Metropolitan Petar v Mitreski

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

3369/97 HIS EMINENCE PETAR, THE DIOCESAN BISHOP OF THE MACEDONIAN ORTHODOX DIOCESE OF AUSTRALIA AND NEW ZEALAND & ANOR v LAMBE MITRESKI & ORS JUDGMENT 1 HIS HONOUR: In this matter I delivered judgment on separate questions on 4 April 2002: Metropolitan Petar v Mitreski [2003] NSWSC 262 ("my judgment"). Other issues remained to be tried and that trial was fixed to commence on 15 March 2004 before me. That fixture was vacated by me on 3 March 2004: Metropolitan Petar v Mitreski [2004] NSWSC 122. That second trial is now fixed to commence before me on 9 August 2004. Before my judgment, there had been in force for some years an interlocutory regime as to the use of church property. Since my judgment there have been a number of applications made relating to the use of church property, both the real property and money. 2 On one application I delivered judgment on 1 July 2003: Metropolitan Petar v Mitreski [2003] NSWSC 594 ("my first interlocutory judgment"). Because of the change of circumstances between the time of that judgment and the making of orders, I delivered a further judgment on 3 July 2003: Metropolitan Petar v Mitreski [2003] NSWSC 608 ("my second interlocutory judgment"). A further application for variation was determined by Master Macready on 5 August 2003: His Eminence Petar the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand v Mitreski NSWSC 5 August 2003 unreported. An application was then made by the defendants to compel the Bishop to reconsecrate the church. That application was heard by Barrett J and judgment delivered on 5 November 2003: Metropolitan Petar v Mitreski [2003] NSWSC 1007. His Honour dismissed the application. 3 It should be said that the interlocutory regime that I laid down in July had provided for the reconsecration of the church by the Bishop (said by him but denied by the defendants to be necessary); the appointment by the Bishop of a priest acceptable to the defendants to conduct services in the reconsecrated church; and the use of the church thereafter for the conduct of services by that priest and also, on other occasions, by Father Mitrev, the first defendant. It is sufficient to say that that process has broken down, without it being necessary to go into full detail as to why. One factor is that there has been building work done in the church by the sixth defendant. Another is the intransigence of both sides. There is evidence that, after the breakdown of attempts for a priest acceptable to both sides to be appointed to conduct services over Christmas, there were some services conducted around Christmas time and up to 19 January 2004 in church premises, being a church hall on property subject to the trust, by a celebrant and not approved by the Bishop. 4 It is in these circumstances that the plaintiffs apply to me for five items of interlocutory relief regulating the conduct of the sixth defendant. They apply for them first as terms to be attached to the Court's order of 3 March 2004 vacating the hearing fixed for 15 March 2004, a course I reserved to them, since constraints of time did not permit the consideration of terms to be attached to the order at the time it was made. Alternatively, they applied for them as interlocutory injunctions. The five items of relief are as follows: (1) That the sixth defendant give an undertaking not to apply or use any property held by the sixth defendant otherwise than for the worship of the Macedonian Orthodox Religion and for activities concerned with or ancillary to the encouragement, practice and promotion of the Macedonian Orthodox Religion. (2) That the sixth defendant give an undertaking to: (a) provide prior written notice to the plaintiffs' solicitor of any proposed payment of money held by, to the account of, or on behalf of the sixth defendant in excess of $1,000, such notice to include details of the amount, proposed payee and purpose of such payment; (b) provide to the plaintiffs' solicitor weekly accounts of all money paid into or out of the bank (or other financial institution) accounts held by the sixth defendant or otherwise received, expended or otherwise dealt with by the sixth defendant, including any transactions referred to in (a) above. (3) That the sixth defendant give an undertaking that it shall not, by itself, its servants or agents, permit the conduct, or purported conduct, of any religious service at any place without the prior written approval of the first plaintiff. (4) That the sixth defendant give an undertaking that it shall not, by itself, its servants or agents, carry out, or cause to be carried out, any building, construction, renovation or other works in or on the St Petka church without the prior written approval of the first plaintiff. (5) That the sixth defendant give an undertaking that it shall by itself, its servants and agents, permit the first plaintiff, and any other persons nominated by the first plaintiff, to enter and inspect the St Petka church at any time provided at least 48 hours' written notice is given. 5 I should say at once that I do not propose to deal with these matters by way of an attachment of terms to the vacation of the fixture, despite my reservation of leave. In my view, there are difficulties about doing that ex post facto. Mr T G R Parker, of counsel for the plaintiffs, urges me to proceed in this way because there may be procedural advantages, including a different onus of proof, in relation to that method of obtaining the relief. However, I should not be inclined, in any event, to attach a condition if there were not established an entitlement to have the subject matter of the condition by way of interlocutory relief. In saying this, I am not aware that there would be any change of onus of proof in proceeding in the way I have indicated. And, so far as I am concerned, there would not be any difference in the result arising from which of the two paths towards relief I followed. In assessing whether or not interlocutory relief should be granted I have borne in mind the balancing exercise enunciated by McLelland J in Kolback Securities Ltd v Epoch Mining NL (1987) 8 NSWLR 533 at 535 - 536. 6 So far as the particular subject matters of relief are concerned, I am not inclined to grant any relief in terms of prayer 1 above. I do not think it useful to grant an injunction in terms so wide. I think that it lacks clarity, which is always desirable in the case of injunctive relief as to the conduct proscribed by the relief, since disobedience of the injunction may constitute contempt of court. The obligation must be clear. That clarity is particularly important in a situation as embattled as the present. I, therefore, decline to give relief pursuant to the first prayer. I should say that it is gratifying that prayer 1 reflects the terms of the trust as embodied in my judgment, unlike a great deal of the correspondence that has passed between both sides concerning interlocutory matters. 7 The second prayer relates to the imposition of a regime of financial supervision. A similar subject was agitated before me last year in relation to funds which it was thought might be collected by Father Mitrev in the course of his use of the church proposed under the interlocutory injunctive regime that I laid down in July 2003. I remarked in my second interlocutory judgment at [4] that "the case has gone for 5 or 6 years now without financial accounting and it seems to me that requirement for weekly accounting during this still delicate period is only a trigger for trouble and I decline to make that order." I said that the plaintiffs should keep strict accounts of all moneys taken by them in the church. Whilst I was not there dealing with an application by the plaintiffs for accounting by the defendants, I was referring to the absence of any regime of this sort in relation to the defendants up to that time. The proceedings have been pending for a long time without any such application being made in relation to the defendants' use of moneys. It is true that the situation changed somewhat last year with my judgment, which did go some considerable way towards defining the situation as to the terms of the trust. However, this application is made now by the plaintiffs at a very late stage of the proceedings and long after my judgment. If there were clear evidence of misuse of trust funds, there might, nonetheless, even at a late stage, be a case for injunctive relief to protect them. However, there is, in my view, on the material presented no such clear evidence. The tendering of annual accounts of the sixth defendant appears to show that accounts are probably kept, as one would hope, nor is there anything on the face of those accounts which makes clear inappropriate use of funds. There is an area in which I propose to grant some injunctive relief and, in my view, obedience to that relief will prevent expenditure clearly improper in view of the terms of the trust. Other than that relief, which I shall deal with below (see [11]), I do not see sufficient ground for granting relief. I say this, bearing in mind on the one hand the paucity of evidence of improper use; the time that has passed since the delivery of my judgment; the remarks that I made last year concerning the long absence of any such regime in this case; the inconvenience that, in my view, bearing in mind the history of this case, is likely to be caused by conflicts arising out of the grant of the relief sought; and the comparatively short period before the trial now fixed. I should also say that, whilst it is clear that the various items of real property are held upon the trusts that I have declared, it is in contest and far from clear that all the moneys held by the sixth defendant are held upon the same trusts. There will be no relief answering prayer 2. 8 There has been further debate about whether or not I should at least grant an injunction restraining the use by the sixth defendant of any of its funds to pay costs outstanding to its lawyers. The sixth defendant is proceeding to obtain judicial advice concerning this matter. I am told that there is no intention at present to make payment to the lawyers out of any funds of the sixth defendant or for the lawyers to receive any payment pending the obtaining of that judicial advice. The fact that the sixth defendant is proceeding to obtain that advice bespeaks a care on its part to use funds only in proper circumstances. On the application for restraint, I bear this fact in mind. I also bear in mind that it is not clear that all funds of the sixth defendant are impressed with this trust. There is, for instance, no reason to think that the funds recently raised by appeal for the costs of the litigation are impressed with the trust. But, further than that, I have already said that it is far from clear on the evidence that all of the funds of the sixth defendant are impressed with the trust. On all the evidence, in the exercise of my discretion, I decline to grant relief of this sort. 9 So far as prayer 3 is concerned, there is still lack of clarity in many ways as to the ambit of the trust, bearing in mind the requirement that the worship that must be conducted on the real property is worship of the Macedonian Orthodox Religion. The ambit of the rules of that Religion in a number of relevant regards remains to be determined and there may be serious questions as to the degree to which non observance of any rule spells into a breach of trust. The Court's function is, of course, only to ensure the proper use of trust funds, and not to lay down dictates as to the conduct of any religious observances. 10 However, some things are quite plain. I have always taken the view that worship of the Macedonian Orthodox Religion must be conducted by a celebrant authorised by the church hierarchy, as is generally the case with any hierarchical religion. If, however, it is needed, there is clear evidence to this effect before me on this application. That is in the form of a report attached to an affidavit of Father John (John Cluny Macpherson), a priest of the Russian Orthodox Church. The affidavit was filed on behalf of the defendants but portions of the report have been read on this occasion on behalf of the plaintiffs. The relevant portion is contained in par 16 of the report where Father John states "that the essential requirements for the celebration of the divine liturgy of the Orthodox church include that … the celebrant must ordained as a priest or bishop and authorised by the Bishop with jurisdiction." It seems to me that there is a strong prima facie case that the Bishop with jurisdiction is the first plaintiff. The orders that I made last July proceeded on the basis that the real property involved could be used for worship only if the worship is conducted by a priest authorised by the Bishop. I should add that, on this interlocutory hearing, the plaintiffs limited this prayer for relief to worship conducted on the real property rather than at any place, as originally claimed. 11 The strongest case against granting relief under the third prayer is that there is no imminent threat of services being conducted by an unauthorised celebrant. The sixth defendant says that it does not intend that this should occur. However, when there was disagreement about the appointment of an authorised priest over Christmas, services were conducted by an unauthorised celebrant. Easter is approaching and there must be some fear that there may be a repeat of this performance, bearing in mind the pressure put on those involved by the approach of the other most important season of the liturgical year. In those circumstances, I propose to grant an injunction restraining the use of the real property for the conduct of worship otherwise than by a priest authorised by the first plaintiff. 12 So far as there is any question as to whether any payments are being made out of any funds of the sixth defendant to a priest who does not have the Archbishop's authorisation to act, upon the evidence I do not reach a conclusion that such payments are currently being made, or are threatened imminently or in the foreseeable future. I decline to grant any relief relating to such payments. 13 So far as the fourth prayer is concerned, there seems little doubt that building work has been carried out over some months on the church itself. The evidence is that the work is almost finished and that what remains is largely, if not wholly, the painting of some icons and decoration. There is some evidence that it is a rule of the Macedonian Orthodox Church that any church building work must be approved by the Bishop, but the incidence of that rule is far from clear. However, application not having been made for relief relating to the building work over some months when it was going on, for that reason alone I do not propose to grant any relief in relation to work remaining, which is in any event minimal. 14 As to the fifth prayer, I do not propose to grant any relief. That prayer seeks an injunction which would permit inspection by the first plaintiff of the church at any time on 48 hours' written notice. The purpose of this injunction is not plain to me on the evidence. Furthermore, it is common ground that, upon a suggestion made in court yesterday, an inspection of the church took place last night and did apprise the Bishop of the progress of the work with a view to his embarking on a possible reconsecration of the church. That is, an inspection was able to be arranged and carried out at short notice. The fact that this could be arranged for a proper and valid purpose militates against the necessity for an injunction. 15 For the reasons that I have given, upon the usual undertaking as to damages being proffered, I propose to grant injunctive relief along the lines indicated and otherwise to dismiss the plaintiffs' application for interlocutory relief.

16 The most desirable course would be if a regime could be instituted whereby the church could be reconsecrated, as I ruled should occur as part of an interlocutory regime, and services conducted in it along the lines anticipated by the orders of 3 July 2003. I urge the parties to cooperate in seeing whether the church can proceed to reconsecration and use along those lines. The use of the church in that way would, of course, be a compliance rather than a non compliance with the terms of the injunctive relief that I propose to grant. 17 Upon the plaintiffs by their counsel giving to the Court the usual undertaking as to damages, I order that until further order the sixth defendant by itself its servants and agents be restrained from permitting the use of any of its real property for the conduct of any religious service not conducted by a celebrant authorised by the first plaintiff. …oOo… 18 The costs of the application have now been debated before me. The plaintiffs asked for relief under five heads. They obtained relief under only one. The application was dismissed as to the other four. The defendants ask for costs of the motion on the ground that they have substantially succeeded. The plaintiffs ask for costs of the motion, or at least some part of costs of the motion. In relation to the matter on which the plaintiffs succeeded in obtaining some relief, neither side fully succeeded. The defendants had agreed to something along the lines I have granted, but on certain conditions which have not been attached to the relief as given by me. Equally, it is true the plaintiffs asked for an injunction against the holding of religious observances at any place but conceded during the course of argument that the injunction ought to be limited to religious observances on the real estate the subject of the trust. Bearing in mind all the above considerations, it is my view that the appropriate order for costs is that there be no order as to the costs of the application. 19 Mr Parker has submitted that, because of the aspect of the plaintiffs' application whereby they attempted to obtain relief by way of the imposition of conditions on the vacation of the fixture in accordance with leave I had reserved, the costs of that day ought be reopened and ought go with the costs of today (his submission being that the plaintiffs should have those costs). However, I do not in the circumstances intend to disturb my reservation of the costs of 3 March: see Metropolitan Petar v Mitreski [2004] NSWSC 122 at [8]. The situation remains that the costs of that day are reserved, with the warning that I then enunciated, that the fact that the defendants on that occasion obtained an indulgence in circumstances which were not attributable to the plaintiffs meant it likely that the defendants would have to bear the costs of that application and any costs thrown away by reason of its success.

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