Variation of Order 3 in the Short Minutes of 8 March 2011
9Mr Sneddon put the application for variation of order 3 on four bases:
(1)In reliance on part 36.16(3) of the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR") which relevantly states:
(3) In addition to its powers under subrules (1) and (2), the court may set aside or vary any judgment or order except so far as it:
(a) determines any claim for relief, or determines any question (whether of fact or law or both) arising on any claim for relief, or
(b) dismisses proceedings, or dismisses proceedings so far as concerns the whole or any part of any claim for relief.
(2)In reliance on the "liberty to apply" provision in the orders made on 8 March 2011.
(3)In reliance on the inherent power of the Court as reflected in s 23 of the Supreme Court Act 1970 (NSW) which provides:
The Court shall have all jurisdiction which may be necessary for the administration of justice in New South Wales.
(4)The slip rule (see part 36.17 of the UCPR).
10In relation to part 36.16(3) Mr Sneddon contended that:
(1)Rule 36.16(3) permits the Court to vary any judgment tor order provided that it does not fall into the category of (3)(a) or (b).
(2)Rule 36.16(3) is not restricted by a time for application as is rule 36.16(1) (see (3A) and as is (3B).
(3)That the order in respect of which variation is sought does not determine the claim for relief or determine any question arising on any claim for relief.
11In relation to the "liberty to apply" provision, Mr Sneddon relies on what was said by Campbell JA (with whom Tobias JA agreed) in Australian Hardboards Ltd v Hudson Investment Group (2007) 70 NSWLR 201 at [50] that:
[50] When final relief has been granted in a suit, an order granting liberty to apply enables further orders to be made which are necessary for the purpose of implementing and giving effect to the principal relief already pronounced or, as it is sometimes called, "working out the order": Poisson and Woods v Robertson and Turvey (1902) 50 WR 260 at 261; Cristel v Cristel [1951] 2 KB 725 at 729 and 730; Nicholson v Nicholson [1974] 2 NSWLR 59 at 63; Hurstville City Council v Renaldo Plus3 Pty Ltd [2006] NSWCA 248at [97]. The manner of invoking liberty to apply is by a substantive motion on notice: Clark Equipment Credit of Australia Ltd v Como Factors Pty Ltd (1988) 14 NSWLR 552 at 559; Kraft v Kupferwasser(1991) 23 NSWLR 236 at 244.
...
[58] There is no difficulty about exercising a liberty to apply for the purpose of dealing with facts that have arisen only since the original order was made. Mahoney JA, in Wentworth v Woollahra Municipal Council (unreported, NSWCA, 31 March 1983) at 5 expressly so recognised, saying:
In some cases, orders have been made which alter the effect of an existing order because of facts which were not before the court which made the original order. It may be that such a supplemental order can be made because of facts which had occurred before the making of the original order but were not brought to the court's attention: see in Re Scowby; Scowby v Scowby [1897] 1 Ch 741. It has been held that supplemental orders can be made because of facts occurring after the making of the original order: Bailey v Marinoff 125 CLR at p 540, per Gibbs J; see also Ford-Hunt v Raghbir Singh(1973) 1 WLR 738; Northern Counties Securities Ltd v Jackson & Steeple Ltd (1974) 1 WLR 1133 at 1138; cf Easton v Brown (1981) 3 All ER 278 at 284(e). This jurisdiction has been long recognised in the practice books: Seton on Judgments and Orders (1912) p 126, 816; Daniell's Chancery Practice (8th edition) p 710, 1139. See also the Annual Practice (1982), Notes to Order 20, r 11/5; Halsbury's Laws of England 4th Edition, Volume 37, par 329(n). There has been no finally authoritative examination of the nature of the supplemental orders which can be made.
[59] One example is that it is possible for an order for specific performance to be discharged by the court, by reason of events occurring after the order was made: JAG Investment Pty Ltd v Strati [1981] 2 NSWLR 600 at 603-604 per Hope JA. Melliday v McMahon (para [57] above) provides another example of the principle that events after the original order can be the subject of an application made on liberty to apply. In accordance with that principle, in a situation where it had been declared that a particular mortgage document ought be rectified to include land other than that stated on its face, and there had been an order for a particular conveyancing procedure to be carried out to enable the mortgagee to obtain rights in accordance with the mortgage as rectified, and it then eventuated that that conveyancing procedure was not able to be carried out, it was held to be within the scope of liberty to apply for the court to order a different means by which the mortgagee can obtain rights in accordance with the mortgage as rectified: Kyabram Property Investments Pty Ltd v Murray [2006] NSWSC 54. In the extracts from Riltang and Fylas quoted at [53] and [54] above, the various types of remedy that White J and McPherson SPJ listed as being obtainable under liberty to apply would frequently involve, in a way crucial to the availability of the remedy, proof of facts that had arisen since the making of the original order.
12Mr Sneddon submitted that in this case what has occurred is that Mr Ajaka and Fishy Bite have failed to comply with the orders made and that their failure to comply is a fact occurring after the date of the order and is analogous to the failure of a defendant to comply with an order for specific performance.
13In relation to the inherent power point Mr Sneddon relies on the statement of principle of the Court of Appeal in Newmont Yandal Operations Pty Ltd v The J Aron Corporation and the Goldman Sachs Group Inc and Others (2007) 70 NSWLR 411 ("Newmont") in which Spigelman CJ (with whom Santow JA and Handley AJA concurred) said concerning the inherent power of the court:
[20] As Morris LJ put it in Thynne v Thynne [1955] 3 WLR 465 at 489:
"In addition to powers resulting from rules of court, it is clear that there are
necessary powers which are inherent in the jurisdiction of the court. It would, I
think, be undesirable to limit the scope of these powers as a result of any words
which describe them. I respectfully agree with what was indicated by Evershed LJ in Meier v Meier [1948] P 89 at 95 when he said: 'I prefer not to attempt a definition of the extent of the court's inherent jurisdiction to vary, modify or extend its own orders if, in its view, the purposes of justice require that it should do so'."
...
The inherent jurisdiction
[67] It is well established that the inherent jurisdiction is not at large, but it is not capable of being confined to defined categories. (See Tringali v Stewardson Stubbs & Collett Pty Ltd [1966] 1 NSWR 354 at 361; Reid v Howard (1995) 184 CLR 1 at 16). It is also well established that the jurisdiction may be exercised after orders have been perfected.
[68] The inherent jurisdiction is closely related to s 23 of the Supreme Court Act 1970, which confers "all jurisdiction which may be necessary for the administration of justice in New South Wales". (See Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 617-618.) Both sources of jurisdiction may be exercised when necessary for the administration of justice: Reid v
Howard (at 17).
[69] As McLelland J said of the exercise of both the inherent power and s 23 in Dwyer v National Companies & Securities Commission (1988) 15 NSWLR 285 at 287: "Since it rests on necessity for the purpose of preventing injustice, the extent of the power is commensurate with the requirements of the
necessity which calls it into existence".
[70] Where it is suggested, as it is in this case, that the effect sought to be given to an order of the court is directly contrary to the court's intention, the test of necessity may extend to protecting the integrity of the administration of justice and/or to maintaining public confidence in the administration of justice.
14In reference to the slip rule, Mr Sneddon again relied on Newmont: see [116]-[117].
15Mr Michos attacked all four grounds making the following points:
(1)Rule 3.16.3 is subject to a time limit as a matter of construction
(2)The Court made final orders on 11 March 2011 following a full contested hearing and an unsuccessful appeal process launched by Mrs Raulfs in which there was no change to the form of orders made and which are the subject of a res judicata.
(3)There is no inherent power to vary orders - the UCPR is a comprehensive code as it were and if the rules do not permit variation there is no jurisdiction or scope for variation.
(4)There is no uncertainty or error in the order made - the parties, with benefit of the advice of senior and junior counsel and solicitors, agreed on the form of orders to be put in place and the mere fact that Mr Ajaka and Fishy Bite have no money is not a reason to vary the orders. The plaintiff may understandably be disappointed but disappointment is not a ground for variation.
(5)That it was necessary for the Receiver to make the application for a change in the order - referring to UCPR 39.49(1) which provides:
39.49 Enforcement by or against non-party (cf SCR Part 42, rule 10)
(1) If, in any proceedings, a person who is not a party obtains an order, or an order is made in favour of a person who is not a party, that person may enforce the order as if that person were a party.
(6)An admittedly small amount of money, $50, has been paid in total to establish the bank account required to be established in accordance with order 3.
(7)There has been a very long delay between making of the orders and the applications.
(8)Some of Mr Michos submissions and the cases cited addressed UCPR provisions on which the plaintiff was not relying: for example UCPR 36.15 and s 63 of the Supreme Court Act 1970 (NSW).
16I do not accept that there is a time limit on applications to vary orders made that fall within rule 36.16(3) but are not caught by subparagraphs (a) and (b). I do not accept that the Court's inherent power was removed by the UCPR. Rule 36.16(4) makes it clear that it was not and the decision Newmont is inconsistent with such a proposition. It is true that there has been a considerable delay since the orders were made. Some of that delay is attributable to the appeal process and some to the attempts to force Mr Ajaka to explain the failure to comply with the orders. Even though the delay is not wholly attributable to the factors I have mentioned, I do not think it is sufficient as a matter of discretion to preclude variation of the orders if otherwise appropriate.
17I accept that the inherent power to vary judgments and orders is very limited and that it cannot be used to reopen a case to alter the substantive conclusions reached: see Gamser v the Nominal Defendant (1977) 136 CLR 145; Romeo v Paralie [2012] NSWCA 221 Sackville AJA with whom Basten J and Campbell JJA concurred and see Dimitrovski v Australian Executor Trustee Limited [2013] NSWSC 337 at [13].
18I do not think however that altering the requirement that payment be made to the Receiver involves any reopening of the case or a change to the substantive decision reached or involves any inconsistency by virtue of the rejection of the appeal and refusal of special leave. It is precisely what I said in my reasons for judgement at [95] should occur - the parties for their own reason chose the different mode of implementation. In my view the change is one of machinery as to how the substantive conclusion reached, namely that Fishy Bite and Mr Ajaka had to repay $400K plus interest to the partnership, is effected. I regard the solicitors' joint account as the agreed conduit for the receipt by the partnership of the monies required to be paid. Mr Ajaka and Fishy Bite have not complied with those orders and they are ineffective to achieve the result which was intended. Cases such as Newmont and Australian Hardboards and Commonwealth v McCormack (1984) 155 CLR 273 make it clear that there are circumstances in which a court may vary a judgment.
19I do not accept that the Receiver has to be the moving party for the variation of orders. The Receiver, although appointed by the Court, was not made a party to the proceedings and did not need to be a party. It is Mrs Raulfs who seeks to protect the funds of her, albeit limited, success in the litigation and who has a significant interest in doing so UCPR. part 39.49 permits a person in whose favour an order is made who is not a party to "enforce" the order as if that person were a party.
20I accept Mr Sneddon's submission that it cannot have been intended that in the absence of payment by Mr Ajaka and Fishy Bite as required by with the Court's order there could be no enforcement of that order by anyone which is inherent in Mr Michos' submissions. I regard the payment of $50 as merely the cost of establishment of the account and an insufficient basis to preclude variation. To avoid any doubt however I will deduct $50 from the amount that is calculated to otherwise be due in respect of the order. In my view, Mrs Raulfs is entitled to protect the fruits of her success in the litigation by empowering the Receiver to pursue Mr Ajaka and Fishy Bite.
21I think that part 36 rule 16(3) and the inherent power both provides a basis for the variation sought and I do not need to consider whether the other two bases advanced provide support.