Paula Jensen v Bank of Queensland Limited

Judgment 1BEAZLEY JA: On 22 January 2009 the respondent, Bank of Queensland, issued a statement of claim in the Supreme Court seeking an order for possession of property at 11 Melaleuca Close, Castle Hill, an order for a writ of possession, and an order for judgment in a sum just over $870,000. 2On 21 May 2009 an order was made dispensing with the requirement for personal service of the statement of claim upon the named defendants, including the applicant here, Ms Paula Jensen, and ordering that service of the statement of claim be effected on the defendants by forwarding a sealed copy of the order and the statement of claim to the address 11 Melaleuca Close, Castle Hill, and by leaving a copy of the statement of claim and a sealed copy of the order in the mail box at 11 Melaleuca Close, together with other documents. 3Subsequently affidavits were filed with the court deposing to service of the statement of claim in accordance with those orders. 4On 21 July 2009 Hoeben J struck out the defence. On 29 September 2009, the bank obtained default judgment on the statement of claim. On 3 December 2009 the bank obtained possession of the property. 5On 15 January 2010 Ms Paula Jensen filed a notice of motion, which included an application for an order that default judgment be set aside. 6That notice of motion came before Hoeben J on two occasions: Once on 9 February 2010 and once on 16 March 2010. On the later date Hoeben J ordered that the matter be listed for hearing before Davies J on 27 April 2010. 7The defendants did not appear before his Honour on 22 April 2010, but Ms Faye Combe asked for leave to appear on that day because Ms Jensen was sick. The matter did not proceed on that occasion but was set down by his Honour for hearing on 13 May 2010. 8On 13 May 2010 another adjournment was sought on behalf of Ms Jensen. A Ms Ormbacken appeared on behalf of Ms Jensen. The previous day, 12 May 2010, Davies J's associate had received an email, to which was attached a medical certificate of Dr Robyn Klumpf, dated 12 May 2010, indicating that the defendants were too ill to attend court, having regard to the conditions which were referred to in the medical certificate. 9His Honour refused the adjournment application. His Honour then dealt with the substantive issues raised in the notice of motion. The two significant matters were the issue of setting aside of the default judgment and the application for pro bono assistance. His Honour rejected both applications and dismissed the notices of motion. 10The summons for leave to appeal is brought against the orders made by Hoeben J and against the orders made by Davies J. The arguments which were raised in support of the summonses for leave to appeal are as follows: (1)that the applicants had not been properly served with the initiating process; (2)that his Honour, Davies J, erred in refusing to adjourn the application; (3)that the default judgment should have been set aside because of the fraud of the respondent bank, and; (4)because this court, that is the Supreme Court, did not have jurisdiction, as the applicant claims that the area which is constituted by the property 11 Melaleuca Place, Castle Hill, has seceded from the Commonwealth of Australia. 11I will deal with each of those issues in turn. As I have already indicated, there was an order of the court for substituted service of the initiating process. The applicants complain that they had always informed the respondent bank that their address was a post office box number and that they ought to have been served with documents at that address. That is not to the point. Service must be affected in accordance with the rules of court or any order of the court. The rules of court required, in the first instance, that the statement of claim be served personally. An application was made to the court for substituted service in circumstances where there was evidence before the court that personal service had not been able to be effected despite many attempts. The court made an order for substituted service, which is regular on its face, and, accordingly, there is no basis for interfering with the orders of Davies J on the basis of what I will call the "service issue". 12The applicant next complains that an adjournment ought to have been granted by his Honour, Davies J. Davies J had before him the medical certificate of Dr Klumpf, which has been marked exhibit A in these proceedings. His Honour was not prepared to act upon that certificate. His reasons for doing so are set out at page 3 of his reasons, commencing "The provision of the medical certificates", and concludes with the words on page 4, "for those reasons I will proceed with the hearing of the motions in the absence of the defendants". 13A court's decision as to whether or not to grant an adjournment is a matter which falls within the discretion of the judge and involves a matter of practice and procedure and is not a matter in respect of which a court will readily grant leave: In Re the Will of Gilbert (1946) 46 SRNSW 318. Davies J gave reasons why he refused the adjournment and no error in exercise of the discretion has been demonstrated. It is also relevant to keep in mind that this court has a statutory obligation, under the Civil Procedure Act 2005, s 56, to ensure that the processes of the court, and matters of practice and procedure, are dealt with justly, quickly and cheaply. This requirement has been emphasised as being a central tenet in the administration of justice by the High Court: Aon Risk Services Australia Limited v Australian University (2009) HCA 27. 14The next basis, which was argued in support of the summons for leave to appeal, was that the Bank had, in effect, been able to obtain judgment on the statement of claim, and therefore, possession of the property, because of its fraud. An application to set aside a default judgment is governed by UCPR rule 36.16.1 and also involves the exercise of a discretion. In exercising the discretion the court is required to determine whether the interests of justice require the judgment to be set aside. There are many authorities in support of that proposition. It is sufficient to refer to the well-known authority; Stollznow v C alvert [1980] 2 NSWLR 7789. 15It will only be in the interests of justice to set aside a default judgment if the defendant, or defendants, demonstrated an arguable defence. I have had regard to the terms of the defence in this case. They rely significantly upon the secession issue, but they also deny the owing of any debt. As I understand the submissions which have been made, it is contended that the debt is only asserted by the Bank because of its own fraud. 16As Davies J indicated, whilst this allegation was made there was no evidence to support the allegation, and accordingly, I see no error in his Honour refusing to set aside the default judgment on that basis. 17Finally, there was the secession issue. Davies J dealt with that, noting that the applicants asserted that they are not subject to the jurisdiction of this court. As I understand it, that is a submission which continues to be made. As Davies J observed, the property, which is subject of the proceedings, is registered property within the State of New South Wales, ultimately under the control of the State of New South Wales, and the court does have jurisdiction to deal with the matter. 18When regard is had to the three defences that his Honour considered arose out of the material; namely, the service issue, the fraud issue, and the secession issue, it was open to his Honour to conclude that none of these demonstrated a basis for setting aside the judgment. In other words, there was nothing before his Honour which was sufficient to raise an arguable defence or defences. 19A review of the evidence filed by the applicant in support of the summons for leave to appeal demonstrates that his Honour's assessment of this matter was clearly open to him. It follows that, the prospects of success of an appeal from his Honour's orders are minimal. Accordingly, leave to appeal on those matters should be refused. 20Complaint is also made as to his Honour's refusal to make an order for pro bono assistance. That is also a discretionary matter. In refusing to make the referral, his Honour considered, amongst other things, that there was no justification for referring the defendants for pro bono assistance and there was nothing to suggest that there was a possibility that the judgment would be set-aside on the material that had then been provided. It was open to his Honour to take that matter into account. Part 7 rule 36.1 provides that, if it is satisfied that it is in the administration of justice, that a court can order a referral of a litigant to the registrar for referral for legal assistance. His Honour was not satisfied on the material before him that there was an arguable defence and I consider that his Honour's discretion did not miscarry in any way in respect of that matter. 21Accordingly, I would refuse leave to appeal in respect of that order also. 22MACFARLAN JA: I agree with the presiding judge. I add in relation to the complaint that the applicant was not properly served with the statement of claim that even if the applicant's complaint has any substance it cannot be regarded as a material one as the applicant did in fact receive a copy of the statement of claim, albeit by informal means, and subsequently filed a defence. I also add, in relation to the complaint concerning pro bono assistance, that the presiding judge, Beazley JA, made an order in relation to the obtaining of assistance late last year and attempts have been made to procure that assistance, but have been unsuccessful.