Satchi & Satchi Australia Pty Ltd v Zeaiter Corporate Holdings Pty Ltd

Supreme Court of NSW|2011-08-10|Before: Fullerton J, Adt J

Judgment 1HER HONOUR: There are two motions listed for hearing before the court today, one by Mr Satchithanantham ("Mr Satchi"), one by Zeaiter Corporate Holdings Pty Limited ("Zeaiter") and Anthony Zeaiter. 2The first plaintiff is Satchi & Satchi Australia Pty Ltd ("Satchi & Satchi"). The second plaintiff is Hemalathasothy Ranjini Satchithanantham. The third plaintiff is Thambiappah Satchithanantham, who is a bankrupt. Mr Satchithanantham and Mrs Satchithanantham are husband and wife. The first defendant is Zeaiter Corporate Holdings Pty Ltd. 3In the statement of claim filed 17 December 2010, Mr Satchi has added his teenage son Bramooth Satchithanantham as fourth plaintiff and the National Australia Bank Limited as second defendant, Insolvency and Trustee Services Australia ("ITSA") as third defendant and Anthony Zeaiter, the sole director of Zeaiter Corporate Holdings Pty Ltd, as fourth defendant. I shall address the issue as to who are proper parties later in this judgment. 4As I understand it, Fullerton J had heard the part of these proceedings and motion so far as it concerns the National Australia Bank ("NAB"). On 29 March 2011, Fullerton J heard NAB's notice of motion to strike out the part of the statement of claim made against it. This application was successful. 5At the outset it should be recorded that this common law file, numbered 2008/289772, is comprised of two boxes of material. It is common ground that at one stage these common law proceedings had the file number 30004/08. Mr Satchi relied upon everything contained in this file. This court has only determined the notices of motions so far as they concern the "plaintiffs" and Zeaiter Corporate Holdings Pty Ltd and Anthony Zeaiter. It is intended to keep these reasons brief. 6At this hearing Mr Satchi represented himself, his wife and his son. So far as Mrs Satchi is concerned, Mr Satchi tendered an authority for him to act for her (Ex A) and a trust deed in relation to his son (Ex B). Mr Satchi was not legally represented. It is difficult to see how his son can have involvement in these proceedings. This court listened carefully to Mr Satchi's submissions and has read his documentation, in particular his affidavit in reply dated 8 July 2011 and his "reply". The Administrative Decisions Tribunal ("ADT") recorded that it had difficulty with the lengthy, repetitive and often obscure submissions filed on behalf of Mrs Satchi. (ADT J 10.6.08 [17]) This court had the same difficulty. Mr Satchi's oral submissions did not make the position any clearer.

The notices of motion 7By notice of motion filed 6 May 2011, Zeaiter seeks, firstly, that the plaintiffs' statement of claim in common law proceedings 2008/289772 be set aside in respect of the first and fourth defendants; secondly, further or in the alternative, that pursuant to UCPR 14.28 the statement of claim as against the first and fourth defendants be struck out; and thirdly, further or in the alternative, that pursuant to UCPR 12.10 the statement of claim as against the first and fourth defendants be stayed until the plaintiff(s) pay the costs of the first and fourth defendants of the following proceedings that have been dismissed and costs orders made against them but not yet paid. The costs orders are set out in the motion and include orders made in the ADT, this court in 30004/08 and a prior costs order in these proceedings made on 23 September 2010. 8By notice of motion filed 10 May 2011, Mr Satchi seeks, firstly, pursuant to UCPR 13.1, that the plaintiffs be granted all of the orders sought and filed by the plaintiffs in this matter on 14 March 2011; secondly, an order setting aside all of the orders, which were made by the Administrative Decisions Tribunal, and the Appeal Panel of the Administrations Decision Tribunal, as to the appeal from, to this court and that default judgment be entered. 9Perhaps the best way to determine the current situation, so far as these proceedings and the Satchis and the Zeaiters are concerned, is to start with the procedural history.

The procedural history 10In January 2004, Zeaiter entered into a first floor lease at XX Station Street, Wentworthville ("the premises") with Mrs Satchi . In March 2004, Satchi & Satchi entered into a ground floor lease of the same premises with Zeaiter. Mr Satchi negotiated both of the leases. 11To understand what has subsequently occurred, it is necessary to keep firmly in mind that there are sometimes separate proceedings in relation to the ground floor premises and the first floor premises. The ground floor was used for storage and the first floor was a retail shop. Also it should be kept in mind that so far as the leases and rent of the premises are concerned, there have been proceedings in both the ADT and this court. 12On 12 July 2004, the first floor lease was terminated upon the basis that Mrs Satchi had failed to pay rent and outgoings. 13In February 2005, Zeaiter Corporate Holdings Pty Ltd commenced Local Court proceedings 8865/05 at Bankstown against Mrs Satchi to recover the sum of $52,330.01 in relation to rent and outgoings lost in relation to the ground floor of the premises as a result of evicting Mrs Satchi and finding a new tenant. 14Mrs Satchi, represented by her husband Mr Satchi, filed a defence and cross claim in the Local Court, which included allegations regarding the ground floor premises. In September 2005, Mrs Satchi applied to transfer the proceedings to the ADT, as the first floor lease was a retail lease. The proceedings were transferred to the ADT.

The ADT proceedings 15Mrs Satchi amended her cross claim and made three main claims in the ADT (file 75031 - the main proceedings). They were: (a) The rent for the first floor premises was $1,100 per month, not $1,100 per week. (b) The rent was later changed to $1,100 per week, but this was in respect of both the first floor and the ground floor leases combined. (c) When the rent was changed to $1,100 per week Mr Satchi did not want to sign the Lease but that Zeaiter's agent, Tony Khoury, forced him to do so. 16On 5 and 6 September 2007 and 10 and 11 October 2007 the proceedings were heard by the ADT. 17On 10 June 2008, the ADT handed down its decision. It awarded Zeaiter the sum of $52,330.01, plus interest, being a total of $70,187.78. Mrs Satchi's cross claim was dismissed. The ADT made findings in relation Mr Satchi's credibility as a witness at [103], [104], [105], [108] and [116] of its judgment, which are not necessary to reproduce here. 18Mrs Satchi lodged a notice of appeal in relation to the decision made by the ADT, to the appeal panel of the ADT. 19On 2 April 2009, the ADT awarded costs in favour of Zeaiter. Mrs Satchi then lodged an appeal in relation to this costs order. 20On 18 June 2009, both appeals came before the appeal panel of the ADT. 21On 25 September 2009, the appeal panel of the ADT delivered its decision and dismissed both of Mrs Satchi's appeals and awarded Zeaiter costs.

Dispute relating to the ground floor premises 22On 12 July 2004, after Mrs Satchi was evicted from the first floor premises, Satchi & Satchi continued to occupy the ground floor premises in accordance with the ground floor lease. They continued this occupation while the ADT proceedings were on foot. 23In September 2006, a dispute arose between Satchi & Satchi and Zeaiter, as Zeaiter alleged that Satchi & Satchi had failed to pay outgoings in relation to the ground floor of the premises. 24In November 2006, Satchi & Satchi purported to exercise its option to extend the lease for a further three years. Correspondence was exchanged to the effect that Satchi & Satchi was in breach of the lease as it had not paid outgoings and therefore could not exercise the option and the lease would come to an end on 14 January 2007. 25On 22 February 2007, Satchi & Satchi filed an application with the ADT seeking a declaration that the option had been validly exercised and that it had actually overpaid its outgoings. 26On 17 and 18 December 2007, these ADT proceedings were heard. Zeaiter found out that Satchi & Satchi was deregistered on the first day of the hearing and applied to have the proceedings dismissed on that basis since Satchi & Satchi could not maintain any legal proceedings. (Satchi & Satchi has subsequently been re-registered). 27On 18 December 2007, the ADT delivered its decision and dismissed the proceedings. A costs order was subsequently made against Mr Satchi personally as agent of Satchi & Satchi. 28On 20 March 2008, Satchi & Satchi filed a notice of appeal, in respect of this decision, in the ADT. On 22 July 2008, the appeal was heard. On 8 October 2008 the appeal was dismissed. 29Zeaiter elected to evict Satchi & Satchi from the ground floor premises as Satchi & Satchi still owed rent and outgoings. On 20 December 2007, Satchi & Satchi were locked out of the premises. 30On 21 December 2007, Satchi & Satchi made an ex-parte application to the Supreme Court and obtained orders for Zeaiter to allow Satchi & Satchi back into the ground floor premises on the basis of undertakings that they pay rent and outgoing to date and continue to make these payments.

These proceedings 31On 7 January 2008, by summons in these proceedings (then numbered 30004/08) Satchi & Satchi Australia Pty Ltd as first plaintiff, Hemalathatsothy Satchithanantham as second plaintiff and Mr Satchithanantham as third plaintiff, commenced these proceedings against Zeaiter Corporate Holdings Pty Ltd as defendant. The plaintiffs sought to set aside the various ADT decisions made, as referred to above, in relation to the ground floor and first floor premises. 32An interim injunction was granted (and extended) on the basis of undertakings provided by Mr and Mrs Satchi to pay the rent and outgoings of the ground floor premises as contained in the lease. As Satchi & Satchi was deregistered, another summons was filed and dismissed but I need not refer to it. As previously stated, Satchi & Satchi were re-registered and these proceedings continued. 33In the summons in these proceedings, Mrs Satchi also sought interim orders as follows: (a) Zeaiter pay the plaintiffs $26,184.41; (b) That the court conducts the appeals of ADT decisions relating to some interim applications made by Satchi & Satchi in the ADT.

Judgments of Hoeben J dated 9 May 2008 and 30 July 2008 34On 9 May 2008, the application relating to the interim orders sought in the summons together with the notice of motion filed by Mr Satchi came before Hoeben J. 35On 9 May 2008, Hoeben J in his written judgment referred to disputes between Mr and Mrs Satchi and Zeaiter. His Honour dismissed Mrs Satchi's notice of motion and previous interim orders. More importantly, Hoeben J dismissed so much of the summons in 30004/08 (now these proceedings) as relates to an appeal from the decision of the ADT matter number 070943 (the ADT main proceedings). [My emphasis added] 36On 7 July 2008, Satchi & Satchi, and Mr Satchi and Mrs Satchi filed an application in relation to the ADT main proceedings seeking to continue to occupy the ground floor premises and for damages in the sum of $140,000. 37On 10 July 2008, Zeaiter filed a notice of motion in these proceedings seeking to dissolve the injunction extended on 4 February 2008 which allowed Satchi & Satchi to occupy the ground floor premises. Zeaiter sought to dissolve the injunction upon the basis that Mr and Mrs Satchi had failed to pay the rent and goings in accordance with their undertakings to do so. Satchi & Satchi filed a notice of motion seeking orders that a third party pay its rent and that the first floor lease with Mrs Satchi be reinstated and that she be allowed to occupy those premises. 38On 30 July 2008, Hoeben J handed down judgment and made orders to the effect that rent was outstanding [J 21] and Zeaiter was relieved of its obligations to comply with the injunction [J 26]. Mr Satchi's notice of motion was dismissed. 39On 2 August 2008, Zeaiter evicted Satchi & Satchi from the ground floor premises. These premises have since been re-leased to a third party. 40Between 30 July 2008 and 20 April 2010, these proceedings remained dormant until Mr Satchi filed a notice of motion for summary judgment. On 13 April 2011, Zeaiter's solicitor Mr Edwards contacted the Supreme Court registry and was informed that the matter had been disposed off and this file had been closed on 30 July 2008. 41The ADT proceedings also remained dormant during this period . On 23 September 2010, an oral application was made in the ADT by Zeaiter to dismiss the proceedings for want of prosecution. The ADT granted this application.

The "revival" of these proceedings 42On 20 April 2010, Satchi & Satchi and Mr Satchi and Mrs Satchi filed a notice of motion for summary judgment in these proceedings. On 21 May 2010, an amended notice of motion was filed. 43On 25 June 2010, the notice of motion came before Garling J, Satchi & Satchi Australia Pty Ltd v Zeaiter Corporation Holdings Pty Ltd [2010] NSWSC 715. Mr Satchi attended and requested that both notices of motions be heard. The motions were heard and dismissed. Importantly, Garling J ordered that the matter proceed by way of pleadings. His Honour ordered that the plaintiffs were to file and serve any statement of claim upon which they wished to rely, setting out all causes of action upon which they claimed to be entitled to relief, on or before 4 pm on 20 August 2010. His Honour further ordered that, should the plaintiffs intend to join any additional parties, they were to file and serve any notice of motion seeking such joinder and all affidavits in support of an order for the joinder of additional parties on or before 4.00 pm on 20 August 2010. His Honour ordered the defendant to file either a defence to the statement of claim or, if so advised, any notice of motion and all affidavits in support, seeking orders in respect of the statement of claim by 4.00 pm on 16 September 2010. 44On 20 August 2010, the plaintiff filed a further notice of motion in these proceedings. On 17 September 2010, these proceedings came back before Garling J. His Honour dismissed the plaintiffs' motion filed 20 August 2010 with costs. His Honour also granted leave for the plaintiffs to file and serve a statement of claim and ordered that if such a statement of claim was not filed and served by 4 pm on 17 December 2010, leave was given for the defendant to file and serve a notice of motion for summary dismissal together with any affidavits in support, if necessary. 45On 17 December 2010, Satchi & Satchi, Mr Satchi, Mrs Satchi and Bramooth Satchi filed a statement of claim in these proceedings. The statement of claim has purported to join new parties that were not named in the summons, namely Bramooth Satchi as fourth plaintiff, NAB as the second defendant, ITSA as third defendant and Mr Zeaiter as fourth defendant. I should add that no leave was granted by Garling J to the plaintiffs to join those additional parties.

The law 46UCPR 13.1(1) provides: "13.1 Summary judgment (1) If, on application by the plaintiff in relation to the plaintiff's claim for relief or any part of the plaintiff's claim for relief: (a) there is evidence of the facts on which the claim or part of the claim is based, and (b) there is evidence, given by the plaintiff or by some responsible person, that, in the belief of the person giving the evidence, the defendant has no defence to the claim or part of the claim, or no defence except as to the amount of any damages claimed, the court may give such judgment for the plaintiff, or make such order on the claim or that part of the claim, as the case requires. (2) Without limiting subrule (1), the court may give judgment for the plaintiff for damages to be assessed. (3) In this rule, a reference to damages includes a reference to the value of goods." 47UCPR 13.4(1) provides that the court may dismiss proceedings generally, or in relation to any claim for relief, in three circumstances. These are, if the proceedings are frivolous or vexatious, or if no reasonable cause of action is disclosed, or if the proceedings are an abuse of the process of the court. 48UCPR 14.28(1) provides that the court may at any stage of the proceedings order that the whole or any part of a pleading be struck out if the pleading firstly, discloses no reasonable cause of action or defence or other case appropriate to the nature of the pleading, secondly, has a tendency to cause prejudice, embarrassment or delay in the proceedings, or thirdly, is otherwise an abuse of the process of the court. 49UCPR 14.28(2) provides that the court may receive evidence on the hearing of an application for an order under subrule (1). 50Zeaiter and Anthony Zeaiter seek that the statement of claim be struck out or dismissed on the basis that the issues pleaded against them in relation to the leases at the premises are the same as the issues raised and determined in the ADT proceedings. The appeal from the ADT decision was determined by Hoeben J on 10 May 2008. 51As against all defendants, the plaintiffs claim seeks, "real property - lease hold title and possessory title; real property - wrongful registration of mortgage, leases and land transfer; trespass; torts; mercantile law; failure of specific performance and money and damages claim." So far as Zeaiter is concerned, the plaintiffs seek that Zeaiter pay them the sum of $1,760,000 and grant them a new lease of the premises with no rent increase.

Res judicata and issue estoppel 52The principles of res judicata or issue estoppel apply where there is an attempt to re-litigate issues that have previously been determined in proceedings. Alternatively, an attempt to litigate issues which could and should have been litigated in previous proceedings that will give rise to the Anshun estoppel: Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589. 53Dixon J's analysis of these two principles in Blair v Curran [1939] HCA 23; (1939) 62 CLR 464 remains a guiding precedent. His Honour says at 531-532: "A judicial determination directly involving an issue of fact or of law disposes once for all of the issue, so that it cannot afterwards be raised between the same parties or their privies. The estoppel covers only those matters which the prior judgment, decree or order necessarily established as the legal foundation or justification of its conclusion, whether that conclusion is that a money sum be recovered or that the doing of an act be commanded or be restrained or that rights be declared. The distinction between res judicata and issue estoppel is that in the first the very right or cause of action claimed or put in suit has in the former proceedings passed into judgment, so that it is merged and has no longer an independent existence, while in the second, for the purpose of some other claim or cause of action, a state of fact or law is alleged or denied the existence of which is a matter necessarily decided by the prior judgment, decree or order." 54Therefore it is clear that the re-litigation of the same cause of action in fresh proceedings is likely to involve the same issues, giving rise to res judicata and issue estoppel. 55Mr Satchi submitted that the lease was fabricated, that the whole proceedings have been manipulated and he should be entitled to pursue his action as pleaded in his statement of claim. Mr Satchi's main argument, in relation to the Satchis' notice of motion, is that since they filed their statement of claim on 17 December 2010, (in accordance with the orders of Garling J), and no defence has been filed by Zeaiter and Anthony Zeaiter so they should be entitled to default judgment against Zeaiter and Anthony Zeaiter. 56The statement of claim does not comply with the rules on pleadings and it is difficult to properly understand the case that the defendants have to meet. In my view it is clear that the plaintiffs seek to raise issues that have already been heard and determined by the ADT against the first and fourth defendants. The plaintiffs appealed to the appeal panel of the ADT in relation to these issues. That appeal was dismissed. So far as they appealed the decisions of the ADT to this court, the appeal was dismissed by Hoeben J on 10 May 2011. The plaintiffs now seek to raise issues relating to the leases once again. These issues are subject to res judicata and issue estoppel. The issues raised in the statement of claim, so far as the first and fourth defendants are concerned, constitute an abuse of process and should be dismissed. 57That leaves the fourth plaintiff, Bramooth Satchithanantham, the first and second plaintiffs' teenage son, and ITSA as third defendant remaining as parties named in the statement of claim. The relief sought against ITSA includes the setting aside of sequestration orders made in 2002 and 2009 against the third plaintiff and an order that he be discharged from bankruptcy. As Fullerton J stated in her judgment in these proceedings dated 30 March 2011, it is clear beyond question that this court has no jurisdiction to grant those orders. It is unclear what involvement Mr and Mrs Satchi's teenage son Bramooth Satchithanantham could have in these proceedings. In any event, no leave was given to join either Bramooth Satchithanantham or ITSA as parties to these proceedings. The balance of the statement of claim should be dismissed. 58No further leave is granted to file any further statement of claim in these proceedings. The plaintiffs' notice of motion filed 10 May 2011 is dismissed. 59Costs are discretionary. Costs usually follow the event. The plaintiffs are to pay Zeaiter Corporate Holdings Pty Ltd and Mr Zeaiter's costs as agreed or assessed.

The Court orders that: (1) The plaintiffs' notice of motion filed 10 May 2011 is dismissed. (2) The statement of claim filed 17 December 2010 is dismissed. (3) No leave is granted to file any further statement of claim in these proceedings. (4) The plaintiffs are to pay the first and fourth defendants' costs of the motions filed 6 May 2011 and 10 May 2011 as agreed or assessed.

The Court notes that: (5) These proceedings are finalised.

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: 22 August 2011

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