a manner which is impractical or unfair to him.
I am persuaded that I should make the declaration sought that the plaintiffs are entitled to possession of the two blocks of land.
There is no reason why costs should not follow the event. The defendant will be ordered to pay the plaintiffs’ costs of the proceedings.
I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Master.
Associate:
Date: 4 May 2012

Counsel for the plaintiffs:  Mr BA Meagher SC
Solicitors for the plaintiffs:  O’Connor Harris & Co
Date of hearing:  24 April 2012
Date of judgment:  4 May 2012

[2012] ACTSC 60

May 4, 2012