Soderstrom v Minas

[2011] VSC 361

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION
PRACTICE COURT

S CI 2010 04957

JUNE PATRICIA SODERSTROM AND OTHERS	Plaintiffs
v
STELLA SOULTANA MINAS	Defendant

---

JUDGE:	KYROU J
WHERE HELD:	Melbourne
DATES OF HEARING:	2 August 2011
DATE OF RULING:	2 August2011
CASE MAY BE CITED AS:	Soderstrom v Minas
MEDIUM NEUTRAL CITATION:	[2011] VSC 361

---

PRACTICE AND PROCEDURE – Judgment in default of service of defence – Whether affidavit in support of entry of judgment proved default of service – Whether judgment irregular – Commonwealth Bank of Australia Ltd v Sky Empire Pty Ltd [2006] VSC 193 (31 May 2006) distinguished.

---

APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr P Bingham	Cornwall Stodart
For the Defendant	Mr M P Pirrie	Frenkel Partners

HIS HONOUR:

1. The defendant has submitted that the judgment entered on 2 May 2011 in default of the service of a defence is irregular because the plaintiffs did not comply with r 21.02(2) of the Supreme Court (General Civil Procedure) Rules 2005 (Vic) (‘Rules’). That rule provides that judgment shall not be entered or given for the plaintiff unless an affidavit proving the default is filed. The relevant default is the defendant’s failure to serve a defence within the time limited by the Rules.

1. There is no dispute that a defence had not been served within the time limited by the Rules or at any time prior to the entry of the default judgment. The sole question for determination is whether the plaintiffs filed an affidavit proving that a defence had not been served within the time limited by the Rules.

1. I am satisfied that the plaintiffs have complied with r 21.02(2).

1. An affidavit of Gino Potenza sworn on 2 May 2011 was filed on that day prior to the entry of the default judgment.  In that affidavit, Mr Potenza deposed as follows:

1.I am a solicitor and partner in the employ of Cornwall Stodart Lawyers of Level 10, 114 William Street, Melbourne, the solicitors for the Plaintiffs herein.  I have the care and conduct of this action on behalf of the Plaintiffs.  I am duly authorised by the Plaintiffs to make this Affidavit on their behalf.

…

4.As at the date of swearing this my Affidavit I have not received a Defence from either the Defendant nor the Defendant’s solicitor within the time required by the Supreme Court Rules and I respectfully request that the Plaintiffs be at liberty to enter Default Judgment for Possession of Land and debt against the Defendant.

1. The defendant relied on the following statement of Kellam J in Commonwealth Bank of Australia Ltd v Sky Empire Pty Ltd:[1] 

The first issue to be determined is whether the judgment was regular. The Court may set aside any judgment in accordance with Rule 21.07. Rule 21.02 provides that where any defendant being required to serve a defence does not do so within the time limited, the plaintiff may enter judgment. Rule 21.03 provides that judgment shall not be entered ‘unless an affidavit proving the default is filed’. It is apparent that failure to prove the defendants’ service of the defence within the time limited would be irregular. In my view the affidavit sworn by the plaintiff’s solicitor on 10 March 2006 stating he had ‘not received a defence or counterclaim’ is not proof of failure to serve. Evidence that a solicitor in the employ of a large firm of solicitors has not ‘received’ a document required to be served is merely evidence that the document has not come into the possession of that individual. It is not proof of the default as required under Rule 21.02. Furthermore, the irregularity is not a mere technicality. The Rules require, and the Court (and the other parties), are entitled to have ‘proof of the default’ before taking a step which so drastically affects the rights of a litigant, as in this case the entry of judgment for possession of land.[2] 

[1][2006] VSC 193 (31 May 2006) (‘CBA’).

[2][2006] VSC 193 (31 May 2006) [15] (emphasis in original).

1. In my opinion, the question of whether there has been compliance with r 21.02(2) is a question of fact that turns on the circumstances of the particular case. Kellam J’s statement in CBA contains a finding of fact that was made in the circumstances of that case.  In that case, the solicitor was an employee of the plaintiff’s solicitors’ firm and simply deposed that he had not received a defence.

1. CBA is distinguishable because, in this case, the deponent, Mr Potenza, is not only an employee solicitor of Cornwall Stodart, but also a partner.  It can be inferred from Mr Potenza’s affidavit that, as he is the partner responsible for this proceeding, all documents relating to this proceeding that are received by the firm are delivered to him in the normal course of the firm’s business.  Such an inference is consistent with the Legal Profession Act2004, which contains provisions that equate the position of a partner of a firm to that of the firm. 

1. Accordingly, Mr Potenza’s statement that he had not received a defence as at the time he swore his affidavit – which was after the time limited by the Rules for the service of a defence – was equivalent to a statement that Cornwall Stodart had not received a defence as at that time.

1. If I am wrong in my conclusion that r 21.02(2) has been complied with, then, in the circumstances of this case, it is appropriate to dispense with the requirements of that rule and to treat the default judgment as being regular.[3] This is because it is common ground between the parties that no defence was served within the time limited by the Rules or at any time prior to the entry of the default judgment.

   [3]See r 2.04(1) of the Rules.

---