WILLIAMS v Howell
[2001] WASC 257
WILLIAMS -v- HOWELL & ORS [2001] WASC 257
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2001] WASC 257 | |
| Case No: | CIV:1646/2000 | 13 SEPTEMBER 2001 | |
| Coram: | MASTER BREDMEYER | 21/09/01 | |
| 8 | Judgment Part: | 1 of 1 | |
| Result: | Application allowed | ||
| B | |||
| PDF Version |
| Parties: | MARK WILLIAMS IAN ARTHUR HOWELL JANICE ANNE HOWELL ROBERT FREDERICK PHILLIPS DOROTHY JEAN PHILLIPS |
Catchwords: | Default judgment Application to set aside Whether defendants have an arguable defence on the merits Relevant test |
Legislation: | Nil |
Case References: | Rolland & Anor v BankWest, unreported; FCt SCt of WA; Library No 980498; 11 June 1998 Charles v Sheperd [1892] 2 QB 622 Johnsen v Dusk [1963] NSWR 730 Carr v Finance Corp of Australia Ltd (1981) 147 CLR 246 Chitty v Mason [1926] VLR 419 ACN 076 676 438 Pty Ltd (In liq) v A-Comms Teledata [2000] WASC 214 Kertesz v Kessler [1966] VR 453 Re Mossenthal; Ex parte Marx (1910) 54 Sol Jo 751 Palmer v Prince [1980] WAR 61 Parker v Transfield [2000] WASC 382 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
IAN ARTHUR HOWELL
JANICE ANNE HOWELL
ROBERT FREDERICK PHILLIPS
DOROTHY JEAN PHILLIPS
Defendants
Catchwords:
Default judgment - Application to set aside - Whether defendants have an arguable defence on the merits - Relevant test
Legislation:
Nil
Result:
Application allowed
(Page 2)
Category: B
Representation:
Counsel:
Plaintiff : Mr M J Bateman
Defendants : Ms L Horwood
Solicitors:
Plaintiff : Batemans
Defendants : Godfrey Virtue & Co
Case(s) referred to in judgment(s):
Rolland & Anor v BankWest, unreported; FCt SCt of WA; Library No 980498; 11 June 1998
Case(s) also cited:
Charles v Sheperd [1892] 2 QB 622
Johnsen v Dusk [1963] NSWR 730
Carr v Finance Corp of Australia Ltd (1981) 147 CLR 246
Chitty v Mason [1926] VLR 419
ACN 076 676 438 Pty Ltd (In liq) v A-Comms Teledata [2000] WASC 214
Kertesz v Kessler [1966] VR 453
Re Mossenthal; Ex parte Marx (1910) 54 Sol Jo 751
Palmer v Prince [1980] WAR 61
Parker v Transfield [2000] WASC 382
(Page 3)
1 MASTER BREDMEYER: This is an application by the defendants dated 13 August 2001 to set aside a default judgment dated 9 March 2001. That judgment was obtained in default of filing a defence and it is judgment for the plaintiff for damages to be assessed.
2 There is no dispute that this judgment was regularly entered. To set it aside, the defendants must show a reasonable explanation as to why the judgment was allowed to go by default and they must show an arguable defence on the merits. On the latter point, Malcolm CJ (with whom Kennedy and Owen JJ agreed) in Rolland & Anor v BankWest, unreported; FCt SCt of WA; Library No 980498; 11 June 1998 at 41 said:
"In my opinion, having regard to the above authorities, for an application to set aside a default judgment to be successful, the defendant must present a credible defence demonstrating that, if the default judgment was set aside and the matter was argued on its merits, the defendant would have a real prospect of success."
3 Why did the defendants fail to file a defence in this action? At a case management conference on 27 September 2000, Registrar Powell ordered the plaintiff to file and serve a statement of claim by 20 October 2000 and ordered the defendants to file and serve a defence and any counterclaim by 3 November 2000. The statement of claim was filed and served late. It was filed on 22 December 2000 and I assume served shortly after that. That late filing probably had the effect of voiding the directions made by Registrar Powell. Under the Supreme Court Rules, the defendants had the benefit of an extension of time for the Christmas vacation until 15 January 2001, and so had to file their defence 14 days after that, ie, by 29 January 2001. They did not do so. The defendants were unrepresented at the time. Why did they fail to file a defence? Mr Phillips, who is the spokesman for the defendants who are a group of mortgagee lenders, states at par 11 of his affidavit of 10 August 2001:
"Neither myself or the other defendants filed or served a defence and counterclaim as we considered that the claim had no merit, that the plaintiff was a vexatious litigant, and that the plaintiff would not pursue the matter and we took no further action."
- That is an explanation from unrepresented parties, but is not really a credible excuse for the non-filing of a defence.
4 The default judgment was obtained, as I have said, on 9 March 2001. It was not served on the defendants nor were they notified of it by letter.
(Page 4)
- On 18 July 2001 the plaintiff filed a summons for directions for the assessment of damages which summons was served on the defendants individually by letter dated 31 July 2001. That alerted them to the fact that a judgment had been entered and they sought legal advice. Indeed, they retained Godfrey Virtue & Co who had formerly acted for them in this action which began with an application by the plaintiff for an interlocutory injunction and, in mid-2000, included an application by the defendants for an interpleader summons. The defendants' solicitors then brought this application to set aside the default judgment on 13 August 2001 and filed affidavits in support, one of which, the affidavit of Mr Phillips, annexes a minute of proposed defence and counterclaim. Given that the default judgment was not served on the defendants and that they were not otherwise notified of it promptly, I consider this application to set aside has been brought reasonably promptly after the defendants learned of that judgment.
5 Have the defendants got a credible defence on the merits, which would have a real prospect of success? The defendants loaned money to Colin David Sullivan which was secured, inter alia, by a mortgage against Mr Sullivan's property at Lot 18 Barfield Road, Banjup. The present plaintiff, Mark Williams, was a tenant of Mr Sullivan. The defendants sued Mr Sullivan for the moneys owing under the mortgage in CIV 1875 of 1999. On 25 May 1999 a demand for possession was served on Mr Sullivan and on the plaintiff, the tenant. The latter notice was addressed to "the Occupier/s of Lot 18, Barfield Road, Banjup". The plaintiff was notified of this action in January 2000. He was notified in February by letter of the hearing date of 8 March 2000.
6 On 8 March 2000 the defendants obtained an order for possession against Mr Sullivan requiring him to vacate the property within seven days of service of the order upon him. The plaintiff learned of that order in March 2000. He was running a business on the land training guard dogs under the name of Australian Canine Trainers.
7 On 28 March 2000 Mr Sullivan was personally served with the order for vacant possession dated 9 March. By letter dated 10 April 2000 the defendants' solicitors wrote to the plaintiff advising him that Mr Sullivan had been served with the order for possession and putting the plaintiff on notice that it was the defendants' intention to execute a writ of possession. The plaintiff was advised in that letter that, when the Sheriff attends the property, he will turn out whoever he finds at the property and any items left on the property would be legally in the possession of the mortgagees. The letter requested the plaintiff to clear the property of any of his
(Page 5)
- belongings and advised that they would be seized and that they could be sold to discharge Mr Sullivan's debt under the mortgage.
8 On Friday 5 May 2000 Mr Doig, the Sheriff, attended the property and advised the plaintiff that he was required to vacate the property by the following Friday, 12 May 2000. He posted a note on the door advising of the writ of possession (obtained against Mr Sullivan) stating that he would return at 9.30 am on Friday 12 May 2000 to "formally take possession and any persons then remaining on the premises will be removed".
9 Mr Doig spoke with the plaintiff by phone on Wednesday 10 May. The plaintiff asked for an extension of time to get out. That was refused. The plaintiff arranged to lease a new property on Thursday 11 May and arranged for removalists to come and remove his belongings early on Friday 12 May.
10 The removalists arrived on 12 May 2000 at 8.00 am. They were 1½ hours late. They left soon after arrival because one of them was asthmatic and had an asthma attack due to the dust stirred up by the truck on the dusty road leading into the property. I was told from the bar table that Mr Williams telephoned the removalists to send out another crew but none was available. The Sheriff changed the locks on that day. No inventory was made of the goods on the property on that day.
11 On 18 May 2000 the defendants' removalists, Kent Transport, came to remove the furniture and chattels from the property and to put them into storage. They also continued this task on 19 May. The removalists prepared an inventory of the goods taken on 18 and 19 May.
12 After the abortive attempt to remove his property on 12 May, Mr Williams rang Mr Doig who said he was already at the property and was about to change the locks. At Mr Williams' request Mr Doig put out an esky full of meat and a file full of documents so that Mr Williams could collect them. Mr Doig said he could collect these items but he was not to go on the property otherwise as he would be trespassing.
13 On 12 May Mr Williams rang Godfrey Virtue & Co and asked to speak to Ms Horwood. She was unavailable. On Monday 15 May he rang Ms Horwood twice but she was unavailable. He rang again on Tuesday morning and she returned the call on Tuesday afternoon. He asked if he could remove his goods. She said she was concerned that he would remove half the goods and then claim the other half was stolen. He assured her that this would not happen and that he desperately needed his goods including clothes and goods necessary to run his business. He said
(Page 6)
- he would be happy to be accompanied by a member of her office when he collected his goods. Ms Horwood said she would have to contact her clients for instructions.
14 On Tuesday 16 May Mr Sullivan and Mr Williams telephoned Mr Howell, one of the defendants, and he said he had no objection to them going back to remove their property because it would be easier to sell if it was empty. But he said that Mr Williams should contact Ms Horwood first because there were four mortgagees involved and he had not spoken yet to Ms Horwood. He told them to contact Ms Horwood because she had the key. On Wednesday 17 May Mr Williams phoned Ms Horwood again. She refused to allow him to come and collect the key. She said he would be trespassing if he or Mr Sullivan attended the property. He explained that the property was located in a rural area and because there were no dogs or people around there was a much higher risk of vandalism or theft. On Wednesday 18 May in the evening, he and Mr Sullivan phoned Mr Howell again who said he did not have a problem with Mr Williams going to collect his goods but he had to be guided by what the solicitor for the mortgagees said, that is Ms Horwood. On Thursday 19 May Mr Williams tried to contact Ms Horwood again but she was unavailable. Mr Sullivan and he then drafted and signed a letter addressed to Ms Horwood in the following terms:
"I have been given verbal approval by Ian Howell on two (2) separate ocassions [sic] to remove the contents of the house and shed(s) at Lot 18, Barfield Rd. Banjup (most of which are Mark's) and I request that you expeditiously arrange for Mark and myself to have access to effect same due to the extreme vulnerability of the house and shed(s) caused by the failure of the Sheriff to properly secure the property and the high risk factor of rural properties in the Banjup area.
We are prepared to sign a waiver of ownership of goods remaining at the premises after we have effected the removal of our goods from the property as discussed with Ian Howell on the evening of Wednesday 17th May 2000 at 8.10pm.
(Sgd) C Sullivan
(Sgd) Mark Williams"
15 Mr Williams instructed solicitors, Butcher Paull & Calder to act for him. On 19 May 2000 they wrote a letter to Godfrey Virtue & Co, for the attention of Ms Horwood, advising that the Sheriff changed the locks on
(Page 7)
- 12 May 2000; their client was then in the process of moving his goods from the premises, but experienced problems with the removalists he had employed. The letter demanded the return of the goods "at your cost to our client at his address at 28 Burren Gate, Willetton within 24 hours". The letter said:
"We are of the opinion that your clients are holding our client's goods with absolutely no legal basis for so doing which action in our view amounts to a trespass to goods. Our client is not indebted to your clients and in the event the mortgage relates to the property itself and not to our client's goods."
There appears to be no response to that letter. On 19 May a Ms Marshall from Blake Dawson Waldron telephoned Ms Horwood. Ms Marshall said she was acting on behalf of Mark Williams and asked why he could not get access to his goods. Ms Horwood's notes of her response include the following:
"- Will not give permission for release unless Sullivan OKs.
- Need inventory.
- Some stuff is Sullivan's.
- Can collect - Why couldn't he collect his belongings?
- He could, until the warrant was executed.
- I said he had ample opportunity and warning to take his goods.
- Sheriff executed. We would not sell or dispose of them without a court order."
17 It was argued for the plaintiff that he could not be guilty of contributory negligence until such time as the defendants had a duty to care for the plaintiff's property, ie, until 12 May when the Sheriff, the defendants' agent, took possession of the goods. I am not labelling the plaintiff's failure to collect his goods before 12 May as contributory negligence, but as a failure which (arguably) caused his loss. It is a
(Page 8)
- failure which goes to the chain of causal connection leading to his loss rather than to negligence.
18 For these reasons I propose to set aside the default judgment. I will hear the parties on costs.
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