BE Australia WD Pty Ltd (subject to a deed of company arrangement) v Sutton

Supreme Court of NSW|2015-12-07

Judgment

HER HONOUR: This judgment mainly involves a review of a Registrar's decision. By amended notice of motion filed 7 December 2015, the defendant seeks firstly, that pursuant to Uniform Civil Procedure Rules 2005 (NSW) 49.19, the orders made by Registrar Kenna on 8 September 2015 be discharged or set aside; secondly, in the premises of order 1, an order that the order sought in the notice of motion filed on 17 July 2015 by the applicant, BearingPoint Inc, seeking leave to issue a writ of execution on the judgment entered 30 May 2014 is refused, that BearingPoint Inc pay the defendant's costs of the notice of motion filed 17 July 2015 and that the defendant pay BearingPoint Inc's costs occasioned by withdrawing the notice of motion to pay the judgment debt by instalments filed 31 July 2015; and thirdly, in the alternative and pursuant to the inherent jurisdiction of the court and/or s 135 of the Civil Procedure Act 2005 (NSW) the plaintiffs and the applicant, BearingPoint Inc, are prohibited from enforcing the costs judgment until further order of the court.
The applicant is BearingPoint Inc ("BearingPoint"). The defendant is Mary Sutton ("Ms Sutton").
There are four main issues to be determined. Three involve a review of the Registrar's decision and the fourth issue is a new one, namely whether a stay of execution of the writ should be granted. I will deal firstly with the Registrar's decision followed by the stay application.
On 8 September 2015, the Registrar made an order granting leave to BearingPoint to issue a writ of execution on the judgment entered on 30 May 2014 and an order that the defendant pay Ms Sutton's costs of the notice of motion filed 17 July 2015 and the withdrawn notice of motion to pay the judgment debt by instalments filed 31 July 2015.

Background

This litigation between the parties spans over 10 years and has been hard fought in various Courts. I acknowledge that I have largely adopted the background set out in BearingPoint's counsel's submissions.
Ms Sutton has been prosecuting (and continues to prosecute) in separate proceedings in the Industrial Court of New South Wales against BE Australia and a third party, Mr Phillip Davidson. The Industrial Court proceedings commenced in 2005 and have not yet been finalised but it was expected they would be listed in that court in May 2016.
On 5 October 2009, Ms Sutton commenced proceedings against BE Australia WD Pty Ltd (admin apptd) ("BE Australia"), Mr Alan John Hayes and Mr Anthony Milton Sims ("the administrators") in this Court. Mr Hayes and Mr Sims were sued as the administrators of BE Australia. Those proceedings related to a proof of debt lodged by Ms Sutton. In those proceedings she sought relief justifying the administrators in admitting her proof of debt or reversing the decision to reject the proof of debt (Aff, Floro 9/10/2015, para [30]).
At first instance, Ms Sutton was successful: see Sutton v BE Australia WD Pty Ltd [2010] NSWSC 772. However, BE Australia and the administrators appealed and Ms Sutton cross appealed to the Court of Appeal. The appeal was allowed and the cross appeal was dismissed: BE Australia WD Pty Ltd v Sutton [2011] NSWCA 414. The Court of Appeal set aside the orders in the court below and in lieu thereof ordered that the summons be dismissed with costs. The Court of Appeal further ordered that the respondent pay the costs of the appellants of the application for leave to appeal, the application for leave to cross appeal, the appeal and the cross appeal.
Ms Sutton then sought special leave to appeal from the decision of the Court of Appeal to the High Court. That application was heard on 22 June 2012 and was dismissed with costs: Sutton v BE Australia WD Pty Ltd (Subject to a Deed of Company Arrangement) [2012] HCATrans 167.
On 21 February 2013, the High Court issued a certificate of taxation in respect of the costs order made in relation to the special leave application. BE Australia's costs were taxed and allowed in the amount of $30,538.28 (Aff, Rasaiah 17/07/2015, Annexure A, p 27).
So far as the costs orders made in the Court of Appeal are concerned, certificates of determination of costs were issued on 23 June 2013 and amended certificates were issued on 20 May 2014 (Aff, Rasaiah 17/07/2015, Annexure A, pp 22-3). The total amount of costs payable by Ms Sutton to BE Australia and the administrators (all of whom were named as cost applicants) was $165,033.52.
On 30 May 2014, judgment for costs for that amount was entered in the present proceedings with BE Australia and each of the administrators named as plaintiffs and Ms Sutton named as defendant (Aff, Rasaiah 17/07/2015, Annexure A, pp 24-5). The terms of the costs judgment provided that Ms Sutton was to pay BE Australia, Mr Hayes and Mr Sims the sum of $165,033.52.
On 24 June 2014, BE Australia and the individual administrators (as assignors) and BearingPoint (as assignee) entered into a deed of assignment of debt ("deed of assignment") (Aff, Rasaiah 17/07/2015, Annexure A, pp 7-27). The deed of assignment recited the litigation history in the Supreme Court, Court of Appeal and the High Court and referred to the issuing of the certificate of taxation, certificates of determination, amended certificates and the costs judgment in these proceedings.
On 18 July 2014, BearingPoint executed a notice of assignment addressed to Ms Sutton ("notice of assignment") (Aff, Rasaiah 17/07/2015, Annexure B, pp 28-9).
On 17 July 2015, BearingPoint filed a notice of motion seeking to issue a writ of execution. The evidence in support of the notice of motion was served on Ms Sutton. On 31 July 2015, a timetable for evidence was given. Leave was also granted for Ms Sutton to file a notice of motion to pay the costs judgment by instalments.
Various methods of service of the notice of assignment were attempted, some successful, with Ms Sutton attempting to avoid service. The process servers' reports are as follows: (a) on 7 August 2014, the notice of assignment was sent by prepaid express post to Ms Sutton by a solicitor (J [34]; Aff, Koo 14/08/2015); (b) on 21 August 2014, a process server informed Ms Sutton on the telephone that the process server had documents for Ms Sutton but when she went to her residence to provide them Ms Sutton did not respond and then did not respond to telephone calls (Aff, Sabatino 19/08/2014); (c) on 9 September 2014, a process server, Mr Romeo, attended Ms Sutton's residence. He saw her leave the property with a male person. When he approached her and called out "Mary" two times she ran and hid in hotel toilets for 45 minutes until security removed her. When Ms Sutton was again approached by the process server and informed by him that he had documents for her, she sought to quickly depart from the hotel and he dropped the documents at her feet. After Ms Sutton left the documents there and quickly walked away, Mr Romeo retrieved these documents and attached them to the front door of Ms Sutton's residential property (J [35]; Aff, Romeo 18/09/2014); and (d) on 23 July 2015 (following the filing of the execution motion on 17 July 2015), a motion together with the supporting affidavit of Caroline Rasaiah of 17 July 2015 were served by express post on numerous addresses (including Ms Sutton's residential address and the address of her solicitors acting in these proceedings). The affidavit included full copies of the notice of assignment and the deed of assignment (J [37], [44]).
On 18 August 2015, the Registrar heard BearingPoint's notice of motion seeking the writ of execution. Ms Sutton withdrew the instalment motion and agreed to pay BearingPoint's costs relating to that motion.
It is convenient that I now briefly set out the relevant clauses of the deed of assignment and notice of assignment.

Deed of assignment

The deed of assignment is dated 24 June 2014 and the parties are described as BE Australia WD Pty Ltd, Anthony Milton Sims and Alan John Hayes (together "the assignors") and BearingPoint ("the assignee").
The following relevant definitions are included in clause 1.1 of the deed of assignment: ""Certificate of Taxation" means the Certificate of Taxation issued by the High Court of Australia on 21 February 2013 in proceedings S20 of 2012, a copy of which is included at Schedule 2 to this deed. … "Court of Appeal Proceedings" means Supreme Court of New South Wales, Court of Appeal proceedings 2009/291932. "Court of Appeal Costs Orders" means orders 6 and 7 made in the Court of Appeal Proceedings on 20 December 2011. … "Debt" means the debt in the principal sum of $195,571.80 comprising the quantified Court of Appeal Costs Orders reflected in the Judgment and High Court Costs Order reflected in the Certificate of Taxation and any right to receive interest on that amount. … "High Court Costs Order" means the orders as to costs made in the High Court Proceedings on 22 June 2012. "High Court Proceedings" means High Court of Australia proceeding is S20/2012. "Judgment" means the judgement/order issued on 30 May 2014 by the Supreme Court of New South Wales, a copy of which is at Schedule 1 to this deed. …" (My emphasis added).
"Certificates of Determination" were also defined as comprising of the certificates and the amended certificates as included in schedule 1 to the deed of assignment. Schedule 1 annexes sealed copies of the certificates of determination of costs, the amended certificates and the costs judgment. The two certificates of determination were both issued on 25 July 2013. Both assessment files have been allocated assessment file number 2013/51335. Schedule 2 contains a copy of the certificate of taxation issued by the High Court dated 21 February 2013.
Clause 3 is headed "Assignment". Clauses 3.1 and 3.3 of the deed of assignment provide: "3.1 Absolute Assignment The Assignors hereby transfer and assign to [BearingPoint] absolutely all the right, title and interest of the Assignors both legal and beneficial in and to the Debt, including (without limitation) any restitution claims and other causes of action and remedies relating to the Debt which the Assignors may at any time have or acquire. … 3.3 Notice The Assignors will give or concur in giving of any notice required by [BearingPoint] to be given to the Debtor, failing which [BearingPoint] may give such notice."
The deed of assignment states that it assigns absolutely from the assignors a debt comprising of costs orders made in NSW Court of Appeal proceedings number 2009/291932 and High Court proceedings S20/2012. (My emphasis added). However, the Court of Appeal file number 2009/291932 is the incorrect file number. That file number relates to proceedings between Ing Bank (Australia) Limited v Scriven. The correct file number is 2009/291532. It appears that a "9" is in the place of the "5" on the notice of assignment. Obviously this is a typographical error.

Notice of assignment

The notice of assignment of debt dated 18 July 2014 is addressed to Ms Sutton and relevantly reads: "Deed of assignment of debt dated 24 June 2014 between BE Australia WD Pty Ltd (subject to deed of company arrangement) …, Anthony Milton Sims, Alan John Hayes and BearingPoint, Inc. Bearing Point Inc, … gives you notice pursuant to section 12 of the Conveyancing Act 1919 (NSW) that: 1. Each of BE Australia WD Pty Ltd (subject to a deed of company arrangement) …, Anthony Milton Simms … and Alan John Hayes … (together the Assignors) have transferred and assigned to BearingPoint, Inc., … (Assignee) absolutely: (a) all rights, titles and interest of the Assignors both legal and beneficial in and to the principal sum of $195,571.80 comprising: (i) the quantified in orders 6 and 7 in the Supreme Court of New South Wales, Court of Appeal proceedings 2009/291932 reflected in the judgment/order issued on 30 May 2014 by the Supreme Court of New South Wales; and (ii) the quantified orders as to costs made in the High Court of Australia proceedings S20/2012 reflected in the Certificate of Taxation issued by the High Court of Australia on 21 February 2013 in the same proceedings; …"
The notice of assignment records the incorrect file number of the Court of Appeal proceedings. However, it does refer to the amount of $195,571.80, reflecting the quantified amount of costs of orders 6 and 7 made by the Court of Appeal, reflected in the judgment issued on 30 May 2014, as well as the High Court costs order reflected in the certificate of taxation issued on 21 February 2013.
On 8 September 2015, the Registrar made an order granting leave to BearingPoint to issue a writ of execution on the judgment entered on 30 May 2014. The Registrar also ordered Ms Sutton to pay BearingPoint's costs of the notice of motion filed 17 July 2015 and the withdrawn notice of motion to pay the judgment debt by instalments filed 31 July 2015.
On 14 September 2015, BearingPoint issued a bankruptcy notice on Ms Sutton in respect of the debt the subject of the costs judgment (Aff, Floro 9/10/2015, para [60]).

Review of Registrar's decision

On 2 October 2015, Ms Sutton filed this current motion seeking a review of the Registrar's decision and, in the alternative, an order prohibiting enforcement of the costs judgment.
UCPR 49.19 governs applications for review of a decision of a registrar. It reads: "49.19 Review of registrar's directions, certificates, orders, decisions and other acts If in any proceedings a registrar gives a direction or certificate, makes an order or decision or does any other act, the court may, on application by any party, review the direction, certificate, order, decision or other act and make such order, by way of confirmation, variation, discharge or otherwise, as the court thinks fit."
A compendious and helpful summary of the legal principles applicable to the review of a Registrar's decision was set out by Hallen J in Noble Earth Technologies Pty Ltd v Hampic Pty Ltd trading as Cyndan Chemicals [2012] NSWSC 935 at [39]: "[39] Relevant principles drawn from authorities relating to the nature of a review are: (a) The review power conferred is not an appeal and, accordingly, is not subject to the limitations that apply to proceedings by way of appeal: Tomko v Palasty (No 2) [2007] NSWCA 369; (2007) 71 NSWLR 61 at [6], [10], [50], [52]; Al-Shennag v Statewide Roads Pty Ltd [2009] NSWSC 210 per Hall J at [44]-[46]; it is 'not restricted' to a reconsideration of the primary material before the Registrar: Lollback v Brakepower Pty Ltd [2010] NSWSC 1457 at [10]. (b) It is unnecessary for the applicant for review to demonstrate any material error of fact, or principle, in the order under review. On the review, the court may exercise its powers regardless of error. However, review, in the relevant sense, involves discretionary intervention: Tomko v Palasty (No 2) at [52]; Lollback v Brakepower Pty Ltd at [13]; the discretion extends to a discretion whether, and if so, how, to intervene. (c) The conduct of the review is at large and in the discretion of the Court. Notwithstanding the foregoing, the review is not accurately described as a hearing de novo: Perpetual Ltd v Barghachoun [2010] NSWSC 108 at [3], although it involves many of the features of a hearing de novo. (d) There is an onus on a person seeking to have a court set aside, or vary, a registrar's decision to make out a case that the court conducting the review, in the interests of justice, should exercise its discretion to do so: Tomko v Palasty (No 2) per Hodgson JA at [7]. In other words, there must be a basis shown for setting aside, or varying, the decision or orders of the registrar. (e) Although on review, the Court should consider the matter afresh, it does not follow that the reasoning of the registrar should be ignored, or that variations in the material presented to her, or him, and the evidence that was adduced are irrelevant. The starting point is, therefore, the decision that is to be reviewed. The court does not merely cast that decision to one side and proceed as if it had never been made. The court will have regard to the basis on which the decision was made and the material placed before the court itself on the application for review: Wily re LED (South Coast) Pty Ltd [2009] NSWSC 946 at [24]-[26]. The real question is whether there are any grounds, or any reasons, which would warrant a review of the orders that have been made by the registrar: Al-Shennag v Statewide Roads Pty Ltd at [47]. (f) What will be required to make out a case for intervention will vary depending upon the nature of the registrar's decision under review: Groeneveld v Wollongong City Council [2009] NSWLEC149; (2009) 168 LGERA 260, per Preston a at [12]. However, the court should inform itself of the material before the registrar at the time when he, or she, mode the decision, should consider the reasons for the decision, and then should make its own decision based on the material before it after having the benefit of the submissions of each party. (g) It is proper for the Court to exhibit a natural inhibition against the unrestrained substitution of the reviewing Court's views for those of the registrar: Westpac Banking Corp v Abemond Pty Ltd; Westpac Banking Corp v Cameron (NSWSC, 3 November 1994, unreported)."
In addition to the evidence and the submissions made to the Registrar and the Registrar's decision, the parties relied upon additional evidence, namely three affidavits of Ms Sutton's solicitor, Andrew Floro, affirmed 9 October 2015, 2 November 2015 and 7 December 2015 and two affidavits of Caroline Rasaiah affirmed 26 October 2015 and 4 December 2015. A large portion of this additional evidence is directed towards the new issue, that is, whether a stay of proceedings should be granted. I have informed myself of all this material.

Grounds of review

Counsel for Ms Sutton submitted that the interests of justice warrant this Court's intervention because, contrary to the findings of the Registrar, that the notice of assignment was inaccurate and did not constitute express notice within the meaning of s 12 of the Conveyancing Act 1919 (NSW). Counsel for BearingPoint submitted that it is not in the interests of justice for this Court to intervene.
Counsel for Ms Sutton submitted that she argued before the Registrar that the notice incorrectly referred to the source of the debt and was therefore ineffective for the purposes of s 12 of the Conveyancing Act. Consequently, the assignment of the legal right to enforce the costs debts as against Ms Sutton had not transferred to BearingPoint. Ms Sutton submitted that the Registrar rejected her argument because sufficient particularity was provided in BearingPoint's notice of motion and supporting affidavit which was served on Ms Sutton on 23 July 2015 (J [44]).
Ms Sutton submitted that the Registrar erred or did not have sufficient regard to the following. Firstly, the fact that express notice is an essential part of the transfer of title to the debt, and as such, the requirements of s 12 of the Conveyancing Act must be strictly complied with and the notice itself must be strictly accurate, particularly in regard to the debt that is given for assignment. If the notice fails to be strictly accurate, it is ineffective (Review Ground 1).
Secondly, until express notice is given to a debtor, the assignment, if any, takes effect in equity only: see Norman v Federal Commissioner of Taxation (1963) 109 CLR 9 at 28-9; [1964] ALR 131 at 147-8; [1963] HCA 21 at [9] per Windeyer J (Review Ground 2).
Thirdly, it is no answer to the above to find that sufficient particularity was provided by the writ of execution motion filed on 17 July 2015. That motion and supporting affidavit annexing a copy of the deed of assignment was served on Ms Sutton on 23 July 2015 after it was filed. According to Ms Sutton it is only when express notice in writing was given to her that BearingPoint obtained the legal right and the legal remedy to the debt and it was only when the legal assignment had been perfected that BearingPoint could take action to recover the debt (Review Ground 3).
I shall deal with Review Grounds 1 and 2 together followed by Review Ground 3. Before I do so, it is convenient that I set out s 12 of the Conveyancing Act as Ms Sutton's arguments centres around it.
Section 12 of the Conveyancing Act relevantly reads: "12 Assignments of debts and choses in action Any absolute assignment by writing under the hand of the assignor (not purporting to be by way of charge only) of any debt … of which express notice in writing has been given to the debtor, … shall be, and be deemed to have been effectual in law (subject to all equities which would have been entitled to priority over the right of the assignee if this Act had not passed) to pass and transfer the legal right to such debt or chose in action from the date of such notice, and all legal and other remedies for the same, and the power to give a good discharge for the same without the concurrence of the assignor…"

Submissions

Counsel for Ms Sutton referred to Norman, where Windeyer J at 29 and 30 stated: "The assignor (the creditor) as legal owner, the debtor and any assignees of other parts of the debt were all necessary parties, so that all the obligations of the debtor and the rights of all persons interested in the fund might be established by the decree."
He submitted that it is no answer to find that sufficient particularity was provided by the writ of execution motion filed on 17 July 2015. That motion and supporting affidavit was relevantly served on the applicant after it was filed, on 23 July 2015. It is only when express notice in writing is given to Ms Sutton that BearingPoint obtains the legal right and the legal remedy to the debt. Moreover, it is only when the legal assignment has been perfected that any assignee may take action to recover the debt.
Counsel for Ms Sutton referred to McIntosh v Shashoua (1931) 46 CLR 494 at 516; APT Finance Pty Ltd v Bajada [2008] WASCA 73 at [29]; and GE Mortgage Solutions Ltd v Whild (No 2) [2014] VSC 581 at [39].
In McIntosh v Shashoua, the High Court considered whether a debt had been assigned to Mrs Shashoua so that she could properly present a petition for the purpose of bankruptcy proceedings involving Mr McIntosh. In determining whether the debt had been assigned under s 12 of the Conveyancing Act, Starke J considered (at 507) that "sec 12 requires express notice in writing to the debtor." Evatt J, in a dissenting judgment, held at 514-5: "If express notice in writing of an absolute assignment of a debt is given to the debtor, then, but not till then, the assignee obtains the legal right and the legal remedy to the debt."
Evatt J held that since notice of the assignment was not provided to the debtor at the relevant time, the assignment was not effected in law, but was effected in equity: at 514-5.
In APT Finance Pty Ltd v Bajada, the Supreme Court of Western Australia Court of Appeal considered whether an interest in a loan had been validly assigned for the purpose of determining whether a third party could be substituted in place of the plaintiff in an action in the District Court. In deciding that the assignment was effected by the delivery of notice, the Court of Appeal held (at [29]): "If express notice in writing of an assignment of a debt is given to the debtor then, but only then, the assignee obtains the legal right and the legal remedy to the debt: McIntosh v Shashoua (1931) 46 CLR 494, 514 (Evatt J). Once there has been a perfected legal assignment any action must be in the name of the assignee and not in the name of the assignor, as the assignor no longer has any right to sue for the debt: Hughes v Pump House Hotel Co Ltd [1902] 2 KB 190, Bacon v Yatchaw Irrigation & Water Supply Trust [1898] VicLawRp 102; (1898) 23 VLR 485, Hobbs v Rawson [1961] WAR 79, 86 (Virtue J), Carob Industries Pty Ltd (In Liq) v Simto Pty Ltd [2000] WASCA 362 [27]."
In GE Mortgage Solutions Ltd v Whild (No 2), the plaintiff sought orders that a third party be substituted in its place as plaintiff. The plaintiff argued that the third party was the assignee of a debt originally owed by the defendant to the plaintiff. In deciding that the assignment had been effected, the Supreme Court of Victoria similarly held (at [39]): "Once express notice in writing of assignment of a debt is given to the debtor then, but only then, the assignee obtains the legal right and the legal remedy to the debt: McIntosh v Shashoua [(1931) 46 CLR 494, 514; Op Cit APT Finance Pty Ltd v Bajada [2008] WASCA 73 [29]]. Thus the assignee (PCL) obtains the 'legal right and the legal remedy' to the debt. Moreover, as the Court of Appeal of Western Australia observed in APT Finance Pty Ltd v Bajada [[2008] WASCA 73 [29]], once there has been a perfected legal assignment any action must be in the name of the assignee and not in the name of the assignor, as the assignor no longer has any right to sue for the debt. That is the case."

Consideration

Counsel for Ms Sutton, at the hearing before the Registrar, conceded that there is no requirement for the notice of assignment to be served personally; service by post is sufficient (J [31]).
So far as the giving of the notice of assignment is concerned, at [35] to [37] of the Registrar's written reasons dated 8 September 2015 she stated: "35 Mr Romeo in his affidavit deposes to serving the notice of assignment by affixing it to the door at 21 Lower Fort Street on 9 September 2014. Ms Koo also deposes to serving the notice of assignment on the defendant by post on 7 August 2014. Although there is no evidence as to the date the notice arrived, s 160 of the Evidence Act 1995 provides a rebuttable presumption in that situation that the notice was delivered on the fourth working day after it was posted, that being 13 August 2014. 36 I do not accept the submission made on behalf of the defendant that the notice of assignment was not served. The applicant has provided evidence showing the defendant's conduct in avoiding service and has effected service in multiple manners. The defendant however has failed to provide any evidence herself to contradict the evidence served by the applicant regarding service for example, evidence regarding issues with receiving mail at her address or her whereabouts in August and September 2014. I am of the view that the defendant has failed to rebut the presumption of service under the Evidence Act 1995. 37 If I am incorrect in my finding that the defendant has failed to rebut the presumption of service in August and September 2014, then it is necessary to determine whether or not service of the Motion would constitute notice of the assignment of the debt. The decision of Brereton J in Grizonic v Suttor [2011] NSWSC 471 establishes that service of notice under s. 12 of the Conveyancing Act 1919 may be given by pleadings. Accordingly, service of the Motion and supporting Affidavit material that annexes a copy of the notice of assignment on the defendant would constitute service of the notice for the purposes of the Act. I note that Ms Koo deposes to serving the Motion and Affidavit of Caroline Jane Rasaiah sworn 17 July 2015 on the defendant on 23 July 2015. Mr Floro's evidence does not contradict this. I am satisfied that at the time of serving the Motion, the defendant has been served with further notice of the assignment of the debt."
The Registrar made findings that the notice of assignment was served on 13 August 2014 and 9 September 2014. These dates pre-date the filing of the notice of motion on 17 July 2015. On 23 July 2015, Ms Sutton had been given the notice of assignment both before and after the notice of motion was filed. The next issue is whether this notice was strictly accurate.

Submissions

Counsel for Ms Sutton drew to the attention of this Court and the Registrar clause 1(a)(i) of the notice of assignment which relevantly reads: "(a) all rights titles and interest of the Assignors both legal and beneficial in and to the principal sum of $195,571.80 comprising: (i) the quantified in orders 6 and 7 made in the Supreme Court of New South Wales, Court of Appeal proceedings 2009/291932 reflected in the judgment/order issued on 30 May 2014 by the Supreme Court of New South Wales …"
2009/291932 is the wrong file number.
Counsel for Ms Sutton submitted that the Registrar erred in that she did not have sufficient regard to the fact that express notice is an essential part of the transfer of title to the debt, and as such, the requirements of s 12 of the Conveyancing Act must be strictly complied with and the notice itself must be strictly accurate particularly in regard to the debt that is given for the assignment. If the notice fails to be strictly accurate, it is ineffective. He relied on the authorities of WF Harrison and Co Ltd v Burke [1956] 2 All ER 169; [1956] 1 WLR 419, International Leasing Corporation (Vic) Ltd v Aiken [1967] 2 NSWR 427 and J G Starke QC, Assignments of Choses in Action in Australia (1st ed, 1972 Butterworths) at [64].
In WF Harrison and Co Ltd v Burke, the English Court of Appeal held that a notice to a debtor of assignment of a debt is not valid if the date of assignment is wrongly stated in the notice. Denning LJ (with whom Morris and Parker LJJ agreed) at 421 said: "I need not say anything about the amount of the debt, which in this case was put at £203 8s. when it was in fact only £33 18s.; but, as at present advised, I should have thought the notice of assignment ought to state the debt accurately too, because, after all, we are dealing with a transfer of title and the requirements of the Act must be strictly complied with. I find myself in agreement with the judgment of the county court judge that the assignee in this case did not prove a right or title in himself to this debt in accordance with the statute, and I think the appeal must fail."
Morris LJ at 422 said: "… I think that a notice given on December 6 purporting to be a notice in reference to an assignment dated December 6, when there was no such assignment in existence, was, therefore, not a good notice to enable the assignment that came into existence the following day to be effectual to pass the legal right to the debt assigned. I therefore agree that the judge came to a correct conclusion."
In International Leasing v Aiken, the majority of the New South Wales Court of Appeal (Asprey JA and Moffitt AJA, Jacobs JA dissenting) held that an interest in a lease was not properly assigned to a third party under s 12 of the Conveyancing Act where there was no date for the notice and no notice in existence. In Asprey JA's decision (with Moffitt AJA agreeing on this point), his Honour followed Denning LJ's decision in WF Harrison, finding (at 450): "In view of the facts that the assignment is stated to be as collateral security for the note and subject to the applicable conditions of the note, that no date appears for the note and that no note was in existence, the delivery to the lessee of the form of assignment incorporated in Exhibit "1", in my view, cannot constitute express notice in writing of an absolute assignment as required by s. 12 [of the Conveyancing Act 1919 (NSW)]."
These cases involved rather serious oversights, namely the wrong date of assignment or no date of assignment being given.
More recently in Grizonic v Suttor [2011] NSWSC 471, Brereton J at [25] relevantly stated: "[25] This letter is said to be inadequate notice by reason that it does not specify the debts concerned, ... However, save that it must be in writing and express, there are no formal requirements for notice under s 12, though it must not mislead; all that is required is "notice in writing", not " a notice in writing" [Van Lynn Developments Ltd v Leias Construction Co Ltd [1968] 1 QB 607, 613, 614, 615]. Although it would have been insufficient for want of identifying the relevant debts had the letter alone been sent, sufficient particularity was provided by the accompanying deeds. …"
Counsel for Ms Sutton argued that it is clear on the evidence that the notice of assignment was not accurate and was in fact wrong and the Registrar failed to have sufficient regard to this.
BearingPoint submitted that Ms Sutton's contention that the notice of assignment was not effective cannot be accepted for the following three reasons.
Firstly, on the proper construction of the notice on its face, it adequately gave notice of the assignment of the debt which was the subject of the costs judgment. Clearly enough, a notice must describe the debt that is being assigned (and it is recognised that it is particularly important that the date of assignment not be misstated for obvious reasons). It is accepted in this regard that the notice must not mislead: see Grizonic. Whether or not it does so involves a common sense view as to whether it conveys its message clearly and distinctly to a reasonable reader in the position of the recipient of the notice having the knowledge of the surrounding circumstances which the recipient has or ought to have: Robinson v Becata Pty Ltd [2004] NSWSC 310 at [49] per Campbell J. In that regard, counsel for BearingPoint submitted that the notice is plainly effective. BearingPoint indicated that as the three named plaintiffs are identified as assignors, there can be no doubt what is being referred to. The notice conveys its message clearly and distinctly such that a reasonable reader in the position of Ms Sutton would understand which debt the notice refers to.
Further, BearingPoint submitted that even if the notice of assignment was not in itself effective, the service of the notice with the deed of assignment was plainly effective to give notice of the assignment of the debt the subject of the costs judgment. According to BearingPoint the Registrar found that one of the numerous modes of service which had been established was by service of the notice together with the deed of assignment on Ms Sutton. Ms Sutton's submissions do not challenge that finding.
BearingPoint submitted that the Registrar found that the deed of assignment effectively assigned the debt that was the subject of the costs judgment and "that a reasonable person reviewing the deed would become apprised of the basis of the debt by reading the document as a whole" (J [30]). Ms Sutton's submissions do not challenge those findings.
Once it is accepted that the deed of assignment on its face and objectively construed effectively assigned the debt and the deed of assignment was served on Ms Sutton, it inexorably follows that she was given notice of the assignment. Counsel for BE Australia submitted that in this regard there can be no doubt as to the correctness of the Registrar's reasoning. The notice expressly referred to the deed of assignment. The deed of assignment referred to the assignment of "the debt" (clause 3.1).
On this topic, in her written reasons dated 8 September 2015 the Registrar stated at [30], [42] to [45]: "[30] I am not satisfied that the typographical error contained in the reference to the case number is fatal to the validity of the deed assigning the debt absolutely to the applicant. It would be contrary to the principles of contractual interpretation to not read the definitions as a whole. I am of the view that a reasonable person reviewing the deed would become apprised of the basis of the debt by reading the document as a whole. … [42] It is clear that the courts have interpreted the requirement for express notice of an assignment of a debt strictly. To satisfy this requirement, the notice must be strictly accurate particularly in regard to the debt that is given for the assignment (W.F. Harrison and Co Ltd v Burke [1956] 2 All ER 169; International Leasing Corporation (Vic) Ltd v Aiken [1967] 2 NSWR 427) to ensure that a debtor has certainty as to whom the debt has vested in. [43] More recently in Grizonic v Suttor, Brereton J at [25] dealt with the detail required for identifying a debt indicating: "save that it must be in writing and express, there are no formal requirements for notice under s 12, though it must not mislead; all that is required is "notice in writing", not "a notice in writing" [Van Lynn Developments Ltd v Leias Construction Co Ltd [1968] 1 QB 607 at 613 614 and 615]. Although it would have been insufficient for want of identifying the relevant debts had the letter alone been sent, sufficient particularity was provided by the accompanying deeds." [44] As I have found that service of the notice was also effected at the time of service of the Motion and supporting Affidavit and it is uncontroverted that the Affidavit of Ms Rasaiah annexed to it a copy of the deed of assignment (inclusive of the schedule containing details of the judgment upon which the debt relates), I do not accept the submission that as the notice incorrectly refers to proceeding number 2009/291932, the notice is clearly inaccurate and therefore ineffective. As Brereton J in Grizonic highlighted, sufficient particularity was provided to the defendant at the time of serving the motion. I am therefore satisfied that the defendant had sufficient detail of the debt and certainty as to whom the debt has vested in. [45] It is clear that the Uniform Civil Procedure Rules 2005 clearly contemplate the situation where a debt is assigned and has provided a mechanism for the valid assignee of a debt to enforce a debt as its own. As I have found that the deed assigns the debt absolutely and that notice has been served, I am satisfied that the requirements in rule 39.1(3) have been met and there is no reason why the applicant should not be granted leave to issue a writ of execution."

Conclusion

The notice of assignment is in writing. It is addressed to Ms Sutton. It is given by BearingPoint (the assignee). It specifies the date of assignment. It identifies that the assignment is between BE Australia Pty Ltd (subject to deed of company arrangement), Anthony Milton Sims, Alan John Hayes and BearingPoint (the assignors). The notice of assignment stipulates that BearingPoint is giving Ms Sutton notice pursuant to s 12 of the Conveyancing Act. It stipulates that each of the assignors have transferred and assigned the deed to BearingPoint absolutely. The notice of assignment provides the details of the debt being the principal sum of $195,571.80 comprising of quantified orders in orders 6 and 7 in the Supreme Court of New South Wales Court of Appeal proceedings 2009/291932 reflected in the judgment/order issued on 30 May 2014 by the Supreme Court of New South Wales and in clause 1(ii) where the correct details of the quantified costs orders made in the High Court reflected in the certificate of taxation of 21 February 2013 are set out. The notice identified the correct parties to each proceeding, the correct courts, the dates upon which the orders were made and the correct amount of the debt.
Although the notice contains an incorrect file number, it is my view that the debt is identified with sufficient particularity. A proper reading of the contents of the notice of assignment is not misleading. In my view, the notice of assignment complies with s 12 of the Conveyancing Act. These grounds of review fail.
In case I am wrong, I shall now deal with Review Ground 3.

Review Ground 3

Review Ground 3 concerns the timing of the service of the notice of assignment.
The Registrar in her reasons at [44] as previously referred to says she had already made a finding that service of the notice of assignment was also effected at the time of service of the notice of motion and a copy of the deed of assignment and she did not accept the submission that as the notice incorrectly referred to proceeding number 2009/291932, the notice was clearly inaccurate and therefore ineffective. As highlighted by Brereton J in Grozonic, sufficient particularity was provided to the defendant at the time of serving the notice of motion. The Registrar was therefore satisfied that Ms Sutton had sufficient detail of the debt and certainty as to whom the debt had vested in.

Submissions

Counsel for Ms Sutton submitted that it is no answer that particularity was provided by the writ of execution motion filed on 17 July 2015. That motion and supporting affidavit which annexed a copy of the deed of assignment was served on Ms Sutton on 23 July 2015, after it was filed.
Counsel for Ms Sutton referred to the following passage of J G Starke QC, Assignments of Choses in Action in Australia where the learned author said: "67 Time for giving notice - The statutory provisions prescribe no specific time limit within which notice may be given by any particular person. Notice may be given even after the death of an assignor…, or after the death of a deceased assignee…, although no notice has been given by him or by the original or any intermediate assignee…. The debtor or fundholder must of course receive notice before payment by him…, or before action brought by the assignee (Cf. Holt v. Heatherfield Trust, Ltd., [1942] 2 KB. 1, at pp. 4, 5-6, and McIntosh v. Shashou (1931), 46 CLR. 494, at pp. 514-5. See also Re Westerton, Public Trustee v Gray, [1919] 2 Ch. 104, at p. 111.)."
Counsel submitted that the notice must be served before the action is brought by BearingPoint. Therefore, the service of the notice of assignment together with the deed of assignment and the notice of motion (after the notice of motion had been filed) is not effective.
Counsel for BearingPoint submitted that even if no effective notice was given, the issue would remain academic. As already noted, Ms Sutton does not challenge that the deed of assignment effectively assigned the debt the subject of the costs judgment. Even if effective notice was not given of that assignment, it would still take effect as an equitable assignment. While a legal assignee need not join the assignor to recover on a debt, an equitable assignee can obtain the relevant remedy where the assignor is also a party to the action. Counsel referred to Treadwell v Hickey [2009] NSWSC 1395 where Barrett J at [98] stated: "[98] The decided cases [citation omitted] thus make it clear that an action commenced by an assignee before the giving of notice to the debtor or other person bound - that is, an action commenced by a mere equitable assignee of a legal chose in action - is not a nullity or liable to be struck out or dismissed out of hand. But such an action will not be an appropriate vehicle for the ultimate recovery of a remedy at law unless and until the assignor who is alone entitled to sue at law is a party. By joining the assignor at a later stage ("in due course", to use Viscount Cave's words), the mere equitable assignee by whom the action was initiated makes that existing action a means of obtaining the common law remedy. The action attains that quality because the joinder ensures that the assignor is privy to the eventual judgment and thereby disabled from afterwards asserting the same cause of action against the defendant. It is because the assignor is a party when judgment is ordered that the possibility of double recovery is forestalled. It is beside the point that the assignor was not a party when the equitable assignee acted alone to initiate the proceedings or at any other time before judgment."
In the present case, the assignors are parties to the proceedings in which the application was made, that is, they are the plaintiffs. Even if that were not the case it would not matter. All that BearingPoint sought was leave to issue a writ of execution as a step along the way to being able to issue a bankruptcy notice (which it has now done). The practice of equity requiring joinder of the assignor was not so rigidly applied by creditors in bankruptcy as a creditor who had a debt whether due at law or in equity was able to apply for a sequestration order: McIntosh v Shashoua at 508 per Starke J (McTiernan J agreeing at 518).

Conclusion

The assignment occurred after judgment was entered in these proceedings. BearingPoint is now seeking to enforce this judgment. Even if the notice of assignment was effective only when served together with the deed of assignment and notice of motion and after the notice of motion was filed this timing does not make the notice of assignment ineffective.
This ground of review fails.

Interests of justice

Even if I am wrong on the grounds of review, the interests of justice do not warrant the Registrar's decision being set aside because Ms Sutton has not been afforded an injustice. She has been aware that she owes the amount set out in the certificates of assessment for some considerable time and has not attempted to pay them so it was necessary for judgment to be entered against her.
The result is that the decision of the Registrar dated 8 September 2015 is affirmed.

Stay of proceedings

Ms Sutton now seeks a stay of the costs judgment under s 135 of the Civil Procedure Act.
Section 135(2)(c) of the Civil Procedure Act relevantly reads: "135 Directions as to enforcement (1) The court may, by order, give directions with respect to the enforcement of its judgments and orders. (2) Without limiting subsection (1), the court may make any of the following orders: … (c) an order prohibiting any other person from taking any further action, either permanently or until a specified day, to enforce a judgment or order of the court, …"
Section 135 of the Civil Procedure Act gives jurisdiction to the Court to make an order that a person not take further action to enforce an order of the Court: see Australian Beverage Distributors Pty Ltd v Evans & Tate Premium Wines Pty Ltd & Anor [2007] NSWCA 57; 69 NSWLR 374, per Beazley JA at [138] (with whom Hodgson and Santow JJA agreed).
The discretion can and should be invoked where the justice of the case requires: see Australian Beverage Distributors Pty Ltd v Evans & Tate Premium Wines Pty Ltd & Anor [2006] NSWSC 560 at [77] at first instance per White J and on appeal, [2007] NSWCA 57, per Beazley JA at [141] to [144]; C2C Investments Pty Limited v Commonwealth Bank of Australia (No 2) [2013] NSWSC 521 per Slattery J at [10] and [11]. An order can be stayed or suspended on the ground of matters occurring after the date it was made: see Permewan Wright Consolidated Pty Limited v Attorney General in and for the State of New South Wales on the relation of Franklins' Stores Pty Ltd (1978) 35 NSWLR 365 per Reynolds JA at 367 and Mahony JA at 374.
The discretion ought to be exercised to reflect the justice of the case. BearingPoint and Ms Sutton are currently litigating in the Industrial Court. The facts of the Industrial Court proceedings are in common with the writ of execution motion and the review motion. Currently, the parties are engaged in conciliation. While there have been substantial discussions between the parties, some further steps are required before any decision can be made on whether or not conciliation is likely to be successful. Unless the proceedings are settled, the final hearing of the Industrial Court proceedings should be heard sometime in May 2016 with an estimated hearing time of about five days.
Counsel for Ms Sutton submitted that in the circumstances of this case, enforcement of the costs judgment should be stayed pending the resolution of the Industrial Court proceedings as it may be that Ms Sutton has a right of set off. It should be noted that BearingPoint delayed in filing its writ of execution motion for about 12 months. Any prejudice to it would therefore be minimal. Counsel for Ms Sutton further submitted that should the enforcement of the costs judgment be stayed pending the resolution of the Industrial Court proceedings, any prejudice caused to BearingPoint would be for a short period, even if it is assumed there may be an appeal from the Industrial Court proceedings.
BearingPoint opposes the granting of a stay of proceedings. BearingPoint's solicitor Ms Rasaiah deposed (Aff, Rasaiah 26/10/2015 p 8) that on 26 October 2015, a company search was conducted in respect of BearingPoint on the US Securities Exchange Commission (SEC) database, EDGAR, and the Orbis company information database. Ms Rasaiah says that she was informed by Martin Shandles, consultant for the Liquidating Trustee of the applicant (John DeGroote) that the recovery of the judgment debt from Ms Sutton is one of a small number (around four or five) of outstanding matters before BearingPoint's Chapter 11 bankruptcy process can be finalised, some of which are on track to resolve before the end of this year (Aff, Rasaiah 26/10/2015 p 8).
Counsel for BearingPoint submitted that the recovery of the debt which is the subject of the costs judgment is one of a small number of outstanding matters before its Chapter 11 bankruptcy process can be finalised. The US Bankruptcy Court initially set an expiration date of 30 December 2015 for the finalisation of that process. On 15 July 2015, that date was extended to 30 December 2018 by the US Bankruptcy Court. Irrespective of the finalisation date of 30 December 2018, BearingPoint says the orderly and proper finalisation of the Chapter 11 process should not be permitted to be delayed or encumbered by the grant of a stay in respect of one of a small number of outstanding matters to be resolved before that process can be brought to an end.
It is my view that BearingPoint should not be locked out from seeking the fruits of the costs judgment until the conclusion of the Industrial Court proceedings. It may be that the judgment will be reserved and an appeal lodged. Hence, I decline to grant a stay of the costs judgment under s 135 of the Civil Procedure Act.

Orders

The orders I make are that the Registrar's decision dated 8 September 2015 is affirmed. So far as costs are concerned, there is no reason why Ms Sutton should not pay BearingPoint's costs before the Registrar, nor why she should not pay BearingPoint's costs occasioned when she withdrew the notice of motion to pay the judgment debt by instalments filed 31 July 2015. The costs orders made by the Registrar are also affirmed.
The defendant's amended notice of motion filed 7 December 2015 is dismissed.
Costs are discretionary. Costs normally follow the event. The defendant is to pay the plaintiff's costs of the notice of motion filed 7 December 2015 on an ordinary basis as agreed or assessed.

The Court orders that: (1) The decision of Registrar Kenna dated 8 September 2015 is affirmed. (2) The defendant's amended notice of motion filed 7 December 2015 is dismissed. (3) The defendant is to pay the plaintiff's costs of the notice of motion filed 7 December 2015 on an ordinary basis as agreed or assessed.

Amendments 22 April 2016 - Coversheet 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: 22 April 2016

(2009) 168 LGERA 260

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