[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
[2]
JUDGMENT
THE COURT: On 19 May 2023, following a hearing on 9 May 2023, the Court refused leave to appeal from two decisions, one of Adamson J (as her Honour then was) and one of N Adams J: Arjunan v Neighbourhood Association DP No 285853 [2023] NSWCA 103 ("Arjunan (No 1)"). The orders of the Court were:
(1) The application for leave to appeal is dismissed.
(2) The respondent's notice of motion dated 17 March 2023 is dismissed.
(3) The applicant is to pay the respondent's costs of the application for leave to appeal, excluding the costs of the notice of motion referred to in Order 2.
On 2 June 2023, the applicants filed a notice of motion seeking "to set aside and vary" the decision in Arjunan (No 1). The applicants also sought to vacate Order 1 and that part of Order 3 which related to their paying of the respondent's costs of the application for leave to appeal. In place thereof, the applicants sought the following orders:
3. Grant leave to appeal.
4. Allow the appeal.
5. Vacate the costs order of Justice Adams.
6. Grant time and order issue of subpoena as requested (dismissed by registrar on 28.4.23).
In support of the notice of motion, the applicants filed an affidavit of the first applicant dated 2 June 2023 (June Affidavit). In accordance with a subsequent direction of the Registrar, the applicants filed written submissions dated 12 July 2023, in which they cross-referred to the June Affidavit, the White Folder that was before the Court on the leave application and the Court Book that was before Adamson J. The written submissions were five pages in length (as the Registrar directed) but annexed a 75-page bundle of material. The annexure included material that the applicants had sent to the Court by email (in a partly redacted form) after the hearing on the leave application and while judgment was reserved. In the communications sent to the Court during that period, the applicants relied on the material in support of a submission that the strata managing agent had committed "breaches" by acting to retain Grace Lawyers when the agent did not hold a licence, and had stopped collecting levies from 30 September 2022. The applicants also submitted that the respondent's solicitor had given false evidence that the insurance claim related to the association's building damage. In Arjunan (No 1), the Court dealt with the additional material it had received as further submissions: at [45].
The Court has determined the notice of motion on the papers, in circumstances where the Registrar directed the applicants to indicate in their written submissions if they required an oral hearing and the submissions made no reference to a further hearing. In view of the Court's assessment of the arguments on the notice of motion, it was not necessary to require the respondents to file responsive evidence or written submissions, the Court being conscious of the costs that have been incurred in this matter to date (to which it referred in Arjunan (No 1) at [46]).
The Court has treated the applicants' notice of motion as an application to reopen and to vary orders that the Court made in Arjunan (No 1). As the notice of motion was filed within 14 days of Arjunan (No 1), the Court has power under r 36.16(1) of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) to reopen the matter and vary the orders, as if the orders had not been entered: UCPR, r 36.16(3A). However, given the public interest in the finality of litigation, that power should be exercised with caution. In particular, the power is not to be exercised for the purpose of allowing arguments that have already been considered by the Court to be reagitated, or because the applicant has failed to present the argument in all its aspects or as well as it might have been put: Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300 at 303; [1993] HCA 6; Lianos v Order of AHEPA NSW Inc (No 4) [2021] NSWCA 159 at [17]. As the Court explained in Majak v Rose (No 5) [2017] NSWCA 238 ("Majak") at [12]:
"The rule has a serious, but limited, purpose which is to permit readily identifiable, readily rectifiable, inadvertent errors to be corrected without the complication and expense of an appeal (or, in the case of this Court, an application for special leave to the High Court). Abuse of the rule is detrimental to the administration of justice in unnecessarily and unfairly (to other litigants) taking up the time of the court. Nor does abuse of the rules facilitate the just, quick and cheap resolution of the issues between parties. On the contrary, unwarranted reliance on r 36.16 is oppressive to the successful party and a drain on the Court's resources."
That statement has particular resonance in the present case having regard to its procedural history. As the Court noted in Arjunan (No 1) at [2], the decision of Adamson J was an appeal from a decision of the Local Court. As the Court further noted at [13], following the decision of Adamson J the applicants applied for leave to vary her Honour's orders (including her Honour's order dismissing the proceedings), which led to the decision of N Adams J. Following the decision of this Court in Arjunan (No 1) to refuse leave from both decisions, the applicants have now sought leave to reopen and vary the orders of this Court, seeking, in substance, a reversal of the Court's decision.
The applicants bore the onus of establishing that the power to reopen should be exercised: Majak at [19]. In the June Affidavit and the written submissions prepared by the first applicant, which have some overlap in content, the applicants advanced a number of bases on which the orders should be varied. For the reasons set out below, the Court is not satisfied that the applicants have established any basis for reopening the matter, let alone to vary the orders in the manner sought. It follows that the notice of motion will be dismissed.
[3]
Additional evidence on proposed Ground 3
The principal matter that the applicants advanced relates to what they described as "newly discovered facts", from records of the Department of Fair Trading (the Department) which the applicants submitted that they only obtained in a wholly unredacted form on 16 June 2023. In summary, the records relate to inquiries the Department made following information it received from the first applicant raising questions about the respondent's compliance with applicable legislation. The applicants relied on the Department having recorded that, contrary to s 4C(3) of the Property, Stock and Business Agents Regulation 2014 (NSW), the Association Agency Agreement dated 4 December 2018 had been executed on behalf of the Managing Agent, O'Connors Strata & Property Specialists Pty Ltd (OSP), by an assistant strata managing agent, Ms Keegan, who did not hold a licence. An entry dated 15 March 2022 included the following (this part of the document was redacted in the version of the records provided to the Court before the decision in Arjunan (No 1)):
"- Strata Managing Agent who signed the management agreement, Kylie [redacted] (nee Kegan) is an assistant strata agent and does not hold a strata licence
- LIC has indicated that it was signed under supervision, however the legislation at the time and now indicate only a licence holder could enter into an agreement"
The Department records also noted that the Association Agency Agreement did not specify the address of the signatory or her licence number (although that absence was evident from the face of the Association Agency Agreement).
The third ground of appeal that the applicants advanced before Adamson J, and proposed Ground 3 in this Court, was that the resolutions appointing Grace Lawyers to act on the respondent's behalf in recovering contributions and costs from defaulting lot owners were invalid because: (i) the minutes of the respondent's meetings did not record that there was a Chairperson; and (ii) more generally, the association became "defunct" from 2018. Relying on the Department's records, the applicants alleged on the notice of motion that the agreement with Grace Lawyers was invalid, illegal and void. They made that submission based, first, on Ms Keegan not holding a licence under the Property and Stock Agents Act 2002 (NSW) when she signed the Association Agency Agreement; and, second, on another person employed at OSP, Ms O'Hea, not holding a Class 1 licence.
Ms O'Hea provided a Witness Statement in the Local Court dated 15 January 2021, and an Affidavit in the Common Law proceedings affirmed on 9 March 2022, in which she stated that she was a licensed managing agent and that she retained Grace Lawyers in accordance with resolutions of the respondent in general meeting. The applicants alleged on the notice of motion that those statements were false; that the respondent did not appoint a properly licensed managing agent in breach of s 50(3) of the Community Land Management Act 1989 (NSW) (CLM Act); and that neither Ms Keegan nor Ms O'Hea could validly appoint Grace Lawyers.
In circumstances where the applicants have had Ms O'Hea's Witness Statement and Affidavit for a significant period, and well before the hearing of the application for leave to appeal, the points that they sought to raise on the notice of motion in relation to her involvement do not constitute a basis on which the Court would consider reopening the application for leave to appeal. As noted above, an application under UCPR r 36.16 is not an opportunity to reagitate the same matters with different emphasis (assuming for present purposes that there was a breach of some legislative requirement in circumstances where Ms O'Hea did hold a licence (albeit a Class 2 licence) and OSP did have a Licensee-in-Charge who held a Class 1 licence, being Ms O'Connor).
In so far as Ms Keegan's execution of the Association Agency Agreement is concerned, the applicants needed to demonstrate that in circumstances where her execution of the document was supervised (and OSP had a Licensee-in-Charge who held the requisite Class 1 licence), a breach of s 4C(3) would affect the validity of the Association Agency Agreement and, further, that this would, in turn, affect the validity of the retainer of Grace Lawyers by OSP on behalf of the respondent. The observation that the Court made in relation to Ground 3 as it was argued on the application for leave to appeal, in Arjunan (No 1) at [35], is apposite to the further contention the applicants sought to advance on the notice of motion. That paragraph also answers the submission, in the first applicant's affidavit of 2 June 2023, that the Court "overlooked" the relevance of the statutory requirements relating to the presence of the Chairperson at an AGM and the Chairperson's declaration of quorum.
In so far as the applicants also sought to invalidate the Association Agency Agreement on other bases, including that it did not specify Ms Keegan's address and licence number and was not validly executed by the respondent (as its seal was not affixed), these matters do not rest on newly obtained Departmental records, but arise on the face of the Association Agency Agreement, which the applicants have had for a considerable period of time. Even if the Court were to entertain these arguments, they would face the same difficulties that the Court has just identified.
[4]
Overlooking significant points on proposed Ground 4
The applicants next submitted that the Court "overlooked" important submissions they made as to whether the CLM Act provides for recovery of unpaid contributions. They submitted that the CLM Act makes provision for the recovery of those contributions in particular circumstances, including where there are proceedings pending in the NSW Civil and Administrative Tribunal (NCAT). They referred in this respect, as they did in their application for leave, to the levy dispute between the respondent and the applicants which was pending in NCAT and the respondent's refusal to mediate. The submissions in this respect did no more than reagitate points that were made on the leave application, which the Court addressed in Arjunan (No 1) at [36]-[38].
[5]
Duplication of costs in relation to proposed Ground 5
The fifth proposed ground of appeal before the Court took issue with particular components of the costs that were the subject of the order in the Local Court, on the basis that invoicing requirements were not satisfied and aspects of the costs were excessive. In the written submissions in support of the notice of motion, the applicants submitted that Mr Radman gave false oral evidence to this Court in the course of the hearing on 9 May 2023, in relation to the applicants' complaint regarding the respondent's receipt of a payment pursuant to its insurance policy whilst also claiming its costs in the Local Court. The applicants alleged that Mr Radman submitted "that the claim related to building damage", when the respondent "never owned a building". A similar statement was made in the letters provided to the Court on 9 and 10 May 2023, which was dealt with by the Court in Arjunan (No 1) at [45].
The applicants did not accurately capture what Mr Radman submitted to the Court on 9 May 2023 in relation to insurance, which was as follows:
"The owners corporation has made a claim against its building insurance policy for what is called legal defence costs. They are costs to defend an application. Because the Neighbourhood Association was a moving party in the Local Court, they are not costs, they [scil that] are recoverable under that insurance policy, but the costs associated with Mr Arjunan appealing that decision are costs which are recoverable and those are the costs which we have sought indemnity from the insurer to recover."
The applicants did not establish a basis for the serious allegation that the respondent withheld evidence of the insurance claim which, had it been disclosed, would have resulted in a costs order by Magistrate Milledge that excluded the legal costs covered by insurance. Accordingly, there is no warrant for the Court to reconsider its decision on this proposed ground.
[6]
Alleged denials of natural justice
The denials of natural justice that the applicants alleged in the last part of their written submissions related to what occurred in the making of the by-law regarding debt recovery and in their dispute with the respondent which led to the decision of the Local Court and the costs that they were ordered to pay. The applicants effectively reagitated the submissions made to the Court about what they contended is a bad precedent set by the rulings which were the subject of their proposed Grounds 1, 3 and 5. The applicants additionally submitted in relation to proposed Ground 5 that the respondent's alleged non-disclosure of the insurance payout (referred to above at [17]) led to expensive and time-consuming legal proceedings and a denial of natural justice. The applicants further submitted that the failure of the Supreme Court of NSW to declare the by-law invalid was a denial of natural justice as it was against public interest. None of these submissions articulated a denial of natural justice, nor did they provide a basis on which the Court would entertain a reopening of its decision or any variation of the orders it made for the reasons it set out in Arjunan (No 1).
[7]
The proposed subpoena
The addressees of the proposed subpoena were the respondent and Ms O'Hea of OSP. The subpoena sought a range of documents, including in relation to the Department's investigation, the insurance cover, the retainer of Grace Lawyers and documents associated with meetings and membership of the Respondent. In so far as documents were sought regarding the Department's investigation, the applicants obtained some material pursuant to an application under the Government Information (Public Access) Act 2009 (NSW), to which the Court has referred above.
The return date for the proposed subpoena was before the hearing of the application for leave to appeal; and the Registrar refused leave to issue it before that date (on 28 April 2023). In the June Affidavit, the first applicant described the material sought as providing "documentary evidence needed to succeed in the appeal". That echoed the statement he provided (on behalf of himself and the second applicant), dated 25 April 2023, in support of the subpoena, namely:
1. The subject documents were "deliberately withheld" by the addressees, despite several requests. The first applicant stated in the June Affidavit that the applicants made several requests to the respondent and the strata manager, but there was no reply.
2. The respondent misled the Court on matters covered by the documents.
3. The documents will "provide further evidence and reinforce the grounds of appeal".
The applicants did not identify any error in the decision to refuse leave to issue the subpoena. In any event, as the proceedings have concluded there is no utility in issuing the subpoena.
[8]
Conclusion
The applicants' notice of motion will be dismissed.
[9]
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 03 August 2023
Parties
Applicant/Plaintiff:
Arjunan
Respondent/Defendant:
Neighbourhood Association DP No 285853
Legislation Cited (5)
Community Land Management Act 1989(NSW)
Property, Stock and Business Agents Regulation 2014(NSW)