Kevern v Marshall [2012] ACTSC 9

Supreme Court of the ACT|2012-01-31

1. the plaintiff's application dated 22 March 2011 be dismissed.

2. the plaintiff's application dated 10 May 2011 be dismissed.

1. The plaintiff in this action has applied for summary judgment. At the time the application was heard, the plaintiff was represented by solicitors and counsel. He has since filed a notice that he is acting in person.

3. The proceedings were started in the name of the plaintiff as Jeff John Kevern. It is apparent from affidavits he has since affirmed that his correct name is Jeffrey John Kevern. At one point in the proceedings, following a change of solicitors, his new solicitors commenced to entitle documents in his correct name. They did not seek leave to amend before doing so, and no formal amendment has been made. Rule 502(4) of the Court Procedures Rules 2006 provides that if there is a mistake in the name of the party, the court must give leave for, or direct the making of, amendments necessary to correct the mistake. To resolve this minor problem, I order that the plaintiff's name be amended to Jeffrey John Kevern, and dispense with compliance with part 2.7 of the Rules to the extent that they would otherwise require any action by either party other than entitling documents filed from now on in the plaintiff's correct name.

4. The plaintiff sets out the background of the matter in an affidavit of 22 March 2011 in support of the application. He now lives in Canberra. At the time of the events giving rise to the proceedings, he lived at Pleasant Hills in the Riverina area of NSW where he was self-employed as an apiarist. In the latter half of 1999 he placed an advertisement for the sale of some beehives, which was answered by the defendant. The plaintiff is now seventy-five. He has worked in the apiary business since 1944, and full time since 1978 on his own account or in partnership with his wife.

5. From about 1989 the plaintiff gained possession of certain items of property owned by a Mr and Mrs Hollingworth or their company Honeyflow Pty Ltd. They were also beekeepers and wanted to sell their equipment. The plaintiff was unable to pay them immediately but agreed to take over their assets if he was given time to pay. He says that they were happy with this arrangement. No one else wanted their bees. The plaintiff took possession of a truck, forklift and trailer, a large number of beehives and honey drums, and other equipment.

6. During 1999 he decided to scale his business down. He intended to sell most of his equipment, and to use the money to pay the Hollingworths what he owed them. He placed an advertisement for five hundred beehives for sale in an industry publication. He had a telephone response from the defendant. They met. The defendant inspected the hives. The defendant told the plaintiff that he was a third-generation beekeeper. He had no money at the time but had equity in a truck and an orchard at Tumbarumba. He also had fifteen hundred beehives. The plaintiff was satisfied that the defendant was an experienced and confident beekeeper.

7. Negotiations continued over the next few days. The plaintiff says that they reached agreement on prices for the vehicles, beehives and other equipment and shook hands. The plaintiff was satisfied that the defendant would operate the business successfully, generating income from which he would in due course be able to pay for what he was buying. There were no discussions about terms of payment at the time. The defendant took possession of the various assets. The plaintiff helped him in the moving, operation and maintenance of the beehives and other equipment. Over time further discussions took place and the defendant agreed to buy other items related to the business from the plaintiff. Some of the motor vehicles included in the arrangement were under hire purchase. The defendant agreed to take over responsibility for payments to the finance companies.

8. The defendant at one point prepared a handwritten agreement but the plaintiff declined to sign this, saying that he wanted to see a solicitor to have a proper agreement drawn up.

9. In late August 1999, while the plaintiff was away from his property, the defendant turned up and removed two vehicles, loaded with items the plaintiff says they had not previously discussed. Neighbours telephoned the police who intercepted the defendant at Henty. A police officer told the defendant to take the items to his property at Tumbarumba and not to sell them. The plaintiff says he had not given the defendant permission to remove the items, and after one further brief telephone conversation he did not speak to the defendant again. The plaintiff received a repossession notice from a finance company about one of his trucks shortly after this.

10. At the end of August 1999 there was a further relevant development. An order was made by a Magistrates Court in Victoria under the Family Law Act 1975 (Cth) in proceedings instituted by the plaintiff's wife. They had been separated since 1996. The order restrained the plaintiff from selling or encumbering his interest in his beekeeping business. Within a week the plaintiff wrote to the defendant. He said that due to circumstances beyond his control he could no longer proceed with the sale of the business, by reason of a court order. He requested the return of all of his property. He said that a copy of the letter would be attached to documentation he would be lodging with the Supreme Court. He apologised for the inconvenience caused but said that it was beyond his control.

11. In November 1999 the plaintiff through a firm of solicitors at Wagga Wagga commenced proceedings in the Equity Division of the Supreme Court of NSW seeking a declaration that he was lawfully entitled to immediate possession of various specified items associated with his beekeeping business. He further sought a declaration that the defendant's refusal to deliver them up amounted to detention, an order that the defendant return the items, and an interim order that the defendant preserve and maintain the items. He also sought damages.

12. The defendant instructed a firm of solicitors at Temora. He swore a lengthy affidavit responding to the claim (I have the benefit of certain of the documents from the file of the Supreme Court of NSW but not the whole file). The defendant gave a different version of his conversations with the plaintiff and their negotiations about the sale of beehives and other equipment. It is unnecessary for me to recite the contents of the defendant's affidavit in detail. It is sufficient for me to say that the affidavit took issue with significant portions of the factual assertions made by the plaintiff.

13. The defendant put on a second affidavit in the proceedings in the Supreme Court of NSW in February 2001. The affidavit appears to have been in support of a counterclaim, of which I do not have a copy.

14. The plaintiff says in an affidavit in the present proceedings that the Sydney action came on for hearing before Young CJ in Eq over several days in February 2001. By that time the plaintiff found himself unable to afford legal representation, and appeared for himself. The defendant was legally represented. The plaintiff says that he attempted to cross-examine the defendant on his affidavits. He lacked the necessary skills, and formed the view that the case was not going well for him. He said that the defendant, at the end of the day in court, came up to him with a handwritten document and said words to the effect "You'd better sign this, because if you don't you won't get anything". A copy of the document is in evidence. Parts of it are in different handwriting, suggestive of some negotiation between the parties as to its contents. The document could be described as terms of settlement of the action.

15. The plaintiff went with the defendant and his solicitor to the solicitor's office. After some discussions, separately and apart, the solicitor told him that if he signed the handwritten document, the solicitor would have it drawn up properly and would show it to the judge in the morning, so that the case would be over. It would be unnecessary for the plaintiff to attend court.

16. The plaintiff says that at that time he had no money and no reliable income. He decided that having something in writing was better than ending up with nothing. He says that he assumed that he had no choice but to sign the document. He did so. A couple of weeks later he received from the solicitors a document in the form of orders of the court, dated 28 February 2001, entered on 7 March 2001, signed by the Chief Clerk and sealed. The so-called orders read as follows:

Jeff Kevern to give Garry Marshall ownership, title, possession and interest in the entire contents of Jeff Kevern's shed at Pleasant Hills, NSW within 7 days. By arrangement with Jeff Kevern, Garry Marshall will take possession of these items.
Jeff Kevern to give Garry Marshall ownership, title, possession and interest in the following property of Honeyflow Pty Ltd, and Hazel Hollingworth, in his possession and control within 7 days:
- At Myrtleford - Volvo, forklift, extractor plant, splitter boards and sundry items;
- At R Stevens at Cootamundra - boiler and honey shed; and
- Other items at other locations.
Provided that Jeff Kevern complies fully with orders 1 and 2:
- (a) Garry Marshall will pay Jeff Kevern $52,500.00 over 5 years in five equal instalments of $10,500.00 on each 1 May commencing 1 May 2002;
- (b) Garry Marshall will pay Hazel Hollingworth $111,465.00;
- (c) Gary Marshall to assume ownership from Jeff Kevern of the Toyota Hilux and the Nissan Navara in Garry Marshall's possession and to assume liability for financial repayments to Capital Finance on the Nissan and Toyota Finance on the Toyota; and
- (d) Jeff Kevern to retain ownership of the Bedford truck in his possession and Garry Marshall to give Jeff Kevern the side boards and spare wheel (rim and tyre) of the Bedford truck.
Until Jeff Kevern complies fully with orders 1 and 2 the vehicles referred to in 3 (c) and 3 (d) are to remain in possession of in the case of 3 (c) Garry Marshall and in the case of 3 (d) Jeff Kevern.
The notice of motion filed for Garry Marshall on 13 December 2000 is withdrawn.
Each party to pay his own costs and all previous costs orders are vacated.

17. The plaintiff says that in 2003, having received no money from the defendant, he sought legal advice. The advice was to bring an application to enforce the orders. The plaintiff did so.

18. The application came before Gzell J, who gave judgment on 15 April 2004. His Honour clearly saw the application as misconceived. He said that the only order made by the court in February 2001 had been the order to vacate all previous orders as to costs. The balance of what purported to be orders of the court were not orders, nor were they undertakings given by either party to the court.

19. His Honour referred to s 63 of the Supreme Court Act 1970 (NSW) which provides that the court shall grant all such remedies as any party may appear entitled to, so that as far as possible all matters in controversy may be completely and finally determined and multiplicity of legal proceedings are avoided. The section had been held to give jurisdiction to enforce a settlement or compromise by motion in the original proceedings, at least in simple cases. His Honour said that that course should not be adopted where there were substantial matters in controversy going beyond the ambit of the proceedings as originally constituted, or where in the interests of justice, disposition of the matter as on summary judgment was inappropriate.

20. His Honour said that in the case before him, the plaintiff had agreed to give the defendant title and possession to equipment at various locations, and that provided he did so, the defendant agreed to make payments to him. The plaintiff had failed to comply fully with the agreement. He had not given the defendant title to some items (a truck, forklift and charger). The defendant had not made any payments to the plaintiff notwithstanding that he had taken possession of some equipment.

21. Gzell J said that the relief the plaintiff was seeking really amounted to rectification of the agreement between the parties, or a claim for unjust enrichment. These stood outside the ambit of the terms of settlement and raised substantial matters of controversy, inappropriate to be dealt with in a summary determination. His Honour dismissed the motion with costs.

22. In responding to the notice of motion before Gzell J, the defendant sworn an affidavit, the body of which (though not the annexures) is exhibited to the plaintiff's affidavit. The affidavit is stated to be in response to an affidavit by the plaintiff sworn on 13 October 2003, which I have not seen. The defendant's affidavit is not fully intelligible without that affidavit of the plaintiff. The defendant deposed at the conclusion of the affidavit that he had not received the equipment agreed to in the orders, and asked that the motion be refused.

23. The plaintiff commenced the present action on 25 January 2010, claiming the following relief:

(a) An order setting aside the compromise agreement [the agreement set out in the "orders" in the Supreme Court of NSW dated 28 February 2001];

(b) An order that the defendant pay to Hazel Hollingworth, or in the alternative to the plaintiff as bailee of Hazel Hollingworth, the sum of $111,465.00;

(c) An order that the defendant pay to the plaintiff the sum of $46,942.00;

(d) An order that the defendant pay interest on the moneys payable under the preceding orders from 28 February 2001 pursuant to rule 1616 or as the court otherwise orders;

(e) Costs.

24. The originating claim bore an endorsement that summary judgment was not to be applied for. The approved form for an originating claim (form 2.1) requires the plaintiff to say whether or not summary judgment is to be applied for.

25. The accompanying statement of claim asserts that between June and September 1999 the defendant took possession of various items belonging to either the plaintiff or to Ms Hollingworth. In December 1999 the plaintiff commenced proceedings for the recovery of the items. The proceedings were defended. On 28 February 2001 the parties reached a written agreement to settle their dispute. Part of the agreement was that the plaintiff would deliver certain items to the defendant. The plaintiff delivered some but not all of the items. The defendant has retained the items delivered but has not paid anything for them. The compromise agreement is void for uncertainty and because there was no consideration for it. Alternatively, the compromise agreement was reached under mistakes of fact by both parties. Alternatively, the plaintiff signed the compromise agreement under duress. The defendant has been unjustly enriched by the delivery to him of the items which were delivered, their value at the date of delivery being at least $158,415.00.

26. A notice of intention to respond was filed on behalf of the defendant on 8 July 2010. On 21 February 2011, the defendant, by then unrepresented, filed a defence and counterclaim. Probably unsurprisingly, the defence and counterclaim does not comply with the requirements of the Court Procedures Rules about pleading. The relief sought in the counterclaim is not conveniently summarised, but there appears to be a counterclaim for some $378,000.00, much of it claimed as the value of items said to have been taken by the plaintiff without authority from the defendant.

27. The application for summary judgment was made by the plaintiff in March 2011. By then the defendant was unrepresented. His notice that he was acting in person gave his Tumbarumba address as his address for service, and also gave an email address. It is not apparent from the court file how, or indeed whether, he was served with the application or supporting affidavits. The matter has been before me a number of times since then, and he has not attended. On reflection I cannot be sure that the defendant has known that the matter has been before the court.

28. Shortly after I heard the summary judgment application, the plaintiff applied through his solicitors for an order that the hearing of the application be treated as the final hearing of the action. There is evidence that that application, which was returnable on 20 May 2011, was served by email. The defendant did not attend court on the return date. That application is presently stood over generally.

29. Rule 1146 provides that the plaintiff may, at any time after a defendant files a notice of intention to respond or defence, apply to the court for summary judgment. The court may give judgment for the plaintiff against the defendant for all or a part of the plaintiff's claim for relief, unless satisfied that the defendant has a good defence on the merits, or sufficient facts are disclosed to entitle the defendant to defend the claim for relief generally.

30. It is somewhat unusual for a plaintiff to apply for summary judgment so long after the institution of proceedings. Under the Supreme Court Rules in force prior to 2006, it was customary for a plaintiff to apply for summary judgment immediately after appearance and before defence. The rules now specifically permit an application to be made after defence, perhaps because a defendant who is in a position to file a defence may do so without first filing a notice of intention to respond. The filing of either document precludes a plaintiff from applying for default judgment. I summarise, with acknowledgement to Dr BC Cairns in his Australian Civil Procedure (9th Ed Thomson Reuters) 2011 some of the general principles to be applied in determining an application for summary judgment. Summary judgment is relevant where a defendant who lacks a valid defence nonetheless lodges an appearance or an unsustainable pleading thus forcing the plaintiff to prepare for trial. The court, on the basis of affidavit evidence, may give judgment for the plaintiff if satisfied that there is no triable issue or that there is no need for a trial. Summary judgment is given sparingly, in accordance with the High Court's pronouncement in Fancourt v Mercantile Credits Ltd [1983] HCA 25; (1983) 154 CLR 87 at [99] that summary judgment should be given with great care and only where it is clear that there is no need for a trial. Once it appears to the court that there is an issue of fact or law that deserves full consideration, the court will decline to give summary judgment and will direct the parties to proceed to trial.

31. In applying for summary judgment the plaintiff must comply strictly with the procedural requirements of the rules and show that there is no defence to the claim or no need for a trial. The defendant may defeat a summary judgment application by showing either that the plaintiff's application is irregular, or that the claim is of a type that cannot be disclosed of summarily. Alternatively, the defendant may show that there is a factual dispute which if resolved in the defendant's favour raises a defence.

32. The affidavit supporting the application must verify the plaintiff's cause of action and must depose that the defendant has no defence. The plaintiff bears the overall onus of establishing that it is proper for the court to give summary judgment.

33. It is apparent from the wording of rule 1146 that the court has a discretion whether or not to grant summary judgment. The court is not obliged to do so simply by reason of not being satisfied that there is a good defence on the merits or that the defendant has disclosed sufficient facts to be entitled to defend.

34. There are a number of circumstances surrounding the present proceeding which cause me some disquiet. As I have said, I cannot be sure that the defendant knows that the matter has been before the court. This may be capable of being remedied fairly simply by evidence of service.

35. Secondly, as I have mentioned, the plaintiff in the originating claim specifically expressed his intention not to apply for summary judgment. There is at least an argument that he should be held to that choice.

36. Thirdly and more significantly, the action has the appearance of being an attempt to re-litigate an action previously brought between the same parties arising out of the same circumstances in the Supreme Court of NSW. As I have previously mentioned, I have not had the benefit of the whole of the court file in relation to the interstate proceedings. However, it appears to me, having regard to the reasons of Gzell J of 15 April 2004, that those proceedings have never been finally heard or determined. It is apparent that a hearing was fixed, commenced and proceeded for some days before the then Chief Judge in Equity, Justice Young. I gather, though this may not be entirely accurate, that His Honour was simply told that the action had been settled and that it was intended that consent orders would be filed in the registry. When the matter came before Gzell J three years later, His Honour made it clear that what the parties may have thought were orders made by the court were not, but were simply a recording of an agreement between the parties. Gzell J had the opportunity to consider the sealed document of 28 February 2001 in detail. His Honour did not suggest that it should be regarded as void for uncertainty, or otherwise criticise it. His Honour noted that what the plaintiff seemed to be looking for was rectification of the agreement or a claim for unjust enrichment. It seems reasonably clear from what His Honour said that he expected, and thought it appropriate, that those issues would be raised in the existing action. It is clearly undesirable that two courts in separate Australian jurisdictions should have before them two current actions between the same parties and generally concerning the same subject matter. It may be that the proper course would be for me to stay the present proceedings until I am informed of the position in the NSW action. This would give the parties, if so advised, an opportunity to apply to the Supreme Court of NSW to have the proceeding in that court transferred to this court under the cross-vesting legislation. Alternatively, I might be persuaded, either on application by a party or on the court's initiative, to order the transfer of these proceedings to the Supreme Court of NSW.

37. A final matter which concerns me is that prima face it appears that the present action may well be out of time, although I am conscious that thus far no limitation defence has been pleaded. Nevertheless, the fact that such a defence may be available seems to me to have some relevance to whether or not the court should exercise its discretion to grant summary judgment.

38. It is clear that there were substantial disputed issues of fact between the parties in the NSW proceedings. If the present action were to be properly pleaded, and go to trial, many of those issues would arise for determination. I have been far from persuaded that this is an action which the plaintiff must inevitably win, or that it is an action to which the defendant has no defence, or that, on the facts disclosed, the defendant should not be regarded as entitled to defend the claim.

39. The application for summary judgment will accordingly be dismissed.

40. It must follow that the plaintiff's application filed on 10 May 2011 seeking an order that the hearing of the summary judgment application be treated as the final hearing of the proceedings, must also be dismissed.

I certify that the preceding forty (40) numbered paragraphs are a true copy of the Reasons for Judgment herein of Master Harper.

Solicitor for the plaintiff: Capital Lawyers (no longer acting)

Procedures Rules 2006

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Judgment (46 paragraphs)

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