Metropolitan Petar v Mitreski

Application of Macedonian Orthodox Community Church St Petka Inc [2004] NSWSC 388 His Eminence Metropolitan Petar Diocesan Bishop of the Macedonian Orthodox Church of Australia & New Zealand v Macedonian Orthodox Community Church St Petka Inc NSWCA 8 December 2004 unreported Metropolitan Petar v Mitreski [2003] NSWSC 262 CASES CITED : Metropolitan Petar v Mitreski [2003] NSWSC 1089 Metropolitan Petar v Mitreski [2003] NSWSC 1213 Metropolitan Petar v Mitreski [2004] NSWSC 1225

His Grace Metropolitan Petar, the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand (P1) The Very Reverend Father Mitko Mitrev (P2) Lambe Mitreski (D1) Pero Damceski (D2) Boris Minovski (D3) PARTIES : Eftim Eftimov (D4) Mile Marcevski (D5) Macedonian Orthodox Community Church St Petka Incorporated (D6) Naum Despotovski (D8) Attorney General for State of NSW (D9)

T G R Parker and R E Steele (Ps) COUNSEL : G O Blake SC (D1 - 6 & D8) V Colaluce (Solicitor) (D9)

Sachs Gerace Lawyers (Ps) McConnell Jaffray (D1 - 6 & 8) SOLICITORS : I V Knight, Crown Solicitor (D9)

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 & NEW ZEALAND & ORS v LAMBE MITRESKI & ORS JUDGMENT 1 HIS HONOUR: This is yet another interlocutory application in these embattled proceedings. During their complex course over the years each side has, at different times, been tardy in meeting its obligations. In addition to that, the matter is complicated by such events as that last year in relation to the appeal from the decision of Palmer J giving judicial advice: Application of Macedonian Orthodox Community Church St Petka Inc [2004] NSWSC 388. After seven months, the appeal was terminated by its dismissal by consent in the Court of Appeal as incompetent on the ground that the appeal was brought without leave when leave was required: His Eminence Metropolitan Petar Diocesan Bishop of the Macedonian Orthodox Church of Australia & New Zealand v Macedonian Orthodox Community Church St Petka Inc NSWCA 8 December 2004 unreported. 2 Those matters I recite by way of background to the contest on the present application. Despite those matters, substantial progress in the case has not been lacking. On 4 April 2003 I delivered judgment on separate questions which had been ordered to be tried before me: Metropolitan Petar v Mitreski [2003] NSWSC 262. I formulated the declaratory relief appropriate to be granted as a result of my decision. Those orders, though made, were withdrawn, so that there could be one set of final orders only and only one substantive appeal to go ultimately to the Court of Appeal: Metropolitan Petar v Mitreski [2003] NSWSC 1089; Metropolitan Petar v Mitreski [2003] NSWSC 1213. Although those orders do not stand formally on the record of the Court, I have made in answer to the questions posed for my decision at the first trial a final decision both as to the terms of the trust and as to the form of the declarations in which that decision ought be clothed. The form those orders, when made, will take is as follows: "1 Declare that the property referred to in Schedule A hereto ('the trust property') was prior to the transfer of the legal titles to the sixth defendant held upon charitable trust to permit the trust property to be used by the Macedonian Orthodox Church St Petka Rockdale NSW Australia as a site for a church of the Macedonian Orthodox Religion and for other buildings and activities concerned with or ancillary to the encouragement practice and promotion of the Macedonian Orthodox Religion ('the trust').

2 Declare that in accordance with the terms of the trust and in the events which have happened the trustee is bound to permit the sixth defendant to use the trust property as a site for a church of the Macedonian Orthodox Religion and for other buildings and activities concerned with or ancillary to the encouragement practice and promotion of the Macedonian Orthodox Religion. " 3 The balance of the proceedings remains to be tried. The issues upon that second trial will essentially be whether, because of breaches of the trust which I have declared, or otherwise by reason of its conduct, the sixth defendant should be removed as the trustee of that trust and whether relief should be granted against the other defendants (apart from the Attorney General). 4 Before turning to the actual questions before me on this application, I also need to set forth what is happening in the separate stream of the case which includes the decisions of Palmer J and of the Court of Appeal mentioned above. The application for judicial advice which is being heard by Palmer J arises from the allegation made comparatively late in the day that the defendants were in breach of trust in defending these proceedings and in using the assets of the trust to pay for that defence. This led to another halt for some time in the preparation for the proceedings. Palmer J gave judicial advice which justified the defendants in defending the proceedings up to July 2004. His Honour limited the period in respect of which he advised that the defence could be undertaken because of the absence of a detailed opinion of counsel as to the prospects of success of the defence. That advice has not been obtained since the decision of the Court of Appeal in December 2004. 5 A matter that has been considered by me in earlier interlocutory decisions (eg Metropolitan Petar v Mitreski [2004] NSWSC 1225) and which will play a part in the judgment that I am now giving is whether the two streams, ie, the substantive proceedings and the proceedings in relation to the judicial advice, ought be allowed to flow simultaneously, or whether the conduct of the substantive proceedings should be checked until finality is attained in relation to the judicial advice. It is obvious from what I have said that Palmer J's decision, so far as it went, has not been disturbed in the Court of Appeal. The matter is back before Palmer J next Friday, 11 February 2005, for his Honour to consider the future course of that stream of the litigation. 6 Before me are applications by the defendants relating to the fifth amended statement of claim and to the particulars given by the plaintiffs of their case. Mr Blake, of Senior Counsel for the defendants, has applied for an order that the fifth amended statement of claim be struck out in whole or in part for various defects, whilst conceding that there ought be leave to replead. He has also drawn attention to what he says are deficiencies in the particulars given. I shall say something during the course of delivering this judgment concerning the overall form which the particulars should take, although I should say at once that I do not intend in this judgment to deal with alleged deficiencies of the particulars in specific regards. The reasons for this I shall make plain in due course. 7 As is apparent from its description as the fifth amended statement of claim, the plaintiffs' statement of claim has a chequered history. Part of that history that particularly affects this application is that the statement of claim was initially in a form where the claim as to the defendants' conduct was essentially set out in paragraphs 22 to 30 of the document, which did not then incorporate paragraphs 29A to 29G. This has led to a disjunction in the flow of the document, because the manner in which the "rules" are said to have been broken, the conduct breaching them, and the consequences, are articulated in quite a different way in the original paragraphs 22 to 29 than in the paragraphs 29A to 29G that were subsequently inserted. 8 It should be quite apparent by now that these proceedings are complicated and difficult. I do not need to go into too much detail in the particular defects that there are in particular provisions of the pleading. Mr Blake has made complaint about the form of paragraphs 20 and 21, but I shall not accede to an application to strike them out. If there really is any problem concerning them, it can be dealt with at a later stage by way of particulars. However, others of the complaints about particular paragraphs, for instance, paragraph 24(a) and paragraph 29G (the conduct in which does not seem to be the subject of an allegation of breach in paragraph 30 as at presently constituted) are made out. Why I need not go into more detail is that Mr T G R Parker, of counsel for the plaintiffs, has conceded that, at least on the face of it, the manner in which the plaintiffs' case is presented in the document is far from entirely satisfactory. However, for various reasons which I shall come to Mr Parker submits that any deficiency there is should not be dealt with in the manner sought by Mr Blake and, indeed, should not be dealt with at all at the present time. 9 In the end the positions of the respective counsel were very clearly stated by them in the course of argument before me. Mr Blake made the following submissions:

(1) That it is not difficult to foresee that, unless there is a pleading that is clear and comprehensive, there will, at the further trial, be substantial argument with attendant delay and cost as to the nature of the plaintiffs' case. (2) For the convenience of the Court and the parties and the avoidance of argument, cost and delay there should be one clear and comprehensive document that sets out the plaintiffs' case. At the moment one has to look at one pleading, which is not entirely clear, and at least five sets of particulars. To render those particulars comprehensible, five requests for particulars need to be looked at. (3) The second trial will be of considerable length. Substantial preparation for such a trial will be facilitated if the claim is clearly and comprehensively articulated. The defendants wish to put on a clear and comprehensive defence to the plaintiffs' claim. (4) As well as the attainment of clarity assisting at the trial it is important that the information which is necessary for the further conduct of the judicial advice proceedings respond clearly and accurately to the plaintiffs' claim. This it will do by responding to a clear articulation of it. The task of the Judge or Judges dealing with that aspect of the matter will be facilitated. 10 When I said earlier that Mr Parker conceded that the present state of the plaintiffs' claim was far from entirely satisfactory, what in fact Mr Parker said was: "Mr Blake's submissions, with respect, were ostensibly extremely reasonable ... if these proceedings were just being commenced and there were not all the features of these proceedings, which I wish to refer to about the history and about where we are going, and about what is to happen next, it would be very difficult to say anything in response to that." 11 Mr Parker drew attention, as did Mr Blake in reply, to various unsatisfactory aspects of the conduct of the matter. Mr Parker particularly emphasised, in relation to any question of the further refinement of the pleading or the particulars, that, in essence, these documents had stood for some time and the defendants had had plenty of earlier opportunity to raise their complaints. He said that they had not done so and ought not be allowed to do so now. He said in relation to the pleading that it was not "demurrable" and nothing ought be done about it. 12 Whilst in no way resiling from his concession that it was desirable that something should be done to achieve greater clarity in relation to the issues, Mr Parker said that this raised two important questions and that those questions were, When and How. As to How, he said that, in the exercise of the very ample powers which the Court undoubtedly has in this day and age, there are many ways of defining issues either in substitution for or in addition to pleadings. If it is necessary to embody the whole of the plaintiffs' case in one document for the sake of clarity and order at the trial, the Court ought leave the present pleadings and particulars alone and, at an appropriate stage, direct the provision of such a document or the definition of issues in some other way. As to When this should be done, he said that, as these matters have not been attended to before, I should not make orders that compelled these things to be done at this stage and before the situation as to judicial advice became clear. 13 As to When, I have earlier taken the view, particularly in light of the long delays in this case and the potentiality in each of the two streams I have mentioned for further delays, as witness the judicial advice appeal last year, that both streams should be allowed to flow and both aspects of the case ought move along together: Metropolitan Petar v Mitreski [2004] NSWSC 1225. Serious issues, including issues that have led to violence, arise in the course of these proceedings and they are important to the spiritual life both of an institutional church in this country and to a body of adherents to that faith. In my view directions should be given now as to the way in which the issues should be defined and clarified. The definition of the issues will not only further the substantive side of the case, but, in my view, will be of assistance to the Court in dealing with the application for judicial advice. 14 As to How, what Mr Parker has said as to the width and flexibility of the Court's power to define issues is quite correct. However, if one orders the formal definition of issues otherwise than by a pleading, one must take one of two courses. One must order that definition to stand in lieu of the pleading or pleadings as the document governing the issues in the case, or one must leave the pleadings to stand and the second document to operate under them. It is my experience in other long and complicated cases that, if one follows the second course, particularly in embattled proceedings, one has constant argument during the course of the trial as to whether or not the second definitional document goes outside the pleadings and therefore propounds a case not open to the relevant party. 15 In any event, it seems to me that a reformulation of the statement of claim or part of it imposes no greater hardship or expense on the plaintiffs than the preparation of a separate document as espoused by Mr Parker. In those circumstances, I intend to proceed by striking out a portion of the statement of claim with leave to replead. A pleading need not be "demurrable" in order to be struck out. It is sufficient if it is not cast in such a form as will best facilitate the orderly trial of the matter. To the extent that it does not, it is embarrassing or vexatious within the meaning of Part 15 r 26 of the Supreme Court Rules 1970 ("the SCR"). In any event, I do not think Mr Parker says it is inappropriate for me to strike out the pleading if I come to the conclusion that that is what ought be done, as opposed to urging upon me the other considerations as to the manner in which and time at which the definition should take place. In other words, I have come to the conclusion that the way in which the definition of the case should take place is by a repleading of the statement of claim, which has the various defects to which I have adverted above. The portion appropriate to be struck out is paragraphs 22 to 30 inclusive of the fifth amended statement of claim. 16 I do not think it appropriate to rule upon the adequacy of particulars in specific regards until there is a formulation of the further amended statement of claim and a collection together of all the particulars necessary to support the pleading allegations. When I say "necessary", I mean necessary in the sense in which the word is used in Part 16 r 1 of the SCR and as extending to any further and better particulars that ought be given upon being sought. I shall leave it entirely to the pleader as to the degree to which it is wished to include the particulars in the statement of claim as repleaded, but, insofar as they are not included in the statement of claim, all particulars given to date and any other necessary particulars must ultimately be incorporated in a single separate particulars document that is comprehensible without reference to any other document, so that the plaintiffs' case is fully set out in, at the most, two documents - the sixth amended statement of claim and a comprehensive particulars document. As I say, when those documents are available any questions that remain as to the sufficiency of particulars may be dealt with. 17 Rather than the sixth amended statement of claim being filed, with the possibility of an application to strike it out, I propose to direct that it be brought into Court and leave then sought for the filing of the particular document, so that any question of its adequacy can be debated on that occasion without the document being on the court record. Thereafter outstanding questions of particulars may be finalised. 18 The orders that I propose to make are as follows:

(1) Order that paragraphs 22 to 30 inclusive of the fifth amended statement of claim be struck out with leave to replead. (2) Direct that the repleaded statement of claim plead consistently and methodically all matters to be relied on at the second trial as justifying the removal of the sixth defendant as trustee (and as justifying any other relief against the sixth defendant or any other defendant). (3) Without derogating from the generality of direction 2 direct that the repleaded statement of claim: (a) state methodically and in the same place (see struck out paragraph 22) all provisions of Church law or other requirements non compliance with which is alleged (whether by reason of the fact that they are incorporated in the trust or otherwise) to constitute a breach of trust; (b) state seriatim all conduct relied on as constituting a breach of trust specifying the provision referred to in (a) of which it is said to be in breach. (c) Allege in the substantive part of the pleading rather than in particulars all acts and omissions relied on as constituting such conduct (cf struck out paragraph 24(a) and the 13 factual matters alleged in particulars as constituting repudiation of the alleged Archbishop's authority). (4) Direct that particulars may be included in the statement of claim or in a single separate particulars document. (5) Direct that the sixth amended statement of claim and any separate particulars document when formulated be brought into Court and leave be sought to file the documents in that form. 19 Mr Blake also complained that the case brought forward by Mr Parker was duplicitous or was unavailable to the plaintiffs in that, on the face of the pleading, the plaintiffs complained that conduct of the defendants was in breach of the trust in the form in which they originally propounded it or, alternatively, in breach of the trust as I have decided it should be declared. In my view no difficulty arises from them making these alternatives plain on the face of the pleading. They must maintain the pleading as relating to the trust which they originally propounded, because they may in due course seek to appeal my decision as to the terms of the trust. If they succeed in that appeal, the appropriate exercise will be to test whether the conduct complained of is in breach of the trust in that form and that course must remain open to them. Mr Parker very properly concedes that on the further trial that will take place before me he will not be able to conduct the case on the first basis, because, for the purposes of that trial, my decision as to the form of the trust and the declarations that should be made in relation to it cannot be challenged and the plaintiffs will, at that trial, conduct the case on the basis that the conduct complained of contravenes the trust as declared by me. I see no difficulty in the case proceeding in this way and, as I have indicated, it is entirely proper that it do so. …oOo… 20 Mr Parker has just placed on the record something to clarify his attitude to the striking out of the statement of claim. Despite what I said in [15] above, Mr Parker does contend that it is beyond power or inappropriate for me to strike out the statement of claim. May I say two things about that. The first is that, as I think is plain from [15] above, it is my view that the relevant paragraphs of the statement of claim, for reasons I have given, do breach the requirements of Part 15 r 26 of the SCR. I should add, however, that I do not regard that as the only source of power to make the order. The Court is under a duty, in this day and age, to ensure the just, quick and cheap disposal of proceedings. Uttering those words in the context of these proceedings makes plain, of course, that they must be regarded as relative. But I regard as so ample the powers of the Court to ensure the orderly conduct of proceedings by the proper and orderly definition of issues that I should take the Court to have the power to strike out a pleading which was not as orderly as possible and to direct a pleading that was more orderly. As I say, I do not primarily rely upon that proposition, because in my view in this case Part 15 r 26 is breached. 21 I make orders 1 to 5 as I have enunciated them. Costs of the application are reserved.

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