Stay of the Judgment Below
5 The arrangements concerning the land intended to be developed were complicated. It is sufficient for present purposes to note that the appellants caused the lands to come under the control of a company named JPG 58 Pty Ltd ("JPG") and that the primary judge found that under the arrangements they had with JPG, the first appellant had thus far received some $900,000.
6 In his affidavit read before me, the first appellant said that JPG had an obligation to pay him monthly amounts of $16,666.66. He said in his affidavit that he had had no discussions with JPG "in recent times" and believed that monthly payments would continue to be made. Some doubt is thrown upon the likelihood of these payments being made by a letter dated 27 August 2009 from the solicitors for JPG to the solicitors for the respondent. However, the first appellant's statement was made in his affidavit sworn on 4 September 2009 and was relevantly against his interests on the present Notices of Motion because it indicates the availability to him of significant funds on a monthly basis. In these circumstances, I consider that I should proceed upon the assumption that it is likely that the payments will continue.
7 The first appellant (who it can be assumed speaks for himself and the second appellant) gave evidence that apart from what he receives by these monthly payments he will not have the resources to satisfy the judgment given below until the sale of the subject property which he says is "unlikely to be until late 2012 at the earliest".
8 In a matter of weeks, the respondent will be 81 years of age. He and his partner have no source of income other than their expected receipt of the judgment amount and the aged pension which has recently been approved and will bring them $478.90 per fortnight.
9 Their monthly expenses comprise a $2,000 mortgage payment to National Australia Bank and living expenses of $1,200. They have been funding their living expenses by drawing on an overdraft facility of $435,800. This is presently drawn to $422,600. They have no assets other than a residence which the respondent says is valued at $850,000 but is subject to mortgages of $550,000. The respondent has incurred legal costs in respect of the proceedings in excess of $270,000, of which $150,000 is still outstanding. He has been advised that the appeal will cost him a further $50,000.
10 The proper approach to the grant of a stay was described in Kalifair Pty Ltd v Digi-Tech (Aust) Ltd [2002] NSWCA 383; (2002) 55 NSWLR 737 as follows:
"The appellant must show that the appeal raises serious issues for the determination of the appellate court, and that there is a real risk that he will suffer prejudice or damage if a stay is not granted, which will not be redressed by a successful appeal. This requirement will be satisfied if the appeal would be rendered abortive or nugatory unless a stay is granted. If these pre-conditions are established the Court will then consider the balance of convenience" (at [15])
11 This statement was referred to with approval by Ipp JA in Masri Apartments Pty Ltd (in liq) v Perpetual Nominees Ltd [2004] NSWCA 255; (2004) 209 ALR 86 at [17].
12 In the present case, it was not contended by the respondent that the appeal was hopeless although for reasons which were identified, it was argued that the appeal was weak. My view is that the appeal reaches the threshold referred to in Kalifair, namely, that it raises serious issues for the determination of the appellate court.
13 Further, there is a real risk that if a stay is not granted the appellants will suffer prejudice or damage which will not be redressed by a successful appeal. This is so because the respondent has limited assets and there is a significant risk that if the judgment sum is paid to him at least a substantial part of it may not be recoverable from him by the appellants in the event that they are successful on the appeal. As a result, it is necessary to consider the balance of convenience.
14 On the one side, the respondent has a prima facie entitlement to the fruits of his victory at first instance. On the other hand, for the reasons just given, the appeal may be rendered wholly or partially abortive if the respondent is allowed to enforce the judgment before the appeal is determined.
15 The respondent is clearly in a difficult financial position and I do not consider that the appellants would be unduly prejudiced if a stay were made conditional upon the appellants making payments to the respondent to alleviate that position and to enable the respondent to pay his costs of the appeal. The figure which I consider is appropriate is $10,000 per month. With expedition being granted, as I conclude below it should be, the proceedings in this Court are likely to be resolved within nine months. I do not consider that there is such a risk of the appellants not recovering from the respondent a sum of $90,000 paid to him in satisfaction of the judgment as would warrant depriving the respondent, to that extent, of the fruits of his victory at first instance. In arriving at this conclusion I have taken account of the fact that the respondent has already obtained payment of $33,105.61 from the appellants by means of a garnishee order. If proceedings in this Court take significantly longer than nine months to be resolved, the terms of the stay may have to be reconsidered. I will grant liberty to apply to facilitate this occurring.