Kwon v Cha; Kwon v O'Neill

Cha proceeding

1. Insofar as can be gleaned from the orders made and judgments given in the Equity Division, the history of the Cha proceedings may be summarised as follows.
2. In May 2013, Ms Kwon applied for an order extending a caveat over a property at Bankstown. That application was dismissed by Kunc J on 27 May 2013 on the basis that the facts alleged did not demonstrate that Ms Kwon had any caveatable interest in the Bankstown property.
3. The matter came before White J in the applications list on 2 August 2013. His Honour made directions for the filing and service of a statement of claim by Ms Kwon. Ms Kwon then filed a statement of claim on 12 August 2013 seeking orders "for Levy of Property" in respect of the Bankstown property and other relief. The defendants to those proceedings were Mr Cha and Ms In Duk Im, the latter being the registered proprietor of the Bankstown property. The matter came back before White J on 10 September 2013 on which occasion an application was made by Mr Cha for summary dismissal of the proceedings. His Honour dismissed the proceedings (2014/164201) on 10 September 2013 on the basis that the statement of claim disclosed no reasonable cause of action for the relief sought (see [2013] NSWSC 1372). His Honour noted that no matters had been pleaded that could arguably give Ms Kwon a proprietary interest in the property owned by Ms Im; that even if what was intended to be alleged was that Mr Cha had used money lent to him by Ms Kwon to acquire the property that would not provide an arguable basis for the relief claimed; and that no facts had been pleaded which could arguably give rise to a constructive trust over the property in question. There was no pleading of the terms of any alleged loan or what moneys were advanced. His Honour also noted that the statement of claim included scandalous allegations of murder and assault including allegations against persons not joined as defendants.
4. His Honour considered whether to strike out the statement of claim and give Ms Kwon leave to file a fresh statement of claim. In circumstances that included that a similar statement of claim had previously been dismissed in 2011 (an application for leave to appeal from that dismissal having been refused in Ki Bun Kwon v Im In Duk (Court of Appeal (NSW), 3 November 2011, unrep), his Honour considered that it was not in the interests of justice to take that course.
5. Ms Kwon then made an application by notice of motion to reopen the order made on 10 September 2013. That application was dismissed by Robb J on 22 November 2013. A further application to the same effect was sought to be made by Ms Kwon on 19 August 2014. On that occasion, White J refused leave for the filing by Ms Kwon of a notice of motion seeking that relief, noting that making a further application for the same relief was an abuse of process.
6. In the notice of motion that White J refused Ms Kwon leave to file she had sought orders also for the extension of a caveat (AI745806) in respect of a property of which Ms Im was the registered proprietor, and for the issue of a subpoena. His Honour noted that it would not be proper to give leave for the issue of a subpoena in respect of proceedings which were then closed, even if it were appropriate to do so in other circumstances; and that an application for extension of a caveat would have to be made by a fresh proceeding.
7. Ms Kwon then sought, and was granted, leave for the filing in court of a summons seeking an order for the extension of the said caveat (matter number 2014/243817). His Honour noted that Ms Im, the registered proprietor of the property the subject of the caveat, was not named as a defendant to that summons. His Honour treated that application as an application for leave to lodge a second or subsequent caveat, the Registrar-General having advised Ms Kwon that pursuant to s 74O of the Real Property Act 1900 (NSW) the caveat had no effect without such leave, since it claimed the same interest and appeared to be based on the same facts as another caveat (AG274260) that Ms Kwon had lodged in respect of the property. That earlier caveat had been the subject of a prior lapsing notice and had lapsed on 4 August 2011; and was the subject of the decision by Kunc J on 27 May 2013 to which I have already referred.
8. White J considered the matters asserted in the summons and in Ms Kwon's affidavit in support and concluded that what Ms Kwon was there asserting was that Mr Cha had bought the Bankstown property with her money and that Mr Cha's solicitor had a document which would show that the "real owner" of the property was Mr Cha, not Ms Im.
9. His Honour concluded that the materials did not disclose any caveatable interest in the property. His Honour noted that the caveat (AI745806) claimed an interest in the land as an equitable mortgagee pursuant to a 1980 loan agreement but that Ms Kwon was instead relying on an oral agreement of loan. His Honour also considered that there was no basis to give leave to lodge a further caveat claiming in substance the same interest that was the subject of the caveat that had lapsed.
10. His Honour dismissed Ms Kwon's summons and refused leave to issue a subpoena seeking inspection of documents from Mr Cha's solicitor's office.
11. By summons filed 9 December 2014, Ms Kwon now seeks leave to appeal from what is identified as the decision of White J on 26 August 2014 in proceedings number 2014/00243817. The named respondent to this summons is Mr Cha. The orders sought are: 1. An order for the Title Transfer WITHOUT Proprietor's Signature. That TORRENS TITLE No: 20/SP52514. 2. If not the Order above, an Order for the new Issues of the Caveat, and Subpoena. 3. Other orders the court thinks a fit.
12. The notice of appeal, however, identifies the decision under appeal as being a decision on 5 August 2014 of his Honour in the Cha proceedings. It is not clear to what decision this relates. I assume this is a typographical error.
13. By reference to the appeal grounds, however, it appears that the challenge sought to be made is to the dismissal of one or both of the summonses in the Cha proceedings and the refusal of leave to lodge a caveat in respect of the Bankstown property or to issue a subpoena to Mr Cha's solicitor. Those were matters the subject of the 19 August 2014 decisions.
14. Handed up during the course of the hearing of the application this morning is a document which I have marked MFI 1 in which Ms Kwon identifies her case in relation to the Cha proceedings as being referable to the partial dismissal of her statement of claim by White J. She states in that document "The reason was: I did not made the argument".
15. Ms Kwon in that document refers to an "argument" filed with the notice of motion and to the non-appearance by the defendant in Court at which time apparently a direction was made that she write or notify the defendants of the application. Ms Kwon stated that on the hearing date the judge "had really made it dismissed because he seemed I did not quote the registrar and the Judge was so busy, I was very busy too".
16. Ms Kwon emphasises the reliance by her on a conversation in which she says Mr Cha said "I can get his unit at Bankstown what I mention it" on 7 August 2010 at 7.33am" because when he bought that unit it was with her money.

O'Neill proceedings

1. The second summons seeking leave to appeal relates to the O'Neill proceedings. Ms Kwon filed two summonses joining Mr O'Neill as defendant. In the first, filed on 24 July 2014, 2014/218723, Ms Kwon sought an order, in effect, for the transfer to her of a property owned by Mr O'Neill, a retired solicitor, in Mosman. That order was sought on the basis that Ms Kwon asserted that he owed her "about $10, Million" and that there was an oral agreement that the property be transferred to her. In the second, filed on 14 August 2014, 2014/239373, Ms Kwon sought an order for the extension of caveats in respect of three properties, the registered proprietors of which were variously Mr O'Neill, a company Llejazz Pty Ltd, and Mr O'Neill and a Ms Degenhardt.
2. The application for an extension of the caveats (AI736524 and AI740172) came before White J on an ex parte basis on 14 August 2014. His Honour refused the application for an extension of the caveats. In his Honour's ex tempore reasons, his Honour noted that the caveats had not been tendered; that the bases on which Ms Kwon claimed an interest in the properties were, first, that she was as an equitable mortgagee (on the basis that her younger brother had advanced a sum of almost $1m of his father's money to Mr O'Neill approximately 25 years ago and had not been repaid) and, second, that there was an oral agreement that a Mosman property would be transferred to her for a price of $1.3m, the consideration for the transfer being the forgiveness of part of the debt owed.
3. His Honour noted that there was no admissible evidence advanced to evidence an equitable mortgage and that there would be serious issues as to whether any debt would be statute barred. As to the alleged oral agreement, his Honour noted that it would be unenforceable pursuant to s 54A of the Conveyancing Act 1919 (NSW). For those reasons, his Honour refused the application for an extension of the caveats.
4. White J then stood over the summons in the second of the O'Neill proceedings to 26 August 2014 and indicated that he would entertain on that occasion any application for the summary dismissal of both proceedings. Such an application was made by Mr O'Neill on that occasion and was successful.
5. His Honour noted that Ms Kwon's claim in the transfer proceeding was based on an alleged oral contract for the sale or other disposition of land; that Ms Kwon was seeking specific performance of that alleged agreement; and that Ms Kwon accepted that there was no note or memorandum in writing of that agreement. His Honour considered the material before him and concluded that there was nothing in Ms Kwon's summons, nor in the affidavits read on the application, that could arguably give rise to any plea of part performance and therefore that it was clear beyond reasonable argument that the claim for specific performance of the alleged oral agreement was doomed to fail by reference to s 54A(1) of the Conveyancing Act 1919.
6. Ms Kwon says that the alleged oral argument was made in a conversation in which Mr O'Neill agreed to transfer the property at Mosman to her for a sum of $1.3 million by way of partial forgiveness of a debt that Ms Kwon claimed Mr O'Neill owed to her late brother. The summons included a statement to the effect that, about 25 years ago, Ms Kwon's now deceased younger brother had paid a sum of approximately $1 million to Mr O'Neill, who was then a solicitor, that Mr O'Neill did not "do any legal matters"; and asserted that Ms Kwon was entitled to a refund and that the amount refunded should be about $16 million on the basis of the time value of money. Ms Kwon today has said the value should be about $16 million to $18 million. His Honour understood Ms Kwon to have indicated that she was prepared to accept re-payment of only $10 million, not the $16 million claimed to be owing.
7. His Honour noted that there had been a history of litigation brought by Ms Kwon against Mr O'Neill, the first being a claim in 1998 for a sum of $870,000 which was dismissed and in respect of which applications for leave to appeal in this Court and in the High Court were also dismissed; the second being a claim in the Common Law Division for $10 million that was summarily dismissed by Bellew J on 11 December 2013 on the basis that, on the evidence before him, no reasonable cause of action was disclosed and the claim brought by Ms Kwon was obviously untenable.
8. White J summarily dismissed the proceedings in which a transfer of the Mosman property was sought on the basis that Ms Kwon's case was clearly doomed to fail and obviously untenable. He dismissed the summons in the second proceedings on the basis that the only orders there sought were for the extension of the caveats and that application had already been refused.
9. In the document which I have marked MFI 1 and which Ms Kwon handed up in court today, Ms Kwon describes her case against Mr O'Neill, matter number 2014/371845, as being in relation to the lawyer's costs and legal fees refund. Ms Kwon states in that document that she had applied for those fees refund by statement of claim and it was "strange dismissed", and that after it was dismissed she met the defendant and appealed to him about her and her brother's circumstances and he said that she could have his house at Mosman for $1.3 million, and the rest she would like to obtain by way of cash. Ms Kwon states in her document if Mr O'Neill does not "get that much money", she wants two other properties of his and has given the title references to them.

Requirement for leave to appeal

1. Leave to appeal from his Honour's summary dismissal of the respective O'Neill proceedings is required because, even though determinative of the proceedings, it is an interlocutory decision (AB v State of New South Wales [2014] NSWCA 243; Macatangay v State of New South Wales (No 2) [2009] NSWCA 272). Leave to appeal from the decision made in the Cha proceedings is necessary because the refusal to give the leave there sought was also an interlocutory decision.
2. Leave to appeal will not be granted in respect of interlocutory decisions where the appeal is doomed to fail (Young v Hones (No 2) [2014] NSWCA 338 at [63]).
3. To succeed in challenging the exercise of a discretion, such as that which his Honour exercised in summarily dismissing the proceedings, an error in the House v The King sense (House v The King [1936] HCA 40; (1936) 55 CLR 499 at 504 to 505) must be established; namely that there was an error of legal principle; a material error of fact; that the decision made took into account an irrelevant consideration or failed to take into account or give sufficient weight to a relevant consideration; or that the decision was so unreasonable or unjust as to bespeak such an error (Micallef v ICI Australia Operations Pty Ltd [2001] NSWCA 274 at [45]).
4. The Court in considering whether leave should be granted must consider whether substantial reasons have been shown to allow appellate review of the relevant interlocutory decision (Collier v Lancer (No 2) [2013] NSWCA 186).
5. Nothing has been shown on the present occasion to demonstrate any error warranting appellate intervention on the part of the primary judge in dismissing the first O'Neill proceeding, seeking specific performance of the alleged oral agreement, or the second O'Neill proceeding in which an extension of the caveats was sought. I note that Ms Kwon was asked this morning on numerous occasions to identify what particular error or errors she considered that there was or were in his Honour's decisions in both the O'Neill proceedings and the Cha proceedings and that Ms Kwon was unable to do so. Rather, Ms Kwon reiterated the circumstances giving rise to her claims in both proceedings and emphasised the importance of the matters to her and of the relief that was sought.
6. As to the specific performance claim, even if Ms Kwon's version of the alleged conversation were to be accepted at a final hearing, the oral agreement was clearly unenforceable for the reasons his Honour gave and no other basis was put forward for the relief sought. As to the respective caveats, his Honour considered whether there was any basis disclosed on the materials for the assertion that Ms Kwon had a caveatable interest in respect of any of the properties in respect of which she had lodged caveats and was not in error in concluding that there was not. Nor was there any error revealed in the refusal to grant leave for the issue of a subpoena once the Cha proceedings had been dismissed.
7. Ms Kwon's appeals from the respective decisions are doomed to fail.
8. Leave should therefore be refused with costs in both proceedings.
9. LEEMING JA: I agree with Ward JA's reasons and the orders that her Honour proposes.

Amendments 28 April 2015 - Typographical error 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: 28 April 2015