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[2011] NSWSC 1555
Supreme Court of NSW
2011-12-01
Simpson J
Original judgment source is linked above.
Judgment 1By summons filed on 21 April 2011 the plaintiff, identified in the summons as "Dave Lahood Motors" purports to appeal from the decision of a magistrate in the Local Court (given on 25 March 2011), refusing an application by "Dave Lahood Motors" that a judgment against it in favour of the defendant, Telstra Corporation Limited trading as Trading Post, ("Telstra"), of 28 January 2011 be set aside. I have identified the plaintiff as I have because there is considerable confusion revealed in the documentation concerning the correct identification. 2The appeal purports to be brought under s 39 of the Local Court Act 2007, which provides for an appeal limited to questions of law. I will return in due course to the grounds upon which the appeal is said to be based. Because the parties to an appeal under s 39 are given the nomenclature "plaintiff" and "defendant", the same nomenclature as used in the Local Court proceedings, it will be best, to avoid confusion, to refer to the parties by their abbreviated names. As will become apparent, there are various entities associated with the "Dave Lahood" name, and the variations have some significance. At times I will refer to them as "the Lahood interests" or "the Lahood entities". 3The appeal was heard on 1 December 2011. The evidence in the appeal consisted of affidavits sworn by Mr David Lahood on 1 June 2011 and Francis Laurence Levy, affirmed on 2 June 2011 (both asserted that they were filed on behalf Dave Lahood Motors; and an affidavit of Angela Coombs, sworn 21 June 2011, to which was exhibited a considerable bulk of documentary material, including various documents filed in the Local Court, and documentary material that was before the magistrate who made the decision under appeal. The documentary material included evidentiary statements of a Mr Will White, and a Ms Mary Hohns, both employees of Telstra, to which were attached various business records of Telstra.
Background 4The proceedings have a rather long and troubled history. In written submissions filed on behalf of Telstra, a chronology of events, which was expressly agreed to be accurate, was set out. In the following account I draw on that chronology. 5Telstra trades as "the Trading Post", a magazine or newspaper that carries advertisements for the sale of goods. Mr David Lahood ("Mr Lahood") is the proprietor of a company, Dave Lahood Pty Ltd, (and, it seems, perhaps other entities associated with the name) that, I glean, trades in used motor vehicles. On 27 November 2007, on behalf of Dave Lahood Motors, Mr Lahood signed a form of contract for the placement of advertisements in the Trading Post. The contract form made provision for insertion of "Customer Details". This was completed (I infer by Mr Lahood) by inserting "Dave Lahood" as "Business Name"; "Dave Lahood Motors" as the trading name, and recording as the Australian Business Number ("ABN") 30079981838. 6On 1 May 2008, a second contract of the same kind was signed by Mr. Lahood. This contract form showed "Dave Lahood Motors" as the business name, and left the space for the trading name blank. The same ABN was inserted in the appropriate space. 7A third form of contract, which is undated, was also signed (according to the evidence about 1 July 2008). This showed "David Lahood Motors" as the business name, and as the trading name. The same ABN was again given. 8Pursuant to the contracts, Telstra ran a series of advertisements for "Dave Lahood Motors". It ceased doing so in June 2009, when Dave Lahood Motors defaulted in the payment its invoices. 9On 24 December 2009, Telstra filed in the Local Court a statement of claim, naming "Dave Lahood Motors ACN 079 981 838" as defendant. In the statement of claim Telstra claimed from the defendant the sum of $33,797.19, made up of a sum of $31,569.30, for "advertising fees incurred during the months of 12/08 - 06/09 in the amount of $31,569.30 ", (bold in original) together with interest. The statement of claim was served on Dave Lahood Motors on 9 January 2010. 10No defence was filed to the statement of claim and, on 4 February 2010, default judgment was entered against "David Lahood Motors ACN 079981838". 11On 23 April 2010 a handwritten notice of motion was filed. It purported to be filed "for the defendant David Lahood." It sought an order that the default judgment be set aside and that enforcement of the judgment be stayed pending determination of that application. It was common ground that this was prepared and signed by Mr Lahood. The notice of motion was supported by a handwritten affidavit also apparently in a common form prepared document, with space for the insertions of relevant information, also written and signed by Mr Lahood. (In the extracts from the documentation that follow, I have attempted to reproduce the spelling and punctuation of the original.) In the affidavit, Mr Lahood deposed: "I am the judgment debtor and applicant." (This was part of the printed material in the affidavit's form.) 12Mr Lahood then deposed that the reason a defence had not been filed by the requisite time was: "Because nothing was received. Also no response From the correspondence." 13He deposed that he had a valid defence: "Because I consistantly told the Rep From trading Not to Run the same Ads in the paper. No one is lookin AT IT Anymore & That why there is No trading post Anymore. paper print is FINNISED." In a space providing for an explanation for the application for stay of "proceedings", he wrote: "My consistancy IN Repeating my self to Rep From trading post Not to appear my Ads in the paper & ignored me & placed them IN without my permission." There was more in the affidavit, but it is not necessary extract it in these reasons. 14On 4 June 2010 a registrar of the Local Court dealt with the application. It may be that this was done in chambers - it is not clear from the evidence. In any event, the registrar refused the application and ordered "the defendant" to pay costs. 15On the same day (4 June 2010) Mr Lahood filed a further notice of motion seeking review of the registrar's decision. He identified as "person seeking orders" "Dave Lahood Mtr". In an affidavit in support of that application, he wrote: "My Reasons For Reviewing The Registra Decision That I am NOT HAPPY & SATISFIED with the Decision of the Registra Because I know & Realise the signiture on the contracts are NOT my signiture and I also put IT IN writing to Rep of the trading post to stop my Ads and verbily told Rep Consistently to stop my Ads & keep Repeating them so I would like A Judge Decision." The claim that the signature on the contracts was not that of Mr Lahood is of some significance. 16On 9 July 2010, Magistrate Marsden set aside the registrar's decision, saying that he was not satisfied that the statement of claim had been served on the defendant. Whether this was done in chambers or in open court is not apparent. Magistrate Marsden allowed the defendant 21 days in which to file and serve a defence. 17On 27 July 2010 a proposed defence was served on Telstra. It was also handwritten, and plainly prepared by Mr Lahood. He set out his proposed defence as follows: "1. cancelled & stop Ads with the Representive of trading IN writing GAVE TO MARIANOS. 2. Also signiture is NOT mine on the contract & sent Details to rong Address". 18On 20 August 2010 an order was made in the Local Court that the matter (that is the statement of claim) be listed for hearing on 24 February 2011, and directed that witness statements be served on or before 24 January. It listed the matter "for review" on 28 January 2011. On 25 January 2011 Telstra served its evidence on the defendant. Neither Mr Lahood, nor Dave Lahood Motors filed or served any evidence. 19On 28 January 2011 neither Mr Lahood nor David Lahood Motors appeared, either in person or by legal representative. Magistrate Betts struck out the defence and entered judgment in favour of Telstra. She ordered costs in favour of Telstra. 20On 2 March 2011 a notice of motion was filed seeking orders that the judgment of 28 January be set aside and that "the defendant" file a defence within 14 days. This notice of motion was filed in the name of "Dave Lahood Motors (ACN 079 981 838)" by Francis Laurence Levy, of Forbes-Smith and Company, solicitors. An affidavit sworn by Mr Lahood was filed in support of this notice of motion. Mr Lahood that the reason he had not been represented on 28 January was that Mr Levy had not made a diary note of the date and, in any event, had another commitment on that date. He deposed that he had a defence on the merits, to the following effect: " ... I say that at least one (1) of the signatures on the copy Agreements and Contracts with the First Plaintiff company, purporting to be my signature, is not my signature. I also dispute the amount owing to the First Plaintiff, firstly, because I have been unable to verify the balance of $15,999.30 ... On my records, being cheque stubbs and Bank Statements, I have paid to the First Plaintiff, the sum of $40,939.00. ... 5. I also dispute the number of occasions for the advertisement in the TRADING POST, of certain vehicles, as I did not request or agree to many repetitions of advertisements for the same vehicle. Those repetitions were, I believe, directed by MARIANO MASSA , an employee of the First Plaintiff, without my authority. 6. On several occasions, I requested the said MARIANO MASSA , to cancel my contract with the TRADING POST, as the advertisements were not, as far as I could judge, producing any results. These requests were made after December 2008 , when I spoke to the said MARIANO MASSA , when he came, almost fortnightly, to my Car Yard and made a written request to the First Plaintiff, for that cancellation, by a letter dated early 2009 , a copy of which I do not hold ..." (bold in original) 21The application came before Magistrate Marsden on 18 March 2011. Whether any oral evidence was taken on this occasion is not apparent from the materials filed in the appeal. No transcript of the proceedings of that day was in evidence. His Honour adjourned the motion to 25 March 2011, apparently for the purpose of delivering judgment. He delivered judgment orally on that day. 22Magistrate Marsden reviewed the evidence that had been placed before him. Ultimately, he concluded that Mr Lahood had failed to establish that he had a bona fide defence to Telstra's claim. The transcript records that he then said: "Having reviewed all of those matters it would seem to me that I, not seem to me [,] I do now come to a different conclusion which I came to on the last occasion that the defendant might have an arguable defence [.] [T]o have an arguable defence it, in my view at least has to be a bona fide defence, that is it is certainly arguable on the material, on the allegation or submission made by the defendant, that is that he never, if one accepted that he did not order the adverts and that they were done without his consent there would be an arguable defence and there must be some evidence which the Court could accept as supporting such a proposition ..." He plainly rejected Mr Lahood's various asserts, and said: " ... [t]he conclusion that I have reached is that this is no more than an attempt by Mr Lahood to avoid payment of a debt which was lawfully due to the plaintiff." 23It seems to me that the first passage extracted ought to be read as meaning that, although the previous week Magistrate Marsden had come to the view that the defendant had an arguable defence, on reflection he considered that a defence was not arguable if not bona fide . He further concluded that the defendant did not have a bona fide defence. That was, inter alia , because he found it impossible to accept the factual basis of the defence advanced by Mr Lahood. This was largely because of the various changes in the position Mr Lahood had adopted, and implausibility in other aspects in what he had from time to time put to the court. By way of example, he referred to different positions adopted by Mr Lahood as to whether the signatures on the contracts were his. In the affidavit of 4 June 2010, Mr Lahood said that the signature on the contracts (that is, all three contracts) was not his; in the affidavit of 2 March 2011, he merely said that "at least one" of the signatures (without identifying which) was not his. Further, Magistrate Marsden found inconsistency in the affidavit of 2 March 2011, in which Mr Lahood said that he had, on 13 January 2011, instructed Mr Levy, and other evidence, indicating that Mr Levy had been involved from as early as 2 or 3 December 2010. A further matter on which Magistrate Marsden found implausibility was Mr Lahood's evidence that he had made a written request for the cessation of the advertisements, but was unable to produce a copy of that written request. This was in contrast to business records of Telstra, which contained no reference to any such correspondence. 24In the light of these implausibilities, Magistrate Marsden concluded that the defendant did not have an arguable defence on the merits. For that reason, he decided to refuse the application. 25He then made reference to something which had apparently occurred the previous week. He said that on the day: " ... the matter was adjourned because at the eleventh hour [Telstra] raised the issue of seeking to amend the name of the plaintiff [sic - defendant] so that it in fact reads Dave Lahood Pty Limited as opposed to Dave Lahood Motors." 26He noted that Mr Levy had opposed that course, but concluded that the application to amend the name of the defendant ought to be granted. He therefore granted leave to Telstra to substitute for "Dave Lahood Motors" as defendant, the name "Dave Lahood Pty Ltd".
The summons commencing appeal 27The summons in this Court identifies four grounds of appeal. They are expressed as: "1. That his Honour, the learned Magistrate MARSDEN, erred in law in his application of the decision of East West Airlines Limited v Turner [2010] NSWCA 53 to the case with the incorrect name of the plaintiff. 2. That His Honour erred in not finding the Plaintiff had a Defence or [sic - on] its merits which had to be tried. 3. That his Honour erred in not setting aside the Judgment of the Court made on 28 January 2011 . 4. That His Honour erred in not allowing the Plaintiff to be heard and to dispute the evidence of the Defendant." Ground 1 28In written submissions, some propositions were directed to this ground. It was submitted that his Honour was in error in his interpretation of the case identified in the grounds. Although other propositions were put, these were entirely factual, and no error of law was specified. 29In oral submissions, a different approach was taken. Mr Levy put this submission: " Your Honour, what we say is that the plaintiff in this court [Dave Lahood Motors] had proceeded on the basis that it wasn't a correct party that had been sued by the defendant in these proceedings [Telstra]." 30In my opinion, that is a palpably wrong statement of fact. It is perfectly apparent that, throughout the proceedings to which I have referred in detail above, no issue was taken by or on behalf of the Lahood interests about the nomination of the defendant until the event referred to in the hearing of 18 March. Mr Levy conceded that there was no evidence that the Lahood interests had in any way been disadvantaged or prejudiced in an evidentiary sense. 31In answer to a question, Mr Levy expressly disclaimed any error of law in the granting, by Magistrate Marsden, of leave to make the amendment to the name of the defendant. 32In the circumstances I am unable to find that any error of law attended the granting of leave to make the amendment. I reject ground 1 of the summons. It is unnecessary to refer to the decision mentioned in Ground 1. Grounds 2 - 4 33Once again, no error of law was identified either in the grounds as pleaded, or in the written submissions or the oral submissions. The only argument was directed towards factual matters. 34For that reason alone, those grounds of appeal must be rejected. 35In written submissions, counsel for Telstra referred to the decision of the Court of Appeal in Adams v Kennick Trading (International) Ltd (1986) 4 NSWLR 503. In that case, Hope JA referred to earlier authority ( Simpson v Alexander (1926) 26 SR(NSW) 296 at 301; 43 WN 76 at 78) to the effect that, in considering an application to set aside a default judgment, a court should avoid trespassing on issues of fact that would, if the judgment were set aside, be matters of factual dispute in the trial. That did not impinge, Hope JA said, on the entitlement of the court to consider matters of credit going to the bona fides of the party seeking the order. That, in fact, is precisely what Magistrate Marsden did. He found that the various inconsistencies were such as to call for rejection of the bona fides of the defence sought to be raised by Mr Lahood or whichever of the Lahood entities was, at the time, named as the defendant. This was an entirely proper approach on the part of Magistrate Marsden. 36I pause to mention only one other matter. Counsel for Telstra pointed out that, in his affidavit of 1 June 2011 filed in this Court, Mr Lahood yet again changed his position in respect of the signature appearing on the contracts. He said: "However, after closely examining the documents, I confirm that it is my signature appearing on the above documents." 37While I can understand the desire of counsel to rely upon this passage, it is not available to him in the question of whether error of law has been shown in the judgment under appeal. Conceivably, it might be relevant if I were to find error of law, and were considering any discretionary aspects of the consequences of such a finding. However, since I found no error of law, that is irrelevant. 38The orders I make are:
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: 14 December 2011
Dave Lahood Motors
Telstra Corporation Limited trading as Trading Post
(1986) 4 NSWLR 503