Shannon v Permanent Custodians Limited [No 2]
[2021] WASCA 119
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT : THE COURT OF APPEAL (WA)
CITATION: SHANNON -v- PERMANENT CUSTODIANS LIMITED [No 2] [2021] WASCA 119
CORAM: QUINLAN CJ
VAUGHAN JA
TOTTLE J
HEARD: 2 JULY 2021
DELIVERED : 2 JULY 2021
PUBLISHED : 7 JULY 2021
FILE NO/S: CACV 98 of 2018
BETWEEN: ANITA LOUISE SHANNON
CHRISTOPHER CHARLES SHANNON
Appellants
AND
PERMANENT CUSTODIANS LIMITED
First Respondent
GEL CUSTODIANS PTY LTD
Second Respondent
AUSTRALIAN MORTGAGE SECURITIES PTY LTD
Third Respondent
AFIG WHOLESALE PTY LTD
Fourth Respondent
REGISTRAR OF TITLES
Fifth Respondent
PEPPER GROUP LIMITED
Sixth Respondent
ON APPEAL FROM:
Jurisdiction : SUPREME COURT OF WESTERN AUSTRALIA
Coram: LE MIERE J
Citation: PERMANENT CUSTODIANS LTD -v- SHANNON [No 2] [2018] WASC 295
File Number : CIV 1174 of 2013
Catchwords:
Appeal – Loan agreement and mortgage – Loan agreement and mortgage declared to be unjust under s 76 of the National Credit Code – Whether consequential orders should be determined on appeal or by remitter
Legislation:
National Credit Code, s 76, s 77
Rules of the Supreme Court 1971 (WA)
Result:
Any consequential orders under s 76 and s 77 of the National Credit Code be determined by the Court of Appeal
Category: B
Representation:
Counsel:
| Appellants | : | In person |
| First Respondent | : | G D Cobby SC |
| Second Respondent | : | G D Cobby SC |
| Third Respondent | : | G D Cobby SC |
| Fourth Respondent | : | G D Cobby SC |
| Fifth Respondent | : | No appearance |
| Sixth Respondent | : | G D Cobby SC |
Solicitors:
| Appellants | : | In person |
| First Respondent | : | Norton Rose Fulbright Australia |
| Second Respondent | : | Norton Rose Fulbright Australia |
| Third Respondent | : | Norton Rose Fulbright Australia |
| Fourth Respondent | : | Norton Rose Fulbright Australia |
| Fifth Respondent | : | No appearance |
| Sixth Respondent | : | Norton Rose Fulbright Australia |
Case referred to in decision:
Shannon v Permanent Custodians Limited [2020] WASCA 198
QUINLAN CJ:
(This judgment was delivered extemporaneously on 2 July 2021 and has been edited from the transcript.)
On 24 November 2020 this court allowed the appellants' appeal from the judgment of Le Miere J, dated 21 September 2018.[1]
[1] Shannon v Permanent Custodians Limited [2020] WASCA 198 (Shannon v Permanent Custodians Limited).
On that date we set aside the orders made by his Honour and declared that the Loan Agreement made between the appellants and the second respondent and the Mortgage granted by the appellants to the second respondent were each unjust within the meaning and for the purpose of s 76 of the National Credit Code (Code).
Having found that the Loan Agreement and the Mortgage were unjust within the meaning of s 76 of the Code, it is necessary for the court to determine whether those transactions should be reopened and what, if any, orders the court should make under s 77 of the Code.
Following the delivery of the orders, the parties were referred to mediation, with a view to explore whether the parties might be able to reach a resolution of their disputes in a manner that best reflected the interests of all parties. That mediation was unsuccessful and the matter was relisted before the court for further directions.
The principal issue to be determined today is whether the question of relief, if any, to be granted under s 77 of the Code should be remitted to the General Division of the court for rehearing, or whether this court should make the appropriate orders, following the receipt of further submissions and any additional evidence adduced by the parties in the appeal for which leave is granted .
In Shannon v Permanent Custodians Limited, Tottle J and I expressed the preliminary view that, as this court was seized of the matter, it was appropriate that any consequential orders should be made by this court, rather than on a remitter.[2] Having heard the parties today, while there are considerations favouring either course, I am of the view that the matter should not be remitted to the General Division of the court and that the Court of Appeal should determine the final orders to follow in the appeal itself.
[2] Shannon v Permanent Custodians Limited [341] (Quinlan CJ & Tottle J).
My reasons for that conclusion are as follows.
This court is seized of the matter and has already made a number of findings that are relevant to whether relief should be granted, and if so, what relief should be granted. The proceedings have been lengthy and drawn out and it is in the interests of justice that they be resolved as soon as is practicable.
As Tottle J and I observed in Shannon v Permanent Custodians Limited,[3] the appropriate relief must take into account the various considerations that have led to the conclusion that the Loan Agreement and the Mortgage were unjust. This court reached those conclusions based on the material that was adduced at trial. As is the ordinary course, it was able to reach those conclusions having regard to the record before the trial judge.
[3] Shannon v Permanent Custodians Limited [333] (Quinlan CJ & Tottle J).
In submissions today the appellants submitted that it was preferable to have the matter referred to the General Division because there were a number of matters in relation to which findings of fact were not made by the trial judge, as a consequence of the manner in which his Honour decided the issues.
Those outstanding matters, which Mrs Shannon made clear were not the only matters that might be identified, were as follows:
(a)the issue of whether there were practical alternatives to obtaining finance on better terms;
(b)the financial loss to the appellants as a consequence of having entered into the Loan Agreement and the Mortgage;
(c)the conduct of the parties following the transaction. And in that respect s 76(5) of the Code specifically allows the Court to take such conduct into account;
(d)issues related to testimony given by Mr Williams, a witness called by the respondents at trial; and
(e)whether or not Permanent Custodians Limited were a bona fide purchaser for value without notice.
I accept that a number of those matters are relevant to the application of the court's discretion under s 76 and s 77 of the Code. As I have said, it is clear that the conduct of the parties since the transaction was entered into is clearly a matter to which the court may have regard and it would be necessary for this court to make findings in that regard in the appeal.
I am, however, satisfied that the court should make those findings based on the evidence adduced by the parties at trial, supplemented, if necessary, by additional evidence if leave be granted for that purpose.
The other matters raised by the appellants may also be relevant to the exercise of the discretion in s 76 and s 77, although I do not express a concluded view as to the extent to which those matters are relevant.
In particular, it is not clear to me at present how the issue as to whether Permanent Custodians Limited was a bona fide purchaser for value without notice would be a relevant matter to the discretionary considerations in s 76 and s 77. That would appear to be, rather, a matter related to claims for equitable relief which are no longer before this court.
The issue of financial loss to the appellants was a matter in relation to which evidence was adduced at trial. I also reserve my view as to whether or not s 77 of the Code would enable consequential orders in relation to financial loss itself to be made, as opposed to orders reopening the transactions. That being said, it might be relevant to the reopening of the transaction (and the exercise of the discretion generally) whether or not the borrower or customer has suffered additional financial loss.
Nevertheless, I am satisfied that while it is not necessarily the usual course, this court is able to make whatever findings would be necessary in relation to that issue as well.
For these reasons, in my view, it is appropriate that this court determine the matter and that it is in the public's interest and the interests of justice that the final terms of the relationship between the parties be known as soon as is practicable.
The parties should have the opportunity to seek leave to adduce additional evidence on the appeal. In particular, to bring the facts up‑to‑date from the date of trial. The interests of finality are otherwise such that the rights of the parties should be determined based upon the evidence at trial and their conduct of the trial. The issue as to what, if any, relief should be granted under s 77 of the Code cannot be used for either party to relitigate old issues, or indeed to litigate new issues not pursued at trial.
For this reason I would propose to make orders for the further conduct of the appeal.
VAUGHAN JA:
In Shannon v Permanent Custodians Limited,[4] I express some hesitancy about whether this court should undertake the task of determining what orders, if any, should be made by way of consequential relief, the court having declared that the Loan Agreement and the Mortgage were unjust. Having heard the submissions of the parties, and having reflected on the competing positions, I am persuaded that this court should determine the question of consequential relief, if any, rather than remitting the question to the General Division.
[4] Shannon v Permanent Custodians Limited [471] (Vaughan JA).
In my view, it is in the interests of justice that this court determine the outstanding issues. That is predominantly because, viewing all things in the balance, I am persuaded that proceeding in this way better meets the goal and objects in O 1 r 4A and O 1 r 4B of the Rules of the Supreme Court 1971 (WA). By so doing this court will minimise the application of the parties' private and the court's public resources in finalisation of the proceedings. It should also bring the proceedings to finalisation in a shorter time frame.
It is clear, both from the orders sought by the appellants and their submissions today, that, in effect, what the appellants seek is a new trial on the question of consequential relief. That goes well beyond what was initially sought on appeal. There, in orders wanted at White Appeal Book 42 ‑ 44, the appellants contemplated the Court of Appeal making all consequential orders. The appellants did not there seek orders for remittal or a new trial on the question of consequential relief. That position altered somewhat in the appellants' supplementary submissions filed 28 January 2020.[5] However, ultimately Mrs Shannon stated as to remittal or determination by this court, that she would be 'Okay either way'.[6]
[5] See [27], [80] (YAB 16, 27). See also Appeal ts 59 ‑ 60, 63, 89, 91, 93 ‑ 94, 125.
[6] Appeal ts 189.
I otherwise agree with the Chief Justice's reasons and the orders that his Honour proposes.
TOTTLE J:
I agree that this Court should determine the issue of relief for the reasons given by the Chief Justice.
I certify that the preceding paragraphs comprise the reasons for decision of the Supreme Court of Western Australia.
AK
Principal Associate to the Honourable Chief Justice Quinlan
7 JULY 2021