Tomcsanyi v National Australia Bank Ltd
[2019] WASCA 154
•3 OCTOBER 2019
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT : THE COURT OF APPEAL (WA)
CITATION: TOMCSANYI -v- NATIONAL AUSTRALIA BANK LTD [2019] WASCA 154
CORAM: MURPHY JA
MITCHELL JA
HEARD: 26 SEPTEMBER 2019
DELIVERED : 26 SEPTEMBER 2019
PUBLISHED : 3 OCTOBER 2019
FILE NO/S: CACV 110 of 2019
BETWEEN: LEWIS MICHAEL TOMCSANYI
First Appellant
MICHELLE ELIZABETH TOMCSANYI
Second Appellant
AND
NATIONAL AUSTRALIA BANK LTD
Respondent
ON APPEAL FROM:
Jurisdiction : SUPREME COURT OF WESTERN AUSTRALIA
Coram: KENNETH MARTIN J
Citation: TOMCSANYI -v- NATIONAL AUSTRALIA BANK LTD [No 2] [2019] WASC 343
File Number : CIV 1427 of 2014
Catchwords:
Practice and procedure - Injunction - Stay pending appeal - Whether any grounds of appeal had any reasonable prospect of succeeding - Balance of convenience
Practice and procedure - Issue of second Property (Seizure and Delivery) Order after expiration of 12 months of the making of the first Property (Seizure and Delivery) Order - Whether power to issue second order - Whether power properly exercised - Whether power to make ancillary injunctive orders to prevent frustration of the court's processes
Legislation:
Civil Judgments Enforcement Act 2004 (WA), s 7(2), s 94, s 95, s 102
Result:
Appellant's application for injunction dismissed
Representation:
Counsel:
| First Appellant | : | In Person |
| Second Appellant | : | In Person |
| Respondent | : | Mr W C J Zappia |
Solicitors:
| First Appellant | : | In Person |
| Second Appellant | : | In Person |
| Respondent | : | Allens |
Case(s) referred to in decision(s):
ANZ Banking Group Ltd v Sandra Elias [2017] VSC 663; (2017) 53 VR 251
Commonwealth Bank of Australia v Kenney [No 2] [2016] WASC 415
Inglis v Commonwealth Trading Bank of Australia [1972] HCA 74; (1972) 126 CLR 161
T v B [2018] WASCA 157
Tomcsanyi v National Australia Bank Ltd [2015] WASC 448
Tomcsanyi v National Australia Bank Ltd [2017] WASCA 140
Tomcsanyi v National Australia Bank Ltd [No 2] [2019] WASC 343
Tomcsanyi v Yuswak [2015] WASC 111
REASONS OF THE COURT:
Introduction
This matter came to a hearing on 26 September 2019 by way of a registrar's notice to attend dated 20 September 2019 to consider the appellants' application filed 19 September 2019.
The appellants' application filed 19 September 2019 was for orders expressed as follows:
1.URGENT INJUNCTION.
2.Interim Orders that will immediately restrain NAB or any of its Agents from any further dealings or the sale of the property at 60 Woylie Road, Kordabup, location No 4308, 4309 and 4331, and to preserve the property until the Appeal is heard.
3.Costs.
The application was supported by affidavits sworn by the first appellant (Mr Tomcsanyi) on 19 September 2019 and 24 September 2019.
The substantive appeal is against the decision of Kenneth Martin J in Tomcsanyi v National Australia Bank Ltd [No 2][1] (primary decision). By that decision, his Honour granted the respondent's (NAB's) application seeking leave to issue a second Property (Seizure and Delivery) Order (PSD Order) against Mr Tomcsanyi as the registered proprietor of two adjoining properties located at 60 Woylie Road, Kordabup (Denmark property).
[1] Tomcsanyi v National Australia Bank Ltd [No 2] [2019] WASC 343.
At the hearing on 26 September 2019, we dismissed the application and said we would provide written reasons. These are our reasons.
Background
There have been lengthy disputes between Mr Tomcsanyi and NAB in relation to the Denmark property going back prior to 2011. Proceedings were initially commenced by Mr Tomcsanyi in 2011 against, relevantly, NAB, which led to the parties entering into a settlement deed dated 21 February 2012.[2]
[2] Tomcsanyi v National Australia Bank Ltd [2015] WASC 448 [1], [20].
The settlement deed required Mr and Mrs Tomcsanyi to deliver up various items of real and personal property to NAB and also provided that their liability to NAB was to be limited to $765,000. This sum was to be repaid in full to NAB on or before 12 months after the date of the settlement deed. The settlement deed also provided that interest would not accrue on that debt until 12 months after the date of the deed.[3]
[3] Tomcsanyi v National Australia Bank Ltd [2017] WASCA 140 [2].
On 22 February 2013, Mr and Mrs Tomcsanyi submitted a dispute to the Financial Ombudsman Service regarding the settlement deed. The Financial Ombudsman Service closed the dispute on or about 24 December 2013, after NAB agreed that Mr Tomcsanyi's debt under the settlement deed was $765,000.[4]
[4] Tomcsanyi v National Australia Bank Ltd [2015] WASC 448 [26] - [30].
On or about 13 January 2014, NAB served a notice of default on Mr Tomcsanyi dated 13 January 2014 in relation to the debt said to be owed under the settlement deed. Mr Tomcsanyi did not comply with this notice of default.[5]
[5] Tomcsanyi v National Australia Bank Ltd [2015] WASC 448 [31] - [32].
There followed further disputes about the settlement deed.
By deed dated 11 March 2014, NAB appointed three principals of Korda Mentha as receivers over the Demark property. The receivers sought to take possession of the Denmark property on 12 March 2014. On 12 March 2014, these receivers drove onto the Denmark property.[6] They were confronted by Mr Tomcsanyi, who discharged his rifle into the air. On 27 August 2014, Mr Tomcsanyi was convicted of two counts of discharging a firearm in a manner to cause fear to a person contrary to s 23(9a) of the Firearms Act 1973 (WA).[7] Mr Tomcsanyi was sentenced to a total effective sentence of 10 months' imprisonment.[8]
[6] Tomcsanyi v National Australia Bank Ltd [2015] WASC 448 [35].
[7] Primary decision [11]; see also Tomcsanyi v Yuswak [2015] WASC 111.
[8] Tomcsanyi v Yuswak [1].
On 28 March 2014, Mr and Mr Tomcsanyi commenced proceedings in the Supreme Court, claiming specific performance of the settlement deed and damages in excess of $5 million. At all times, including at trial, NAB maintained that the principal amount owing under the settlement deed was $765,000.[9]
[9] Tomcsanyi v National Australia Bank Ltd [2015] WASC 448 [3], [6].
As Mr Tomcsanyi had not paid any part of the $765,000 within 12 months of the date of the settlement deed, or at all, NAB counterclaimed against Mr Tomcsanyi for $765,000, together with interest, and for orders relating to the enforcement of a mortgage held over the Denmark property as security for the debt owed by Mr Tomcsanyi.[10] NAB asserted that Mr Tomcsanyi's failure to pay under the settlement deed meant that Mr Tomcsanyi was in default of the relevant finance facility and the mortgage over the Denmark property. NAB proceeded to attempt to enforce the mortgage, however Mr and Mrs Tomcsanyi remained in possession of the Denmark property at the time of trial.[11]
[10] Tomcsanyi v National Australia Bank Ltd [2017] WASCA 140 [4].
[11] Tomcsanyi v National Australia Bank Ltd [2015] WASC 448 [4] - [5].
The trial was heard between 20 October and 21 October 2015. At trial, all parties accepted and purported to abide by the terms of the settlement deed.[12]
[12] Tomcsanyi v National Australia Bank Ltd [2015] WASC 448 [7] - [8].
In reasons delivered on 30 November 2015, the acting master found, relevantly for present purposes, that NAB's counterclaim was made out. He entered judgment against Mr Tomcsanyi in the amount of $1,340,905.97, together with interest accruing from the date of judgment, being 4 December 2015 until payment. His Honour also required Mr Tomcsanyi to deliver up possession of the properties over which NAB held security.[13]
[13] Tomcsanyi v National Australia Bank Ltd [2017] WASCA 140 [5].
On 4 December 2015, the acting master ordered, relevantly, that Mr Tomcsanyi deliver up possession of the Denmark property by 12 February 2016 (December 2015 Possession Orders).[14]
[14] Tomcsanyi v National Australia Bank Ltd [2017] WASCA 140 [43]; primary decision [3].
By 12 February 2016, Mr Tomcsanyi had not complied with the December 2015 Possession Orders.[15]
[15] Primary decision [3].
Mr Tomcsanyi appealed to the Court of Appeal the judgment of the acting master delivered 30 November 2015 and the December 2015 Possession Orders. Mr Tomcsanyi's appeal was dismissed.[16] However, due to the period of time which had elapsed between 2015 and 2017, this court made orders on 27 July 2017 extending the time for Mr Tomcsanyi to comply with the December 2015 Possession Orders until 2 October 2017 (July 2017 Possession Orders). However, Mr Tomcsanyi did not comply with these orders.[17]
[16] Tomcsanyi v National Australia Bank Ltd [2017] WASCA 140 [72].
[17] Primary decision [4].
Subsequently, Mr Tomcsanyi applied to the High Court seeking special leave to appeal against the orders of this court. By decision of Keane and Edelman JJ on 20 November 2017, Mr Tomcsanyi's application for special leave was refused. The July 2017 Possession Orders remained in place.[18]
[18] Primary decision [5].
As at the time of the primary decision, Mr Tomcsanyi had not delivered possession to NAB of the Denmark property.[19]
The first PSD Order
[19] Primary decision [5].
On 22 March 2018, the Supreme Court issued a PSD Order under s 95 of the Civil Judgments Enforcement Act 2004 (WA) (first PSD Order). The first PSD Order commanded the sheriff to take possession of the Denmark property and deliver possession over to NAB as the judgment creditor.[20]
[20] Primary decision [2] - [3], [6]
On 12 September 2018, the sheriff, police and representatives of NAB attended the Denmark property. The external locks, being the gates, were recoded and the sheriff gave keys to NAB's real estate agents. The first PSD Order was duly perfected by the delivery of possession to NAB's real estate agents and was thus 'spent'.[21]
[21] Primary decision [7].
NAB remained in possession of the Denmark property for the following ten months. NAB made arrangements to sell the Denmark property to a third party and a contract of sale was entered into.[22]
The second PSD Order and the events leading up to it
[22] Primary decision [8].
On 23 July 2019, Mr Tomcsanyi emailed one of NAB's solicitors, advising him that he had changed the locks to the Denmark property.[23]
[23] Primary decision [9].
On 29 July 2019, Mr Tomcsanyi emailed NAB's solicitors and said he would use whatever force necessary to defend himself and his properties. Kenneth Martin J said that this was a particularly serious threat, carrying 'a particularly ominous tone', given the past conduct of Mr Tomcsanyi in relation to the incident on 12 March 2014.[24]
[24] Primary decision [10] - [13].
On 2 August 2019, representatives of NAB, accompanied by a neighbour, who had some of his 300 cows grazing on the Denmark property, and a local locksmith (Mr Wilkinson), attended the Denmark property on NAB's behalf. Local police were also in attendance. They retrieved the neighbour's cattle and changed the locks essentially recapturing possession of the Denmark property.[25]
[25] Primary decision [14].
On 5 August 2019, Mr Tomcsanyi attended Mr Wilkinson's locksmith premises and advised him that he had removed one of the locksmith's etched padlocks and had put his own locks back on again.[26]
[26] Primary decision [15].
On 7 August 2019, Mr Tomcsanyi called Mr Paul Wagner (Mr Wagner), the managing director of Allmain Consultants & Property, who were engaged by NAB to assist in exercising its power of sale. Mr Tomcsanyi advised Mr Wagner that 'he had replaced all padlocks on the Denmark property and, further, that there "would be trouble" if his padlocks were removed'.[27]
[27] Primary decision [16].
On 13 August 2019, Mr Tomcsanyi wrote to NAB's lawyers advising:[28]
I Lewis M Tomcsanyi state that I am in possession of my [Denmark property] and it is my locks and property on all perimeter gates of my [Denmark property].
[28] Primary decision [17].
On 4 September 2019, NAB, by notice of motion, sought leave to issue a second PSD Order against the Denmark property.[29] The application was heard by Kenneth Martin J on 4 September 2019.
[29] Primary decision [1].
Primary decision
NAB's notice of motion seeking leave to issue a second PSD Order against the Denmark property was heard by Kenneth Martin J on 4 September 2019. Kenneth Martin J delivered reasons extemporaneously on 6 September 2019. His Honour subsequently published written reasons on 20 September 2019 (ie, the primary decision).
The judge said that NAB's application raised two questions for determination. Firstly, whether it was open, under the Civil Judgments Enforcement Act, for a further PSD Order to be issued, and if so, whether orders by way of ancillary or consequential restraints can be added to the further PSD Order to essentially protect against and entrench a further recaptured possession of the property by the sheriff under the further PSD Order.[30]
[30] Primary decision [20].
Kenneth Martin J was satisfied that the power to issue a further PSD Order under s 95(1) of the Civil Judgment Enforcement Act existed as a matter of implication under that Act. His Honour was satisfied, as a matter of policy, that the orders of the court must not be permitted to be rendered sterile in effect or allowed to be undermined by unlawful interference. His Honour was satisfied that it was appropriate for the court to issue a second PSD Order at NAB's request, commanding the sheriff to act, to seize the Denmark property and to then deliver possession of the Denmark property over to NAB.[31]
[31] Primary decision [28] - [29].
Kenneth Martin J said the court is necessarily empowered, as a matter of implication from the terms of s 95 of the Civil Judgments Enforcement Act, to issue further PSD Orders to the sheriff where necessary. Essentially, his Honour said that the present circumstances were unusual, in that the first PSD Order was issued and carried out by the sheriff, but was later interfered with by Mr Tomcsanyi retaking the Denmark property. His Honour was nevertheless satisfied there was nothing, as a matter of policy or principle, to stop further PSD Orders being made, where necessary.[32]
[32] Primary decision [26] - [27].
Kenneth Martin J said that Mr Tomcsanyi's unlawful retaking of possession post seizure and delivery could have been dealt with at common law, by a court issued writ of restitution, commanding the sheriff to restore possession to an unlawfully dispossessed judgment creditor. By virtue of s 7(2) of the Civil Judgments Enforcement Act, s 95 of that Act could be redeployed to achieve the same outcome.[33]
[33] Primary decision [27].
Kenneth Martin J was satisfied, on the evidence of past conduct before him, and Mr Tomcsanyi's resolutely‑expressed attitude to PSD Orders, that there was a firm basis established for further ancillary restraint orders to issue against Mr Tomcsanyi.[34]
[34] Primary decision [41].
His Honour referred[35] to the decision of Mukhtar AsJ in ANZ Banking Group Ltd v Sandra Elias.[36] His Honour said in that case, Mukhtar AsJ said the evidence gave rise to a reasonable apprehension that a re-entry by the sheriff will result in the defendant and a related person, again, re‑entering themselves, and that a restraining order ought to operate as a deterrence. The defendant's and the related person's actions were frustrating and defying the court's processes for the enforcement of judgments. Mukhtar AsJ found if there were doubt as to whether he could make a restraining order under the rules of the Victorian Supreme Court, his Honour would have made the same order in exercise of the Court's inherent jurisdiction.[37]
[35] Primary decision [30] - [34].
[36] ANZ Banking Group Ltd v Sandra Elias [2017] VSC 663; (2017) 53 VR 251.
[37] Primary decision [32] - [33].
Kenneth Martin J also referred to Commonwealth Bank of Australia v Kenney [No 2].[38] In that case, Le Miere J discussed the view that a PSD Order expired after 12 months, and said that no competent solicitor would have told the defendant that where a PSD Order has been executed and possession has been given, the registered proprietor becomes entitled to resume possession of the property 12 months after the order was made, if the judgment creditor has not sold or otherwise dealt with the property in the meantime.[39] Kenneth Martin J agreed with Le Miere J's observations, saying they accord with common sense and practicality.[40]
[38] Commonwealth Bank of Australia v Kenney [No 2] [2016] WASC 415.
[39] Kenney [No 2] [23].
[40] Primary decision [38] - [39].
Kenneth Martin J, in granting the ancillary restraining relief sought by NAB's application, was satisfied Mr Tomcsanyi was a serious threat of interfering against NAB's possession if a further PSD Order is executed. His Honour said this threat was evident from Mr Tomcsanyi's repeatedly expressed position regarding his view that a PSD Order only lasts 12 months, allowing him to reclaim possession after 12 months. His Honour said this view would diminish the utility of perfected PSD Orders and effectively see them rendered sterile as against future unlawful dispossession conduct, which would bring the administration of justice into disrepute.[41]
[41] Primary decision [35] - [36], [39].
His Honour found Mr Tomcsanyi's entrenched view on a PSD Order lasting only 12 months was sufficient to justify a restraining order being issued. The judge said he attempted to explain to Mr Tomcsanyi why he rejected Mr Tomcsanyi's view of s 95 of the Civil Judgments Enforcement Act. The judge said that it did not accord with the ordinary text of the section, and did not accord with case authority in this court on the subject, citing Kenney [No 2]. His Honour said despite this, Mr Tomcsanyi told him firmly and repeatedly at the hearing that Mr Tomcsanyi would not accept that position about PSD Orders.[42]
[42] Primary decision [37] - [41].
The orders of Kenneth Martin J on 6 September 2019
On 6 September 2019, Kenneth Martin J made orders in the following terms (September 2019 orders):
1. [NAB] has leave to apply for a further [PSD Order] under section 95(1) of the Civil Judgments Enforcement Act 2004 (WA) (Act) in terms of the Form 6 attached as Annexure A in respect of the land comprised in Certificate of Title Volume 1895 Folio 652 and Certificate of Title Volume 1789 Folio 527 (together, the [Denmark property]).
2. [NAB's] application for a further [PSD Order] under section 95(1) of the Act in terms of the Form 6 attached as Annexure A is granted.
3.Pursuant to section 95(3) of the Act, further or alternatively the inherent jurisdiction of the Court, [Mr Tomcsanyi] (the Judgment Debtor) whether by himself, his employees, his agents or otherwise is hereby restrained until further order from
(a)accessing or entering onto the [Denmark Property] other than with the:
(i)written consent and express written authorisation of [NAB], given by its employees or agents or given by any person who purchases the [Denmark property] from [NAB] and becomes its registered owner (New Registered Owner); and then
(ii)only under the direct supervision of either [NAB] (by its employees or agents) of after the settlement of the sale of the [Denmark property], any New Registered Owner; and
(b) engaging in any conduct or taking any steps, personally or by others, to obstruct, disturb or interfere with:
(i)[NAB's] right to possession of the [Denmark property]; and/or
(ii)the settlement of the sale of the [Denmark property] pursuant to the contract for the sale of land dated 1 July 2019.
4.The costs of the application made by the notice of motion be paid by the Judgment Debtor, on a party/party basis to be taxed, if not agreed.
Relevant legislation
Section 7 of the Civil Judgments Enforcement Act provides:
7.Common law writs etc. and rules, application of
(1) The writs, warrants and orders that, immediately before the commencement of this Act, could be issued or made at common law or in equity or under a written law -
(a) to enforce or execute a judgment of a court; or
(b) in aid of a writ, warrant or order to enforce or execute a judgment of a court,
are abolished.
(2) The rules at common law or in equity applicable to or in relation to a writ, warrant or order that is abolished by subsection (1) and that is substantially similar to an order that may be made under this Act, apply to or in relation to the order that may be made under this Act so far as they are consistent with this Act.
Section 95 of the Civil Judgment Enforcement Act provides:
95.Property (seizure and delivery) order
(1)In order to enforce a judgment to which this Division applies, a person entitled to the benefit of the judgment may apply to the court for an order, addressed to the sheriff, authorising the sheriff to seize the property concerned and deliver possession of it to the person.
(2)The court may make such an order and may do so on terms as to costs or otherwise.
(3)When or after making a property (seizure and delivery) order the court may make any necessary ancillary or consequential order and may do so on terms as to costs or otherwise.
(4)When or after making a property (seizure and delivery) order, the court may make an enforcement order under Part 4 for the purpose of enforcing the payment of -
(a)the enforcement costs associated with the property (seizure and delivery) order; and
(b)the value of the property concerned, as assessed by the court, if the property cannot be seizure under the property (seizure and delivery) order.
Section 95 is in pt 5 div 1 of the Civil Judgments Enforcement Act. Under s 94 of that Act, div 1 applies:
If a judgment of a court requires or has the effect of requiring a person to give possession of any real or personal property to another person.
The affidavit of Mr Tomcsanyi in support of the appellants' application also seeks to rely on s 102 of the Civil Judgments Enforcement Act, which provides:
102.Duration and renewal of orders and warrants
(1) Each of the following operates for 12 months after the day on which it is made or issued -
(a)a property (seizure and delivery) order;
(b) a property (seizure and sale) order;
(c)a warrant issued under section 29(4) or 89(4).
(2) A person in whose favour such an order operates may from time to time apply to the court that made it for the order's operation to be extended.
(3)The judgment creditor in proceedings in which such a warrant was issued may from time to time apply to the court that made it for the warrant's operation to be extended.
(4)On such an application, the court may extend the operation of the order or warrant for a period set by the court that is not longer than 12 months.
(5)An order made under subsection (4) has no effect if it is made after the order or warrant referred to in subsection (1) has ceased to operate.
The parties' submissions
The appellants' submissions
In his affidavit sworn 19 September 2019, Mr Tomcsanyi said that:
There are, but not limited to, three reasons for my Appeal, that is, the hearing conducted by [Kenneth] Martin J was 1. Biased, 2 Procedural Fairness, and 3. no Confidence in [Kenneth] Martin J. [Kenneth] Martin J's conduct was contumelious, having knowingly disregard the Law.
1.Biased - [Kenneth] Martin J lead NAB's entire Defence from the bench, telling NAB's Lawyers what he could do for them, which he did without NAB, or their Lawyers, asking for any of it.
2.No Procedural Fairness - This is where [Kenneth] Martin J refused to accept the meaning of Black Letter Law - [Kenneth] Martin J failed procedural fairness. When I read what was a simple unambiguous Section 102 of the Civil Judgment Enforcements Act 2004 [sic], which as published states the following:
'102. Duration and renewal of orders and warrants
(1)Each of the following has effect for 12 months after the day on which it is made or issued -
(a)a property (seizure and delivery) order; …'
[Kenneth] Martin J refused to accept its simple meaning in Black Written Law. When I challenged [Kenneth] Martin J as to which bit of Legislation supports his version, he answered 'it's not in any Act or Legislation its common sense'.
[Kenneth] Martin J refused to listen to any discussion or explanation with my plight in my Matter.
3.No Confidence - After arguing with me, and I made it quite clear I was not accepting anything he said regarding Section 102 of the Civil Judgments Enforcement Act 2004, he asked me to be seated while he addressed NAB's Lawyers. In a simple Layman's Terms, the following is roughly what [Kenneth] Martin J said to NAB's Lawyers:
a)Do not ask me for any new orders as it is impossible for me to give them because you have had them before. The Matter is finished and any new Orders can't be given because of res judicata.
b)[Kenneth] Martin J then told NAB's Lawyers he would consider Leave for contempt, to which I objected to stating that I was charged with Trespass not Contempt, in the Albany Magistrates Court and found Not Guilty. I can't be charged for doing the same thing twice in two difference [sic] Courts.
c)[Kenneth] Martin J, realising I might be right, he then looked at NAB's Lawyers and said 'I would consider Leave to the bank for new Orders if they requested them, to which I objected, saying this was in absolute breach of Section 102 of the Civil Judgments Enforcement Act 2004.
…
Summary:
…
I was denied procedural fairness by:
-[Kenneth] Martin J's biased opinion;
-[Kenneth] Martin J's incorrect interpretation of the Law;
-[Kenneth] Martin J's displayed wilful blindness in my Matter;
-[Kenneth] Martin J's refusal to deal with any argument I tried to present to him.
-[Kenneth] Martin J's serious attempt to falsely claim I was in Contempt of Court.
-[Kenneth] Martin J's inability to provide the Black Written Law in a Court.
-[Kenneth] Martin J's Orders reflect his own emotional state, not the state of Black Written Law.
-[Kenneth] Martin J defamed my character by claiming I was a threat in Court.
-[Kenneth] Martin J then listed a 'Warning' in his Orders.
In oral submissions, Mr Tomcsanyi said, in effect, that the primary decision was wrong because the true effect of s 102 of the Civil Judgments Enforcement Act was that, after the expiration of 12 months in respect of the first PSD Order, possession of the Denmark property was automatically revested in him.
NAB's submissions
NAB, in written submissions filed 25 September 2019, submitted, in effect, that (1) the relevant principles were those applicable to an application for a stay, (2) the appellants' appeal had no reasonable prospects of success, and (3) the balance of convenience favoured the disposition of the application given that NAB had lawful possession of the property, there was no dispute as to the exercise of the power of sale (other than the argument that possession had revested in Mr Tomcsanyi), and the mortgage debt had not been paid into court consistently with the principles in Inglis v Commonwealth Trading Bank of Australia.[43]
[43] Inglis v Commonwealth Trading Bank of Australia [1972] HCA 74; (1972) 126 CLR 161.
Disposition
The principles to be applied in a case such as this were outlined in T v B:[44]
[44] T v B [2018] WASCA 157 [6] - [7].
In Mercanti v Mercanti, the court said:
'The exercise of this court's discretion to grant an injunction pending the determination of an appeal requires an assessment to be made of the decision under appeal and also the balance of convenience, including whether refusal of the injunction would render the appeal nugatory. See Paringa Mining & Exploration Co Plc v North Flinders Mines Ltd [1988] HCA 53; (1988) 165 CLR 452, 460. The nature of the criteria which are ordinarily relevant to the exercise of this court's discretion to grant an injunction, pending an appeal, are analogous to those which are relevant to the grant of a stay. Although it is ordinarily necessary to establish that the appellant has reasonable prospects of success on the appeal, the appellant's prospects are, to some extent, interdependent with the balance of convenience. See Apache Northwest Pty Ltd v Agostini [2009] WASCA 147 [10].
The general principles which apply to an application for a stay are not materially different from those which apply to an application for a suspension order under s 15 of the Civil Judgments Enforcement Act 2004 (WA). Those principles were summarised in Eastland Technology Australia Pty Ltd v Whisson [2003] WASCA 307; (2003) 28 WAR 308 [9]. See also Ladang Jalong (Australia) Pty Ltd v Callander [2005] WASCA 203 [3].'
In Eastland Technology Australia Pty Ltd v Whisson, the court outlined the relevant principles in the following terms:
'•The successful litigant at first instance will ordinarily be entitled to enforce the judgment pending the determination of any appeal.
•It is for the applicant for a stay to move the court to a favourable exercise of its discretion.
•It will not do so unless special circumstances are shown justifying the departure from the ordinary rule.
•The central issue will be whether the grant of a stay is perceived to be necessary to preserve the subject matter or the integrity of the litigation, or where refusal of a stay could create practical difficulties in respect of the relief which may be granted on appeal. It is often put shortly that it will first and foremost be necessary to establish that without the grant of a stay, the right of appeal, whether upon the grant of leave or special leave or not, will be rendered nugatory.
•If that can be demonstrated, the stay will generally still be refused unless it can be established that the appeal process, whether upon the grant of leave or special leave or not, has ultimately reasonable prospects of success so as to result in the grant of relief to the appellant.
•If that hurdle can be overcome, the stay may still be refused where it appears that the balance of convenience does not lie in favour of the applicant; where, for example, the grant of a stay will occasion hardship to the respondent which may not be alleviated by the terms upon which the stay may be granted.' (footnotes omitted)
In the present case, it may be accepted that the refusal of an injunction pending determination of the appeal would render the appeal nugatory. The settlement of the sale of the Denmark property, which is in substance the subject matter of the appeal, is planned to occur on 10 October 2019.[45]
[45] Affidavit of Charles Philip Blaxill sworn 24 September 2019, par 12.
However, the appellant's appeal has no reasonable prospect of succeeding, for the following reasons.
First, it cannot be seriously disputed that NAB became entitled to possession pursuant to the operation of the December 2015 and July 2017 Possession Orders (Possession Orders). Mr Tomcsanyi was unsuccessful (up to the High Court) in resisting the making of the Possession Orders. Subject to a consideration of the appellants' argument as to the operation of s 102 of the Civil Judgments Enforcement Act, the appellants have no legal right to possession of the Denmark property.
Secondly, s 102 of the Civil Judgments Enforcement Act does not provide expressly or impliedly that upon expiration of a PSD Order, the property revests in (relevantly in this case) the mortgagor. PSD Orders in this context deal with the enforcement of substantive legal rights. NAB's substantive legal right, established by the Possession Orders, was to possession of the Denmark property. Section 95 and s 102 provide, in effect, for a 12 month period (subject to extension) during which the sheriff was authorised to seize the Denmark and deliver possession of the property to NAB. In the present case the sheriff seized the Denmark property and delivered possession of it to NAB within that 12 month period. No extension of the PSD Order under s 102(4) was required. Nothing in s 102 arguably limits NAB's right to possession of the Denmark property, established by the Possession Orders and delivered pursuant to the first PSD Order, to a period of 12 months from the day on which the PSD Order was made. The appellants' argument that s 102 operates to defeat NAB's substantive legal right to possession pursuant to the Possession Orders has no arguable merit.
Thirdly, the primary judge was clearly correct to conclude that a second PSD Order could be issued under s 95 to enforce the Possession Orders after Mr Tomcsanyi unlawfully re-took possession of the Denmark property which had been seized and delivered to NAB under the first PSD Order. The court also clearly had power to issue ancillary injunctive relief to prevent the frustration of the court's process. We agree with his Honour's reasons for reaching those conclusions.
Fourthly, having examined the transcript of the hearing before the primary judge, there is no arguable basis upon which it might be said that the appellants were denied procedural fairness. In particular, the suggestion that the primary judge was biased lacks any arguable foundation. Nor is there any other basis to doubt the correctness of the primary decision.
The effect of the preceding observations is that the appeal has no possible prospect of success. To order a stay/injunction in these circumstances would be futile.
In any event, even if (contrary to our view) the appeal had some reasonable prospect of success, the balance of convenience is against the grant of injunctive relief. NAB's right to possession of the property is established by the Possession Orders. The sale of the Denmark property cannot deprive the appellants of anything to which they are lawfully entitled. On the other hand, the issue of an injunction would interfere with the settlement of the sale of the Denmark property which is agreed to occur on 10 October 2019. NAB would likely incur damages and additional costs if an injunction prevents it from being able to settle the sale of the Denmark property pursuant to the terms of its contract with the buyer. As the contract sale price is less than the judgment sum, it is unlikely that NAB would have any security for recovery of its loss and additional costs. Particularly in these circumstances, an injunction would not be ordered absent an undertaking as to damages. No undertaking was given, and, in any event, there was no evidence that the appellants have the means to make any undertaking efficacious.
For the above reasons, we dismissed the appellants' application.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
AW
Research Associate to the Honourable Justice Murphy and the Honourable Justice Mazza3 OCTOBER 2019
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