HIS HONOUR: On 8 July 2015 Schmidt J made orders giving possession of certain lands at Bungonia to the plaintiff: Roxo v Normandie Farm (Dairy) Pty Ltd [2015] NSWSC 895. On 14 September 2015 the defendant sought a stay of her Honour's order. Bellew J granted a stay on that occasion "until further order of the court" and brought the proceedings back before him on 16 September 2015, at which time he stood the proceedings over for hearing by the duty judge on 30 September 2015. The proceedings came before me on that day for that purpose.
The defendant relied upon two affidavits sworn by Julia McKay on 14 September 2015 and 29 September 2015 respectively. Ms McKay was not cross-examined on either affidavit.
Ms McKay's evidence was that the defendant runs or conducts a substantial dairy farming operation from the property. There are currently approximately 70 dairy cows there that require milking twice daily. There are other animals on the property as well. The substantially uncontradicted evidence is that Ms McKay has nowhere to place these animals if the defendant is required to vacate the property and that the defendant's dairy enterprise could be destroyed or fundamentally compromised if they had to be removed. Her evidence was relevantly as follows:
"27 If a stay is not granted I believe I will suffer prejudice because my eviction from the property and that of the livestock is an irreversible change of circumstances that could not be rectified. This is because I would have to sell all the livestock prior to leaving the property. Alternatively, I would need to lease a functional dairy facility to conduct my business, which is the supply of raw milk products to herd sharers in the Australian Capital Territory, the Southern Highlands and the Southern Tablelands.
28. In order to sell the livestock I would have to arrange a clearance sale on the farm, establish the pregnancy status of all the animals and gain health certificates in respect Johne's disease, which is a restricted disease that is prevalent in dairy cattle. A certificate in respect of Johne's disease is required before cattle are moved from a particular area and I do not know how long it takes do [sic] receive to a negative clearance.
29. I have about 70 dairy cows including calves on the property. I also have 8 horses, 5 chickens, 2 dogs and 2 cats. I live alone, but I have wwoofers (willing workers on organic farms), who come and work and live on the farm from time to time. Wwoofers usually stay for up to three months to learn about agriculture and Australia in general.
30. If I were required to vacate and lease a dairy farm at short notice I would need access to a hygienic premises for milking, storage of product in a convenient location for delivery to the regions described in paragraph 27 above. I do not know of any dairy farms that are presently available in reasonable proximity to the property.
31. I would require at least six months to vacate the farm, re-establish my business and find a new home.
32. If I were required to vacate the property on short notice, it is likely I would lose my herd sharing customers, I would not be able to source animals of the same quality in terms of bloodline and productivity. It would be the end of my business as I would not be able to re-establish the business in the form in which it currently operates. Many of the improvements I have made to the property and the assets of the business are tied to the land, for example the fixed machinery (pumps and irrigation), dairy sheds and yards.
33. The detriment to the business caused by vacating the property could not be remedied by a costs order in my favour in the event I were successful in the appeal against the judgment."
Roxo v Normandie Farm [2015] NSWSC 1448 | Case summary | Zoe
Ms McKay also deposed to the reasons why she had taken no steps to vacate the property before now. First, the defendant has filed a notice of intention to appeal to the Court of Appeal against the orders of Schmidt J. Ms McKay said that she had operated upon the (erroneous) assumption that the filing of such a notice operated as an automatic stay of her Honour's orders. The evidence does not make clear precisely when that misapprehension was corrected. Secondly, Ms McKay deposed in some detail to her inability to obtain or secure the services of any legal representative to appear for her or to assist with her appeal. It seems apparent that the defendant's notice of intention to appeal was lodged without the benefit of advice about any prospects of success that such appeal might have had in fact and that Ms McKay was content to lodge documents that she thought operated to stay the proceedings without an understanding of whether an attack upon the judgment of Schmidt J had merit.
Whilst Ms McKay's unsuccessful attempts to secure legal assistance appear to be uncontested, there is no material upon the basis of which to determine or assess what is or what are the challenges that the defendant wishes to make to Schmidt J's judgment or to evaluate the associated question of whether any possible grounds of appeal have merit. In that respect the plaintiff drew my attention to her Honour's reasons. At [6] of the judgment, after setting out a list of the issues that remained in dispute for determination, her Honour said this:
"[6] The resolution of what remained in issue thus depended on the evidence of Mr Roxo and Ms McKay, Normandie's sole director and shareholder. I have concluded that in the case of conflict, Mr Roxo's evidence must be preferred over that of Ms McKay. Not only was her evidence shown to be unreliable in various relevant respects, it was not credible in other important respects, particularly given evidence which she had earlier given in other proceedings in the Federal Court."
Her Honour found in favour of the plaintiff in every significant respect. Counsel for the defendant was also unable to furnish me with any indication of the way or ways in which it is to be suggested that the defendant had any reasonable or identifiable prospects of success on appeal. From my reading of her Honour's reasons, none is evident.
It is trite to observe that in order to justify a stay an applicant must identify the circumstances that warrant a departure from the general rule that the judgment below should be presumed to be correct and is appropriate to be enforced, although it is not necessary to show that the circumstances relied upon are special or exceptional. A prospective appellant's ability to identify reasonably arguable grounds of appeal is highly relevant to the exercise of any discretion to grant or to refuse a stay. However, the existence of arguable grounds of appeal is not necessarily sufficient to justify the grant of a stay and the absence of such grounds has been described as likely to be a determinative consideration against the stay application.
The defendant does not contest the strength or application of these propositions in this case. However, it argues in effect that a refusal of the stay would render the appeal futile or would cause the defendant irreparable harm. The ever present difficulty for the defendant with such an approach is that the relevance of both the futility ground and the irreparable harm ground is necessarily a function of the defendant's prospects of success on appeal: the consequences of a futile appeal or the prospect of allegedly irreparable harm do not in either case create or amount to powerful discretionary considerations unless the prospects of success are somehow measurable or capable of identification.
Inasmuch as the defendant contends that it did not have legal advice confirming that the filing of a notice of intention to appeal does not operate as an automatic stay, it in reality presents this application as a fait accompli. The burden of the defendant's position is that it is not possible or practical at this late stage to disband its farming operation in a measured and timely way without the prospect of business losses and the implied risks to the welfare of its animals. Implicit in that position is the proposition that the defendant is not really at fault for the delay and that this Court therefore has no alternative but to grant a stay and await the outcome of the defendant's appeal.
I disagree. Counsel for the plaintiff has acknowledged that the welfare of any commercial stock still grazing upon the property will be the plaintiff's responsibility in the event that they are not removed before possession is recovered. That must necessarily include compliance with all appropriate animal husbandry requirements for the dairy cattle in question. To that extent there is no reason to believe that the animals are in or are likely to be in any danger. The evidence concerning the question of whether or not the defendant is conducting a commercially viable but potentially vulnerable horticultural or agricultural business on the property is either wholly absent at worst or unconvincing at best. I am not satisfied that Ms McKay's expressed concerns about the portability of the defendant's enterprise have been demonstrated.
The defendant did not lodge a notice of intention to appeal until 4 August 2015. Ms McKay did not seek legal advice about the defendant's position until "about mid-August". Counsel appearing for the defendant before me was only consulted on 29 September 2015 and would appear, through no fault of her own, to be relevantly uninstructed about the proposed grounds of appeal or the underpinning basis, if any, upon which the defendant contends its appeal is likely to succeed.
Mr Roxo has deposed to the fact that for as long as he remains unable to enforce his judgment, he will lose something approaching $25,000 per month, calculated at an interest rate of 6 percent per annum, having regard to the defendant's current level of indebtedness to him. In support of his opposition to the present application he relied upon an affidavit sworn 23 September 2015 in the following relevant terms:
"2. The grant of any further stay of recovery proceedings is extremely prejudicial to me and other members of my family who funded the loan to the defendant largely from home equity borrowings.
3. The principal of $755,000 (secured by first registered mortgage) was loaned to the defendant some 10 years ago at a contract rate of 4.5% per month for a short term only.
4. Nil repayments have been made towards this loan.
5. My family and I have suffered severe hardship at having to service this compounding monthly repayments in respect to this borrowing along with our other personal borrowings over this period. The current balance due under the loan contract including principal plus interest is $4,967.00 as at 19 September 2015.
6. This amount if received would reduce our overall debt by reducing a large part of our combined home equity loans and credit card borrowings at interest rates up to 15% per annum."
I am not satisfied in all of these circumstances that the defendant has established any proper basis for the making of an order extending the stay granted by Bellew J on 14 September 2015. The defendant has been content to do nothing in a practical sense to give vacant possession of the property to the plaintiff in accordance with a valid and enforceable judgment of this Court. That attitude is wholly unacceptable, particularly having regard to the history of the proceedings over many years and the amount owing to the plaintiff. In my view the stay should be discharged.
In these circumstances my orders are as follows:
1. Order that the plaintiff be at liberty forthwith to execute the writ of possession issued on 4 August 2015.
2. Order the defendant to pay the plaintiff's costs of the defendant's notice of motion filed on 14 September 2015.
[2]
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Decision last updated: 01 October 2015