Ramzy Sebie v Andy Duong Duc Pham

Supreme Court of NSW|2021-11-04|Before: Sackar J, Honour Slattery J

Judgment

These proceedings were commenced by Amended Summons dated 30 May 2018. In broad terms the plaintiffs seek a declaration that the first and second defendants' interest in a property at Chiswick is defeasible for fraud, and that the first defendant holds the property on trust for the plaintiffs and fourth defendant. Further, that the fourth defendant has subrogated the right of a mortgage and has a secured sum of $504,709 in priority to the first and second defendants. There are various other forms of relief sought in relation to the other defendants.
The current matter concerns whether the proceedings should be dismissed for want of prosecution.

The pleading is defective

The plaintiffs rely on their Amended Summons on a "trust ownership" in the Chiswick property. It is unclear if this is to be found in a written or oral (or partly oral) agreement but it is clear from the pleading that a purely equitable right is asserted. Although it is claimed that the Commonwealth Bank provided moneys secured by first mortgage there is no specificity of total purchase plus stamp duty and legals, nor the amount the bank advanced and on what terms. The plaintiffs assert that around $1,379,315 was advanced to the third defendant "via their company ENA Development Pty Ltd" although for some reason, ENA is a defendant in the proceeding. There is no specificity of the amount paid by the first and second defendants and nor is it alleged that they have no interest in the property, only that they acquired their interest by fraud (again unspecified). It is by no means clear even if the first and second defendant are said to have knowledge of the arrangement between the third defendant and the plaintiffs that necessarily involves any fraud at all by reason of them acquiring the property. Further, it was the fourth defendant in July 2015 that paid out the mortgage (the second loan).

History of the plaintiffs' involvement in the matter

Some preliminary material was filed in May 2018, including multiple expert reports and affidavits first filed in related proceedings commenced in 2015 ("the 2015 proceedings") to which Mr Ramzy Sebie and Mrs Rose Sebie were not party. The matter had not otherwise progressed since that time.
Mr Ramzy Sebie appeared in person at the first hearing of this matter on 2 May 2018 and then later that year occasionally was represented by counsel or appeared as a litigant-in-person. He passed away in 2019 although there is no material about his will or whether there is an executor to his estate.
Mrs Rose Sebie has seemingly not appeared at any hearing of the 2018 proceeding. At a directions hearing on 12 June 2018, his Honour Slattery J was told that her capacity was affected by a condition, possibly dementia and that she may need a tutor (Transcript of 12 June 2018 at T.33). On 14 June 2018, Mr Ramzy Sebie had requested to appear by phone as tutor for his wife which was denied.
A notice of motion was filed on 23 October 2019 seeking pro bono assistance for Mrs Sebie who had stated in her affidavit in support that she had Parkinson's disease and was an 83 year old pensioner. She also asked for Mr Robert Sebie (the third defendant and the son of herself and Mr Ramzy Sebie) or Ms Sophie Georgy to act on her behalf until the pro bono application was determined.
During a directions hearing before myself on 3 May 2021 for the 2015 proceedings, Ms Georgy who is apparently a law graduate but not a current legal practitioner (Transcript of 3 May 2021 at T.6/10-14) appeared by leave to act as agent for the cross-claimant in that matter, ENA Development Pty Ltd (the fourth defendant in the 2018 proceedings). On that occasion, Ms Georgy put forward an amended notice of motion filed 6 March 2020 proposing to determine whether moneys the subject of the 2018 proceeding ought to be paid to Mrs Rose Sebie, the second plaintiff in this matter (Transcript of 3 May 2021 at T.3/41). At the time I noted it was inappropriate to determine such a matter by notice of motion and Ms Georgy informed me of the current proceeding having been filed in 2018 (T.4/33-T.5/10). The issues appeared to relate to the cross-claim in the 2015 proceedings, so I proposed to list the notice of motion relating to Mrs Sebie at the same time as the cross-claim before the Registrar (T.6/33-50). Mrs Sebie is not a party to the 2015 proceedings and as far as I am aware has never sought to be joined.
Her Honour Ward CJ in Eq dismissed Mrs Sebie's notice of motion seeking pro bono assistance in the 2018 matter the next day on 4 May 2021: Sebie v Pham [2021] NSWSC 470. The notice of motion was being agitated by Ms Cheryl Ansah, claiming to be a friend of Mrs Sebie, but not by either of Mr Robert Sebie or Ms Georgy who had both been proposed by Mrs Sebie in her affidavit in support: [6]. There was no evidence as to the actual relationship between Mrs Sebie and Ms Ansah, nor was it clear whether Mrs Sebie was capable of providing instructions: [21]. There was also almost nothing to shed light on the underlying merits of Mrs Sebie's claim of interest in the Chiswick property: [22]. Finally, the relief sought in the amended summons was said to be to a large extent obsolete following the sale of the Chiswick property: [23].
At a subsequent directions hearing for the 2015 matter on 8 June 2021 I indicated that I would fix dates for the notice of motion dated 6 March 2020 given the cross-over of the claims (T.5/19-23). At that time, Mr Zipser of counsel indicated that at the last few hearings of the 2015 matter before the Registrar, someone had sent emails to cause the current 2018 proceeding to be listed concurrently. Given it is accepted that Mrs Sebie is incapacitated, the Registrar stated that a tutor must be appointed in the 2018 matter (T.5/25-33). I was then notified that Ms Ansah had filed an application for tutor in the current proceedings on 27 May 2021.
I set out a detailed history of the Court's interactions with Ms Ansah in Andy Vuong Duc Pham v Enterprice ICT Pty Limited [2021] NSWSC 1132. In brief, on 4 August 2021 Ms Ansah sought to appear as a McKenzie friend for Mrs Sebie in the 2018 proceedings. On that occasion I informed her that her application to be appointed tutor did not comply with the Court rules and offered to organise pro bono assistance to explain what would be involved were she to be appointed tutor, which she accepted. Ms Ansah did not appear at the next listing of the matter on 19 August and later sent correspondence to my chambers criticising various persons and by implication the Court, stating that she was seeking legal assistance for Mrs Sebie and not herself. I also received correspondence from the Bar Association setting out their multiple unsuccessful attempts to contact Ms Ansah to facilitate providing her pro bono assistance. Ms Ansah did not appear at the directions hearing on 2 September. On that date Mr Zipser indicated his client was considering making an application to dismiss the 2018 proceedings and I noted that I would hear such an application and relisted the matter for 10 September.
At a directions hearing for the 2018 matter on 10 September I noted that Ms Ansah had written to my Associate asking to be excused from further appearing in the proceedings, which I allowed. I had also received submissions from Mr Robert Sebie and the Phams regarding the question of whether to dismiss the matter. I stated that I would like to give Mrs Sebie an opportunity to have a tutor appointed, but that such a person must provide an appropriate application under the rules and warned that the amended summons was an entirely inadequate document which would need to be fixed by that tutor (Transcript of 10 September at TT.6-7).
I was to address the question of the application to strike out the current proceedings on 14 October on the same day as dealing with issues in the 2015 matter. The 2015 matter ran late, so I proposed to relist the current proceedings at a date to be fixed in the next week. I should note that no one appeared for Mrs Sebie on 14 October and that no application for appointment of tutor has been filed since that date or an attempt made to correct the amended summons. Mr Jones, solicitor, appeared for ENA Development Pty Ltd in the 2015 proceedings, but explicitly confirmed he did not have instructions in the 2018 matter.
I re-listed the 2018 matter on 19 October to hear the first and second defendants' application to dismiss the proceedings. Despite having previously indicated his availability on that date, the night before the directions Mr Robert Sebie informed the Court that he could not attend. At that time I raised concerns regarding compliance with UCPR r.13.6 and set the matter down again for 20 October, notifying all of the parties, including Mr Robert Sebie and ENA, of the time. Mr Sebie did not participate in those directions nor inform the Court about any issues with his availability. I further canvassed my concerns regarding due notice being given to Mrs Sebie under r.13.6 and relisted the matter for 22 October to address this issue. Despite prior notification, neither Mr Robert Sebie nor a representative of ENA attended. I signified that the Court would send any contact details we had for Mrs Rose Sebie in the file to the parties, so that a reasonable attempt at giving notice could be made.
At a directions hearing on 29 October, Mr Zipser of counsel highlighted the steps that Mr Pham had taken (as outlined in his affidavit of that same date) using these contact details to notify Mrs Sebie. Mr Pham stated in his affidavit that he has not been contacted by Mrs Sebie or a person on her behalf in response to his written communications. In written submissions on 4 November 2021, Mr Zipser of counsel confirmed the position remained the same.
The defendants brought to the Court's attention an email sent on 28 April 2021 to Mr Pham, purportedly written by Mrs Sebie. While the defendants doubted the email was written by Mrs Sebie because of the issue of her capacity, they noted that the email demonstrated that someone with knowledge of matters close to Mrs Sebie wrote it, and that the email address was active in late April 2021. This was one of the email addresses the defendants used to attempt to contact Mrs Sebie.
One of the addresses that the defendants posted a notice to was in Seven Hills and has been the family home of Rose and Ramzy Sebie since the late 1960s. Rose and Ramzy Sebie remain the registered proprietors of the property. On 26 October 2021, Mr Pham posted a letter to Mrs Sebie at the address by express post. The defendants argued that even if Mrs Sebie is a person under legal incapacity, there is a fair chance that she continues to live in the house and is cared for there. Even if she no longer lives there, there is a good chance a family member lives there. Alternatively, if the house has been rented to tenants, the tenants would have forwarded the correspondence to Mrs Sebie.
Mr Jones who acted for ENA in the 2015 matter explicitly confirmed at the hearing of 29 October that he was not instructed in the 2018 matter. Mr Robert Sebie and a representative of ENA were not present on this occasion despite notification. The last of the letters sent by Mr Pham was delivered on 28 October 2021, so I listed the motion to dismiss the proceedings on 4 November, being five days from the latest possible date that notice could be said to be given.

Legal principles

There are multiple ways in which proceedings which have not been pursued or actively participated in by the plaintiff can be dismissed.
Rule 12.7(1) of the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR") provides that: (1) If a plaintiff does not prosecute the proceedings with due despatch, the court may order that the proceedings be dismissed or make such other order as the court thinks fit.
In relation to this rule, in Green v Healthscope Ltd t/as The Hills Private Hospital [2015] NSWCA 325 ("Green v Healthscope"), Gleeson JA commented that: [26]…when there has been no hearing on the merits, a court should be reluctant to make an order dismissing proceedings for want of prosecution or want of due despatch, unless there has been an intentional and contumelious default on the part of the plaintiff, or inordinate or inexcusable delay giving rise to a substantial risk that a fair trial would not be possible: Birkett v James [1978] AC 297at 318. Nonetheless, it has been observed that the stringency of that principle has been diminished by the enactment of ss 56-60 of the Civil Procedure Act 2005 (NSW): see State of New South Wales v Plaintiff A [2012] NSWCA 248 at [17] (Basten JA). Accordingly, it is now necessary to have regard to the "overriding purpose" referred to in s 56, being to "facilitate the just, quick and cheap resolution of the real issues in the proceedings": Hobbs v Australian Securities and Investments Commission [2013] NSWCA 432 at [52] (Barrett JA). [27] The exercise of the power under UCPR r 12.7 to dismiss proceedings for want of prosecution involves a balancing exercise, in the course of which a variety of factors may be considered: Dank v Cronulla Sutherland District Rugby League Football Club Ltd [2014] NSWCA 288 at [103].
Green v Healthscope also involved a plaintiff that was under a legal incapacity. In that case, however, the plaintiff was legally represented and although there had been delays in prosecuting by the time judgment was given a tutor had been appointed for her and the matter was ready to be given a fresh hearing date: [43]. In those circumstances, Gleeson JA refused to dismiss the proceeding: [45].
In Ghosh v Ninemsm Pty Ltd (2015) 90 NSWLR 595, the Court (Macfarlan JA, Leeming JA and Adamson J in agreement) reiterated (at [40]) that the discretion to dismiss proceedings under r.12.7 "is broad and should not be confined by rigid formulae" (citing Stollznow v Calvert [1980] 2 NSWLR 749 at 751), that a decision to dismiss a proceeding "must depend on the circumstances" of a case, and that it is appropriate "to consider whether or not there is evidence of particular prejudice to the opposing party by reason of the delay" (quoting Walsh JA said in Witten v Lombard Australia Ltd [1968] 2 NSWR 529 at 534). Delay was said to arise not only out of lack of activity, but also out of a "want of constructive activity": [41].
Rule 13.6 of the UCPR also allows for the dismissal proceedings for the non-appearance by a plaintiff and provides: (1) If there is no attendance by or on behalf of a plaintiff at a hearing of which the plaintiff has had due notice, the court may adjourn the hearing to another date and direct that not less than 5 days before that date a notice of the adjournment be served on the plaintiff advising that the proceedings may be dismissed if there is no attendance by or on behalf of the plaintiff at the adjourned hearing. (2) If the plaintiff has been given notice in accordance with subrule (1) and there is no attendance by or on behalf of the plaintiff at the adjourned hearing, the court may dismiss the proceedings. (3) This rule does not restrict any other power of the court to dismiss proceedings.

Submissions of the parties

Only the first, second and third defendants made submissions.

Submissions of the first and second defendants

The first and second defendants provided submissions in support of their application to dismiss the 2018 proceedings for want of due dispatch or non-appearance by the plaintiffs under UCPR r.12.7(1) and 13.6 respectively.
First, it was argued that the plaintiffs have not taken any active steps to prosecute or advance the 2018 proceedings since mid-2018. Mr Ramzy Sebie died in 2019 and it appears to be common ground that since June 2018, Mrs Sebie has been a person under legal incapacity within the meaning of Part 7 Div 4 of the UCPR.
On 5 December 2018, for example, Mrs Sebie appeared in a court room before Beazley P who recorded in a judgment (Sebie v Pham [2018] NSWCA 333) in a separate but related matter at [19] that: The records of this Court will record that yesterday Mrs Rose Sebie was in Court and was represented by counsel, but that counsel, having spoken to Mrs Rose Sebie, had taken the view that he did not consider he should proceed with any application that might have been filed by Mrs Rose Sebie, (about which there was some doubt), or rely upon her affidavit, as he was not sure that she was competent to understand what was going on.
Second, it was highlighted that Mr Robert Sebie is the son of Mrs Sebie and cares for her and her financial interests in the 2018 financial proceedings. Further, that Mrs Sebie is a director of ENA and that her claim in the 2018 proceeding runs parallel to a claim in the 2015 proceeding. Therefore, those close to Mrs Sebie who have a desire to protect her financial interests in the 2018 proceeding have been on notice that if the 2018 proceeding is to be heard this must be done at the same time as the 2015 proceeding in December 2021. Despite this, the plaintiffs have not taken any active step to prosecute the 2018 proceeding.
Third, if no one appears for Mrs Sebie at the next directions hearing, the preconditions for dismissal under r.13.6 will be satisfied.
Fourth, Ms Ansah has held herself out to the Court as a person in close contact with Mrs Sebie who is familiar with her personal circumstances, the 2015 and 2018 proceedings and is willing to appear for Mrs Sebie if permitted to do so. Ms Ansah did not take up the opportunities offered to her to obtain legal advice and file an amended application to become tutor nor organise for someone else to do so. She has told the Court she is now too busy for further involvement in the matter.
Fifth, if the 2018 proceeding is neither dismissed nor ready for hearing in December 2021, the Phams and Ms Musabwasoni will suffer immense prejudice. The first and second defendants submitted that this prejudice would be that if ENA's cross-claim in the 2015 proceeding is dismissed following the trial in December 2021, a person will materialise and seek to prosecute the 2018 proceeding instead, leading to a further substantive hearing concerning the same subject matter as ENA's cross-claim. The Phams and Ms Musabwasoni would incur additional costs and the fund of money in the Supreme Court would need to remain in place until the 2018 proceeding is determined.
Sixth, if the 2018 proceeding is neither dismissed nor ready for hearing in December 2021 and there is a subsequent substantive hearing of Mrs Sebie's claim, which may be before a different judicial officer, this may lead to conflicting findings of fact concerning the same subject matter.
Seventh, the Court should not give Mrs Sebie a further chance to organise the 2018 proceeding. If someone appears or seeks leave to appear for her and asks for more time, the appropriate approach would still be to dismiss the proceeding.
Eighth, the first and second defendants argued that the consequence of dismissing the proceedings cannot be said to be draconian. If a person concerned about the interests of Mrs Sebie genuinely believes at a future point in time that there is merit in the cause of action underlying the 2018 proceeding, that person can, upon formally being appointed a tutor for Mrs Sebie, firstly apply to set aside the dismissal order under r.36.16(2) of the UCPR or subject to paying any costs order, commence a new proceeding since no res judicata or Anshun estoppel arises where proceedings are dismissed for want of prosecution without determination of the substance of the claim.
The first and second defendants further argued their application could not be said to be a denial of procedural fairness and cited the case of Kapoor v State Transit Authority of NSW [2010] NSWCA 143 ("Kapoor") as an example from which to distinguish the present circumstances. The plaintiff in Kapoor had been very slowly prosecuting their claim in the District Court. After the plaintiff became unrepresented he told the Court he intended to appear for himself and the matter was therefore delayed. On a date in late January 2008 the plaintiff failed to appear and counsel for the defendant made an ex parte application without notice to the plaintiff to dismiss the proceedings for want of prosecution. The Court of Appeal stated that counsel should not have made that application and the Court should not have entertained it: [23]. This amounted to a denial of procedural fairness: [59].
The first and second defendants also made submissions as to costs. They argued that if the 2018 proceeding is dismissed, the Court should, consistent with r.42.20 of the UCPR, order that the plaintiffs pay the costs of the Phams. Although the costs are not large and the Phams are unlikely to try to enforce the costs order, the combination of a costs order and rule 12.10 of the UCPR give the Phams some protection in the event (which the Phams consider likely) that, if ENA's cross-claim is dismissed following the trial in December, Robert or another person will attempt to resurrect the 2018 Proceeding.
The first and second defendants finally addressed the notice of motion of 6 March 2020 in the 2015 proceeding. From time to time Mr Robert Sebie and Ms Ansah have sought to list for hearing the claim in paragraph 6 of the Notice of Motion, which appears identical to Mrs Sebie's claim in the 2018 proceeding. The Phams submitted that if the Court dismisses the 2018 proceeding, it should also order the removal of Mrs Sebie as an applicant to the Notice of Motion. Mrs Sebie is not a party to the 2015 proceeding so it is irregular and improper that she is an applicant on the motion. By March 2020 Mrs Sebie was under legal incapacity and there is no evidence that her consent to being named an applicant was properly obtained. Mrs Sebie has never appeared, in person, by a lawyer, or by a tutor in the 2015 proceeding. Finally, if Mrs Sebie is not removed as an applicant, if ENA's cross-claim in the 2015 proceeding is dismissed, the risk remains that a person may try to prosecute Mrs Sebie's claim in paragraph 6 of the Notice of Motion.

Submissions of the third defendant

The third defendant made submissions as a friend of the Court.
He argued that the manner in which the Phams are seeking to dismiss Mrs Sebie's application without notifying her or giving her opportunity to reply to such an application is unjust.
The third defendant argued that when Mr Ramzy Sebie was alive he had been active in the proceeding, and that he and Mrs Sebie had appeared in person at Court to pursue their application. Before Mr Ramzy Sebie died he had been the main advocate for Mrs Sebie's claim.
It was submitted that in October 2019, Ms Ansah first appeared on behalf of Mrs Sebie and continued to do so until this year. She attempted to formalise her application to become a tutor for Mrs Sebie, but leave was not granted and then in June 2021 Ms Ansah became extremely busy in her line of work due to the COVID-19 outbreak in Sydney.
No real costs were said to be incurred on behalf of the parties in the 2018 proceeding as it was rarely listed and was running concurrently with the 2015 matter.
It was argued that the proceedings should be stayed until Mrs Sebie could secure a tutor. Due to the lockdown restrictions it was difficult for any possible representatives to liaise with Mrs Sebie to assist her.

Consideration

The first plaintiff, it is accepted, died in 2019. No one, including an executor should one exist, has ever sought to continue the proceedings on behalf of his estate.
It is also accepted that the second plaintiff is in need of a tutor. Recent attempts to appoint such a person have failed and none is likely to emerge it seems to me given the history of the matter.
The third defendant, Mr Robert Sebie, has taken somewhat an indifferent interest in the proceedings only appearing intermittently by telephone. The fourth defendant, ENA, it is obvious has no interest in the proceedings. That has been abundantly plain by reason of the fact that in recent times ENA, also a party to the 2015 proceedings and currently represented in those proceedings by Mr Jones solicitor and in due course I am told Mr Stapleton of counsel when the matter is due to be heard in December, has twice disavowed any instructions in relation to these proceedings.
The pleading is hopelessly flawed and very little if any evidence has ever been filed nor has any serious attempt been made to progress the matter.
I am satisfied that all relevant parties, more importantly the second plaintiff, have been given more than adequate notice of the first and second defendants' application. There is no doubt here that neither plaintiff has sought to prosecute the proceedings with due despatch. Even were the matter to proceed it could not possibly do so without a dramatic revision of the pleadings. It is also entirely unclear from the current pleading, but it is certainly open to infer, that the oral testimony of Mr Ramzy Sebie (deceased) and / or his wife, Mrs Rose Sebie, would have been necessary to provide the relevant context for the moneys advanced in the absence, or so it seems, of written documentation. There is also an entire confusion in the proceedings about whose money was actually advanced.
Striking out a proceeding, even in cases where it can be recommenced, is a serious step not to be taken lightly, and depends on the circumstances of the case. Especially where one plaintiff is deceased and the status of their estate is unknown and the other is incapacitated, every effort must be taken to ensure proper notice to persons or their representatives. With that in mind, I have, as will be apparent from the history of this matter, been slow to determine the first and second defendants' application. I am satisfied the defendants made all efforts possible to bring their application to the attention of anyone who might represent Mr Ramzy Sebie's estate or act on behalf of Mrs Sebie. I am satisfied due notice as to the application for costs on the motion was also given.
There has been no attempt in my view constructively to activate this litigation beyond merely commencing the process with a flawed pleading. There appears no interest from the first plaintiff's estate and no one it seems is prepared to come forward and nominate themselves (subject to Court approval) as a tutor for the second plaintiff. The continuation of these proceedings, in my view, is grossly unfair to all defendants, but in particular the first and second defendants. They have been embroiled in litigation concerning this and related matters now for some years and much of the disputation is not of their doing. In my view, due notice having been given and what appears to be an entire lack of interest on the part of the plaintiffs, it is appropriate that the matter be dismissed for want of prosecution and the plaintiffs pay the first and second defendants' costs of this application.
Finally, I would not strike out the proposed order 6 of the notice of motion dated 6 March 2020 in the 2015 proceedings. In my view the motion is incompetent given that Mrs Sebie is not a party to that litigation and, in any event, she would require a tutor to act on her behalf which is unlikely to occur.

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: 05 November 2021

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Judgment (9 paragraphs)

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