Zafra Pty Ltd v Stevenson
[2023] WADC 89
•15 SEPTEMBER 2023
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS
LOCATION: PERTH
CITATION: ZAFRA PTY LTD -v- STEVENSON [2023] WADC 89
CORAM: REGISTRAR JEYAMOHAN
HEARD: 8 AUGUST 2023
DELIVERED : Ex tempore
PUBLISHED : 15 SEPTEMBER 2023
FILE NO/S: CIV 3531 of 2019
BETWEEN: ZAFRA PTY LTD
Plaintiff
AND
CANDICE MARGARET STEVENSON
Defendant
Catchwords:
Summary judgment - Leave to bring application for summary judgment out of time - Turns on own facts
Legislation:
Legal Profession Act 2008 (WA)
Rules of the Supreme Court 1971 (WA)
Supreme Court Act 2014 (WA)
Result:
Judgment awarded
Representation:
Counsel:
| Plaintiff | : | Mr P G McGowan |
| Defendant | : | Ms E Carlean |
Solicitors:
| Plaintiff | : | Zafra Legal |
| Defendant | : | Not applicable |
Case(s) referred to in decision(s):
Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552
Ansearch Ltd v Wavtech Pty Ltd [2006] WASC 184
Bynon v Atma Nominees Pty Ltd as trustee for the Badjyn Investment Trust and the H & B Farm Trust [2017] WASC 30
Fancourt v Mercantile Credits Ltd (1983) 154 CLR 87
Gel Custodians Pty Ltd v Dewar [2014] WASC 177
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125
Moscow Narodny Bank Ltd v Mosbert Finance (Aust) Pty Ltd [1976] WAR 109
Stevenson v Zafra Pty Ltd [2021] WASCA 181
Webster v Lampard (1993) 177 CLR 598
Westpac Banking Corporation v Anderson [2017] WASC 106
REGISTRAR JEYAMOHAN:
[This decision was delivered extemporaneously on 8 August 2023 and edited from the transcript.]
Introduction
By chamber summons dated 24 February 2023, the plaintiff seeks summary judgment be entered against the defendant (Application) in the following terms:
1.The time for making this application be extended.
2.The plaintiff have judgment against the defendant for $91,627.82 and interest thereon at the rate of 3.5% from the dates pleaded in paragraph 14 of the statement of claim until judgment.
3.The defendant pay the plaintiff's costs of this application and of the action, including reserved costs, to be taxed.
Overview
The background to the dispute is summarised at [4] ‑ [93] of the reasons for decision of the Court of Appeal in Stevenson v Zafra Pty Ltd [2021] WASCA 181.
By way of overview:
1.The defendant was the group accountant for Atrum Coal NL (Atrum).
2.The defendant was, on 4 November 2015, sued in the Federal Court proceedings by Atrum and an associated company. She was the third of multiple respondents. The claims against the defendant included breach of contractual, fiduciary and statutory duties as an employee.
3.The defendant requested Mr Leslie of Wilson & Atkinson to act for her in respect of the Federal Court proceedings.
4.The defendant entered into a costs agreement with Wilson & Atkinson.
5.Wilson & Atkinson invoiced the defendant $118,097.13 for acting for her. There were seven invoices.
6.Wilson & Atkinson ceased to carry on business and Mr Leslie informed the defendant that this was to happen and invited the defendant to transfer her file to the plaintiff where he would continue to act for her. The defendant authorised her file to be transferred to the plaintiff and entered into a costs agreement with the plaintiff.
7.The Federal Court proceedings were complex. They came on for trial within eight months and one week of the proceedings being commenced. During the first day of the trial, on 11 July 2016, the Federal Court proceedings settled. The terms of settlement included an allocation of a number of Atrum shares which the defendant was purportedly to hold in escrow for three months. The terms of the settlement are publicly known.
8.The plaintiff invoiced the defendant $178,805.33 for acting for her, via four invoices.
9.Mr Leslie discounted the invoices of Wilson & Atkinson and the plaintiff by an aggregate amount of $35,010.25 or about 11%.
10.$46,874.64 of the $50,000 was paid to Wilson & Atkinson on 15 August 2016.
11.On 20 December 2016 Mr Leslie received $158,400 from the defendant as payment of part of her account.
12.That payment was allocated as to $71,222.49 in respect of outstanding Wilson & Atkinson invoices and $87,177.51 to the oldest outstanding invoices of the plaintiff. This left $91,627.82 due to the plaintiff.
13.The Atrum shares allocated to the defendant came out of escrow on 11 October 2016. Their share price was then $0.710 per share. The market value of the shares was then $144,460.15. Their allocation value had been $0.4915 per share ($100,000).
14.In the weeks following the shares coming out of escrow (from 11 October to early November 2016) their share price hovered around and above $0.710, giving the shares a market value of $144,460.
15.By 20 December 2016 the share price had fallen to around $0.500, being about the price they had been at the date of settlement and making the market value of the parcel of shares again approximately $100,000.
16.On 30 March 2017 the share price had fallen to $0.300. In September 2017 the share price was about $0.200. On 16 October 2017 the share price was $0.185. On 8 March 2019 the share price was $0.220.
17.Following various correspondence, on 13 September 2019, the plaintiff issued these proceedings seeking to recover the outstanding amount.
It is the plaintiff's position that the defendant has not paid the $91,627.82 in respect of outstanding invoices to the plaintiff.
Following various correspondence, on 13 September 2019, the plaintiff issued these proceedings seeking to recover the outstanding amount. The plaintiff's claim against the defendant is set out in the Writ of Summons and Statement of Claim filed 13 June 2019 (SOC) for the sum of $91,627.82 plus interest at the rate of 3.5% calculated as follows:
Invoice No Amount outstanding Date of invoice Date 30 days after the date for payment Cash Target Rate Plus 2% (a) 190 $44,327.82 08.07.2016 21.08.2016 1.5% 3.5% (b) 249 $46,750.00 04.08.2016 17.09.2016 1.5% 3.5% (c) 423 $550.00 03 10.2016 16.11.2016 1.5% 3.5% alternatively pursuant to s 32 of the Supreme Court Act 2014 (WA).
A memorandum of appearance was filed on behalf of the defendant on 23 September 2019. By notice of change of representation filed 3 June 2020, the defendant is now self-represented. However, the defendant briefed counsel to appear at the hearing of the Application on 8 August 2023.
The defendant, in her defence filed 31 March 2023 broadly resists the SOC on the following basis:
(a)that the defendant previously sought to set aside the Wilson & Atkinson costs agreement;
(b)that the defendant sought to extend the time for the assessment of the costs rendered under the Wilson & Atkinson costs agreement;
(c)that the defendant told the plaintiff that she could not pay the legal fees and would need to consider bankruptcy;
(d)that the defendant disputes the amounts charged by Wilson & Atkinson on the basis she pleads she has been unreasonably charged;
(e)that the defendant purportedly instructed Wilson & Atkinson to transfer her file to the plaintiff and instructed the plaintiff to act on her behalf in relation to the Federal Court proceedings and the defendant pleads that she was required to transfer her file to the plaintiff;
(f)that the defendant sought to set aside the written costs agreement;
(g)that the defendant sought to extend the time for assessment of the costs rendered under the written costs agreement;
(h)that the plaintiff was purportedly aware, after January 2016 that the defendant could not pay the legal fees;
(i)that in any event the defendant disputes the plaintiff's charges; and
(j)that the defendant did not instruct the plaintiff to pay Wilson & Atkinson and her instructions were not sought (prior to payment being made).
The defendant briefed counsel to appear on her behalf at the hearing of the Application on 8 August 2023. At that hearing, counsel for the defendant foreshadowed that should the defendant be successful in resisting the Application, that the defendant would seek leave of the court and orders to amend the defence. No minute of proposed amended defence or substance of the amended defence position was communicated to the plaintiff prior to the hearing of the Application.
Issues
The preliminary issue to be determined is, should the plaintiff have leave to apply for summary judgment?
The issues to be determined in the summary judgment application are, in broad terms:
1.Has the plaintiff established a prima facie entitlement to judgment?
2.Does the defendant have an arguable defence?
3.Is there some other reason why there should be a trial of the action?
Leave to apply for summary judgment
On 17 September 2019 the defendant filed an application in the Supreme Court seeking to extend time for assessment of the costs rendered by Wilson & Atkinson and the plaintiff. On 26 November 2019 the defendant commenced proceedings in the Supreme Court seeking to set aside the costs agreements of Wilson & Atkinson and the plaintiff.
By order of the court made 1 October 2019 following the filing of a memorandum of consent orders, the following orders in respect of the question of leave to bring any application for summary judgment were made:
2.The time under Order 14 Rule 1(1) within which the plaintiff may apply for summary judgment be extended to 21 days after the substantive hearing of Supreme Court of WA proceedings LPA 39 of 2019 or further order of the Court.
The plaintiff's application for summary judgment was filed on 24 February 2023, more than 21 days after the substantive hearing of Supreme Court of WA proceedings LPA 39 of 2019, being the defendant's application for the extension of time to apply for the assessment of costs made pursuant to the Legal Profession Act 2008 (WA). That application having been finally argued on 22 December 2022, and having occurred subsequent to the defendant's further application to set aside the costs agreements as between the defendant and Wilson & Atkinson and the plaintiff respectively (CAVC 62 of 2020).
In addressing the question of the delay in the bringing of this Application by some two months, counsel for the plaintiff pointed to the First Leslie Affidavit in support of the complex and lengthy history of the related matters.[1] Counsel for the plaintiff further submitted that the defendant's own actions in respect of the various Supreme Court proceedings have in effect informed the timing of the Application.
[1] First Leslie Affidavit, pars 32 ‑ 49 (inclusive).
Prejudice to the defendant is one consideration the court must consider in its discretion to allow an application to be brought out of time. It is not the only issue that must be considered. There is nothing before me to suggest any prejudice to the defendant arising from the timing of the bringing of the Application by some two or so months.
I also note that the defendant does not take issue with the timing of the Application and does not oppose leave being granted.
In all of these circumstances, I am satisfied on the material before me that it is appropriate that I exercise my discretion to grant leave to the plaintiff to make its application for summary judgment out of time.
Leave is therefore granted.
The plaintiff's application for summary judgment
Principles applicable to summary judgment
The legal principles governing the power to order summary judgment are uncontroversial. In summary:
(a)summary judgment should be exercised with great care and will not be exercised unless it is clear that there is no real question to be tried: Fancourt v Mercantile Credits Ltd (1983) 154 CLR 87, 99;
(b)the onus is on a plaintiff to persuade the court that it is an appropriate case to award summary judgment: Gel Custodians Pty Ltd v Dewar [2014] WASC 177;
(c)once a plaintiff has established a prima facie right to judgment, the onus is on the defendant to satisfy the court why judgment should not be given: Moscow Narodny Bank Ltd v Mosbert Finance (Aust) Pty Ltd [1976] WAR 109, 110;
(d)the defendant does not have to show a defence on the balance of probabilities, only to show cause as to why there is an arguable defence: Westpac Banking Corporation v Anderson [2017] WASC 106;
(e)the court should not dispose of an action summarily where there is a conflict on the facts. Summary judgment must only be granted where the court has a high degree of certainty of the outcome of the proceedings if they went to a trial: Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552 [57];
(f)summary judgment is appropriate where the defence is so obviously untenable that it cannot possibly succeed or where it would be manifest that to allow the defence to stand would involve useless expense: General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125, 129;
(g)in determining whether there is an issue in dispute which ought to be tried, the version of facts put forward by the defendant should be accepted, assuming they are not inherently incredible: Webster v Lampard (1993) 177 CLR 598;
(h)the court is not bound to accept uncritically as raising a dispute of fact calling for further investigation every statement in an affidavit, however equivocal, lacking in precision or inconsistent with contemporary documents: Ansearch Ltd v Wavtech Pty Ltd [2006] WASC 184 [28];
(i)if defending a summary judgment application on the basis of factual issues, the defendant must file an affidavit/s which provide particulars of the facts upon which he asserts that summary judgment should not be given: Westpac Banking Corporation v Anderson; and
(j)summary judgment is not only given where a case is so hopeless as to not require argument. Extensive argument may sometimes be necessary to demonstrate that there is no question which ought to be tried: Bynon v Atma Nominees Pty Ltd as trustee for the Badjyn Investment Trust and the H & B Farm Trust [2017] WASC 30 [16].
The evidence relied upon
The plaintiff's application was supported by the affidavits of Shayne Graham Leslie declared 24 February 2023 (First Leslie Affidavit) and 23 April 2023 (Second Leslie Affidavit) and the affidavit of Daniel Steven Romano sworn 24 April 2023.
The defendant relies on the affidavit of Candice Margaret Stevenson sworn 31 March 2023 (First Stevenson Affidavit) and 7 August 2023 (Second Stevenson Affidavit).
I have carefully considered the written submissions filed and the submissions made by counsel for the plaintiff and the defendant during the hearing of the Application on 8 August 2023.
The plaintiff's position
The plaintiff's position was set out in substantive detail in the plaintiff's outline of submissions filed 24 April 2023. By way of summary, further to the written and oral submission put by plaintiff's counsel at the hearing on 8 August 2023, the plaintiff's position is that the matters pleaded in the defence do not disclose any triable issue or defence to the plaintiff's claim.
The plaintiff's submission is that the matters pleaded in the defendant's defence are a statement of something that happened in the past that do not seek, or lead to, any relief or remedy.
Further, the plaintiff's position is that the issue raised in the defence have in fact been considered by the Supreme Court, and was determined against the defendant. On any question as to the reasonableness of bills rendered to the defendant by her solicitors, only a taxing officer of the Supreme Court could have assessed the bills, the District Court does not have that jurisdiction.
Further, only the Supreme Court could have extended the time within which the application for assessment could have been made, the District Court does not have that jurisdiction.
On the plaintiff's submission therefore, all of these issues are now res judicata and the subject of an issue estoppel; it cannot be re-litigated by the defendant.
On the matter of invoices rendered to the defendant:
(a)Wilson & Atkinson invoiced the defendant $118,097.13 for acting for her; and
(b)the plaintiff invoiced the defendant $178,805.33 for acting for her,
in respect of the Federal Court proceedings.
Mr Leslie discounted the invoices of Wilson & Atkinson and the plaintiff by an aggregate amount of $35,010.25 or about 11%. $46,874.64 of the $50,000 was paid to Wilson & Atkinson on 15 August 2016. On 20 December 2016 Mr Leslie received $158,400 from the defendant as payment of part of her account. That payment was allocated as to $71,222.49 in respect of outstanding Wilson & Atkinson invoices and $87,177.51 to the oldest outstanding invoices of the plaintiff.
The plaintiff's position is that payment of the $71,222.49 in respect of outstanding Wilson & Atkinson invoices was made pursuant to the terms of the lien in respect of outstanding fees to Wilson & Atkinson and lien capable of being enforced.[2] The defendant was represented by Mr Leslie throughout, and entered into a separate costs agreement with the plaintiff and the signed authority authorising the transfer of the file from Wilson & Atkinson to the plaintiff (as signed by the defendant) granted the transfer of the file on those terms (ie subject to the lien).
[2] First Leslie Affidavit, SGL-18, page 22.
Counsel for the plaintiff submits that if there had been a situation where there was a direction from the defendant to the plaintiff not to pay Wilson & Atkinson, then an act contrary to that direction may give rise to a defence. However, that was not the case. Rather, the circumstances in which the file was transferred, and the lien, were such was that there was nothing to suggest anything to the contrary to what the lien required.
The plaintiff's position is that it was common ground in the proceedings to set aside the costs agreement, and confirmed by the Court of Appeal, that $91,627.82 remains outstanding by the defendant to the plaintiff. On this basis, even if the transfer of monies to Wilson & Atkinson had been made without the direction of the defendant, the defendant would be estopped from now contending otherwise.
As to the contention with respect to Mr Romano in the defence, the position is explained in some detail in the affidavit of Mr Romano sworn 20 April 2023. The application for deregistration was withdrawn and no consequence flows from the matters pleaded in the defence.
The plaintiff submits that in these circumstances, the matters pleaded do not disclose any triable issue or defence to the plaintiff's claim. Mr Leslie in the First Leslie Affidavit deposes that he believes that the defendant does not have a defence to the plaintiff's claim.[3]
[3] First Leslie Affidavit, par 50.
Counsel for the plaintiff submits that payment has been withheld from the plaintiff of its entitlement to be paid for the past four years due to the actions of the defendant. The actions of the defendant, do not raise in themselves triable issues, because they have been tried. They are therefore not defences.
The plaintiff's position is that the only remaining issue is an unsupported bold contention that the charges were excessive and unreasonable, and because there was no direction to make payment in December 2016, the defendant was not otherwise liable - both of which fail, because neither raises a defence, or a factual or legal basis for that contention.
The defendant's position
The defendant resists the Application on the basis that there is an issue or question in dispute which ought to be tried and relies on the various affidavit materials filed and the submissions put both in writing and by counsel on behalf of the defendant. At the hearing of the Application on 8 August 2023, counsel for the defendant, having been briefed by the defendant in respect of this hearing, advanced submissions in addition to those matters set out in the defendant's outline of submissions filed 9 May 2023.
The defendant's position is that the defence is not immediately plain and obvious. This is a case in which the facts are in dispute. Counsel for the defendant at the hearing submitted that the defendant concedes that the defence in its present form is lacking and that it is foreshadowed that to the extent the defendant is successful in resisting the Application, leave to amend the defence will be sought. In saying that, counsel for the defendant submitted that the defendant's position is as pleaded in par 13 of the defence. Relevantly that:
(a)the defendant made a payment of $158,400 to the trust account of the plaintiff on or around 20 December 2016;
(b)the plaintiff informed the defendant by email dated 21 December 2016 that the plaintiff had paid Wilson & Atkinson invoices from these monies;
(c)the defendant did not instruct the plaintiff to pay Wilson & Atkinson from these monies and her instruction was not sought; and
(d)on 24 June 2022, Mr Daniel Romano who is a director of both the plaintiff and Wilson & Atkinson, attempted to deregister Wilson & Atkinson prior to the final hearing of the Enlargement of Time Application, filing an application for voluntary deregistration of a company with the Australian Securities & Investments Commission in which he falsely declared that Wilson & Atkinson was not a party to any legal proceedings.
In advancing the defendant's position, further submissions were put on the matter of the defendant purportedly not having instructed the plaintiff to make payment to Wilson & Atkinson from the $158,400 paid by the defendant into the trust account of the plaintiff on or around 20 December 2016. The defendant relied on the terms of the written costs agreement with the plaintiff and the purported failure by the plaintiff to give notice in accordance with the terms of that agreement prior to withdrawing the funds.[4] The defendant also submitted that this was contrary to the plaintiff's prior conduct and relied here on the Second Leslie Affidavit.[5]
[4] First Leslie Affidavit, SGL-3.
[5] Second Leslie Affidavit, SGL-22.
At the hearing of the Application on 8 August 2023, the defendant's position is that the defendant does not dispute monies owing to both Wilson & Atkinson and the plaintiff pursuant to the various invoices rendered in respect of the miscellaneous proceedings. However, the defendant's submission is that the plaintiff in electing to apply $158,400 towards the amount owing to Wilson & Atkinson did so without authority from the plaintiff in circumstances where those monies should have been applied towards payment of the amount owing by the defendant to the plaintiff.
The defendant concedes therefore that accordingly, there is an amount outstanding to the plaintiff. However, the defendant submits that the value of that amount is disputed.
Analysis
The plaintiff must first establish a prima facie right to judgment against the defendant. It is the plaintiff's case that there is no triable issue in the proceedings. Having considered the plaintiff's written and oral submissions, I am satisfied that the matters pleaded in the defence do not disclose any triable issue or defence to the plaintiff's claim.
Matters in respect of the Wilson & Atkinson's costs agreement, and any extension of time for the assessment of costs rendered under that agreement are matters that have been the subject of determination and the issue is now res judicata and the subject of an issue estoppel. Questions as to the reasonableness of any bill rendered to the defendant could only be assessed by a taxing officer of the Supreme Court. The District Court does not have that jurisdiction.
In order to oppose a summary judgment application, the defendant need only to have demonstrated that her defence is not so obviously untenable and that her version of the facts is not inherently incredible. The defendant's submissions placed significant emphasis on the defendant purportedly not having instructed the plaintiff to pay Wilson & Atkinson. Relevantly, that the plaintiff, having received the $158,400 from the defendant, was not authorised to allocate $71,222.49 in respect of outstanding Wilson & Atkinson invoices. That is, had the plaintiff applied the entirety of that amount of $158,400 to the plaintiff's accounts alone, the balance owing would be an amount significantly less than the $91,627.82, being the claimed judgment amount.
Matters to do with the history of the Supreme Court proceedings are common ground and evidenced by the decisions of that Honourable Court, including the Court of Appeal. The defendant, in its submissions, does not engage on these matters, and importantly, the issue of estoppel. In addition, the defendant does not dispute or challenge, the amount of the invoices rendered, or that payment is owed to the plaintiff. Rather, that the balance owing should be an amount less than the claimed judgment amount of $91,627.82.
It follows that in these circumstances, it is difficult to understand how the defendant can maintain that there remains any triable issues or defence to the plaintiff's claim.
In summary, I conclude that the plaintiff's application should succeed.
Interest
On the question of interest, the defendant accepts the interest rates claimed by the plaintiff in the statement of claim and does not take issue with the correctness of the 3.5%.
Orders
The plaintiff do have leave to bring the application for summary judgment out of time.
The plaintiff have judgment against the defendant for $91,627.82 and interest thereon at the rate of 3.5% from the dates pleaded in par 14 of the statement of claim until judgment.
The defendant pay the plaintiff's costs of this application and of the action, including reserved costs, to be taxed if not agreed.
I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia.
AC
Court Officer
11 AUGUST 2023
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