Smith & Hillig v Gao

[2021] NSWSC 1016

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Smith & Hillig v Gao [2021] NSWSC 1016

Hearing dates:

16 July 2021

Decision date:

16 July 2021

Jurisdiction:

Equity

Before:

Ward CJ in Eq

Decision:

See [64] of judgment

Catchwords:

COSTS — Party/Party — Bases of quantification — Indemnity basis – Unreasonable conduct

LEASES AND TENANCIES — Ejectment — Order for vacant possession— Writ of possession — Mesne profits

Legislation Cited:

Conveyancing Act 1919 (NSW), s 66G

Real Property Act 1900 (NSW), s 86

Supreme Court Act 1970 (NSW), s 63

Uniform Civil Procedure Rules 2005 (NSW), r 36.17

Cases Cited:

Foundas v Arambatzis (No. 3) (2020) 19 BPR 40,357; [2020] NSWCA 87

Foundas v Arambatzis [2020] NSWCA 47

Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd and Others (1988) 81 ALR 397; [1988] FCA 364

Gao v Perry [2020] NSWCA 15

Gongsun & Paling [2020] FamCAFC 244

Heydon v NRMA Ltd (No 2); Morgan and Others v NTMS Ltd (No 2); Bateman v NRMA Ltd and Others (No 2) (2001) 53 NSWLR 600; [2001] NSWCA 445

James v James [2018] NSWSC 316

Katramados v Hasapis (No 4) [2019] NSWSC 846

Livio Versi v John Versi [2015] NSWSC 805

Perry v Gao [2019] NSWSC 1022

Phillips v Walsh (1990) 20 NSWLR 206

Category:

Consequential orders

Parties:

Michael John Morris Smith (First Applicant)
Peter Hillig (Second Applicant)
Min Gao (First Respondent)
Graham Perry (Second Respondent)

Representation:

Counsel:
Mr DA Smallbone (Applicants)
Ms M Gao (First Respondent) (in person) (self-represented)

Solicitors:
Coleman Greig (Applicants)

File Number(s):

2017/00106176

Publication restriction:

Nil

Judgment

1. HER HONOUR: This is an application by notice of motion filed on 16 June 2021 by the applicants, who are the trustees for the sale of certain land in Parramatta (the Parramatta Property) pursuant to orders made by Rein J on 2 August 2019.

2. The Parramatta Property is registered in the name of the defendant, Ms Gao. Ms Gao has no legal representation on this application, although Ms Gao has been represented by lawyers in the past. Ms Gao nevertheless has had the assistance of a friend who has acted as an interpreter for Ms Gao on the present application. It became apparent during the course of the submissions that Ms Gao can speak some English, but I do not suggest that she would have been in a position to have understood all of the debate and discussion without the assistance of an interpreter.

3. The orders sought in the notice of motion filed on 16 June 2021 are, broadly speaking, for the vesting of the Parramatta Property in the trustees for sale; for the delivery of vacant possession of the Parramatta Property; for the issue of a writ of possession forthwith; and for orders and directions as to how the trustees should account for the balance of the proceeds of sale after the usual costs and expenses of sale. There is also an application that Ms Gao pay the applicants’ costs of the motion on an indemnity basis.

Background

4. The background to the application, relevantly, commences with the orders made by Rein J on 2 August 2019 (see Perry v Gao [2019] NSWSC 1022). His Honour, for the reasons published on that day, concluded that the plaintiff (an elderly man who had been in a relationship with the defendant and who had transferred, in effect, the whole of his estate to the defendant) was entitled to relief on the basis of findings of unconscionable conduct and undue influence.

5. His Honour made declarations on 2 August 2019 that the plaintiff had an interest of 50% in the Parramatta Property and that the defendant held the Parramatta Property on trust for the plaintiff to the extent of the plaintiff's 50% interest in the property. His Honour also made orders: that the defendant pay the plaintiff’s costs as agreed or assessed; that the costs which the defendant is liable to pay the plaintiff be paid from the net proceeds of sale of the Parramatta Property to which the defendant would otherwise be entitled; that the applicants, who are accountants, be appointed as trustees for the sale of the property under s 66G of the Conveyancing Act 1919 (NSW); that the trustees pay out of the proceeds of sale any rates and charges relating to the Parramatta Property which are liable to be paid and any expenses incurred in relation to the sale; and that the trustees be authorised to charge fees at a rate not exceeding $595 per hour exclusive of GST, and to deduct such expenses from the proceeds of sale.

6. His Honour also ordered in effect that, following the deductions referred to above, the trustees for sale distribute 50% of the net proceeds of sale to, or as directed by, the plaintiff and distribute the remaining 50% of the net proceeds of sale (less $125,000, or such other amount as agreed between the parties or determined by the Court) to the defendant; and that, following the quantification (whether by agreement or assessment) of the costs the defendant is liable to pay the plaintiff, the trustees pay to, or as directed by, the plaintiff the costs from the retained amount and pay the balance of the retained amount to the defendant.

7. Relevantly, his Honour included an order that the plaintiff and the defendant cooperate in the sale of the Parramatta Property. As will become relevant shortly, his Honour did not make a formal vesting order of the Parramatta Property in the trustees for sale.

8. Ms Gao then lodged an appeal from the orders that were made by his Honour. While that appeal was pending, there was an application by the appellant for relief, including the transfer of the proceeding to the Family Court of Australia. The outcome of that application was, pursuant to the reasons published on 19 February 2020 (see Gao v Perry [2020] NSWCA 15), that the matter was transferred to the Family Court of Australia.

9. Before I deal with the Family Court proceeding, there is an issue as to whether, or for how long, the orders of 2 August 2019 made by Rein J were stayed. In the decision of the Court of Appeal, Leeming JA (with whom Bell P and Simpson JA agreed) noted, at [36], that the notice of motion had sought a stay of the orders made at first instance and that the orders had already been made by consent and remained in place.

10. When the matter came to be determined by the Full Court of the Family Court in September 2020 (see Gongsun & Paling [2020] FamCAFC 244), the Full Court of the Family Court dismissed the appeal (for reasons in which the Court indicated that, had the appeal not otherwise been dismissed, their Honours would have upheld the amended notice of contention in the appeal).

11. What followed thereafter was a series of communications in which the trustees for sale (and the solicitors acting for the trustees for sale) sought to obtain Ms Gao's cooperation in relation to the sale of the Parramatta Property and the vacation of the premises in order to enable the sale of the Parramatta Property. It will be remembered that Rein J had made an order that the parties cooperate in relation to the sale of the Parramatta Property.

12. On 9 October 2020, one of the trustees for sale (Mr Peter Hillig, who has sworn two affidavits on this application), emailed the solicitor then acting for Ms Gao, attaching the final orders in the proceeding in the Family Court, and sought confirmation of various matters, including (if Ms Gao was occupying the premises), details of Ms Gao's plans to vacate the premises so that a sale of the property could be facilitated without delay. That email noted that the trustees were prepared to accommodate Ms Gao's reasonable requests for an orderly vacation and sale of the property.

13. That email was met by a response, by email on 9 November 2020 from Ms Gao, raising complaints as to the legal process that had taken place (complaints that Ms Gao has again raised in the context of the present application).

14. On 12 November 2020, an employee of the trustees for sale (Mr Leung), who speaks Mandarin, had a telephone conversation with Ms Gao and recorded that conversation in a file note which is part of Exhibit A. In that conversation, Mr Leung records that Ms Gao said that she understood that the Court-appointed trustees would be managing the sales process and that she would be required to move out at some point. Mr Leung's file note also notes that Ms Gao stated that the property was currently very messy and that this would have a negative impact on the sale campaign; and that it would be very difficult for her to move somewhere else as she currently had no money to pay rent and no relative on whom she could rely. According to the file note, in that conversation, Ms Gao informed Mr Leung: that Ms Gao has a son; that Ms Gao and her son used to live in government public housing; and that Ms Gao’s son did not live with her at that time, nor did he have a good relationship with her. (I interpose to note that Ms Gao does not dispute that such a conversation took place.)

15. By letter dated 11 December 2020, solicitors acting for the trustees for sale wrote to Ms Gao. Relevantly, in that letter demand was made that Ms Gao vacate the Parramatta Property by 22 January 2021 so that the trustees could prepare for and attend to the sale of the property; and a request was made for delivery of the original Certificate of Title which Ms Gao held to be provided by 18 December 2020.

16. The trustees for sale meanwhile had lodged a caveat over the Parramatta Property in preparation for the sale of the property.

17. By letter dated 15 December 2020, Broaden Legal, the solicitors then acting for Ms Gao, wrote to the trustees' solicitors, instructing them that Ms Gao would use her best endeavours to locate the original Certificate of Title and to deliver it to the lawyers' offices by the Christmas holiday. Broaden Legal noted that Ms Gao was prepared to cooperate in the sale of the Parramatta Property and asserted their understanding that (while the usual case was that the property would be sold with vacant possession) that vacant possession was only required at the time of settlement of the property and that, in the usual case, an owner or tenant would live in the property during the marketing campaign until settlement.

18. The letter conveyed the solicitors' instructions that Ms Gao suffered from extreme financial difficulty with little income and cash on hand; and, if forced to vacate the property, would not have a fund to pay rent for accommodation, storage and living expenses. A medical certificate was attached to that letter, certifying that Ms Gao was suffering from acute stress and depression and making reference to a suicidal attempt and to Ms Gao seeing a psychologist (and being under treatment).

19. The solicitors for the trustees for sale, by email on 21 December 2020, conveyed their instructions that the trustees were willing to work with Ms Gao to facilitate the sale of the Parramatta Property and, in order to ensure that the sale of the property was conducted in a sensible fashion, proposed that there be an entry into a deed to facilitate the sale. A draft deed was attached. It appears that, shortly thereafter, Broaden Legal ceased to act for Ms Gao, advising the trustees' solicitors of this by email on 18 January 2021.

20. The trustees' solicitors then communicated directly with Ms Gao, by email on 19 January 2021, seeking a response in relation to the draft deed by no later than 22 January 2021 and noting that Ms Gao had not provided the original title deed to the Parramatta Property. The trustee’s solicitors requested that the deed be delivered by 5pm on Friday 22 January, failing which it was said that steps would be taken to obtain a replacement deed, the costs of which would be claimed from Ms Gao.

21. There is a file note by Mr Leung of another telephone conversation with Ms Gao on 11 February 2021, noting, amongst other things, that Ms Gao there claimed that she had discovered new evidence to prove that her other former lawyer, the plaintiff's lawyer, and the judge had all colluded against her in Court. Following this, Mr Leung emailed Ms Gao in Chinese on 15 February 2021 in relation to the matter.

22. By letter dated 18 February 2021, a formal demand for delivery of the Certificate of Title was made by the solicitors acting for the trustees for sale.

23. On 24 February 2021, a new solicitor apparently then instructed by Ms Gao emailed the solicitors for the trustees for sale, advising he was instructed that Ms Gao was able to cooperate with the matter, including production of the Certificate of Title; that he had explained to Ms Gao that she must abide by the Court order; and that Ms Gao was prepared to cooperate with Mr Leung and the selling agent in the course of the sale of the Parramatta Property. The email requested that Ms Gao be allowed to stay in the subject property for an extra three months after a settlement of the sale transaction because she might be able to use the remaining funds of the judgment sale proceeds to find a new shelter or place for residence.

24. On 25 February 2021, the solicitors for the trustees for sale emailed Ms Gao's new solicitor, reiterating the requirement for delivery up of the original Certificate of Title by 4 o'clock that day. The original Certificate of Title was delivered to the trustees on 25 February 2021, as confirmed in a letter dated 15 April 2021 from the solicitors acting for the trustees.

25. In relation to the request that Ms Gao be allowed to reside in the property for a period of three months after settlement of any future sale, the solicitors for the trustees for sale advised that this request was rejected for the reasons there stated, including that the request was likely to inhibit or frustrate the trustees' ability to obtain a sale of the property for the maximum market value. The letter noted that the trustees' staff had carried out an inspection of the Parramatta Property in October 2020 and observed it to be unkempt, and stated that Ms Gao's presence at the property and failure to keep it in a presentable condition was likely to frustrate the advertising of the property for sale.

26. The letter also referred to Ms Gao's failure to correspond or cooperate with the trustees in good faith; and to the additional costs that had been incurred by the trustees as a result. The letter demanded that Ms Gao vacate the Parramatta Property by 5pm on 13 May 2021.

27. The response seems to have been an email on 11 May 2021 (shortly before the time at which vacant possession of the premises had been demanded) by Ms Gao directly, forwarding a medical certificate again making reference to Ms Gao's stress and depression.

28. By email on 12 May 2021, solicitors for the trustees for sale confirmed the trustees' rejection of the request for Ms Gao to be allowed to remain in the Parramatta Property for a period of three months post-settlement. They advised that the trustees were preparing an application to obtain possession of the Parramatta Property and the costs of so doing would be paid out of Ms Gao's portion of the sale proceeds, and indicated that the trustees would provide a final opportunity for the Parramatta Property to be vacated by 26 May 2021 on the conditions there stated. These conditions included that there a signed undertaking attached that Ms Gao would vacate the Parramatta Property by 26 May 2021 and that Ms Gao agree to pay an occupation fee or accept that an occupation fee would be deducted from her share of the proceeds of the sale.

29. The undertaking to vacate was not signed. Ms Gao's response on 12 May 2021 was to make further accusations in relation to the conduct of the primary hearing. What then transpired was the bringing of the present application by notice of motion filed on 16 June 2021.

The Application

30. As part of Exhibit A, is an opinion obtained by the trustees for sale as to rental for the Parramatta Property, dated 13 May 2021, which states that, based on similar properties on the market for lease, a rent in the vicinity of $650 to $720 per week is believed might be achievable.

31. In support of the application the trustees for sale rely upon the affidavit evidence of Mr Hillig and an affidavit of the trustees' solicitor, Mr James Ferguson.

32. Ms Gao has not filed any affidavit evidence on the application but has forwarded communications to my associate, which have been copied to the parties, in which Ms Gao has raised again the same complaints in relation to the conduct of the primary proceedings and the perceived injustice of the result.

33. Ms Gao has also had the opportunity, through her friend Ms Ling and herself, to make oral submissions in relation to the matter. Those oral submissions, it is fair to say, have focused on the perceived injustice and unfairness of the result at first instance. Ms Gao has emphasised that she spent a lot of her money on Mr Perry's care; that she cared for him, arranged hospitalisation for him and provided food to him; and that his siblings showed no care for him.

34. Ms Gao again maintained that, because she had moved in with Mr Perry in Parramatta, she had lost her public housing. Ms Gao said more than once that she simply should have let Mr Perry die; that she should not have spent the time caring for him; and that if she had known eight years ago that she would not obtain the house, she would not have cared for him. Ms Gao also repeated her allegations in relation to fraud and collusion.

Vesting of the property in the trustees for sale

35. Turning then to the relief that is sought, the first order (prayer 1) is an order for the property formally to vest in the trustees appointed for sale. This arises because the Land Titles Office made a requisition in relation to an attempt to have the title of the property transferred into the trustees' name.

36. The juridical basis for the application for the order that is sought is put first on the basis of the “slip rule”, under r 36.17 of the Uniform Civil Procedure Rules 2005 (NSW). It is submitted, and I accept, that it is clear from the judgment of Rein J that his Honour intended that the property should be sold as soon as possible (and, indeed, his Honour made orders in order 9 as I have referred to above that the plaintiff and the defendant cooperate in the sale). It is submitted that it was simply a slip that the proposed orders (which were provided to his Honour) did not include such an order. Alternatively, it is submitted that the making of a vesting order can be dealt with as part of the inherent jurisdiction of the Court to supervise the orders that have been made, and reference is made to Phillips v Walsh (1990) 20 NSWLR 206 in this regard.

37. It is submitted that the making of a vesting order will remove the difficulty that has been experienced in enabling the applicants to be registered as registered proprietors of the land; and will enable the applicants in due course to execute a transfer as proprietors to the purchaser. It is accepted that, by reference to s 86 of the Real Property Act 1900 (NSW), such a vesting order may not be necessary for title to be transferred to a purchaser. It is nevertheless said that it is not conducive to sale to leave the title in an unsettled state. It is further submitted that it is in the interests of both the plaintiff and the defendant for the trustees' title to be clear and, hence, the application is made under the slip rule.

38. I am satisfied that the slip rule has been properly invoked but in any event that there is jurisdiction to make the order sought; and that it should be made (for the reasons submitted by the trustees for sale). Accordingly, I will make the order sought in prayer 1 of the notice of motion filed on 16 June.

Delivery of vacant possession and writ for possession

39. The next set of orders sought relate to the delivery of vacant possession by Ms Gao of the Parramatta Property to the applicants within 28 days (prayer 2), and an order that the applicants be at liberty to obtain a writ for possession forthwith, such writ not to be executed before the expiry of 28 days (prayer 3).

39. Reference is made to the decision of Darke J at first instance (the subject of the appeal in Foundas v Arambatzis [2020] NSWCA 47) (Foundas) in which his Honour, after appointing trustees for sale, ordered that the appellant deliver vacant possession of the property to the trustees by a particular date. It is noted that, while this order was not the subject of a distinct challenge in that appeal, the Court of Appeal nonetheless made a fresh order for the delivery of vacant possession, with leave to issue a writ for possession.

40. The trustees for sale point to the fact that White JA addressed at [98] a submission that a claim there made by the first respondent for possession should have been made in separate proceedings and that his Honour said that this would be contrary to s 63 of the Supreme Court Act 1970 (NSW) which requires, so far as possible, that all matters in controversy between the parties be finally and completely determined.

41. It is thus submitted that Foundas stands as authority for the proposition that an order can be made for possession in s 66G proceedings and that it is appropriate to do so rather than to commence separate proceedings in the Possession List. I accept that this is the case and that such a course has been followed in other matters (see, for example, the decision of James v James [2018] NSWSC 316 per Slattery J, and see also the decision of Robb J in Katramados v Hasapis (No 4) [2019] NSWSC 846).

Determination

43. There is no basis that I can see to refuse now to make an order for vacant possession of the Parramatta Property. This will enable the judgment and orders made by Rein J in 2019 to be effected and I note (as I sought to make clear in the course of oral submissions with Ms Gao) that this is a case where Ms Gao’s appeal from Rein J's judgment and orders has been unsuccessful. Unfortunately, Ms Gao does not accept that decision, but the decision stands and the effect of her conduct has been to frustrate the ability of the trustees for sale to perform the functions that they have been appointed to exercise. As such I consider that the orders sought in prayers 2 and 3 should be made.

44. The only qualification I make to that is as to whether or not the order for vacant possession should be for delivery within 28 days. I accept that there has been inordinate delay to date, but I note that there may well be difficulties at the present time with the current pandemic in obtaining alternative accommodation; and I am conscious of the fact that Ms Gao is not represented and has put forward evidence of her suffering from stress and depression.

45. I consider that, in all the circumstances, it would be appropriate to allow a period of two months for the order for delivery of vacant possession to take effect and, therefore, I will make the orders sought in prayers 2 and 3 but I will specify that the delivery of vacant possession of the Parramatta Property to the applicants is to be effected by no later than 10 September 2021, and that the applicants be at liberty to obtain a writ for possession forthwith, such writ not to be executed before close of business on 10 September 2021.

Accounting for balance of the proceeds of sale

46. The next set of orders sought (prayers 4 to 6) relates to whether the applicants would be justified in or should (in accounting for the balance to be paid to the respondents in accordance with the orders of 2 August 2019) charging Ms Gao with a reasonable market occupation fee for her occupation of the Parramatta Property, up to the date of her delivering vacant possession or the execution of the writ of possession. The orders sought also relate to how certain costs, remuneration and expenses ought to be borne.

47. In Foundas, White JA (with whom Bell P and Basten JA agreed) proposed, and ultimately made, orders effectively for payment of a reasonable market rent for the occupation of the property. His Honour said, at [108], that from the date of the order appointing the trustees for sale, the appellant was no longer entitled to occupy the property by virtue of her legal ownership and had no right to occupy the property except under lease or licence from the trustees. His Honour stated that the appellant was liable to a rent or occupation fee (or, his Honour thought more accurately described, damages by way of mesne profits) equivalent to a reasonable rent for so long as she remained in occupation. In that case, whether the sum claimed was a reasonable rent was not in issue.

48. The order, however, that was ultimately made was not for the payment of that amount by reference to the date that the order appointing trustees for sale was made; rather, it was an order by reference to the date from which demand had been made for payment of the asserted market rent for the property. The orders made by the Court were that, in accounting for the balance to be paid to the parties in accordance with the orders made by the primary judge (as varied by the Court of Appeal's orders), the trustees would charge the appellant with a reasonable market rent for her occupation of the property, from the date of the demand for payment of rent to the date of her delivering vacant possession.

49. Counsel for the trustees for sale in the present case indicated in written submissions a range of potential dates which might be applicable in the present case. Relevantly, those potential possibilities were: first, 30 August 2019, or 28 days from the date the orders were made for the appointment of the trustees for sale by Rein J; second, 28 October 2020, or 28 days from the date of dismissal of the appeal; and, third, from some date by which the formal demand for possession had expired, which was by 21 January 2021.

50. In the course of oral submissions, other potential dates were raised, including a date by reference to when the stay of orders expired. I should note that the Court of Appeal's orders (see Gao v Perry [2020] NSWCA 15), that the proceeding be transferred to the Family Court and that otherwise the notice of motion filed 4 December 2019 be dismissed, would suggest that the stay had expired by 19 February 2020 or possibly (on another construction of the orders, by 30 March 2020). It was submitted that certainly by 30 March 2020 the stay had expired.

51. A fifth possibility that was canvassed was that the order for an occupation fee, consistently with the decision in Foundas v Arambatzis (No 3) (2020) 19 BPR 40,357; [2020] NSWCA 87, might be from the date of demand for possession. The issue was effectively put in terms of there being at common law an entitlement to an occupation fee from the date of demand but that, if the matter were to be approached on a restitutionary basis then it might be from the date of the original order (see Heydon v NRMA Ltd (No 2); Morgan v NTMS Ltd (No 2); Bateman v NRMA Ltd (No 2) (2001) 53 NSWLR 600; [2001] NSWCA 445 at [14].)

52. In the circumstances, I consider it appropriate that the payment of an occupation fee or damages by way of mesne profits, equivalent to a reasonable rent for the occupation of the premises, should be from the date by which vacant possession of the premises was demanded, that being 22 January 2021. I say that because there were communications between the trustees and Ms Gao in which the trustees (quite reasonably) sought prior to that to reach agreement with Ms Gao as to the basis on which she would cooperate and vacate the premises; and did not demand possession. I am concerned that, in circumstances where Ms Gao has clearly had difficulty in understanding the nature of the obligations that she had as a result of the judgments, the appropriate course is to make the occupation fee run from 22 January 2021 until vacant possession is obtained.

53. Therefore, in terms of prayer 4 of the notice of motion, I will direct and order that the applicants would be justified, and should, in accounting for the balance to be paid to the respondents in accordance with the orders of 2 August 2019, charge the first respondent with a reasonable market occupation fee, or damages by way of mesne profits equivalent to a reasonable rent or occupation fee, in respect of her occupation of the Parramatta Property from 22 January 2021 up to the date of vacant possession being obtained.

54. As to the amount of that fee, I have noted that there is some evidence as to the rental range being from $650 a week to $720 a week. It was submitted that an appropriate way to deal with this matter might be simply to authorise the trustees to fix the relevant amount using the trustees' information, experience and professional judgment. I understand the force of that submission. Nevertheless, it seems to me that in the circumstances of the dispute to date, where the appraisal of the market rental gives a range of $650 to $720 a week and there is no other evidence in relation to the likely market rental, it would be appropriate for the occupation fee here to be fixed. Accordingly, I would fix the occupation fee per week from 22 January 2021 at a mid-point between that range (namely, $685 per week).

55. I also consider that it is appropriate that it be deducted from the balance to be paid to Ms Gao from the net proceeds of sale, particularly in circumstances where she has made submissions as to her inability to pay that amount at this stage.

56. The next prayer for relief is prayer 5, which seeks directions and orders effectively as to whether the trustees would be justified in deducting from Ms Gao's share of the proceeds of the Parramatta Property the following costs, remuneration and expenses of the applicants: first, the costs, remuneration and expenses in respect of work to obtain production of the Certificate of Title from Ms Gao; and, second, the costs, remuneration and expenses in respect of dealing with Ms Gao regarding her occupancy of the Parramatta Property, and in seeking and obtaining vacant possession thereof, including the anticipated issue and execution of any writ for possession under these orders.

57. I am satisfied that the conduct of Ms Gao has caused unnecessary costs to be incurred by the trustees for sale both in relation to the attempts to obtain production of the Certificate of Title and in relation to the matters the subject of prayer 5(b). Considering, in particular, the circumstances wherein Ms Gao was ordered by Rein J to cooperate in the sale process, and where there is evidence that this was explained to her in Mandarin and she purported to understand that obligation, I consider that it is appropriate that Ms Gao’s share of the proceeds of sale be burdened by those unnecessary costs and I will make an order sought in prayer 5.

58. Prayer 6 is an application that Ms Gao pay the applicants' costs of the motion on an indemnity basis. Reference is made in that regard to the decision of Kunc J in Livio Versi v John Versi [2015] NSWSC 805. In that case, his Honour considered at [16] that it was appropriate to make indemnity costs orders on the basis that the respondent had persisted "albeit perhaps out of ignorance" in a position that was hopeless. His Honour said that the respondent had behaved unreasonably in maintaining his resistance to vacating the property and in those circumstances an order for indemnity costs should be made.

59. The circumstances in which special costs orders of this kind may be made have been considered in various decisions, including Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd and Others (1988) 81 ALR 397; [1988] FCA 364. I am satisfied that this is a case where the position of Ms Gao was indeed hopeless and that the trustees’ costs of the application were unnecessarily forced to be incurred.

60. The submissions made on the present application make very clear that Ms Gao does not accept the judgment that was made in 2019. However, Ms Gao has exercised her rights of appeal in relation to that judgment and it seems to me that it is not appropriate that the ongoing costs should be borne equally between the parties in those circumstances.

61. Accordingly, I will order that the first respondent pay the applicants' costs of the motion, assessed on an indemnity basis, and that those costs be paid from the proceeds of sale of the land the subject of the applicants' appointment as trustees for sale. For the avoidance of doubt, I will order that the applicants be authorised to deduct those costs, if otherwise unpaid, from the first respondent's share in the distribution of any surplus arising from the sale of the subject land. I will also order that all costs orders may be assessed forthwith.

62. I think it is appropriate to make an order for liberty to the parties, including the applicants, to apply for any further or consequential orders that may be necessary in the implementation of the orders made on this occasion.

63. I will also order that these orders be entered forthwith.

Orders

64. For the above reasons, I make the following orders:

1. Order that the property formally vest in the applicants appointed for sale, pursuant to the slip rule in r 36.17 of the Uniform Civil Procedure Rules 2005 (NSW).

2. Order that the first respondent deliver vacant possession of the Parramatta Property to the applicants by no later than 10 September 2021.

3. Order that the applicants be at liberty to obtain a writ for possession forthwith, such writ not to be executed before close of business on 10 September 2021.

4. Direct and order that the applicants would be justified, and should, in accounting for the balance to be paid to the first respondent in accordance with the orders of 2 August 2019, charge the first respondent with a reasonable market occupation fee, or damages by way of mesne profits equivalent to a reasonable rent or occupation fee, the fixed amount of $685 per week in respect of her occupation of the Parramatta Property from 22 January 2021 up to the date of vacant possession being obtained.

5. Order that the occupation fee be deducted from the balance to be paid to the first respondent from the net proceeds of sale.

6. Order that the first respondent’s share of the proceeds of sale be burdened by those unnecessary costs, remuneration and expenses of the applicants as sought in prayer 5 of the notice of motion.

7. Order that the first respondent pay the applicants’ costs of the motion assessed on the indemnity basis and paid from the proceeds of sale of the land the subject of the applicants' appointment as trustees for sale.

8. Order that the applicants be authorised to deduct those costs if otherwise unpaid from the first respondent's share in the distribution of any surplus arising from the sale of the subject land.

9. Order for liberty to the parties, including the applicants, to apply for any further or consequential orders that may be necessary in the implementation of the orders made on this occasion.

10. Order that all costs orders may be assessed forthwith.

11. These orders be entered forthwith.

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Amendments

20 September 2022 - amendment to [17]

Decision last updated: 20 September 2022