Weber v Carkeek
[2022] VSC 498
•26 August 2022
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
ENFORCEMENT LIST
S ECI 2019 00010
BETWEEN:
| MARK PAUL WEBER | Applicant |
| v | |
| EWAN AUBREY CARKEEK & ORS (according to the schedule attached) | Respondents |
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JUDGE: | Irving AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 15 August 2022 |
DATE OF RULING: | 26 August 2022 |
CASE MAY BE CITED AS: | Weber v Carkeek & Ors |
MEDIUM NEUTRAL CITATION: | [2022] VSC 498 |
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ENFORCEMENT – Application to set aside warrant of seizure and sale – Power to stay an execution of a judgment or order - Supreme Court (General Civil Procedure) Rules 2015 (Vic), r 66.16 – Inherent power - Snowball v Capital Securities XVII Pty Ltd [2018] VSC 588 - Australian Beverage Distributors Pty Ltd v Evans & Tate Premium Wines Pty Ltd (2007) 69 NSWLR 374.
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APPEARANCES: | Counsel | Solicitors |
| The Plaintiff in person | M Weber | Self-represented litigant |
| For the Respondents | M Lapirow of counsel | Davies Moloney |
HIS HONOUR:
Introduction
On 3 January 2019, Mark Weber (Weber) registered in the Supreme Court of Victoria (Court) an order made by the Victorian Civil and Administrative Tribunal (Tribunal) on 7 December 2018 (Tribunal order). The terms of the Tribunal order required Weber to pay Ewan Carkeek and Lorraine Carkeek (the Carkeeks) the sum of $84,014.35, for the Carkeeks to pay Weber the sum of $10,000 and for Ewan Carkeek to pay Weber the sum of $125,142.42. Having registered the Tribunal order, on 15 June 2022 Weber had the Court issue a warrant of seizure and sale of the Carkeeks’ property (warrant).0F[1] The Carkeeks have applied to have the warrant set aside on the basis that since the Tribunal order was made, the Carkeeks have obtained orders in related and other proceedings that Weber pay them sums which together are in excess of the amount they owe Weber by virtue of the Tribunal order.
[1]In fact, Weber had caused a warrant of seizure and sale to be issued on 22 January 2019. However, that warrant was not satisfied and subsequently expired.
For the reasons that follow I have decided that the warrant should not be set aside but that it is appropriate, subject to any further order of the Court, to stay execution of the warrant.
Background
The background to the relationship between Weber and the Carkeeks and their dispute was set out by Richards J in Weber v Carkeek.1F[2] I adopt her Honour’s summary:
[2][2020] VSC 366, [1]–[8].
Mark Weber met Ewan Carkeek in April 2016, during a horse riding event near Corryong, at a time when Mr Weber was looking to move to the high country. Mr Carkeek was looking for someone to work on a farming property that he owns with his wife, Lorraine Carkeek, at Berringama in the Upper Murray region. Mr Weber and Mr Carkeek agreed that Mr Weber would live in a house on the property in exchange for doing work on the farm, and they negotiated the details of the arrangement. Shortly afterwards, Mr Weber moved to the property.
While Mr Weber was living and working at Berringama, he made several loans to Mr Carkeek. The first loan was in May 2016 for $50,000. In June and July 2017, Mr Weber lent a further $50,000 to Mr Carkeek.
On 28 June 2017, over dinner at the Carkeeks’ house, Mr Weber discussed with them his business plan for a beef cattle enterprise. Following that discussion, Mr Weber purchased some cattle, which he agisted on the Carkeeks’ property. He also provided some business advice to Mr Carkeek.
Unfortunately, the relationship between Mr Weber and Mr and Mrs Carkeek soured. Mr Weber stopped working on the property in December 2017, although he remained living there until October 2018, and also kept his cattle agisted on the property. In January 2018, he asked for repayment of the loans, and claimed to be owed $36,150 for management fees. During May 2018, Mr Weber became concerned about the condition of the cattle and claimed that Mr Carkeek had deliberately starved them by keeping them in the same paddock for over three months. There was ongoing conflict about the agistment of Mr Weber’s cattle, until he sold the last of them on 1 October 2018.
In May 2018, Mr Weber made an application to the Victorian Civil and Administrative Tribunal, seeking orders against Mr and Mrs Carkeek under the Australian Consumer Law and Fair Trading Act 2012 (Vic). He sought payment of around $750,000 in respect of the loans that had not been repaid, for management consultancy services provided, and for breach of the agistment agreement. In July 2018, Mr Weber joined Mr Carkeek’s mother, Alison Carkeek, as the third respondent, on the basis that she had been in partnership with Mr and Mrs Carkeek until some time in 2017.
The Carkeeks disputed the claims made by Mr Weber and counterclaimed for rent and agistment fees. They also applied to the Tribunal for a possession order under the Residential Tenancies Act 1997 (Vic). In August 2018, the Tribunal made an order requiring Mr Weber to vacate the house on the property by 28 October 2018.
The proceedings brought under the Fair Trading Act were heard by the Tribunal, constituted by Senior Member Forde, over six days in October and November 2018. By that time, the amounts claimed by Mr Weber exceeded $2 million, including over $1.5 million for loss of future opportunity due to the termination of the agistment agreement. Mr Weber appeared for himself throughout the hearing, while the Carkeeks were represented by a solicitor.
On 7 December 2018, the Tribunal made the following orders:
1. The claims against the third respondent [Alison Carkeek] are dismissed.
2. Mark Weber must pay Ewan Carkeek and Lorraine Carkeek the sum of $84,014.35.
3. Ewan Carkeek and Lorraine Carkeek must pay Mark Weber the sum of $10,000.
4. Ewan Carkeek must pay Mark Weber the sum of $125,142.42.
…
[emphasis in original]
The litigation between Weber and the Carkeeks did not end there. I have summarised the subsequent litigation between the parties below. The summary provided is not strictly chronological but rather deals with the various threads of litigation by topic.
On 14 March 2019, on the Carkeeks’ application, the Tribunal ordered that Weber pay 90% of the Carkeeks’ legal costs (Tribunal costs order). Weber then applied to the Tribunal to review that costs order (review application). Weber’s review application was listed for hearing on 5 July 2019. However, he did not appear on that date and so the Tribunal dismissed his review application and made a further costs order in favour of the Carkeeks in the sum of $700. Weber says this costs award was later set aside and the Tribunal allowed a subsequent review to take place. Weber’s assertion appears to be supported by the solicitor for the Carkeeks, Colman Francis Moloney (Moloney), who deposes in his affidavit affirmed 12 August 2022 that Weber made a further review application that was part-heard by Member Knights on 6 September 2019 and adjourned to 4 December 2019. The outcome of that application is not in evidence.
On 23 April 2019, the Carkeeks filed a summons of taxation in this Court in relation to the Tribunal costs order. On 15 August 2019, Costs Registrar Conidi taxed the Carkeeks’ costs and allowed them in the sum of $45,559.25.
On 7 January 2019, Weber filed in the Court an application for leave to appeal the first three paragraphs of the Tribunal order. Weber’s application was determined by Richards J on 22 June 2020. Richards J granted Weber leave to appeal but dismissed his appeal. Richards J ordered that Weber pay the Carkeeks’ costs on a standard basis. Those costs were taxed and allowed by Costs Registrar Walton on 20 October 2020 in the sum of $108,950.
On 18 January 2019, on the basis of the third and fourth paragraphs of the Tribunal order (that the Carkeeks pay Weber the sum of $10,000 and that Ewan Carkeek pay Weber the sum of $125,142.42), Weber served a bankruptcy notice on Ewan Carkeek. Ewan Carkeek made an unsuccessful application to extend and then stay the bankruptcy notice in the Federal Circuit Court of Australia (Federal Circuit Court) in proceeding MLG308/2019. On 19 September 2019, Weber filed a creditor’s petition in the Federal Circuit Court in proceeding MLG3141/2019. Ewan Carkeek applied to the Federal Circuit Court to have Weber’s creditor’s petition struck out as an abuse of process. On 31 October 2019, the Federal Circuit Court dismissed the creditor’s petition and ordered that Weber pay Ewan Carkeek’s costs of the petition. On 17 March 2020, the Federal Circuit Court issued a certificate of taxation deeming Ewan Carkeek’s costs in proceeding MLG3141/2019 to be $19,000.
In July 2018, Weber issued Federal Circuit Court proceeding MLG2473/2018 against the Carkeeks, alleging underpayment. On 16 September 2019, Weber did not appear and the Federal Circuit Court dismissed the proceeding and ordered that Weber pay the Carkeeks’ costs, fixed in the amount of $3,000 within 14 days.
Moloney filed three affidavits in the proceeding. The first of Moloney’s affidavits was sworn on 14 July 2022 and the remaining two affidavits were both sworn on 12 August 2022.
Moloney’s first affidavit briefly outlines the litigation between the parties in the Tribunal and the Federal Circuit Court and canvasses the various awards and costs orders made. Moloney then states that the amount of money Weber owes the Carkeeks exceeds the amount of money owed by the Carkeeks to Weber such that there is no basis for Weber’s warrant. Additionally, Moloney deposes that on 22 February 2022 the Carkeeks issued a warrant of seizure and sale in Supreme Court proceeding S ECI 2019 00390 against Weber for recovery of the costs order made by Richards J and taxed by Costs Registrar Walton in the amount of $108,950.
By the second affidavit, sworn on 12 August 2022, Moloney deposes that, taking into account interest and setting off later orders against earlier orders from the date the later orders were made, as at 19 August 20222F[3] Weber is indebted to the Carkeeks as follows:
Victorian judgments $118,315.11
First Federal [Circuit] Court judgment $3,552.66
Second Federal [Circuit] Court judgment $21,822.54
Total (excluding costs of execution) $143,690.31
[3]I note that 19 August 2022 is a date four days after the hearing of the Carkeeks’ summons.
Weber filed two affidavits in opposition to the Carkeeks’ summons. Weber’s first affidavit, affirmed 27 July 2022, deposes that:
(a) the Carkeeks’ affidavits in support of their application to set aside the warrant are misleading and contain errors;
(b) on 15 June 2022, Weber emailed a copy of the warrant to Moloney, inviting a negotiation to settle all matters between the parties;
(c) the Carkeeks’ application is made on the basis that the award of damages be aggregated with the other orders and only the balance of the damages to the most successful party be considered. This does not reflect the terms of the separate orders made by the Tribunal on 7 December 2018;
(d) the Carkeeks’ assertion that Weber issued the warrant in response to a warrant issued by the Carkeeks in February 2022 is denied and inconsistent with the fact that Weber had earlier issued a warrant which was unsatisfied and expired;
(e) the $700 costs order made by the Tribunal on 5 July 2019 was:
made nugatory as it was found the VCAT had not notified [Weber] of the hearing date for the Review of the Costs Order and allowed for a subsequent hearing of the Review of Costs to take place;
(f) the Carkeeks have never sought to enforce the award of $45,559.25 made by Costs Registrar Conidi on 15 August 2019;
(g) the costs orders made in the Federal Circuit Court relate to another jurisdiction and should not have any relevance to this application, rather it was open to the Carkeeks to enforce those orders through that court but they have failed to do so;
(h) the Supreme Court (General Civil Procedure) Rules 2015 (Vic) (Rules) do not provide for a warrant to be set aside by a judgment debtor;
(i) a judgment debtor can only avoid a warrant if they become bankrupt, pay the amount due in full or reach an agreement with the creditor, none of which the Carkeeks have done;
(j) as at 27 July 2022, the amount due to Weber, including the judgment debt and interest is $184,180.67; and
(k) the Court does not have the power to set off the orders made against Weber in favour of the Carkeeks in other courts.
Weber’s second affidavit was affirmed on 15 August 2022, the day of the hearing of the Carkeeks’ application to set aside the warrant. In this affidavit, Weber deposes that he first saw the two affidavits filed by the Carkeeks on 12 August 2022 at 9:15pm on 14 August 2022 and that he believes the Carkeeks have deliberately delayed filing the affidavits to disadvantage him at the hearing. Weber asserts that the Carkeeks’ application to set aside his warrant is an abuse of process as it was filed in order to cause him stress and psychological harm in circumstances where the Carkeeks and their legal representatives are aware that Weber suffers with post-traumatic stress disorder.
The Carkeeks’ summons primarily seeks an order that the warrant be set aside and that Weber pay the Carkeeks’ costs on an indemnity basis. The summons also seeks any such further or other order as the Court deems fit.
In support of their application, counsel for the Carkeeks referred the Court to two cases. The first involved an application for a stay of orders on the basis of offsetting debts. The second involved an application for orders restraining a party from enforcing costs orders on the basis of an offsetting costs order. I will say more about these cases below but it is sufficient at this point to note that neither of these cases deals with an application to set aside, as opposed to stay, an enforcement process.
Neither the Carkeeks nor Weber suggested that the Tribunal order was obtained irregularly. Given the Tribunal order had been the subject of an unsuccessful appeal before Richards J, such an argument would in any event have been unsustainable. During the hearing on 15 August 2022, counsel for the Carkeeks submitted that the warrant had been obtained irregularly because at the time it was issued, once offsetting orders were taken into account, the Carkeeks did not owe Weber the full amount claimed in the warrant.
Relevant principles
Rule 66.16 of the Rules empowers the Court to stay an execution of a judgment or order. The Court also has this power by virtue of its inherent jurisdiction. The power is discretionary and to be exercised by reference to all the circumstances of the case. The principles relevant to granting a stay were restated by John Dixon J in Snowball v Capital Securities XVII Pty Ltd (Snowball):3F[4]
[4][2018] VSC 588 [29].
(a)the prima facie position is that a party entitled to judgment is entitled to immediately enforce that judgment;
(b)any exercise of the inherent jurisdiction to order otherwise ‘must be exercised on grounds relevant to a stay of the enforcement proceedings, rather than on grounds which may bear upon the validity or correctness of the judgment’; and
(c)the applicant for a stay bears the onus of demonstrating the stay sought is justified.
[citations omitted]
Counsel for the Carkeeks sought to rely on the case of Medlon v Medlon (No 7) (Medlon)4F[5], a judgment of Strickland J in the Family Court of Australia (Family Court) as authority for the proposition that the Court has inherent jurisdiction to take into account offsetting debts in formulating its orders. In Medlon, the wife appealed orders made by the trial judge that she pay the husband’s costs, and if that was not done by a certain date, an enforcement warrant of seizure and sale of the wife’s property would be issued. The wife’s single ground of appeal was that the trial judge had erred by not offsetting the liabilities the husband had been earlier ordered to pay but had not paid against the costs the wife was ordered to pay. Relevantly, the liabilities the wife alleged were ‘tax liabilities that she has been left with, dividends that she says she has not received, long service leave and annual leave entitlements … unpaid accounts, and items of personalty including motor vehicles not yet delivered up’.5F[6] The trial judge had indicated to the wife that these issues were irrelevant to the issue before the trial judge, which was the husband’s enforcement application.
[5][2015] FamCAFC 246.
[6]Ibid [13].
On my reading of Medlon, the Family Court found no error by the trial judge on the basis that the wife had sought to rely on offsetting debts that were not, at the time she sought to rely upon them, sums certain.
Counsel for the Carkeeks referred the Court to the following passage from Strickland J’s reasons:
There is no error by her Honour in taking this approach; there was simply nothing to “off-set”, even if that was a course open to her Honour, which I doubt. The wife would have had to have previously sought a stay of the execution of the orders for costs to enable her to pursue any claim against the husband. However, she had not done that.6F[7]
[7]Ibid [17].
Next, counsel for the Carkeeks referred to White J’s decision in the Supreme Court of New South Wales case of Australian Beverage Distributors v Evans & Tate Premium Wines Pty Ltd.7F[8] The Carkeeks sought to rely on White J’s decision as authority for the principle that the Court has inherent jurisdiction to set off judgments for costs in different actions and in different courts and to restrain one party from enforcing its judgment for costs until it has paid the debt owing to the other party.
[8](2006) 230 ALR 184.
This case involves applications by the defendants, Evans & Tate Premium Wines Pty Ltd (ETPW) and Evans & Tate Ltd, for summary dismissal of winding-up applications brought by the plaintiff, Australian Beverage Distributors Pty Ltd (ABD), on the basis of insolvency. ETPW also sought to restrain ABD from executing a judgment based on a costs certificate made in an earlier proceeding between the parties. There had been previous litigation between the parties in debt and damages.
White J identified the issue insofar as the proceeding concerned the enforcement of any judgment based on the costs certificate as being:
whether ETPW is entitled to set off against a debt or judgment in favour of ABD for costs another judgment for costs which it has against ABD, and an admitted debt owed by ABD to it. If not, there is an issue as to whether there is a wider jurisdiction to restrain execution of the costs order which should be exercised.8F[9]
[9]Ibid [3].
White J identified that the Supreme Court of New South Wales has inherent jurisdiction to stay its own proceeding wherever the requirements of justice so demand and that while that jurisdiction should be exercised with caution, it extends to staying execution of judgments and orders. White J also identified that s 135 of the Civil Procedure Act 2005 (NSW) granted the Supreme Court of New South Wales a broad power to make directions and orders in respect of enforcement of its judgments and orders, including restraining a person from taking any further action, either permanently or until a specified date, to enforce a judgment or order of the Supreme Court of New South Wales. His Honour stayed any further action by either party to enforce existing orders until a related proceeding was determined and stated:
The stay of execution of a judgment to give effect to a set-off between two judgment debts is but an instance of the control which the Court exercises over its own proceedings.
In this case, justice requires that not only should the two certificates for costs be set off against each other, but that ABD not be entitled to enforce its judgment for costs until it has paid the debt owed to ETPW, or until the District Court proceedings have been determined. ...
On the materials before me, ABD owes more to ETPW than ETPW owes to it. Even though that is not sufficient to give rise to a set-off in equity, and even though a stay of execution is tantamount to allowing a set-off, the jurisdiction to stay execution of the order for costs does not depend on satisfaction of the requirements for establishing an equitable set-off. There is no reason to think that it should, as an equitable set-off extinguishes or reduces the debt, whereas a stay merely precludes enforcement of the debt for so long as the stay operates.9F[10]
[10]Ibid [77]–[79].
White J’s judgment was appealed to the New South Wales Court of Appeal (Court of Appeal).10F[11] Beazley JA gave the main judgment with Hodgson and Santow JJA agreeing with Beazley JA. In the Court of Appeal, ABD argued that White J’s order staying the costs judgment was made without jurisdiction, or alternatively, his Honour’s exercise of discretion in staying the judgment miscarried.11F[12] It is unnecessary to consider Beazley JA’s decision in relation to lack of jurisdiction as that focussed on the scope of s 135 of the Civil Procedure Act 2005 (NSW). Beazley JA found, however, that s 135 does not oust or delimit the inherent jurisdiction of the Supreme Court of New South Wales and that the authorities show that a stay is available in a variety of circumstances, including where a defendant claims a right of set-off.12F[13] Further, Beazley JA found that the Supreme Court of New South Wales’ inherent jurisdiction provided undoubted power to exercise its discretion to grant a stay of the costs order.13F[14]
[11]Australian Beverage Distributors Pty Ltd v Evans & Tate Premium Wines Pty Ltd (2007) 69 NSWLR 374.
[12]Ibid [128].
[13]Ibid [140]. Her Honour cited the case of In re A Debtor, No 21 of 1950 (No 2); Ex parte the Petitioning Creditors v The Debtor [1951] Ch 612.
[14]Ibid [143].
Beazley JA, however, found that in all of the circumstances of the case before the Court of Appeal, White J’s discretion in ordering the stay had miscarried. Her Honour stated:
The costs order created a debt that was separate from any other indebtedness and was not available as a set off against any indebtedness owed by ABD. Neither the costs order nor the proceedings in which it was made was subject to any appeal process. The mere fact that there were other claims between the parties, some of which were disputed and some of which were not, was not sufficient in my opinion in all the circumstances of this case, including those referred to in para [83] above, to stay the enforcement of an order that created another indebtedness.14F[15]
[15]Ibid [145]. In para [83] her Honour had found that White J erred in finding that, in filing a winding‑up application, ABD had abused the Supreme Court of New South Wales’ processes.
Analysis
I am not prepared to find that the very late filing of affidavits by the Carkeeks amounted to an abuse of process, although it was extremely unhelpful to both the Court and Weber, a self-represented litigant. Similarly, the Court and Weber would have greatly benefitted if the Carkeeks had identified and provided copies of the authorities they intended to rely upon before, rather than during, the hearing. I note that Weber was offered the opportunity to seek an adjournment to consider the authorities provided during the hearing. However, he did not seek an adjournment.
I am not satisfied that the warrant was obtained irregularly. Weber’s warrant was based on a regularly obtained order of the Tribunal that had been registered in the Court in accordance with the Rules. There can be no doubt that on its terms the order created a debt that Weber was entitled to enforce. In these circumstances, I am not satisfied that the warrant should be set aside.
Should the warrant be stayed in all of the circumstances of this case?
In my view, the authorities support the view that the Court does have, through its inherent jurisdiction, the power to take into account and set off orders when deciding whether to grant a stay. This power is not limited to only orders that have been sought to be enforced or only orders from the same proceeding or court. The Court’s discretion is to be exercised according to the principles identified by John Dixon J in Snowball.
While Weber disputes the Tribunal costs order made on 5 July 2019 in the sum of $700, he did not seek to dispute the existence of the other orders. Rather, the thrust of Weber’s argument was, first, that the Carkeeks should seek to enforce orders made in their favour by the Federal Circuit Court in that court. Second, that this Court had no power to take into account and set off orders made in the Carkeeks’ favour in either the Tribunal or the Federal Circuit Court. Third, Weber submitted that if the Court allowed the set off, it would deny Weber payment of the interest on his Tribunal award.
In my view, the interests of justice warrant a stay of execution of the warrant.
I start from the position that Weber obtained the Tribunal order and so is entitled to the benefit of that order.
I am not persuaded that Weber is correct about the Carkeeks being liable for interest on his Tribunal award. Weber did not identify the basis of his assertion of a right to post-judgment interest and his assertion was not challenged by the Carkeeks. Nevertheless, there is authority that a Tribunal order, even once registered in the Supreme Court is not a judgment debt for the purpose of s 101 of the Supreme Court Act 1986 (Vic).15F[16]
[16]Ajaimi v Giswick Pty Ltd (No 3) [2022] VSC 447, [53]–[58].
Even leaving the question of interest to one side, the evidence plainly demonstrates that, other than in respect of the $700 order, the sums the Carkeeks seek to offset are the subject of finalised orders which are not subject to further review or appeal. Nor were the terms and effect of the orders the subject of serious dispute between the parties at the hearing of the summons. To this extent, they are a sum certain. On the basis of this evidence alone, it appears that the debt the Carkeeks owe to Weber is far exceeded by the debt Weber owes to the Carkeeks. The Carkeeks have issued a warrant only in relation to the costs of the appeal before Richards J. The fact that they have not sought to enforce the other orders in their favour appears to reflect their view that those orders offset the Tribunal order, which was made in Weber’s favour.
Conclusion
In all of the circumstances of this case, I am satisfied that it is appropriate to order that the warrant be stayed until further order of the Court.
SCHEDULE OF PARTIES
| S ECI 2019 00010 | |
| BETWEEN: | |
| MARK PAUL WEBER | Applicant |
| - v - | |
| EWAN AUBREY CARKEEK | First Respondent |
| LORRAINE KATHLEEN CARKEEK | Second Respondent |
| ALISON DORETHA CARKEEK | Third Respondent |
0
6
0