Ronowska v Kus - [2012] NSWSC 817 - NSWSC 2012 case summary — Zoe

NSWNSWSC

Ronowska v Kus

[2012] NSWSC 817

Supreme Court of NSW|2012-07-20|Before: Pembroke J, Young J

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At a glance

Source facts

Court

Supreme Court of NSW

Decision date

2012-07-20

Before

Pembroke J, Young J

Catchwords

(1965) 112 CLR 483 Australasian Meat Industries Employees' Union v Mudginberri Station Pty Ltd [1986] HCA 46
(1953) 90 CLR 573 Crowley v Brown [1964] 1 WLR 147 Danchevsky v Danchevsky [1974] 3 WLR 709
(1978) 143 CLR 102 Flamingo Park Pty Ltd v Dolly Dolly Creation Pty Ltd (1985) 5 FLR 169 Gallagher v Durack [1983] HCA 2
(2008) 235 CLR 125 Hinch v Attorney-General (Vic) [1987] HCA 56

Source

Original judgment source is linked above.

Catchwords

(1965) 112 CLR 483 Australasian Meat Industries Employees' Union v Mudginberri Station Pty Ltd [1986] HCA 46(1953) 90 CLR 573 Crowley v Brown [1964] 1 WLR 147 Danchevsky v Danchevsky [1974] 3 WLR 709(1978) 143 CLR 102 Flamingo Park Pty Ltd v Dolly Dolly Creation Pty Ltd (1985) 5 FLR 169 Gallagher v Durack [1983] HCA 2(2008) 235 CLR 125 Hinch v Attorney-General (Vic) [1987] HCA 56(1987) 164 CLR 15 Keeley v Brooking [1979] HCA 28

Judgment (19 paragraphs)

[1]

Kennedy v Lovell [2002] WASCA 226 Lawrence v The King [1933] AC 699 McGoldrick v Citicorp Finance Pty Ltd [1990] VR 503 McHardie v The Queen [1983] 2 NSWLR 733 McIntyre v Perkes (1988) 15 NSWLR 417 NCR Australia Pty Ltd v Credit Connection Pty Ltd [2005] NSWSC 1118 P Bockowski Pty Ltd v Kostrzynski [2010] NSWSC 583 PDM v JEM [2006] FamCA 1182 Pang v Bydand Holdings Pty Ltd [2011] NSWCA 69 R v Cornwell [1972] 2 NSWLR 1 R v Hallocoglu (1991) 29 NSWLR 67 R v Howson (1982) 74 Cr App R 172 R v Jones (1998) 72 SASR 281 R v Jones (No 2) [1972] 1 WLR 887 R v Parry (1997) 92 A Crim R 295 R v Vernell [1953] VLR 591 Re Barrell Enterprises [1972] 1 WLR 19 Re Bramblevale [1970] Ch 128 Registrar of the Court of Appeal v Maniam (No 2) (1992) 26 NSWLR 309 Ronowska v Kus [2012] NSWSC 280 Ryan v Wright (No 2) [2004] NSWSC 1019 Taylor v Whelan [1962] VR 306 Witham v Holloway [1995] HCA 3; (1995) 183 CLR 525 Young v Registrar, Court of Appeal (No 3) (1993) 32 NSWLR 262 Category: Principal judgment Parties: Krystyna Urszula Ronowska - plaintiff Ludwig Kus - first defendant Peter Severin Kus - second defendant Representation: D M Roberts - for the plaintiff K Bozinovska (solicitor) - for the first defendant No appearance for the second defendant George West Solicitor & Attorney - for the plaintiff NSW Trustee & Guardian - for the first defendant No appearance for the second defendant File Number(s): 2011/257705

[2]

Introduction 1This is an application by the plaintiff that the second defendant (Peter Kus) be found guilty of contempt and be punished accordingly. The application has both civil and criminal aspects although, it must be said, the dichotomy between civil and criminal contempt is not in all respects clear. In some respects it is "illusory": Witham v Holloway [1995] HCA 3; (1995) 183 CLR 525 at 534 (Brennan, Deane, Toohey and Gaudron JJ). In Pang v Bydand Holdings Pty Ltd [2011] NSWCA 69 Beazley JA described the dichotomy as "uncomfortable": at [72]. In Young v Registrar, Court of Appeal (No 3) (1993) 32 NSWLR 262 Kirby P said it was "wholly artificial and unsatisfactory": at 277. 2The definitional complication that afflicts the difference between civil and criminal contempt arises because proceedings brought in the interest of an individual to secure compliance with a court order are equally brought in the public interest to vindicate the court's authority: Witham v Holloway at 532-533; Australasian Meat Industry Employees' Union v Mudginberri Station Pty Ltd [1986] HCA 46; (1986) 161 CLR 98 at 107ff; Hearne v Street [2008] HCA 36; (2008) 235 CLR 125 at 131. 3From the plaintiff's perspective, her contempt application is remedial and coercive. She has been thwarted by the dishonest conduct of Peter Kus from recovering any part of the sum of $200,000 for which I gave her judgment on 22 March 2012. She now seeks to punish disobedience in the hope that by doing so it will compel obedience - and that it may directly or indirectly lead to the satisfaction of her judgment: Australian Consolidated Press Ltd v Morgan [1965] HCA 21; (1965) 112 CLR 483 at 498-499 (Windeyer J). From the public perspective, the application is punitive and is brought in the public interest to vindicate judicial authority and to maintain the integrity of the judicial process: Witham v Holloway at 531. Conduct, especially dishonest conduct, that obstructs the course of justice should not be allowed to go unpunished. 4This is not a case of technical contempt, such as where there has been a "casual, accidental or unintentional" breach of a court order: Mudginberri at 109; Registrar, Court of Appeal v Maniam (No 2) (1992) 26 NSWLR 309 at 314. This case is one of deliberate, defiant and contumelious conduct that was intended to obstruct the course of justice. The plaintiff's application is clearly a criminal proceeding. It requires proof of all material facts beyond reasonable doubt. If they are proved, penal sanctions may follow.

[3]

The Contempt 5I will shortly make more detailed factual findings but I should first outline the context of the contempt and its source. It arises out of the plaintiff's claim against Peter Kus' father, the first defendant. That claim was set out in a statement of claim filed on 7 November 2011. Among other things, the plaintiff claimed equitable compensation from the first defendant arising out of his representations to her and her conduct in reliance on those representations. If successful, her claim would have reduced the assets of the father to which Peter Kus appears to have thought himself entitled. The source of the contempt is an order of the court made on 7 November 2011 (which was disobeyed) and evidence subsequently given by Peter Kus on 20 March 2012 (which was knowingly false). The consequence of the conduct of Peter Kus in relation to both was to obstruct the course of justice. 6On 7 November Peter Kus was not a party to the proceedings but he held a power of attorney from his father and gave instructions on his behalf for the conduct of the defence of the proceedings. The father's capacity to manage his own affairs was diminished. On that day, Peter Kus gave instructions to consent to an order that on completion of the sale of the father's property at Greystanes, the sum of $250,000 would be lodged in a controlled moneys account with the firm known as Maclarens Lawyers. That firm acted in the proceedings for the father. The order was expressed to subsist "pending written agreement between the parties or further order of the court". There was no written agreement and no further order. 7Not only did Peter Kus cause the 7 November order to be flouted, appropriating the proceeds of sale to himself and failing to lodge any moneys in a controlled moneys account with Maclarens Lawyers but he pointedly and knowingly misled the court at the hearing of the plaintiff's claim on 20 March 2012. In doing so, I am quite satisfied that he acted defiantly and contumaciously. 8The circumstances in which he misled the court were as follows. On the first day of the hearing, at a time when the legal representatives of both parties assumed that the sale of the Greystanes property had not yet been completed and that the obligation to lodge the $250,000 pursuant to the 7 November order had not yet arisen, Peter Kus stated that he "believed subject to confirmation" that the sale had been completed "within the last couple of days" but that he had "not yet received a settlement sheet". This was mildly surprising but it did not seem to cause any alarm, especially as he explained that he had not yet received the settlement sheet. In any event, there was no confirmation of Peter Kus' supposed belief and the father's legal representatives appeared to assume that the evidence was inaccurate. Certainly there was no suggestion that the court order made on 7 November 2011 had not been or would not be complied with. 9In fact, the true situation was markedly different. Peter Kus knew that the sale had completed on 7 March. On that date he had taken delivery of four bank cheques representing the net proceeds of sale of $458,379.47. He deposited those cheques in the Bendigo Bank account of his father, to which he was also a signatory. On 14 and 16 March he withdrew or transferred $151,000 of that sum from his father's bank account. On 22 and 23 March, immediately following the judgment, he withdrew or transferred a further $305,000 from that account. On 25 and 26 March, he withdrew two further amounts of $1,000. And on 27 March, he withdrew a further $350. In the result, from the total net proceeds of sale of $458,379.47, Peter Kus withdrew or transferred from his father's account $151,000 before the hearing and $307,350 in the days immediately following the hearing. 10Furthermore, Peter Kus did not cause to be lodged, and never has lodged, $250,000 in a controlled moneys account of Maclarens Lawyers. He was personally responsible for doing so because he was in effective practical control of his father's affairs. He held a power of attorney from his father, gave instructions to his father's solicitors and was appointed as his father's tutor on 16 November 2011. In fact he had signed the consent to act as tutor on 4 November 2011 - before the court order made on 7 November. For those reasons, his evidence to the court on 20 March was both disingenuous and knowingly false.

[4]

Accounting for the Monies 11When the true position became apparent, the plaintiff's solicitor painstakingly collected the evidence demonstrating the disbursement by Peter Kus of the net proceeds of sale of the Greystanes property. The settlement sum of $458,379.47 was deposited into the Bendigo Bank account on 8 March. The subsequent disbursement of those monies was as follows: (a)On 14 March, Peter Kus transferred $30,000 to an ANZ Bank account in the name of his daughter-in-law, Erin Jayne Kus. (b)On 16 March, he transferred $100,000 to a Suncorp-Metway account in his own name. (c)Between 14 and 16 March, he withdrew $21,000 in cash from the Bendigo Bank account in the following amounts: (i)$18,000 from the Katoomba branch of the Bendigo Bank on 14 March. (ii)$1,000 from a Bendigo Bank ATM on 14 March. (iii)$1,000 from a Bendigo Bank ATM on 16 March. (iv)$1,000 from a Commonwealth Bank ATM on 16 March. (d)On 23 March, he transferred $250,000 to his Suncorp-Metway account. (e)Between 22 and 23 March, he withdrew $55,000 in cash from the Bendigo Bank account in the following amounts: (i)$9,000 from the Sydney CBD branch of the Bendigo Bank on 22 March. (ii)$10,000 from the Katoomba branch of the Bendigo Bank on 22 March. (iii)$20,000 from the Katoomba branch of the Bendigo Bank on 23 March. (iv)$15,000 from the Parramatta branch of the Bendigo Bank on 23 March. (v)$1,000 from a Bendigo Bank ATM on 23 March. (f)Between 25 and 27 March he withdrew a further $2,350 in cash from the Bendigo Bank account in the following amounts: (i)$1,000 from a Commonwealth Bank ATM on 25 March. (ii)$1,000 from a Commonwealth Bank ATM on 26 March. (iii)$350 from an ATM in Colliers Arcade on 27 March. 12On 1 April, the sum of $675.75, representing interest earned on the account balance, was credited to the Bendigo Bank account. On 2 April Peter Kus withdrew $660 of that amount at a Suncorp Bank ATM in Pacific Fair. The account balance of the Bendigo Bank account became $12.46. The documents produced by the bank confirm that Peter Kus is the only signatory on the account other than Ludwig Kus himself. His signature appears on Bendigo Bank withdrawal slips totalling $422,000 and on an electronic funds transfer slip for $30,000 to the ANZ. I am satisfied beyond all reasonable doubt that Peter Kus was responsible for all of the transfers and withdrawals from the Bendigo Bank account. No one else was in a position to do so. His father did not have the capacity to do so. 13Putting aside the cash withdrawals of $78,350 and the transfer of $30,000 to the account of his daughter-in-law, Peter Kus transferred a total of $350,000 from the proceeds of sale to his Suncorp-Metway account. He then promptly disbursed those monies. The disbursement took place within days of the judgment that I gave on 22 March. The sequence was as follows: (a)On 23 March, Peter Kus made two cash withdrawals of $50,000 and $10,000. (b)On 23 March, he transferred $40,000 to an account whose BSB and account number were identified in the evidence although the name of the account and that of the account holder were not. (c)On 26 March, he withdrew $100,000 in cash in the following amounts: (i)$50,000 (ii)$30,000 (iii)$20,000 (d)On 28 March, he withdrew $147,000 in cash. (e)Between 26 March and 2 April, he made three ATM withdrawals of $1,000 on 26 March, 27 March and 2 April, respectively. 14The balance of the Suncorp-Metway account is now $49.41. The evidence does not reveal the current whereabouts of the substantial majority of the sum of $458,350 that Peter Kus took from his father's account at the Bendigo Bank. I have assumed that he retains for his own benefit most of those monies. The only possible exceptions are the sum of $30,000 that he transferred to his daughter-in-law and the sum of $40,000 that he transferred to another account on 23 March. The sum of $30,000 is, in any event, the subject of a written loan agreement. There is no evidence that requires me to infer that the substantial majority of the misappropriated monies has been lost or dissipated by Peter Kus, or that at least the sum of $250,000, which is the amount that was the subject of the order made on 7 November 2011, is no longer available to him.

[5]

The Fraud Revealed 15The conduct of Peter Kus obstructed the course of justice in a tangible and material way. It resulted in the plaintiff being prevented - for the time being - from having the benefit of my judgment in her favour. The only assets of the father available to satisfy her judgment were the proceeds of sale of the Greystanes property. That is why there was an order that $250,000 of the proceeds of sale be placed in a controlled monies account. Peter Kus knew this and acted deliberately and defiantly to obstruct the plaintiff and to prevent her having recourse to those monies. 16I have already mentioned that, notwithstanding Peter Kus' tentative statement that he believed subject to confirmation that the sale had been completed "within the last couple of days", there was no apprehension during the hearing that the court order made on 7 November 2011 would be, or had been, ignored. Thus, counsel for the first defendant, who called Peter Kus as a witness, stated in open court in his presence: "The state of the property is that the sale is about to complete and there will be a sum of $400,000 odd that will be proceeds of sale..." 17The plaintiff's legal representatives proceeded on the same basis. There was no hint of foul play. Consequently, I stated in my principal judgment: "35. ... I was informed that the property is now subject to a contract of sale. The sale price is $460,000. There is no agent's commission and the net proceeds of sale will be approximately $455,000. The parties agreed prior to the hearing that a fund of $250,000 would be set aside from the proceeds of sale to meet the plaintiff's claim." 18 In the result, I made the following orders: (a)that the defendant (the father) pay to the plaintiff $200,000. (b)that, in order to secure the said sum of $200,000, the plaintiff have an equitable charge: (i)over the land known as '119 Beechwood Avenue, Greystanes', pending settlement of the sale of the land; (ii)over the proceeds of sale of the said land, upon settlement of the said sale. 19After I gave judgment and made orders on 22 March 2012, it was clear that Mr Hadley, counsel for the first defendant, maintained his belief as to the basis on which the proceedings had been conducted - a basis in which Peter Kus dishonestly acquiesced. Mr Hadley informed the plaintiff's solicitor that "as the property is almost sold, the defendant should be able to pay the judgment monies within 28 days". 20On 23 March the first indication of Peter Kus' dishonesty emerged. On that date, the first defendant's solicitor, Mr Feher from Maclarens Lawyers, informed the plaintiff's solicitor that he had now been told by Peter Kus that the property had been sold earlier in the month by a conveyancing firm. Mr Feher made clear that he had been unaware that the sale had occurred and that his firm did not act on the sale. 21On 26 March Mr Feher wrote to the plaintiff's solicitor. His letter was apologetic. He included another letter, also dated 26 March, from a firm known as Key Conveyancing. That letter stated that settlement had taken place on 7 March and that cheques representing the proceeds of sale had been handed to Peter Kus on that date. Mr Feher made clear that he had made a number of unsuccessful attempts to contact Peter Kus. In his letter, he stated percipiently, indeed prophetically: "We are concerned at the prospect of any attempt to thwart the judgment of the Court or the earlier consent orders entered on 7 November 2011 in the proceedings."

[6]

Freezing Orders 22On 28 March I made freezing orders against Peter Kus. On 30 March I made orders that he attend court and produce any documents in his possession relating to the whereabouts of the sum of $458,379.47 representing the proceeds of sale of the Greystanes property. On 4 April, I granted leave to the plaintiff to file in court a notice of motion seeking orders that Peter Kus be found guilty of contempt and be punished by committal to prison or fine or both. And I made orders, among others, that Peter Kus be joined as the second defendant in the proceedings; that his appointment as the tutor of the first defendant be discharged; and that the New South Wales Trustee and Guardian be appointed as the financial manager of the estate of the first defendant. The appointment of a financial manager caused the power of attorney in favour of Peter Kus to be suspended: Section 50(3), Powers of Attorney Act 2003. 23On 5 April, following his failure to comply with my 30 March order that he attend court and produce documents, I ordered that a warrant be issued pursuant to Section 97(1) of the Civil Procedure Act 2005 for the arrest of Peter Kus and that he be brought before the Court on 13 April. In addition, I ordered that until compliance with my order for the production of documents relating to the sum of $458,379.47, he be restrained from leaving the Commonwealth of Australia and that he surrender his passport. 24These orders have, where necessary, been extended and varied from time to time. Peter Kus has ignored them. He has not attended court and not produced documents. He has avoided arrest and moved from place to place. He has however been seen - by some of his own relatives and by the plaintiff. And he has sent email communications to my associate, as recently as 19 July 2012. On a number of occasions, he has caused medical practitioners to send uninformative and unconvincing certificates to the Court to justify or explain his non-attendance at hearing dates appointed by me. At an early stage I ordered that documents be served on him at his email address. For the reasons that I have explained in paragraphs [47] to [50] below, I am satisfied that this application, and the documents and evidence relied on by the plaintiff, have come to his attention. 25In mid-April Peter Kus even retained a solicitor. That solicitor, a Mr Foley, informed the plaintiff's solicitor, among other things, that he acted for Peter Kus; that Peter Kus was aware that he was required to attend court; and that Peter Kus had instructed him to lodge an appeal on behalf of his father. On 18 April 2012, Mr Foley filed a notice of appearance and a notice of intention to appeal on behalf of the first defendant. However both documents were incompetent as Mr Foley had no instructions from the New South Wales Trustee and Guardian and no authority to act on behalf of the first defendant.

[7]

Requirement for Personal Service 26The last time that Peter Kus attended court was on the day I gave judgment - 22 March 2012. From that date he has avoided personal service of documents and frustrated attempts by Sheriff's officers to execute a warrant for his arrest and bring him to court. His usual place of residence is at 23 Palmer Crescent, Blackheath but attempts to serve or arrest him at that address, or anywhere else, have been unproductive. I am satisfied beyond reasonable doubt that he has deliberately evaded service and arrest, and continues to do so. 27Applications for contempt are governed by the Supreme Court Rules 1970, Part 55. Rule 6 provides that where a contempt is committed in connection with proceedings in the court, an application for punishment for contempt must be made by motion on notice in the proceedings. Rule 7 provides that a statement specifying the contempt must be subscribed to or filed with the notice of motion. Rule 9 provides that the notice of motion, the statement of charge and any affidavits relied upon, must be served personally on the contemnor. 28In addition to the requirements of Part 55 of the Supreme Court Rules, Rule 40.7 of the Uniform Civil Procedure Rules has the effect that a judgment or order is not enforceable by committal to prison unless the person affected is served with a sealed copy of the judgment or order bearing a notice that the person served is liable to imprisonment or sequestration of property in the event of non-compliance. 29It may be that Rule 40.7 is mainly concerned with enforcing injunctive relief rather than punishing contempt: ANS Nominees Pty Ltd v Beverley Manufacturing Co Pty Ltd [1979] 2 NSWLR 875. But if and whenever it applies, there are two qualifications: (a)a judgment may be enforced by committal to prison without service having been effected under Rule 40.7 if the person liable to committal had notice of the judgment by being present when the judgment was directed to be entered or was notified of the terms of the judgment by "telephone, telegram or otherwise". This must of course include notification by email; (b)in addition, Rule 40.7(5) provides that the court may dispense with service under Rule 40.7. This is an express power, confined in its operation to Rule 40.7, operating independently of the general statutory power to dispense with any requirement of the rules of court in relation to particular civil proceedings: Section 14, Civil Procedure Act 2005. Avoidance of service is a circumstance which might justify the exercise of the power to dispense with service under Rule 40.7: NCR Australia v Credit Connection [2005] NSWSC 1118 at [59] (Campbell J); Drummoyne Municipal Council v Lewis [1974] 1 NSWLR 655 at 658 (Holland J). In such a case it might be appropriate to impose a sentence of imprisonment even if Rule 40.7 has not been satisfied: NCR Australia at [59]. 30These requirements for service, including the unambiguous specification of the contempt in a statement of charge, represent the usual means by which the law seeks to ensure that elementary fairness is achieved. But personal service is not indispensable and is not the only means of ensuring elementary fairness in contempt proceedings. This was made clear in relation to contempt proceedings in Doyle v The Commonwealth [1985] HCA 46; (1985) 156 CLR 510 when the court (Gibbs CJ, Mason, Wilson, Brennan and Dawson JJ) said at 517: However personal service is not indispensable; substituted service may be ordered in a proper case. The effect of the cases was stated in Oswald on Contempt, 3rd ed. (1910), p205, in a passage cited in Taylor v Whelan as follows "But when all reasonable efforts to effect personal service of a notice of motion to commit have been made and failed, the court can and ought to grant an order for substituted service [of the notice of motion]" There would have been no difficulty in the present case in making an order for substituted service which would have been likely to ensure that the motion was brought to the notice of the persons to be served. See also Taylor v Whelan [1962] VR 306; Circuit Finance Australia Ltd v Sobbi [2010] NSWSC 789 at [10] (Ball J); P Bockowski Pty Ltd v Kostrzynski [2010] NSWSC 583 at [22] (Brereton J); Bank of Singapore (Australia) Ltd v Tschannen (Supreme Court of New South Wales, Young J, 7 April 1992, unreported). 31The evident purpose of the requirement for personal service in Part 55 of the Supreme Court Rules is to ensure that, before there is a finding that a person is guilty of contempt, the alleged contemnor is clearly informed of the charge against him and is given "a reasonable opportunity of placing before the court any explanation or amplification of his evidence, and any submissions of fact or law, which he may wish the court to consider as bearing either upon the charge itself or upon the question of punishment": Coward v Stapleton [1953] HCA 48; (1953) 90 CLR 573 at 579-80 (Williams ACJ, Kitto and Taylor JJ). If that purpose is achieved by means other than personal service, there can be no unfairness and no objection in principle to proceeding with the hearing of the application against him. 32If however, despite substituted service, the contemnor chooses not to appear at the hearing, a different issue arises. I deal with this issue in paragraphs [51] - [61] below.

[8]

Substituted Service 33I have already explained that at an early stage I ordered that there be substituted service on Peter Kus by the sending of documents to his email address. The sequence of events was as follows: (a)On 28 March 2012, I made ex parte freezing orders against Peter Kus; (b)On 29 March 2012, Mr Feher's secretary from Maclarens Lawyers, informed the plaintiff's solicitor that a copy of the freezing orders had been sent to Peter Kus. She also said that "Mr Kus is in the country at the present time. He is returning to the Blue Mountains at the end of the week". (c)On 30 March 2012, I made further ex parte orders, extending until 4 April the freezing orders and ordering Peter Kus to produce at court on that date any documents in his possession relating to the whereabouts of the sum of $458,379.47 representing the proceeds of sale of the Greystanes property. (d)On 3 April 2012, Peter Kus caused a Dr Mohindra, from the Coolangatta Skin & Travel Doctor's Facial Rejuvenation Clinic, to send a medical certificate to my associate and also, it would appear, to Mr Feher, stating that he was suffering from a personal "illness" and was "unfit for work/school" from 3 - 17 April 2012. 34On 4 April 2012, there was no appearance by Peter Kus. An affidavit of service filed by the plaintiff explained that there had been several unsuccessful attempts to serve him at his home address in Blackheath. The process server was informed by Robert Kus, a brother, that Peter Kus was allegedly overseas and that the date of his likely return to Australia was unknown. 35I then made the following further ex parte orders on 4 April, among others: (a)I granted leave to the plaintiff to file in court a notice of motion which sought, among other things, an order that Peter Kus be joined as the second defendant and that he be found guilty of contempt for failing, in his capacity as the tutor of the first defendant, to comply with the court order made on 7 November 2011. (b)I ordered that the appointment of Peter Kus as the tutor of the first defendant be discharged. (c)I appointed the NSW Trustee & Guardian as the financial manager of the estate of the first defendant. (d)I extended until the following day, 5 April, the orders made on 30 March requiring Peter Kus to attend at court and to produce any documents in his possession relating to the whereabouts of the sum of $458,379.47. 36At the hearing on 4 April 2012, Mr Hadley attended. He did so out of a sense of duty to the Court. I am grateful to him. He had appeared instructed by Mr Feher for the first defendant at the substantive hearing. He informed me that during the hearing Maclarens Lawyers had been communicating with Peter Kus at a particular email address. He also said that, as recently as 27 March, Maclarens had received an email from Peter Kus from that same email address. 37I formed the view that Peter Kus already had notice of my earlier orders including the orders that he attend court on 4 April and produce documents relating to the whereabouts of the sum of $458,379.47. I also formed the view that I could be confident that service of documents by sending them to the email address identified by Mr Hadley, and used by Maclarens Lawyers, would ensure that the content of those documents would be brought to the attention of Peter Kus. I therefore made an order that service of copies of my orders made on 4 April, the notice of motion filed on 4 April, the statement of charge and the affidavit of George West sworn on 3 April, be effected by sending them by email to Peter Kus at the following address: psk_098@hotmail.com. 38Later on 4 April 2012, the plaintiff's solicitor purported to effect service on Peter Kus in accordance with my orders. However he did so at a slightly different email address: "psk098@hotmail.com". In addition, the copy of the signed statement of charge was not sealed. 39On 5 April 2012, when the matter came back to me, I adjourned the proceedings to 13 April and made the following further orders, among others: (a)that a warrant be issued for the arrest of Peter Kus and that he be brought before the court on 13 April 2012; and (b)that until compliance by Peter Kus with the order for production of documents relating to the sum of $458,479.47, he be restrained from leaving the Commonwealth of Australia and that he surrender his passport. 40Later on 5 April 2012, the plaintiff's solicitor purported to effect service of these orders on Peter Kus. Once again he used the slightly different email address: "psk098@hotmail.com". 41On 13 April 2012, when the matter came back to me, there was no appearance by Peter Kus. I adjourned the proceedings until 27 April and varied the order for the issue of a warrant for the arrest of Peter Kus so as to require that he be brought to court on that date. 42Between 16 and 25 April 2012 there was a series of communications between the plaintiff's solicitor and a solicitor known as "Michael Foley". In an email sent to the plaintiff's solicitor on 18 April, Mr Foley stated that he had been contacted by Peter Kus to represent his father for the purpose of lodging an appeal; that he met Peter Kus on 14 April; that he had prepared a notice of intention to appeal; and that he last spoke to Peter Kus on 16 April. 43In a subsequent email sent to the plaintiff's solicitor on 23 April, Mr Foley stated that after he spoke to Peter Kus on 16 April, he received a short email from him saying that he was not well. On the next day, 24 April, Mr Foley sent an email to the plaintiff's solicitor in which he set out in full an email from Peter Kus that he received on 20 April. This appears to be the email to which Mr Foley had referred on 23 April. 44Then on 25 April, as the hearing date of 27 April approached, Mr Foley sent an email to the plaintiff's solicitor and to my associate. He attached, presumably on the instructions of Peter Kus, an unsatisfactory form of medical certificate from a Dr Orgias at the Blackheath Family Medical Centre. It was dated 16 April and stated that Peter Kus "will be unfit to attend court from 16/04/2012 to 29/04/2012 inclusive". Mr Foley also stated in the email that he had previously received an email from Peter Kus from the address: "psk098@hotmail.com". This is the same address as that which the plaintiff's solicitor had used to give effect to my orders for service. 45On 27 April 2012, there was no appearance by Peter Kus. Between 27 April and 27 June, there were numerous adjournments at the request of the plaintiff to enable her solicitor to gather evidence and to cause subpoenas to be issued. On 15 June, I granted leave to the plaintiff to amend the notice of motion filed on 4 April. The purpose of the proposed amendment was to add a further count of contempt based on the false evidence that Peter Kus gave on 20 March. I directed that the amended notice of motion and any further affidavits be served on Peter Kus at his email address by 21 June. I listed the proposed amended notice of motion for hearing on 27 June. 46At the hearing on 27 June, there was no appearance by Peter Kus and the hearing proceeded in his absence - to a certain point. The plaintiff's counsel then requested an adjournment to enable him to submit further written submissions. Subject to those written submissions, I reserved judgment.

[9]

Further Service & Notice 47On 6 July, because I was concerned about the fact that service of all documents had been effected on Peter Kus at the email address "psk098@hotmail.com" rather than the slightly different address which I had stipulated, namely "psk_098@hotmail.com", I made the following further orders: (2)I adjourn the further hearing of the plaintiff's amended notice of motion to 20 July 2012. (3)I dispense with the need for compliance, to the extent necessary, with Part 40 Rule 7 of the Uniform Civil Procedure Rules. (4)I direct that the following notice be given to second defendant: "The Court has adjourned the hearing of the plaintiff's application for orders that you be found guilty of contempt until 20 July 2012 in order to provide you with a reasonable opportunity of placing before the court any explanation or amplification or any submissions of fact or law which you may wish the court to consider whether bearing upon the charges of contempt or upon the question of punishment. You should be aware that the court may punish the contempt if it is found by a term of imprisonment including imprisonment for an indefinite term unless and until you purge your contempt by the payment into court of the sum of $250,000 which was the subject of the court order made on 7 November 2011 or unless you satisfy the court that there is no reasonable prospect that you will be able to pay that sum from your own or other resources". (5)I direct that service of that notice together with sealed copies of the amended notice of motion, the amended statement of charge, all affidavits on which the plaintiff relies and the written submissions which have been provided by the plaintiff be effected by sending those documents addressed to Peter Severin Kus at both the following email addresses: psk_098@hotmail.com and psk098@hotmail.com. (7)Service of all documents should be effected by 13 July 2012. 48The discrepancy in relation to service had arisen because Mr Hadley had provided the court with one address and Mr Foley had provided another. The plaintiff's solicitor had adopted the address stated by Mr Foley although the original order for substituted service which I made, and subsequently repeated, was based on the address provided by Mr Hadley. There was every reason to conclude that all documents had been successfully transmitted to Peter Kus and that the address provided by Mr Foley was correct. Indeed, the inference that arose from the timing and receipt of the three unsatisfactory medical certificates reinforced that conclusion. Each certificate purported to explain Peter Kus' unavailability on days when he was required to attend court. I do not think the medical certificates were a coincidence. They indicate knowledge of the course of the proceedings and a deliberate decision to stay away. 49However, to put the matter beyond any reasonable doubt, I took the view that all relevant documents should be re-served at both email addresses. I also took the view that, if it applied, the purpose and policy of Rule 40.7 would be better achieved if a notice in the form which I stipulated were given to Peter Kus. I did not wish to be in the position of possibly sentencing Peter Kus to a term of imprisonment in his absence without being completely satisfied that he was aware of the steps that were open to the court to punish him for the contempts charged by the plaintiff. 50The further service and notice which I ordered were duly effected and the adjourned hearing resumed on 20 July. Once again there was no appearance by Peter Kus. However, on the evening before the hearing, he sent to my associate an email attaching a letter and a long list of comments on my judgment given on 22 March. He made no comment and provided no information relevant to the contempt hearing. I am satisfied beyond reasonable doubt that he was aware of the contempt hearing, aware of the charges against him, aware of the evidence and submissions relied on by the plaintiff and aware of the potential consequences to him, including imprisonment, if the charges of contempt were proved. He chose voluntarily to stay away.

[10]

Absence of Contemnor 51A threshold issue arises because of the absence of Peter Kus. Although this is a criminal proceeding, I have chosen to exercise my discretion to proceed with the hearing against him, and to sentence him to a term of imprisonment, in his absence. I recognise that the discretion to do so should be exercised sparingly: R v Jones (1998) 72 SASR 281 at 297. I have not done so lightly. 52Lord Atkin once said that there was an "inviolable rule" that the trial and sentence for an indictable offence must be conducted in the presence of the accused: Lawrence v The King [1933] AC 699 at 708. Subsequent decisions have however recognised that there must, as a practical necessity, be exceptions to this rule: R v Cornwell [1972] 2 NSWLR 1 at 3 (Jacobs JA); McHardie v The Queen [1983] 2 NSWLR 733 at 741-2 (the Court); R v Hallocoglu (1991) 29 NSWLR 67 at 71-72 (Hunt CJ at CL). See also in Victoria: R v Vernell [1953] VLR 591; in South Australia: R v Jones (1998) 72 SASR 281; and in England: R v Howson (1982) 74 Cr App R 172 and R v Jones (No 2) [1972] 1 WLR 887. 53The most common jurisprudential basis for an exception to the rule has its foundation in the accused's own conduct. In certain circumstances, the conduct of an accused will be treated as amounting to a voluntary waiver of his right to be present at trial and sentence. In such circumstances, the accused forfeits the right to be present. Examples of conduct that might in a particular case justify the exercise of discretion to proceed in his absence include where an accused absconds on bail or is so disruptive that he is removed from court. 54It is not possible to foresee all of the circumstances that might justify the exercise of the discretion. And I do not regard the categories as closed. In R v Jones (1998) 72 SASR 281, the South Australian Court of Criminal Appeal stated (at 295) that there must be circumstances where a trial can proceed in the absence of the accused. I agree. Lander J, with whom Prior and Wicks JJ agreed, explained (at 295) that: ... if the court is satisfied that the accused has waived his or her right to be present during the trial, and that the trial may proceed without any injustice to that person except the injustice caused by the accused's own waiver, then the court may proceed with the accused's trial. (emphasis added) 55In England, the exercise of the discretion to proceed in the absence of an accused has an even broader basis. In R v Howson (1982) 74 Cr App R 172 the English Court of Appeal held that a trial judge was not in error in allowing a criminal trial to continue in the absence of one of the co-accused who was too ill to attend. The court said (at 179) that a discretion existed to allow the matter to proceed but that the discretion to do so should be exercised sparingly and never if the accused's defence could be prejudiced by his absence. 56Griffiths LJ, for the court, stated expressly (at 179) that the discretion was not limited to voluntary waiver. Referring to the judgment of Roskill LJ in R v Jones (No 2) [1972] WLR 887, he said: ... we do not believe that Roskill LJ was intending to fetter that discretion by limiting it solely to those cases in which the accused had abused the right to be present or had voluntarily agreed to the trial going on in his absence. In our view, the discretion is not so limited ... 57In this case, I need not go beyond voluntary waiver. But whatever the basis for the discretion to proceed in the absence of an accused, its exercise in a particular case will be conditioned by a number of factors. Those factors must necessarily include the nature and seriousness of the charge and the conduct and circumstances of the accused. Other important factors will: ... include an assessment of the strength of the Crown case and the nature of the Crown case, the defence in so far it has been disclosed, the length of time over which the case has run and will run, the prejudice that the accused might suffer, the risk of a miscarriage of justice, the inconvenience to the victims and the witnesses and the impact upon the administration of justice. R v Jones (1998) 72 SASR 281 at 297. 58In my view, the conduct of Peter Kus in this case amounts to a voluntary waiver of his right to be present at the hearing against him. It is analogous to the conduct of an accused who absconds on bail and chooses not to attend his own trial and sentence. Although Peter Kus has deliberately avoided personal service, I am satisfied beyond reasonable doubt that he is aware of the plaintiff's application that he be found guilty of contempt on the two charges alleged against him. He has been sent by email, not only the constituent documents on which the plaintiff relies - the amended notice of motion, the amended statement of charge and the affidavits - but also the plaintiff's written submissions, including her submissions on punishment. In addition, the notice which I ordered to be sent to him, informed him of the adjourned hearing on 20 July 2012 and of the possibility that at that hearing he might be sentenced to a term of imprisonment. 59I have endeavoured to ensure that Peter Kus be given every opportunity to come forward and put evidence or submissions before me that might tend to exculpate him. His email to my associate on the evening of 19 July only serves to confirm my satisfaction that he was aware of the hearing fixed for 20 July and chose voluntarily to absent himself. In exercising my discretion to proceed in his absence, I have taken into account the overwhelming strength of the evidence against him; the absence of any apparent justification or defence available to him; the defiant nature of his conduct, both in ignoring the original court order and in subsequently avoiding personal service and arrest; the hardship to the plaintiff if I refrain from proceeding; and the interests of justice in swiftly demonstrating the court's reproach and in not delaying punishment for the wilful conduct that he has demonstrated. 60There is no prejudice to Peter Kus by my decision to proceed in his absence, other than such prejudice as is self-inflicted because he has chosen not to appear. In any event, on the question of whether he is guilty of the charges alleged against him, the evidence does not suggest the reasonable likelihood of any defence that could have been advanced by him, if he had appeared. On the question of sentence, I do not know what might have been said by him in mitigation. But Peter Kus' failure to appear and put forward any evidence or submissions in explanation or mitigation, is his own doing. 61I am further fortified in the approach that I have adopted because it is consistent with the procedure countenanced by Section 250 of the Criminal Procedure Act 1986. That section, which forms part of Chapter 4 Part 5 of the Act, does not apply to contempt proceedings: Director of Public Prosecutions (Cth) v Sexton [2008] NSWSC 352 at [11] (Howie J) but the principle which it represents bears comparison with the circumstances of this case. Under Section 250, the court may proceed to hear and determine any matter within its summary criminal jurisdiction in the absence of an accused if an order made under Section 246 (specifying the time and place of hearing) has been served on the accused person.

[12]

Perjury or Contempt 64Peter Kus' false evidence on 20 March 2012 is equally blameworthy. It has been proved beyond reasonable doubt. Its purpose was to conceal the breach of the 7 November 2011 court order and to allow himself further time within which to disburse the proceeds of sale of the Greystanes property, without the plaintiff's solicitors, or even the first defendant's solicitors, becoming aware of his wrongful conduct. His false evidence enabled him to misappropriate to himself the monies which belonged to his father and to frustrate any prospect of the plaintiff having the benefit of a judgment that might be awarded in her favour. 65This was not mere perjury for which an application that the witness be punished for contempt would usually be inappropriate. Peter Kus' knowingly false evidence on the issue of the completion of the sale of the Greystanes property amounted to the deliberate suppression of facts and the presentation of a falsehood: Ditfort v Katz [1991] NSWCA 80 (Samuels JA). It was done in order to allow him more time within which to disburse the proceeds of sale; to obtain a financial advantage for himself; to prevent the plaintiff having the benefit of any judgment in her favour; and to obstruct the course of justice. 66The qualitative distinction between mere perjury and contempt is well recognised. The difference is no better explained than by Barwick CJ in Keeley v Brooking [1979] HCA 28; (1979) 143 CLR 162 at 169-170: If it could be concluded beyond all reasonable doubt that the false swearing was with the actual or inevitable intent or consequence of frustrating or obstructing the proceedings, the party or witness could be dealt with for contempt of the tribunal. But that intent or inevitable consequence would differentiate what I might call mere perjury from contempt. The contempt would lie in the obstruction or frustration of the proceedings actually intended or necessarily consequential. 67Thus, there will usually need to be more than false evidence. In Croll v Reeves [2005] QCA 77 Keane JA, with whom McPherson JA and Fryberg J agreed, referred to "the class of case of a palpably false answer" which was "calculated to frustrate the processes of the court before whom the evidence is given". And in Re Bramblevale [1970] Ch 128 at 137, Lord Denning MR said that the contempt in that case "is not proved by showing that ... he told lies". See also Borrie & Lowe, The Law of Contempt, 4th edition, LexisNexis, 2010, pp507-508; cf McGoldrick v Citicorp Finance Pty Ltd [1990] VR 503.

[13]

Punishment 68That then leads me to the question of punishment. The powers of a court to punish for contempt are considerable. When confronted with a defiant challenge to its authority, not to mention a deliberate attempt to ensure that a plaintiff is prevented from enjoying the fruits of a judgment, the court's responsibility to select an appropriate punishment is a heavy one. The punishment should seek, as far as possible, to both address and redress the contemptuous conduct. In Mudginberri, Gibbs CJ, Mason, Wilson and Deane JJ referred at 115 to the court's extensive powers and its heavy responsibility and then stated: Contempt of court is a distinctive offence attracting remedies which are sui generis: Morris v Crown Office [1970] 2 QB 114 at 149. It is required of the chosen remedy that it be effective, no more but no less. For, if it is not effective, serious and lasting damage to the fabric of the law may result". 69Part 55 of the Supreme Court Rules is the primary reference point for the selection of an appropriate remedy. Rule 13(1) provides that in the case of an individual, the Court may punish contempt by committal to a correctional centre or fine or both. Rule 13(3) provides that the Court may make an order for punishment on terms including a suspension of punishment in case the contemnor gives security in such manner and in such sum as the Court may approve for good behaviour and performs the terms of the security. 70Rule 14 provides that where a contemnor is committed to a correctional centre for a term, the Court may order his discharge before the expiry of his term. This power is available, for example, where there has been a change in circumstances: Young v Registrar, Court of Appeal (No 3); where the contemnor has purged his contempt: Crowley v Brown [1964] 1 WLR 147; or where it is clear that no good purpose will be served by further detaining the contemnor: Re Barrell Enterprises [1972] 1 WLR 19. 71The provisions of Part 55 are however only declaratory of the Court's power to punish for contempt and do not exhaust it: Maniam (No 2). The rule is "purely facultative" to quote Rogers AJA in McIntyre v Perkes (1988) 15 NSWLR 417 at 434. In Australian Consolidated Press Ltd v Morgan, Windeyer J discussed at length the armoury of remedies that were historically available to punish for contempt and continue to be so. The Court retains the flexibility to impose a punishment that is not constrained by the express terms of Part 55 Rule 13. This may include, for example, a community service order as in Maniam (No 2) at 319 or the range of penalties contemplated by the Crimes (Sentencing Procedure) Act 1999. The options include among others, periodic detention, home detention, a good behaviour bond or suspension or deferral of the sentence: NCR Australia at [25] (Campbell J); Australian Securities & Investments Commission v Michalik [2004] NSWSC 1259 (Palmer J). 72I have reached the view in this case that a sentence of imprisonment is clearly appropriate. In Maniam (No 2) Kirby P emphasised (at 314) the twin objects of deterrence and denunciation when punishing a convicted contemnor. He also reiterated that because a contempt is a common law offence, there is no maximum penalty: A conviction of contempt of court is a conviction of an offence, criminal in nature. Punishment of the convicted contemnor must therefore take into account the considerations normally applicable to the punishment of crime and apt to uphold the purpose of this jurisdiction, viz, the undisturbed and orderly administration of justice in the courts according to law. Thus, in determining the punishment which is apt to the circumstances which have led to a conviction of contempt, it is appropriate to bear in mind the purposes of punishing the contemnor; deterring the contemnor and others in the future from committing like contempts; and denouncing the conduct concerned in an approximately (sic) emphatic way: see Director of Public Prosecutions v John Fairfax & Sons Ltd (1987) 8 NSWLR 732 at 741. In this jurisdiction, contempt is a common law offence for which there is therefore no maximum penalty in this Court: R v Dunbabin; Ex parte Williams (1935) 53 CLR 434 at 442. Any limits which are imposed upon the Court's powers derive from the purposes stated above and the limitations expressed in the Tenth Article of the Bill of Rights 1688 which restrains the imposition of cruel or unusual punishments or "excessive fines": see Smith v R (1991) 25 NSWLR 1, noted (1991) 65 ALJ 695. 73The policy reasons for punitive sanctions were explained in the Report of the Australian Law Reform Commission, No 35, "Contempt" at paragraph [519]: In our society, courts are the ultimate arbiters of disputes. This system of dispute resolution depends upon, among other things, their making orders and, if necessary, enforcing them. Given that litigation can be frustrating, time consuming and costly, there would be no incentive at all in undertaking it, if there were no likelihood that orders made by the court in settlement of a dispute could not be enforced. The imposition of coercive sanctions is clearly directed towards this goal; the imposition of punitive sanctions re-inforces it. In circumstances where enforcement is no longer relevant, either because the order has since been complied with, or is no longer capable of being complied with, the imposition of a punitive sanction vindicates the claims of the aggrieved party, signifies the disapproval of the court, and acts as both as a specific deterrent (that is, to the particular contemnor) and as a general deterrent (that is to future would be contemnors). The Commission endorses the general principle that punitive sanctions should be available to the Court to the extent that they are necessary to uphold the effectiveness of court orders. (emphasis added) 74I have borne in mind those observations. In addition, I have taken into account the sentencing considerations specified in the Crimes (Sentencing Procedure) Act 1999 including whether there are any applicable aggravating factors as set out in Section 21A(2) of the Act or any applicable mitigating factors as set out in Section 21A(3): Australian Securities & Investments Commission v Michalik at [26]; Principal Registrar of the Supreme Court of New South Wales v Jando (2001) 53 NSWLR 527 at [42] - [45]; Ryan v Wright (No 2) [2004] NSWSC 1019 at [21]; Attorney-General for New South Wales v Whiley (1993) 31 NSWLR 314. 75In this case, there are aggravating factors but there are no apparent mitigating factors. Peter Kus was motivated by a desire for financial gain. His intention was to advantage himself by preventing the plaintiff having the fruits of her judgment. He abused his position of trust as his father's tutor and as the holder of his power-of-attorney. He attempted to achieve his objective by flagrantly and knowingly disobeying a court order and then by subsequently lying about it under oath. His father was vulnerable because of his lack of capacity and the plaintiff was vulnerable because the utility of any judgment that she might obtain was dependent on Peter Kus' honesty and his adherence to the court order made on 7 November 2011.

[14]

Sentence 76One of the options open to me is an indefinite term of imprisonment unless and until Peter Kus purges his contempt by the payment of the monies that he was required by court order to place in a controlled monies account for the benefit of the plaintiff. The availability of such a punishment has been affirmed in a number of cases: Gallagher v Durack [1983] HCA 2; (1983) 152 CLR 238; Mudginberri at 114; Flamingo Park Pty Ltd v Dolly Dolly Creation Pty Ltd (1985) 5 FLR 169 at 178; Kennedy v Lovell [2002] WASCA 226 at [5]; Danchevsky v Danchevsky [1974] 3 WLR 709; 3 All ER 934 at 937 (Lord Denning MR). 77I am reluctant however to adopt this approach - as a matter of discretion. The possibility of an indefinite term of imprisonment, perhaps for the term of the natural life of Peter Kus, has to my mind a faintly medieval whiff about it. The problematic nature of indefinite imprisonment led the Phillimore Committee to recommend its abolition in England and Wales many years ago: Report of the Committee on Contempt of Court (HMSO, London, Cmnd 4794, 1974). In 1981 the Phillimore recommendation was implemented in the Contempt of Court Act 1981 (UK) which now provides for a maximum term of two years' imprisonment for contempt: Section 14. 78There may be some cases where it is appropriate to impose a sentence of indefinite imprisonment unless and until the contemnor purges his contempt. But I do not think that this is such a case. Disputes in the Family Court of Australia may sometimes fall into that category. The remedy of indefinite imprisonment for contempt of court is utilised from time to time in that court: PDM v JEM [2006] FamCA 1182. But the source of jurisdiction to do so is Section 112AP of the Family Law Act 1975 which is a self-contained statutory code for dealing with contempts in that court. In exercising my discretion in this case, I prefer to treat those decisions separately. They are instructive but do not bind the exercise of my discretion. 79I prefer to impose a fixed term of imprisonment. In my view, it will be an effective means of achieving the policy objectives that I have explained. I therefore propose to sentence Peter Kus on each charge of contempt to a term of imprisonment of 18 months. The sentences should be served concurrently with the intention that the maximum period of detention will be no more than 18 months. 80I have reached the view that a period of 18 months is appropriate after considering the serious and flagrant nature of the contempts that have occurred and after comparing the sentences imposed in other decisions of this court. Many of those decisions are set out in the comprehensive analysis by Hunt CJ at CL in Wood v Galea (1996) 84 A Crim R 274 at 278-280. See also R v Parry (1997) 92 A Crim R 295 at 296, a case concerned with a refusal to answer questions. The cases collected in Haritopoulos Pty Ltd v Scott [2007] VSCA 174 at [115] are also illustrative. Some more recent decisions include Corruption and Crime Commission v Allbeury (No 2) [2011] (2 years - 2 years, 3 months); ASIC v Matthews [2009] NSWSC 285 (6 months); ACCC v Levi (No 3) [2008] FCA 1586 (10 months); Abduramanoski v Abduramanoska [2005] FamCA 88 (18 months); Hannaford v HH [2012] FCA 560 (18 months); and ASIC v Michalik (18 months). 81In the end of course, as is well recognised, the review of punishments in other cases is of limited assistance. Each case really depends on the assessment of its own unique facts: Wood v Galea at 277; ASIC v Michalik at [49]. I am quite satisfied however that the seriousness of the conduct of Peter Kus does not justify a suspended or deferred sentence, periodic detention or a community service order. In my view, only a sentence of imprisonment fits the bill. 82An important consideration is that the court retains the power to order the discharge of a convicted contemnor before the expiry of his term of imprisonment: Part 55 Rule 14 of the Supreme Court Rules. If Peter Kus, or anyone else on his behalf, pays to the plaintiff's solicitors, or into court, the sum of $250,000 so that it becomes available to the plaintiff to satisfy the judgment and the charge which I ordered in her favour, the fact of that payment will be a powerful reason for ordering his discharge from imprisonment. Additionally, if any material change of circumstance occurs after the date of sentence, which is relevant to whether Peter Kus should continue to serve the whole of his term of imprisonment, he may apply for a discharge pursuant to Part 55 Rule 14.

[16]

Warrant of Committal 85I will order that a warrant be issued for the committal of Peter Kus. Section 62(1) of the Crimes (Sentencing Procedure) Act provides that as soon as possible after sentencing an offender to imprisonment, a court must issue a warrant for the committal of the offender to a correctional centre. The warrant operates as sufficient authority for any police officer to convey the offender to the correctional centre identified in the warrant and for the governor of the correctional centre to keep the offender in custody for the term of the sentence or until such earlier discharge as may be ordered by the court pursuant to Part 55 Rule 14 of the Supreme Court Rules: Section 62(3). In England and Wales, and possibly in New South Wales, the practice is that contemnors who have been committed to prison, are treated under special prison rules and are kept out of contact with convicted prisoners as far as possible: Borrie & Lowe, The Law of Contempt, 4th edition, LexisNexis, 2010, page 530. 86My previous attempts to have Peter Kus brought before the court pursuant to a warrant for his arrest issued under Section 97 of the Civil Procedure Act have been unsuccessful. I first made such an order on 5 April 2012. The reason for the issue of that arrest warrant was the failure of Peter Kus to comply with an order that he attend court on 4 April and produce documents relating to the whereabouts of the proceeds of sale of the Greystanes property. The arrest warrant was addressed to the Sheriff of New South Wales. It was either extended, or further warrants were issued, from time to time. The Sheriff's officers were unable to locate and arrest Peter Kus. Any extant arrest warrant issued pursuant to the Civil Procedure Act should now be revoked pursuant to Section 97(3). The attempts to have him arrested and brought to court have proved to be ineffective. The criminal process should now take over. A warrant for the committal of Peter Kus to a correctional centre pursuant to Section 62(3) of the Crimes (Sentencing Procedure) Act should now take effect. 87As Section 62(3)(a) makes clear, a warrant for committal authorises "any police officer" to convey the offender to the specified correction centre. It requires the location, apprehension and detention of the offender. The warrant should be addressed to the New South Wales Police Service, Central Warrants Index. It should authorise any police officer to take Peter Kus into custody and deliver him to the General Manager of the Metropolitan Remand & Reception Centre. It is desirable that the warrant specify the cause of commitment and the nature of the contempt: Ferraro v Woodward [1978] HCA 7; (1978) 143 CLR 102 at 105. Although such specification may not necessarily be a condition of validity of a warrant issued by the Supreme Court, there are good reasons for doing so. It enables the person committed to know what he must do to purge his contempt. And if an application for habeas corpus is made, the production of the warrant makes it possible to see whether the prisoner is being held arbitrarily or for a lawful reason: Ferraro v Woodward at 106.

[17]

Indemnity Costs 88I propose to order that Peter Kus pay the plaintiff's costs of the application on an indemnity basis. As proceedings relating to contempt are criminal, the Civil Procedure Act 2005 does not apply and the statutory power to order costs under Section 98 of the Act is unavailable: ASIC v Sigalla (No 6) [2012] NSWSC 83 at [11]. Equally the Criminal Procedure Act 1986 does not apply to criminal contempt proceedings: Director of Public Prosecutions (Cth) v Sexton [2008] NSWSC 352 at [20]. Nonetheless, as White J held in ASIC v Sigalla (No 6) at [31] a power to order costs exists under the Supreme Court's inherent jurisdiction, preserved by Section 23 of the Supreme Court Act 1970. I should also observe that in Hinch v Attorney-General (Vic) [1987] HCA 56; (1987) 164 CLR 15 at 89-90 it was said generally that contempt proceedings "proceed in the civil jurisdiction and attract the rule that ordinarily applies in that jurisdiction, namely, that costs follow the event". 89It sometimes said that the usual order for costs in cases where a person has been found guilty of contempt is that the contemnor should pay the indemnity costs of the civil prosecutor. However the issue is by nature discretionary and must always yield to the particular circumstances of the case: McIntyre v Perkes (1988) 15 NSWLR 417; ACCC v World Netsafe Pty Ltd [2003] FCA 1501 at [39]. In an appropriate case, the policy considerations in favour of indemnity costs explained by Samuels JA (at 428) and Rogers AJA (at 435-436) in McIntyre v Perkes will be powerful. And the following statement by Megarry VC in EMI Records Ltd v Ian Wallace Ltd [1983] Ch 59 at 76; [1982] 2 All ER 980 at 991 is salutary: "In [contempt] cases, nothing should be done to deter a person from bringing a contempt to the notice of the court; and the risk of having to bear any of the costs will often be a real deterrent: see Morgan v. Carmarthen Corporation [1957] Ch 455, particularly at p 474." 90This is an appropriate case. Since 7 March 2012, Peter Kus has demonstrated a contemptuous disregard for the orders of the court and the authority which they represent. And as a result of his non-compliance and his non-attendance, the time, trouble and expense to which the plaintiff has been put, have been multiplied excessively. She has been required to issue many subpoenas, collect much evidence, trace the movement of the money misappropriated by Peter Kus and suffer multiple adjournments. Her legal representatives have been required to prepare additional affidavits and further submissions. I have no hesitation in concluding that in this case I should make an order for indemnity costs.

Ronowska v Kus

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