Konica Minolta Business Solutions Australia Pty Ltd v Vongkeneta

Judgment - EX TEMPORE 1HIS HONOUR: In these proceedings, the Plaintiff, Konica Minolta Business Solutions Australia Pty Limited, sues three Defendants, being Linda Sisaveth Vongkeneta, her husband, Houmchanh Simmalavong (also known as Eddie Simmalavong), and her daughter (and his stepdaughter), Sutari Vongkeneta. (The first and second Defendants have two other daughters, being Suriya and Sutara, who are not parties to the litigation.) 2The claim against the first and second Defendants is for $3,638,572.20 plus interest, as well as for declarations that a property described as "the Edensor Park property" is held by them on trust for the Plaintiff absolutely; or in the alternative, that the Edensor Park property is held upon trust up to the amount claimed (plus interest); or alternatively, subject to a charge for the amount claimed (plus interest). 3The Plaintiff accepts that it will take any such interest subject to any existing registered encumbrance on title to the Edensor Park property. 4As against all Defendants, the Plaintiffs sought a declaration that a transfer of land described as "the Homebush property", by the first and second Defendants to the third Defendant, is void; further or alternatively that the Homebush property is held by them, or her, on trust for the Plaintiff absolutely; or in the alternative, that the Homebush property is held on trust up to the amount claimed (plus interest); or alternatively, subject to a charge for the amount claimed (plus interest). 5As against the third Defendant, the Plaintiff sought a declaration that the Homebush property is held by the third Defendant on trust for the Plaintiff for an amount calculated as the difference between the price paid by her for the purchase of the Homebush property and its market value at the date of transfer; or further or alternatively that the interest of the first and second Defendants', or that of the third Defendant in the Homebush property, is held subject to a charge for the amount claimed (plus interest). (The Plaintiff accepts that it will take any such interest subject to any existing registered encumbrance on title to the Homebush property.) 6As against all Defendants, the Plaintiff sought an order for costs and interest on those costs. 7The Plaintiff filed the Statement of Claim on 13 September 2012. Prior to that date, it had filed a Summons on 27 July 2012, seeking an asset freezing order. It obtained such an order, as well as other orders, on that date. Subject to some amendments made to the form of the orders that were made initially, most of the orders have been continued since then, most recently on 5 February 2013. The terms of the order are such that they expire at 4:00 p.m. today 8Of course, because the first and second Defendants did not file an Appearance or a Defence, within 28 days after service on each of the Statement of Claim or such other time as the court directed for the filing of a defence, each was regarded as being "in default": Uniform Civil Procedure Rules 2005 ("UCPR") rule 16.2(a). In addition, by her, and his, failure to file a defence traversing the allegations of fact in the Statement of Claim, each of those allegations of fact is taken to be admitted as against each of them: UCPR rule 14.26(1). Finally, pursuant to UCPR rule 16.3, which deals with the case where a defendant is in default, it allows the Plaintiff to apply for judgment under UCPR Part 16 "according to the nature of his or her claim for relief". Unless the court otherwise orders, such an application for judgment must be accompanied by an affidavit of service of the statement of claim and an affidavit in support of the application. 9Only the third Defendant filed a Defence to the Statement of Claim. She did so on 24 October 2012. In answer to the claim made against her, the third Defendant, at paragraph 54, pleaded that: (a) If the first and/or second Defendant were indebted to the Plaintiff, as alleged in the Statement of Claim (which was not admitted), she was not aware of the circumstances giving rise to that indebtedness at the time the Homebush property was transferred to her. (b) The first and second Defendants sold the Homebush property to her for $260,000. (c) The third Defendant had borrowed $200,000 from the National Australia Bank Limited ("the NAB"), which amount was paid to the prior mortgagee of the Homebush property to secure the discharge of its mortgages registered on the title to the Homebush property ("the NAB Loan"). (d) As security for the loan from the NAB, she provided to the NAB, a mortgage that was registered on the title to the Homebush property. (e) The third Defendant remains liable to the NAB under the NAB Loan and Mortgage. 10On the evening before the commencement of the hearing, the Court was advised that the claim of the Plaintiff against the third Defendant had been resolved and that "the Plaintiff and the third Defendant will seek orders in accordance with Short Minutes of Orders" (a copy of which were provided). 11At the hearing, Mr Sher, solicitor, appeared for the third Defendant. There were then further discussions between him and the legal representatives of the Plaintiff, which resulted in amended orders being signed. The Short Minutes of Order were identified as being made between the Plaintiff and the Third Defendant. 12By consent of the Plaintiff and the third Defendant, I made the relevant declaration and order in the Short Minutes of Order between the Plaintiff and the third Defendant as well as other notations, which appear at the conclusion of these reasons for judgment, sought by the Plaintiff and the third Defendant, and, thereafter, excused Mr Sher, on behalf of the third Defendant, from further attendance. 13The trial then proceeded only as against the first and second Defendants. 14The first and second Defendants have not appeared themselves, or by a legal practitioner, at any time, since the proceedings commenced. Nor did they appear at the trial. (They were not outside the Court when the matter commenced and when called, later, there was no appearance by, or on their behalf.) 15Evidence reveals that the first and second Defendants (and their two minor children) left Australia on 15 July 2012 and flew to Bangkok, Thailand. There is no evidence that the first and/or second Defendant has, or have, returned. 16UCPR rule 29.7, relevantly, provides: "Procedure to be followed if party is absent (1) This rule applies when a trial is called on. (2) If any party is absent, the court: (a) may proceed with the trial generally or so far as concerns any claim for relief in the proceedings, or (b) may adjourn the trial. ..." 17I have previously held, in French Consulting Pty Limited v Lawson Stuart Donald [2011] NSWSC 584, at [14]: "The clear purpose of UCPR rule 29.7 is the efficient dispatch of Court business. However, in despatching Court business, I cannot ignore the right of a defendant to be informed, or, at least, to be made aware, of a trial date. It is a fundamental principle that a party who may be adversely affected by the making of court orders has a right to be heard: Cameron v Cole [1944] HCA 5; (1944) 68 CLR 571, in which Rich J said (at 589): 'It is a fundamental principle of natural justice, applicable to all courts whether superior or inferior, that a person against whom a claim or charge is made must be given a reasonable opportunity of appearing and presenting his case. If this principle be not observed, the person affected is entitled, ex debito justitiae, to have any determination which affects him set aside, and a court which finds that it has been led to purport to determine a matter in which there has been a failure to observe the principle has inherent jurisdiction to set its determination aside. ... In such a case that has been no valid trial at all.'" 18At [39] - [40], I added: "This conclusion may be reached in another way. I refer, again, to what was said by Ward J in In the matter of Anton Fabrications (NSW) Pty Ltd - Bentley Smythe Pty Ltd v Anton Fabrications (NSW) Pty Ltd at [12]: "As noted in the commentary in Ritchie's, a party fails to appear, for the purpose of the Rule 29.7 , if that party fails to provide the Court with an apparently credible explanation, for that non-attendance. By way of example of a lack of credible explanation reference is made to Magjarraj v Asteron Life Ltd [2009] NSWSC 1433 at [22] where the court had been provided with an inadmissible doctor's certificate asserting incapacity resulting from an undisclosed medical condition." It seems to me to be an "apparently credible explanation for non-attendance" if it could be established that a defendant is unaware of the date of the trial. It cannot be said, in the present case, that the first Defendant was aware of, or otherwise had knowledge of, the date of trial, but chose not to attend court." 19In the circumstances, the first issue to address is whether I am satisfied that it is appropriate to proceed in the absence of the first and second Defendants or anyone representing each of them. 20Clearly, the first and second Defendant was each "absent", that is, she and he was not physically present at the trial and was not represented. I consider a party is "absent" within the meaning of the rule, when the trial is called on, only if it can be shown that he, or she, has knowledge, or notice, of the date of the trial, and is not physically present, or not represented. In other words, before the rule can be relied upon, there should be proof that the absent party has been given reasonable notice of, or has knowledge of, the date of the trial. 21To demonstrate that the first and second Defendant had been served with the Statement of Claim, the Plaintiff relied upon an affidavit of Morrie Fahd who deposed to having served the first and second Defendants in accordance one of the methods of service that had been prescribed in orders made on 30 August 2012. 22In relation to the notification of the hearing date, the Plaintiff relied upon an affidavit of Anthony Peterson, a solicitor, who deposed to having sent, on 5 February, 2013, certain copy documents, including a copy of orders made on 5 February 2013, to the first and second Defendants, also in accordance with one of the methods of service that had been prescribed by the asset freezing orders. 23In the orders made on 5 February 2013, the following paragraph appears: "2 Subject to the next paragraph, this order has effect up to and including 4:00 p.m. on 24 APRIL 2013 (the Hearing Day). On the Hearing Day at 10:00 a.m. there will be a further hearing in respect of this order before the Court." (Paragraph 3 of the Orders is not relevant.) 24There is also evidence that the Plaintiff has, unsuccessfully, sought details of the precise whereabouts of the first and second Defendants from the third Defendant. (Mr Sher, without objection, indicated from the bar table that his instructions were to the effect that the third Defendant had no contact with either the first or second Defendants.) 25I am satisfied from all of the evidence I have read, that all reasonable attempts have been made to give each of the first and second Defendants notice of the date of the trial. Overall, I am satisfied that attempts have been made, fruitlessly, to provide each with the documents to be relied upon, and to allow her, and him, to participate in the proceedings. 26The Plaintiff has also established that all reasonable attempts have been made to notify the first and second Defendants of the date for the trial and that it was to then proceed. 27No apparently credible explanation for non-attendance has been advanced and I am of the view that neither of the first or second Defendants has sought, or seeks, to participate in the proceedings. In this regard, I bear in mind that neither has appeared at any of the interlocutory, or directions, hearings that have occurred since the proceedings were commenced. 28Finally, I have not forgotten what I wrote in Smirski v Macander [2010] NSWSC 929 at [34]: "It is to be remembered that the primary considerations on whether to proceed ex parte concern whether there is urgency; whether irreparable damage would flow from making an ex parte order; whether hardship would flow to a party against whom an order is made and whether such an order can be set aside: Ndjamba v Toyota Finance Australia Ltd [2010] NTSC 23, per Blokland J at [8]." 29No particular urgency is disclosed. However, if the allegations of fact alleged against the first Defendant are established, the Plaintiff has had moneys, to which it was entitled, taken from its account, over several years, ending in early 2012. Additionally, the proceedings were commenced over nine months ago. 30There is no ground on which it would be appropriate for the court to adjourn the trial. It is unlikely that either of the first or second Defendants would appear to meet the allegations made, even if a further opportunity was given. Thus, there would be no point in the Court, of its own motion, adjourning the matter, and I have proceeded to hear the matter in the absence of the first and second Defendants. 31The Plaintiff has been required to prove the claim so far as the burden of proof lies upon it and if it does so against the first and second Defendant, it is entitled to the relief claimed and such other relief as is consistent therewith: Re Anton Fabrications (NSW) Pty Ltd; Bentley Smythe Pty Ltd v Anton Fabrications (NSW) Pty Ltd [2011] NSWSC 186, per Ward J, at [11]. Of course, as previously stated, the failure of defendants who do not appear to plead to allegations in the Statement of Claim founds deemed admissions of the allegations in the Statement of Claim: Ward v Ward [2011] NSWSC 107 at [28]. The evidence has been read so that the Court can be satisfied that the orders and declarations sought are appropriate.