Sutherland v Rogic

[2011] NSWSC 712

Supreme Court

New South Wales

Medium Neutral Citation:

Sutherland v Rogic [2011] NSWSC 712

Hearing dates:

6 July 2011

Decision date:

06 July 2011

Jurisdiction:

Equity Division - Duty List

Before:

Rein J

Decision:

1. Leave granted to the plaintiff to proceed with the summons pursuant to rule 11.4(1) of the Uniform Civil Procedure Rules 2005 (NSW).

2. Order for the sale of the property.

3. Direct the second defendant to issue a new certificate of title to the plaintiff.

Catchwords:

PRACTICE AND PROCEDURE - service of originating process on the defendant who resides overseas and who has not entered an appearance - whether the Court should grant leave to the plaintiff to proceed pursuant to rule 11.4(1) of the Uniform Civil Procedure Rules 2005 (NSW) - whether personal service is required

REAL PROPERTY - where the defendant and her ex-husband are co-owners of a property - where the ex-husband has been made bankrupt and his trustee in bankruptcy seeks sale of the property as tenant-in-common - where the trustee in bankruptcy has asked the defendant whether she would like to buy out her ex-husband's interest in the property but received no reply - whether trustees for the sale of the property should be appointed

Legislation Cited:

Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

Site Foreman Pty Limited v Brand [2011] NSWSC 451

Category:

Principal judgment

Parties:

Roderick Mackay Sutherland (plaintiff)
Hayley Rogic (first defendant)
The Registrar-General of NSW (second defendant)

Representation:

S Nash (plaintiff)

File Number(s):

SC 2011/196643

EX TEMPORE Judgment

1. In this matter the Court has before it a summons for the appointment of trustees for sale of property, a unit, in Parramatta. The unit was owned by Mr Mark Rogic and Mrs Hayley Rogic (nee Vickars) who were married. There has been a binding financial agreement reached between Mr and Mrs Rogic following their separation and this agreement was reached on 27 February 2006. Mr Rogic has been made a bankrupt in more recent times and the plaintiff in these proceedings is his trustee in bankruptcy.

1. The trustee in bankruptcy does not seek to challenge the validity of the binding agreement. As a consequence of that agreement another property, not the subject of these proceedings, was sold and the net proceeds have been paid to the trustee. In respect of the Parramatta unit, it was agreed between Mr and Mrs Rogic that Mr Rogic would receive $30,000 from that property. The trustee in bankruptcy has written to Mrs Rogic seeking to ascertain whether she wished to buy out that $30,000 interest but received no reply to that suggestion.

1. In support of the relief sought in the summons the plaintiff relies on the affidavit of his solicitor, Ms Sally Susan Nash of 5 July 2011, an affidavit of Ms Daniela Fazio of 20 June 2011, an affidavit of Mr Roderick Mackay Sutherland of 2 May 2011 and an affidavit of Mr Daniel Civil of 8 June 2011. Also, there has been filed in Court the consent of the proposed trustees for sale, Mr Sutherland himself and a second trustee Sule Arnautovic, both of the firm Jirsch Sutherland Chartered Accountants ( "Jirsch Sutherland" ), consenting to their appointment, and a formal affidavit attesting to their having executed their consent in the presence of Mr Civil.

1. When the matter was called this morning in Court there was no appearance by Mrs Rogic, the first defendant. The second defendant, who is the Registrar-General of NSW ( "Registrar-General" ), has previously filed a submitting appearance and did not appear.

1. I am informed by Ms Nash and accept that when the matter was called before the Registrar this morning it was called both inside and outside the Court and there was no appearance by Mrs Rogic, the first defendant. It is apparent from the evidence before the Court that Mrs Rogic has moved to England. She has filed in the bankruptcy a proof of debt, Exhibit B, in which she provides her address in England. The proof of debt relates to a substantial claim for maintenance unpaid by Mr Rogic. Given that Mrs Rogic has not appeared, and given that the service which has been effected has been effected overseas, there arises the question of whether or not leave should be granted for the matter to proceed within the terms of Rule 11.4(1) of the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR") which is in the following terms:

"If originating process is served on a defendant outside Australia, and the defendant does not enter an appearance, the plaintiff may not proceed against the defendant except by leave of the Supreme Court."

1. The plaintiff seeks leave in accordance with Rule 11.4 of the UCPR and the evidence which is provided in support of the application is that service has been effected on Mrs Rogic by originating process being sent to the address referred to in the proof of debt. It has also been sent by email to an address given by the first defendant's mother in an email which is before the Court as part of Exhibit A by which the mother, Mrs Carole Clark, communicated to Jirsch Sutherland on behalf of Mrs Rogic. There is a second email address which is on file at Jirsch Sutherland to which the documents were also sent. Although the providence of that address has not been established, it is reasonable, I think, to infer that that is an email address provided by Mrs Rogic given that it contains her maiden name.

1. Rule 10.20(2)(a) of the UCPR provides:

"(2) Except as otherwise provided by these rules:

(a) any originating process, and any order for examination or garnishee order, in proceedings in the Supreme Court, the Industrial Relations Commission (including the Commission when constituted as the Industrial Court), the Land and Environment Court, the District Court or the Dust Diseases Tribunal must be personally served, and....."

1. The plaintiff accepts that the documents have not been personally served (for a discussion in relation to personal service see Site Foreman Pty Limited v Brand [2011] NSWSC 451 per Barrett J). However, Rule 11.6 of the UCPR provides:

"A document to be served outside Australia need not be personally served on a person so long as it is served on the person in accordance with the law of the country in which service is effected."

1. Ms Nash draws my attention to the material in her affidavit relating to her endeavours to ascertain the manner in which, in England, an initiating process of this kind is to be served, and there is evidence, although of a somewhat informal nature, that personal service is not required and that postal service is sufficient. Accordingly, by virtue of Rule 11.6, although service has not been effected personally, it has been effected in accordance with the procedures in place in England. The fact that the address to which it was sent was that given by the first defendant as the address in her proof of debt, together with despatch to the email address given of a person writing on behalf of Mrs Rogic to the trustee in bankruptcy leads me to be satisfied that service has been effected on Mrs Rogic and that notice of the proceedings has come to Mrs Rogic's attention. Accordingly, I grant leave to the plaintiff to proceed with the summons.

1. In relation to the principal relief which is the appointment of the trustees for sale, it should be noted that on the bankruptcy of Mr Rogic the joint tenancy was severed, and there was thereupon established a tenancy in common between, on the one hand, Mrs Rogic, and on the other hand, Mr Rogic.

1. As I have indicated, the trustee in bankruptcy accepts that the normal position, which is that the bankrupt estate would be entitled to 50% of the property, does not apply as a result of the binding agreement earlier referred to, and the claim brought by the trustee is limited to $30,000 out of the net proceeds of sale. He has, as I have indicated, invited Mrs Rogic to buy out the bankrupt estate, which invitation she has not accepted. He has also sought from her the original certificate of title. He has had no reply to that request and he has sought the original certificate from Mr Rogic. Mr Rogic has replied and indicated that he does not hold it. This brings in the need for a fresh certificate to be issued and that is the reason the Registrar-General has been joined.

1. The unit in question is currently occupied by a tenant and has been for quite some time. The tenant, who has been paying rent, is entitled to adequate notice, and the plaintiff accepts that an appropriate period for notice is ninety days, and that has been taken into account in the orders which have been prepared, as amended.

1. One other matter which should be noted is that apparently there have been strata levies that have not been paid by Mr and Mrs Rogic over a period of time, and I was informed that rent which has been paid by the tenant has been applied to that outstanding debt to the owners' corporation on a continuing basis.

1. In the absence of a desire by Mrs Rogic to buy out the interest in the property, there is no alternative but to order the sale so that the bankrupt estate can receive the amount of $30,000 out of the net proceeds, that is after payment of the costs of the application and, of course, the costs associated with the sale of the property, including the costs of the trustees for sale.

1. I am satisfied that it is appropriate to make the orders sought by the plaintiff and I make the orders in accordance with the short minutes of order, as amended, which I will initial and date with today's date.

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Decision last updated: 11 July 2011