CIVIL PROCEDURE - leave sought to rely on affidavits and commercial list response filed out of time and on the eve of the hearing - leave refused due to extreme prejudice to plaintiff.
Source
Original judgment source is linked above.
Catchwords
CIVIL PROCEDURE - leave sought to rely on affidavits and commercial list response filed out of time and on the eve of the hearing - leave refused due to extreme prejudice to plaintiff.
Judgment (4 paragraphs)
[1]
Solicitors:
McEvoy Legal Pty Ltd (Plaintiff)
Kings Law Group (Ninth and Tenth Defendants)
Origin Lawyers (Eleventh Defendant)
File Number(s): 2018/138175
[2]
Judgment (ex tempore - revised 26 july 2018)
HIS HONOUR: The plaintiff seeks orders for delivery up of the motor vehicles identified in prayers 1 and 2 of its further amended summons filed in Court today. The only relevant defendants who have filed a commercial list response are the ninth and tenth defendants. They are Mr Harold James Price, known as Jim Price, and his son Mr Scott Price. That document was filed yesterday, although on 8 June 2018 the Court had ordered that any defendants who wished to file a list response should do so by 15 June 2018.
The list response of the ninth and tenth defendants consists for the most part of non-admissions. It contains some denials, but not of any matters that are relevant to the claim for possession. Further, the list response does not seek to make out any affirmative case.
The ninth defendant did seek to rely upon an affidavit sworn and filed three days ago, on 23 July 2018. The orders of the Court made on 8 June 2018 to which I have referred already also provided that the defendants were not to adduce evidence that had not been served by 15 June 2018 without the leave of the Court. The Court's leave was not sought to rely on the ninth defendant's affidavit at the time it was filed. That leave was sought today. I refused it in circumstances where there was no sufficient explanation for the delay and where to grant leave to rely upon the affidavit would have caused extreme prejudice to the plaintiff. That prejudice would have arisen from the fact that the plaintiff had been given no realistic opportunity to investigate the matters of fact to which the affidavit deposed.
In all likelihood, the consequence of allowing the ninth defendant to rely upon that affidavit would have been an adjournment of the hearing. No doubt, the hearing could have been adjourned. No doubt, costs orders could have been made. In circumstances where the ninth defendant is bankrupt, the value of those costs orders would be, to put it mildly, questionable.
Further, in taking into account the circumstances, I considered that much of what was stated in the affidavit was inadmissible, being expressions of belief that did not go to any issue on the plaintiff's case. A fortiori, having regard to the nature of the commercial list response filed for the ninth and tenth defendants, the affidavit in question did not go to any "pleaded" issue.
The eleventh defendant also sought to file in Court and rely upon an affidavit. That affidavit was affirmed yesterday. Again, leave to rely upon that affidavit was required. Again, I refused that leave. The reasons are essentially the same as those I have given in respect of the affidavit of the ninth defendant (who is her father).
That leaves a situation where there is no relevant pleading that raises, either by way of denial or by way of affirmative defence, an issue with the plaintiff's claim to possession, and no controverting evidence.
The claim is founded upon loan agreements made between the plaintiff, the first two defendants, and the ninth defendant on 18 December 2015, and on a loan agreement made on 21 November 2017 between the plaintiff and the fourth defendant. In each case those loan agreements were supported by security. There was a general security agreement made between the plaintiff and the first two defendants on 18 December 2015, and a separate general security agreement made between the plaintiff and the ninth defendant on the same day. The loan agreement between the plaintiff and the fourth defendant contained its own security provisions.
It is the plaintiff's case that by virtue of the various security agreements to which I have referred, the relevant defendants charged all their property, and that the property in question included, one way or another, the motor vehicles and other equipment, delivery up of which is sought. I am satisfied that the plaintiff has made good that part of its claim. As I have said, there is no pleaded denial. Further, there is evidence in some cases of registration and in all cases of possession or control, by one defendant or the other or, more generally, by the Price family (the ninth, tenth and eleventh defendants) standing behind the corporate defendants.
I am satisfied that funds were advanced. There is no suggestion that they have been repaid.
There was a submission put for the ninth and tenth defendants that the advance of the funds was outside the purposes stated in the relevant loan agreements (the ones made on 18 December 2015). The first point to make about that submission is that it is the "Borrower" that is bound by the purpose provision. The second point to make is that the evidence of the general ledger showing how the advances were made, is not at all inconsistent with their having been made for the stated purpose. It was submitted that the clause in question related only to repayment of loans and advances made before 18 December 2015. I do not agree. On the face of the document, the purpose is wide enough to accommodate repayment of loans whenever made, whilst so ever the loan agreement remains on foot.
It follows that I am satisfied that there has been a breach and that the breach entitles the plaintiff to exercise the various powers given to it.
Those powers include the right to take possession of any security property, generally referred to as "Collateral". I am satisfied that, as between the plaintiff and the personal defendants, the plaintiff's right to possession is the better. In most cases, that follows inevitably from the grants of security and from the plaintiff's registration of its security interests.
In two cases, the claim to possession arises separately. Those vehicles were registered in the name of a Ms Perri, who is a motor vehicle dealer. Her evidence is that she holds the vehicles on trust for the plaintiff. One of those vehicles is in the possession of the tenth defendant. Another is in the possession of the eleventh defendant. As to one of those vehicles, there is a registered security interest which has nothing to do with the plaintiff. However, that is irrelevant to the question of the right to possession as between the plaintiff and the defendants in question.
As to both those two vehicles, I am satisfied that the acknowledged trust forms a sufficient basis for the plaintiff to recover possession.
There is also evidence that, one way or another, the defendants have sought to frustrate the plaintiff's attempts to regain possession. It would appear that those attempts were orchestrated by the ninth defendant. It seems to be reasonably clear that, absent some order of the Court, the defendants will do what they can to prevent the plaintiff from enforcing its right to possession.
It is well established that the Court may order delivery up of personal property in aid of a legal right. It may also do so in aid of an equitable right. Whether the plaintiff's right is equitable (which would appear to be the case where the charges are concerned, and also where it claims through the trust acknowledged by Ms Perri) or legal is irrelevant. Either way, the Court may assist the plaintiff to enforce its rights. In those circumstances I am satisfied that the plaintiff has made good its claim to possession.
The orders sought are against the individual defendants. They are in effect that those defendants deliver up or cause to be delivered up the vehicles that are specified in the summons. Additionally, in the case of the fourth defendant, the order is sought against it also.
Of course, for one reason or another, the defendants may be unable to comply with those orders, if made. The orders sought encompass that because they seek an affidavit from each of the personal defendants setting out what they have done to comply, and (if it be the case) why they have not complied.
There have been no submissions put as to the form of the relief sought. Accordingly, in my view, it is appropriate to make orders for delivery up in accordance with prayers 1 and 2 of the summons. It is also appropriate to make the order sought as to affidavits. However, in my view, those affidavits should be filed and served within seven days after expiry of the time limited for delivery up.
The summons also seeks damages and equitable compensation. There has been no submission put towards that relief. I do not think this is an appropriate case to split the hearing and, accordingly, I am not satisfied that there is any basis on which damages can be ordered.
The summons also seeks orders in aid of enforcement if necessary. That is something that can be taken up under a general reservation of liberty to apply.
Finally, there is the question of costs. In the ordinary way the plaintiff, having succeeded, would be entitled to its costs. That follows from UCPR r 42.1. The summons seeks interest on costs but, given that the proceedings were commenced only two months ago, it seems to me to be reasonably unlikely that there would have been any substantial interest cost incurred.
Unless anyone wishes to speak to the contrary, I shall direct the plaintiff to bring in short minutes of order to give effect to the reasons that I have just given.
[3]
[Counsel addressed.]
The plaintiff is to bring in orders to give effect to these reasons by 5pm today.
[4]
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: 27 July 2018