Wilden Pty Ltd v Green [No 3] - [2016] WASCA 74

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE COURT OF APPEAL (WA)

CITATION: WILDEN PTY LTD -v- GREEN [No 3] [2016] WASCA 74

CORAM: McLURE P
NEWNES JA
MURPHY JA

HEARD: 22 MARCH 2016

DELIVERED : 4 MAY 2016

FILE NO/S: CACV 101 of 2005

BETWEEN: WILDEN PTY LTD (ACN 009 143 033)
First Appellant
MAGENTA NOMINEES PTY LTD (ACN 009 340 158)
Second Appellant
TACE PTY LTD (ACN 009 204 915)
Third Appellant
SYDNEY JAMES CHESSON
Fourth Appellant
BERT LEONARD DENBOER
Fifth Appellant
CALLAO PTY LTD (ACN 008 867 552)
Sixth Appellant
BENRONE PTY LTD (ACN 008 931 084)
Seventh Appellant
AND
GRAEME WILLIAM GREEN
First Respondent
W J GREEN & CO (1984) PTY LTD (ACN 008 851 867)
Second Respondent
SHARYN LEE GREEN
First-named Third Respondent
GRAEME WILLIAM GREEN
Second-named Third Respondent
JULIE ANNE GREEN
Third-named Third Respondent
WILLIAM JOSEPH GREEN
Fourth-named Third Respondent
NORMA GLENYCE GREEN
Fifth-named Third Respondent

ON APPEAL FROM:
Jurisdiction              :  SUPREME COURT OF WESTERN AUSTRALIA
Coram  :HASLUCK J
Citation  :GREEN -v- WILDEN PTY LTD [2005] WASC 83
File No  :CIV 3049 of 1991, CIV 3050 of 1991, CIV 2965 of 1990, CIV 2966 of 1990
Jurisdiction              :  SUPREME COURT OF WESTERN AUSTRALIA
Coram  :HASLUCK J
Citation  :GREEN -v- WILDEN PTY LTD [2005] WASC 83 (S)
File No  :CIV 3049 of 1991, CIV 3050 of 1991, CIV 2965 of 1990, CIV 2966 of 1990

Catchwords:

Civil judgment - Application to vary final orders - Power to vary - Whether post-judgment interest payable on judgment sum - Section 8 of Civil Judgment Enforcement Act 2005 (WA) - Claim of breach of trust

Legislation:

Civil Judgments Enforcement Act 2005 (WA)
Supreme Court Act 1935 (WA)
Trustees Act 1962 (WA)

Result:

Application dismissed

Category: B

Representation:

Counsel:

First Appellant          :    Mr N D C Dillon
Second Appellant          :    Mr N D C Dillon
Third Appellant          :    Mr N D C Dillon
Fourth Appellant          :    In person
Fifth Appellant          :    Mr N D C Dillon
Sixth Appellant          :    Mr N D C Dillon
Seventh Appellant          :    Mr N D C Dillon
First Respondent          :    Mr M L Bennett
Second Respondent          :    Mr M L Bennett
First-named Third Respondent   :    Mr M L Bennett
Second-named Third Respondent: Mr M L Bennett
Third-named Third Respondent :    Mr M L Bennett
Fourth-named Third Respondent :    Mr M L Bennett
Fifth-named Third Respondent :    Mr M L Bennett

Solicitors:

First Appellant              :     AustAsia Legal Pty Ltd
Second Appellant          :     AustAsia Legal Pty Ltd
Third Appellant            :     AustAsia Legal Pty Ltd
Fourth Appellant          :    In person
Fifth Appellant          :    AustAsia Legal Pty Ltd
Sixth Appellant          :    AustAsia Legal Pty Ltd
Seventh Appellant          :    AustAsia Legal Pty Ltd
First Respondent          :    Bennett & Co
Second Respondent          :    Bennett & Co
First-named Third Respondent   :    Bennett & Co
Second-named Third Respondent: Bennett & Co
Third-named Third Respondent :    Bennett & Co
Fourth-named Third Respondent :    Bennett & Co
Fifth-named Third Respondent :    Bennett & Co

Case(s) referred to in judgment(s):

Green v Wilden Pty Ltd [2005] WASC 83
Green v Wilden Pty Ltd [2005] WASC 83 (S)
Rambal v The Griffin Coal Mining Co Pty Ltd [2015] WASCA 197
Wilden Pty Ltd v Green [2009] WASCA 38
Wilden Pty Ltd v Green [2009] WASCA 38 (S)
Wilden Pty Ltd v Green [No 2] [2012] WASCA 34

McLURE P: This is yet another application by the respondents to vary final orders made by this court on 6 July 2009. Before providing details of the application it is necessary to explain the history.
On 10 May 2005 Hasluck J delivered reasons in Green v Wilden Pty Ltd [2005] WASC 83. The broad background to the litigation is as follows. Wilden Pty Ltd (Wilden) was the trustee of the Balga Bazaar (1985) Unit Trust (the Balga Trust). The first and second respondents were (and remain) registered holders of units in the Balga Trust. They financed the purchase of those units by loans from Wilden. Magenta Nominees Pty Ltd (Magenta) was the trustee of the Kelmscott Village (1988) Unit Trust (the Kelmscott Trust). All respondents were (and remain) holders of units in the Kelmscott Trust. They financed their purchase of the units by loans from Magenta. At trial Wilden and Magenta successfully counterclaimed to recover the loans owed by the respondent unitholders.
In 1991 the respondents holding units in the Balga Trust and the Kelmscott Trust requested the respective trustees to repurchase their units in the relevant trust at a price calculated in accordance with that specified in the trust deeds. Wilden and Magenta appointed independent valuers to determine the repurchase value of the units in the relevant trusts. The respondents were successful at trial in their claim that the valuers' appointments were invalid and that their valuations were of no force or effect.
On 9 August 2005 Hasluck J made orders giving effect to his reasons: Green v Wilden Pty Ltd [2005] WASC 83 (S). Hasluck J ordered, relevantly, that:
13.1The first [respondent] is indebted to the Balga Trust as and from 25 October 1990 in the sum of $85,365.86; and
13.2The second [respondent] is indebted to the Balga Trust as and from 25 October 1990 in the sum of $234,097.56.
14.There be an account to be taken before a Registrar of this Honourable Court between the first and second [respondents] and [Wilden] as to the cost to the Balga Trust from time to time as and from 1 December 1990 of its borrowing of a bill line facility with the ANZ Bank Limited together with recurring charges.
15.The sums declared to be owing to the Balga Trust referred to in paragraph 14 hereof:
15.1bear interest at the rate and for the periods found on the account referred to in paragraph 14 hereof to be the cost to the Balga Trust; and
15.2for the period during which the Balga Trust did not incur costs on any bill line facility with the ANZ Bank Limited at the rate prescribed from time to time pursuant to s 32 of the Supreme Court Act.
…
31.It is declared that:
31.1the [first-named third respondent] … is indebted to the Kelmscott Trust in the principal sum of $30,000;
31.2the [second and third-named third respondents] … are indebted to the Kelmscott Trust in the principal sum of $30,000; and
31.3the [fourth and fifth-named third respondents] … are indebted to the Kelmscott Trust in the principal sum of $500,000.
32.There be an account to be taken before a Registrar of this Honourable Court between the [third respondents] and Magenta Pty Ltd as to the cost to the Kelmscott Trust from time to time as and from 6 December 1988 of its borrowings of a bill line facility with the ANZ Bank Limited together with recurring charges.
33.The sums referred to in paragraph 30:
33.1bear interest at the rate and for the periods found on account referred to in paragraph 32 hereof; and
33.2for the period during which the Kelmscott Trust did not incur costs on any bill line facility with the ANZ Bank Limited at the rate prescribed from time to time pursuant to s 32 of the Supreme Court Act.
The appellants appealed from the orders made by Hasluck J: Wilden Pty Ltd v Green [2009] WASCA 38. On 6 July 2009 the court made orders in the appeal: Wilden Pty Ltd v Green [2009] WASCA 38 (S). With the exception of (inter alia) orders 13.1, 13.2, 14, 15, 31.1, 31.2, 31.3, 32 and 33 above (the preserved trial orders) the orders made by Hasluck J on 9 August 2005 were set aside. The findings relating to the validity of the valuations were overturned on appeal.
The preserved trial orders were the subject of appeal orders 2(b) and (c). This court made the following further orders in the appeal:
5.The respondents are entitled to be paid for their units the amount determined by reference to the relevant applicable current repurchase value (less any deductions for stamp duty and other disbursements properly incurred by the relevant trustee upon or in respect of the repurchase).
6.The respondents are entitled to be paid:
(a)the amount (if any) paid or credited as having been paid by way of income distribution to holders of units in the trust in which they hold units from the date of the repurchase request until the cancellation or transfer of the units to or at the direction of the trustee; and
(b)interest on the amounts referred to in (a) accruing at the rate the funds would have earned if invested in an interest-bearing deposit with the banker to the trust.
7.If upon the determination of the amounts owing under orders 2(b) and (c), 5 and 6:
(a)a net amount is payable to a respondent(s), then on payment of the net amount the respondent(s) shall transfer their units to or at the direction of the relevant trustee;
(b)a net amount is payable by a respondent(s), they shall forthwith transfer their units to or at the direction of the relevant trustee.
…
10.If the parties are unable to agree upon the amounts payable by the respondents to the appellants or by the appellants to the respondents or by the appellants to other appellants as the case may be pursuant to orders 5, 6 and 8, then:
(a)leave be granted to the appellants and the respondents (or any of them), to apply to a single judge of this court for an order that there be mediation with respect to such matters as the parties are unable to agree; and that
(b)in the absence of agreement (either before or consequent upon mediation) an account be taken before a registrar of this court for the purpose of determining those matters.
11.Payment of any amount payable by any of the appellants (defendants) to any of the respondents (plaintiffs) determined in accordance with the foregoing orders be stayed until the appellants' costs of the appeal and of the action have been taxed or agreed, and the taxed or agreed costs set off (as the appellants see fit) against any amount payable to any respondent, so that only the balance (if any) after such set off will be payable.
Appeal order 13 is to the effect that the plaintiffs (respondents) pay the defendants (appellants) taxed costs at first instance. Appeal order 14 requires the respondents to pay the appellants taxed costs of the appeal. The court also ordered that there be liberty to apply generally. Registrar Davies is presently conducting an account pursuant to appeal order 10(b).
In July 2011 the appellants (or some of them) applied to wind up or bankrupt the respondents (or some of them) for their failure to pay the taxed costs of the appeal and of an unsuccessful special leave application to the High Court. An issue in the insolvency proceedings was the effect of the stay the subject of appeal order 11.
In November 2011 the respondents applied under the order for liberty to apply for a stay of payment of the costs the subject of appeal orders 13 and 14. This court confirmed that appeal order 11 was predicated on the assumption that the trustee appellants would act within a reasonable time to identify the amounts payable to the respondents in accordance with orders 5 ‑ 10: Wilden Pty Ltd v Green [No 2] [2012] WASCA 34 [7]. That had not occurred. The sworn evidence of Mr Chesson was that he had mistakenly construed appeal order 11 as staying appeal orders 1 ‑ 10 until such time as the costs in the appeal and in the trial were determined. This court stayed the payment of the costs the subject of appeal orders 13 and 14 until the amounts payable determined in accordance with appeal orders 5 ‑ 10 were ascertained or otherwise agreed or until further order of this court.
By amended application dated 9 March 2016, the respondents seek to be relieved of their obligation to pay interest on the amounts payable by them to the appellants pursuant to the preserved trial orders and appeal orders 13 and 14. In particular, in respect of appeal orders 2, 13 and 14, they seek the following orders:
1.pursuant to s 8(2) of the Civil Judgments Enforcement Act 2005 (WA), the respondents not pay any interest to the appellants in accordance with s 8(1) of the Act from 1 July 2011 or such alternative date as may be directed;
2.further and in the alternative, pursuant to s 94 of the Trustees Act in the Account conducted by acting Court of Appeal Registrar Davies … the appellants be directed to not claim interest from the respondents as and from 1 July 2011 or such alternative date as may be directed by this Honourable Court;
3.alternatively, in the taking of the Account … pursuant to the orders of this Honourable Court made on 9 July 2011 [sic] the Registrar be directed to give or make no allowance for interest … as and from 1 July 2011 or such other date as this Honourable Court may direct.
The relief relating to appeal orders 13 and 14 was not pressed at the hearing of the respondents application. Even if there was power to do so, it would be odd indeed to decline to award post‑judgment interest on costs (as to which, see Rambal v The Griffin Coal Mining Co Pty Ltd [2015] WASCA 197 (Rambal)) in circumstances where the respondents had sought and obtained a stay of the performance of their obligation to pay costs. That aspect of the application must be refused if only on discretionary grounds. The focus of the hearing was on appeal orders 2(b) and (c) relating to the preserved trial orders.

Issues in the application

The broad issues arising in this application are:
1.do the preserved trial orders apply to the payment of post‑judgment interest (in addition to pre‑judgment interest);
2.if not, does this court have the power to grant the relief sought by the respondents, which raises the proper construction of s 8 of the Civil Judgments Enforcement Act 2005 (WA) (Civil Judgments Act) and the scope of the liberty to apply order in the appeal;
3.if the court has the power to grant relief, should it do so in the exercise of its discretion.

The scope of preserved trial orders

The appellants claim that preserved trial orders 14, 15, 32 and 33 govern both pre‑judgment and post‑judgment interest with the consequence that they can only be set aside or varied on appeal.
The natural and ordinary meaning of the orders is that they are confined to pre‑judgment interest. The effect of a judgment after trial is that the causes of action litigated at trial merge in the judgment and cease to exist. Thus the rights of the parties are determined up to the date of judgment. That that was the intention in this case is confirmed by the reference in preserved trial orders 15 and 33 to s 32 of the Supreme Court Act 1935 (WA) which is in terms confined to pre‑judgment interest.
Thus, the appellants' entitlement to post‑judgment interest on the amounts payable by the respondent pursuant to the preserved trial orders is governed by the Civil Judgments Act.

Civil Judgments Act

Section 8 of the Civil Judgments Act relevantly provides:
(1)Interest is to be paid on the unpaid amount of a judgment sum from the date of the judgment until the date on which the judgment sum is paid ‑
(a)at the rate prescribed by the regulations; or
(b)at the rate set by the court in the judgment or by an order made after the judgment is given.
(2)Subsection (1) applies whether or not ‑
(a)a suspension order has been made; or
(b)a time for payment order or an instalment order has been made,
unless the court that made such an order orders otherwise.
Under s 8(3), a judgment creditor may waive the payment of the whole or part of the interest referred to in s 8(1). The expression 'judgment sum' is defined in s 3 to mean the amount of money ordered to be paid under a monetary judgment, whether or not the money is or includes costs or pre‑judgment interest.
The expression 'monetary judgment' is defined in s 3 to mean a judgment or an order of a court that requires or has the effect of requiring a person to pay money, whether or not the judgment or order contains any other requirements.
The respondents claim that the court's power in s 8(2) to 'order otherwise' is at large and not confined to the matters specified in pars (a) or (b) thereof.
The appellants claim that this court does not have the power to set the rate under s 8(1)(b) because the only time at which the rate can be altered is at the time of judgment.
There is no merit in the construction claims advanced by the respondents and the appellants. The text of s 8(1) and s 8(2), which must be read together, compel the following conclusions. First, the power of the court in s 8(2) to 'order otherwise' only arises if a suspension order, a time for payment order or an instalment order has been made. That is, s 8(1) applies to a suspension order, a time for payment order or an instalment order that has been made unless the court that made such an order, orders otherwise. Second, under s 8(1) a judgment creditor has an entitlement to post‑judgment interest. Third, in the absence of a court order, the rate of post‑judgment interest is the rate prescribed by the regulations (s 8(1)(a)). Fourth, under s 8(1)(b) the court has the power to set the rate of post‑judgment interest but not the power to deprive a judgment creditor of its entitlement to post‑judgment interest. Fifth, the court's power under s 8(1)(b) to set the rate of interest is not confined or limited to the time of judgment. An order can be made at any time after the judgment is given, at least until receipt of the full judgment sum. The rate may be increased above that prescribed in the regulations or below that rate to reflect movements in the value of money between the date of judgment and the date of payment. It is unnecessary to answer whether the power persists beyond that point.
Accordingly, this court does not have the power to make proposed orders 1 or 3 sought by the respondents, even if it were minded to do so.
I will assume for present purposes, without deciding, that this court has the power under s 94(1) of the Trustees Act 1962 (WA) to direct the trustee appellants to waive the payment of whole or part of the interest to which it is entitled under s 8(1). However, I would decline to do so in this case. The factual basis for the relief the subject of proposed order 2 is a claim that the trustee appellants had breached their duties (to act with fidelity and due diligence, to act in the interests of the respondents as beneficiaries of the trust, to act impartially, to exercise reasonable care and skill) in failing to implement orders 5 to 9 by July 2011. The proper course is for those substantive allegations of breach to be raised and properly proven in separate, discrete proceedings in which, no doubt, cl 13.4 of the Trust Deeds will again become a live issue. See Wilden Pty Ltd v Green [2009] WASCA 38 [155] ‑ [167].
Further, and in any event, I would refuse relief on discretionary grounds. The respondents have had, and continue to have, the benefit of the loans over the extended period as well as an entitlement to any income distributed to holders of units in the Kelmscott Trust and the Balga Trust, of which they continue to be beneficial owners, until the repurchase price

is paid: Wilden Pty Ltd v Green [2009] WASCA 38 (S) [4], appeal order 7.

The application should be dismissed. I would hear from the parties on costs.
NEWNES JA: I agree with McLure P.
MURPHY JA: I agree with McLure P.