Consideration
25In order to succeed under UCPR 36.15(1), the second defendant must satisfy the onus enshrined in the words "on sufficient cause being shown". As Bryson JA held in Kendell v Carnegie [2006] NSWCA 302; (2006) 68 NSWLR 193 at [45], "sufficient cause" recognised "the need for finality in protecting judgments from being set aside for slight or uncertain causes".
26In my opinion the second defendant has not shown or established the existence of a sufficient cause for the purposes of the rule. Her affidavits are directed to the possible existence of some defence to the claim or a cross-claim in cognate terms. The affidavits not only do not address the issues of impropriety, illegality or absence of good faith, but in contrast they contain no material at all from which any supportable contention in aid of the second defendant's application could be drawn.
27Indeed, as the plaintiff emphasises, the position is to the contrary. The second defendant was represented by a solicitor before the 2005 orders were made. Her solicitor signed them. The defendants were given back possession of the property when they borrowed and paid $180,000. The second defendant signed the 2006 orders, even if she cannot now recall doing so. She knew what the monthly repayments were and played an active and practical role in making them. None of this material assists the second defendant in establishing that the 2005 or 2006 orders are vulnerable in any way to attack.
28In Coles v Burke (1987) 10 NSWLR 429 at 437, Kirby P said this:
"The genus which is involved in the phrase "irregularly, illegally or against good faith" appears to me to be misconduct or dishonourable conduct of the person who procured the judgment which it is suggested undermines the authority of that judgment warranting the exceptional course for which r 12A provides. Here, there was no such lack of good faith on the part of the claimants. The signing of the judgment was made in accordance with the authority of the order earlier consented to and after a warning had been given by the letter to which I have referred. It is perhaps undesirable, in the modern practice of the legal profession (where much give and take is required) that judgment should be signed in this way without a final telephone call or other warning. However, the failure to give such a final and further warning could not, on any view, amount to a lack of good faith."
29In AVS Australian Venue Security Services Pty Ltd v Criminale [2006] NSWCA 368, Basten JA dealt with the notions of irregularity and illegally at [35] and [71] as follows:
"[35] There is no need to rely upon an implied statutory power to discharge an order made, if it can be said that the order has been entered "irregularly, illegally or against good faith". As noted above, in Coles Kirby P suggested that such language might invoke misconduct or dishonourable conduct on the part of the person who procured the judgment, although he did not specify whether that was necessarily a party or could be a solicitor. However, it would appear that his Honour was dealing with the phrase "against good faith" in the circumstances of that case, and was not seeking to impose a general limitation inconsistent with the source of the statutory language relied upon by the Appellant in this case, namely Anlaby v Praetorius: see Roach v B & W Steel Pty Ltd (1991) 23 NSWLR 110 at 114D, and Smith v Budandan Enterprises (2002) 55 NSWLR 367 at [60]-[67].
...
[71] For reasons noted at [35] above, that authority does not preclude the words 'irregularly' or 'illegally' embracing conduct which was in contravention of the rules, but which did not involve misconduct or dishonourable conduct. Nevertheless, the defendant must fail because there was no irregularity, illegality, contravention of rules or non-compliance with rules, in the conduct undertaken on behalf of the plaintiff. Her Honour's conclusion that the plaintiff was "punctilious in taking every possible step to ensure that the defendant was aware of the proceedings and the progress of the proceedings" (Judgment, p 21) should, with one qualification which her Honour noted, be upheld. The qualification relates to the fact that the directions given by the registrar on 11 September 2002 were notified in a standard, and unamended form. As her Honour correctly found, the plaintiff's solicitor "must be taken to have had knowledge of those orders, and could not seek refuge behind an inexperienced clerk's failures to appreciate that he should have brought the amended orders to the attention of the solicitor": Judgment, p 20. However, as already noted, the amendments, so far as they were relevant for present purposes, were immaterial. There was no shred of evidence that the defendant misunderstood the orders (or even that Mr Taylor on its behalf was concerned to note the orders). No steps were taken, or not taken, because of the failure to note the amendments. Different changes to the standard form of orders, or different circumstances, might give rise to a different conclusion. In the present case, the omissions were clerical errors. They could not, on any view, give rise to an allegation of conduct 'against good faith'."
30In Kendell at [52] and [53] Basten JA also said this:
"[52] In my respectful opinion Fitzgerald JA's observations show clearly that the reference in Roach to its being contrary to good faith to attempt to retain the benefit of an order if it had been obtained contrary to a promise or representation binding on the client was not the real basis for decision, and was not an exposition of the reference to "against good faith" in r.12A. The reference in Roach v B&W Steel to unconscionability in later relying on a judgment which had been entered up as a result of a mistake is not in my respectful opinion authorised by the terms of r.12A, which relates good faith to the circumstance in which the judgment was given, and does not extend to lack of good faith in reliance on the judgment at some later time.
[53] In Smith v Budandan Enterprises [2002] 55 NSWLR 367 at 374 [60] to 375 [67] M.W. Campbell AJA (with whom Mason P. and Beazley JA agreed) considered the effect of Roach v B&W Steel on observations in Coles v Burke and said (at 375[67]: "In my view Roach makes it clear that the ground of irregularity referred to in Pt.31 r.12A can be made out without misconduct or dishonourable conduct being established." In my respectful view this observation should be understood with the benefit of Fitzgerald JA's observations in Shirriff v The Nominal Defendant, to which the Court of Appeal was not referred in Smith v Bundanan Enterprises. The observations of MW Campbell AJA at [63] do not, if correctly understood, give approval to the reference in Roach to retaining the benefit of an order innocently obtained. The force of the words "against good faith" in their context in r.12A was well expressed in Coles v Burke by Kirby P."
31The second defendant has conspicuously failed to approach the satisfaction of any formulation of the requirements of the relevant rule.
32The second defendant also sought to rely upon UCPR 36.16(2)(c). I was referred in particular to a discussion of that rule undertaken by Adamson J in Provident Capital Ltd v Norton [2012] NSWSC 17 at [43] - [48]. From my position the second defendant's reliance upon that rule appeared to be faint. That is not surprising. There are no facts in this case that could bring the second defendant within the operation of the rule. The rule does not apply to the second defendant and it cannot assist her in the present application.
33Finally, the second defendant sought to invoke the inherent jurisdiction of the Court. The Court has relevantly an inherent jurisdiction to set aside a default or irregularly obtained judgment. I was referred in particular to a brief consideration of that jurisdiction by Rothman J in First Mortgage Managed Investments Ltd v Oberlechner [2006] NSWSC 1397 at [40] - [43]. It was not suggested, and I would find it difficult to accept, that any consideration of the second defendant's application relying upon an exercise of the Court's inherent jurisdiction would proceed upon any relevantly different principles in this case to those that apply under UCPR 36.15. Nor in my opinion would any different result be produced.
34I am finally also mindful, in the present context, and in the light of the authorities to which I have referred, of what has been said by the High Court in D'Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1 at [34] - [36]:
"Finality
[34] A central and pervading tenet of the judicial system is that controversies, once resolved, are not to be reopened except in a few, narrowly defined, circumstances. That tenet finds reflection in the restriction upon the reopening of final orders after entry and in the rules concerning the bringing of an action to set aside a final judgment on the ground that it was procured by fraud. The tenet also finds reflection in the doctrines of res judicata and issue estoppel. Those doctrines prevent a party to a proceeding raising, in a new proceeding against a party to the original proceeding, a cause of action or issue that was finally decided in the original proceeding. It is a tenet that underpins the extension of principles of preclusion to some circumstances where the issues raised in the later proceeding could have been raised in an earlier proceeding.
[35] The principal qualification to the general principle that controversies, once quelled, may not be reopened is provided by the appellate system. But even there, the importance of finality pervades the law. Restraints on the nature and availability of appeals, rules about what points may be taken on appeal and rules about when further evidence may be called in an appeal (in particular, the so-called "fresh evidence rule") are all rules based on the need for finality. As was said in the joint reasons in Coulton v Holcombe: "[i]t is fundamental to the due administration of justice that the substantial issues between the parties are ordinarily settled at the trial".
[36] The rules based on the need for finality of judicial determination are not confined to rules like those mentioned above. Those are rules which operate between the parties to a proceeding that has been determined. Other rules of law, which affect persons other than the parties to the original proceeding, also find their justification in considerations of the need for finality in judicial decisions. And some of those rules are rules of immunity from suit."