Chris (Krste) Saravinovski v George Saravinovski

EX TEMPORE Judgment 1HIS HONOUR: The cross-claimant (to whom I shall refer without disrespect as George) brings his cross-claim against his father, the cross-defendant (to whom I shall refer without disrespect as Chris). 2By a notice of motion filed in Court by leave today, and made returnable instanter, George applies pursuant to UCPR Part 22 Rule 22.1 for an order that Chris answer certain interrogatories in relation to George's cross-claim. Chris, for whom Ms Cheeseman of Senior Counsel appeared with Ms English of Counsel, opposed the application. 3The proposed interrogatories are: (1)What cash reserves did you hold legally or beneficially as at 15 September 2014 in any bank account or otherwise in Australia or elsewhere? (2)What real property do you own legally or beneficially solely or with others? (3)What shares do you own legally or beneficially solely or with others? (4)What is the income earned or received by you in the year ending 30 June 2014? (5)What money have you lent that has not been repaid as at 15 September 2014? (6)Who occupies the real estate you currently own or control? (7)What rent or licence fees do you receive from the occupants of any property you control? 4The critical provision of the rules which I must bear in mind is UCPR Part 22 Rule 22.1(4) which provides that: In any case, such an order [for interrogatories to be answered] is not to be made unless the court is satisfied that the order is necessary at the time it is made. 5Furthermore, the Court's discretion must be exercised to give effect to the overriding purpose of the "just, cheap and quick resolution of the real issues in the proceedings" (Civil Procedure Act 2005 (NSW), s 56(2)). 6The authorities suggest that the word "necessary" in Rule 22.1(4) is to be understood in the sense of being reasonably necessary for disposing fairly of the cause or matter or otherwise be in the interests of ensuring a fair trial. 7What is necessary must be determined by reference to the pleadings. Putting the matter broadly, George's cross-claim alleges that his father represented to him (George) from an early stage of his life that if he paid the whole of his income to his father and otherwise acted in what is referred to in the cross-claim as "Macedonian tradition", George "would benefit from the family assets". 8George alleges that between about 1972 and 1999 he did in fact give his net earnings to his father and that his father "took, used and invested and accumulated assets on his and his family's behalf". That process apparently came to an end in mid 2009 when relations broke down between George and his father. 9George's cross-claim then goes on to refer to a number of properties which were acquired between 1966 and 1998 (including by a company registered by Chris). 10It is further alleged that Chris had the benefit of rents collected from those various properties. 11Again putting the matter in very broad terms, George submits that in the circumstances pleaded in his cross-claim he is entitled by way of constructive trust to an interest in those properties and their income, at least as to a proportion not presently specified but presumably in some way reflecting the benefit which George will submit at trial was conferred upon Chris by having the use of George's funds. 12George's cross-claim also includes a claim expressed to be a further and alternative claim which seeks to raise an estoppel against Chris to the effect that Chris is estopped from denying George's interest in what is defined as the "greater share" of Chris' property. That greater share is particularised by reference to two specific properties and "... such other sum that is just and equitable in the circumstances as determined by the court following the taking of accounts". 13In considering George's application for an order that Chris answer the interrogatories set out above, two matters are especially important in determining whether those interrogatories are necessary in the sense required by the rules. 14First, there is the chronology of events set out in the pleadings. While the proposed interrogatories are directed to matters as they stand today, that chronology identifies a number of properties purchased during a specific period which appears to have ended in 2009. It is also in 2009 that George says that Chris ceased to have control of George's funds. In noting those dates, I do not overlook George's submission that insofar as benefits in the form of rent and otherwise continued to be received by Chris from properties referred to in the cross-claim, it may be that George's claim extends to an interest in those rents after 2009. Even allowing that to be so, it does not affect the decision which I have to make in relation to the application for an order for interrogatories. 15The second matter of importance is the indication which the Court has consistently given during the case management of these proceedings that if George demonstrates a case for accounts as being appropriate as part or all of the relief to which he may ultimately be entitled, that accounting will not be undertaken by the Court but will be referred out. In other words, in approaching the present application for an order for interrogatories, I bear in mind that a more detailed examination of how money received by Chris from George (if that is able to be demonstrated) was applied may be necessary at the stage of accounting, but is unnecessary for the purposes of addressing what I shall loosely refer to as the question of liability. 16Bearing those two matters in mind, it is instructive also to consider the proposed interrogatories against the forms of relief sought. 17Prayer 1 in the cross-claim is for: "an order that the cross-defendant accounts to the cross-claimant for the money paid to the cross-defendant by the cross-claimant between 1972 and 2009." 18None of the matters the subject of the proposed interrogatories will advance George's case for relief in relation to prayer 1. 19Prayer 2 in the cross-claim is for a declaration: "that the cross-defendant holds property on trust for the cross-claimant in such shares as the court thinks fit." 20When it is recognised that the property the subject of the proceedings is the property set out in the cross-claim and acquired in the period to which I have referred (see paragraph [14] above), it does not seem to me that any of the matters the subject of the proposed interrogatories will be necessary for George's case in support of prayer 2. 21What follows in the relief claimed in the cross-claim essentially depends upon George making out an entitlement to the order and the declaration to which I have just referred. It is not necessary for me to go through the balance of the relief sought in the cross-claim, other than to observe again that part of the armoury of relief sought to be invoked is for the taking of accounts. 22Testing the matter against the principal forms of relief sought in the cross-claim satisfies me that, to adopt the language used by Mr Carney of Counsel for George, understanding the "size of the pool" as it stands at the moment (which I interpolate would be the result of answers to the proposed interrogatories) is not necessary at this time for the determination of the proceedings as I currently understand the issues. It may be that upon an accounting some of the matters which are sought to be interrogated upon will be relevant. However, that is a matter that can be determined when the Court has reached a view as to whether or not George has made out his fundamental claim that he has some form of equitable interest in the properties and the income from the properties which are specifically referred to in the cross-claim. 23For these reasons I am not satisfied that the proposed interrogatories are necessary at this time in the course of these proceedings. It follows that Rule 22.1(4) precludes the making of an order for the proposed interrogatories to be answered. 24Chris seeks his costs of today, the motion only having been filed in Court today. 25It is submitted by Mr Carney on behalf of George that the Court has really only postponed the question of interrogatories until a later date so that the costs of today should be costs in the cause. That characterisation of what has occurred is not correct. Even if Mr Carney is right and the question of interrogatories is considered again at a later date, the question for today was whether the proposed interrogatories were necessary at the time the proposed order was sought, namely today. 26George has failed to satisfy me that they are necessary today. I will order that George's notice of motion be dismissed and that George pay Chris' costs of today.