PROCEDURE - ENFORCEMENT OF ORDERS - Seize and sale - money order - judgment of the Magistrates Court registered in the Supreme Court - service of the enforcement order - in chambers orders - Application in Proceedings was entitled between enforcement officer and the enforcement debtor

REAL PROPERTY - SEIZURE AND SALE OF LAND - Amount of judgment debt justified a sale of real property - sale must be at a fair and reasonable price - r 2219 of the Court Procedure Rules 2006 (ACT)

Building Act 2004 (ACT), s 52

Civil Law (Sale of Residential Property) Act 2003 (ACT), s 9

Districts Act 2002 (ACT), ss 5, 6, 7

Land Titles Act 1925 (ACT), ss 43, 47

Planning and Development Act 2007 (ACT), ss 10, 12

Supreme Court Act 1933 (ACT), s 21

Unit Titles Act 2001 (ACT), ss 17, 20, 27, 32, s 33(1), 33(3)

Unit Titles (Management) Act 2011 (ACT), ss 8, 9

Court Procedures Rules 2006 (ACT), rr 202, 2000, 2010, 2015(2)(c), 2015(2)(d), 2200, 2201, 2204, 2212(1)(c), 2219, 2430, 2431, 2153, Pt 2.18, Pt 6.2

ACTEW Corporation Ltd v Mihaljevic [2011] ACTSC 23

Anderson v Liddell [1968] HCA 12; (1968) 117 CLR 36

Brookfield v Davey Products Pty Ltd [2002] FCA 889

City Hill Pty Ltd v ACT Planning and Land Authority [2015] ACTSC 40; 207 LGERA 48

Hartmont v Foster (1881) 8 QBD 82

King Investment Solutions Pty Ltd v Hussain [2005] NSWSC 1076; 64 NSWLR 441

Moldex Pty Ltd v Recon Ltd [1948] VicLawRp 15; [1948] VLR 59

Owen v Daly [1955] VicLawRp 72; [1955] VLR 442

Patersons Credit Pty Ltd v Credit Licensing Authority (Unreported, Supreme Court of Victoria, Beach J, 31 July 1987)

Raybos Australia Pty Ltd v Tectran Corporation Pty Ltd (1987) 76 ALR 69

R v BR [2010] ACTSC 17

R v Warby [1983] 1 NSWLR 289

Greg Stilianou et al, Baalman & Wells Land Titles Office Practice NSW (Thomson Reuters Law Book Co, 2012)

Nicole Leedham, "Forced sale - at any price", The Canberra Times, 15 May 1997

Law Reform Commission of Western Australia, Enforcement of Judgment Debts (Perth, WA, 1977) Report No 61

Amy Kilpatrick, "They want to take our house": An Investigation into House Repossessions in the ACT Supreme Court (Care Inc Financial Counselling, Canberra, 2006)

The Owners of Units Plan 932 (Enforcement Creditor)

1. The Owners of Units Plan 932 as plaintiff sued the defendant, Roubi de Andrade Nee Marhaba, in the ACT Magistrates Court for a debt of $34 875.91.

2. The plaintiff was a corporation with perpetual succession and is entitled to sue and liable to be sued in its corporate name. It became a corporation in the following way.

3. A lessee of a Crown lease of land in the Australian Capital Territory may apply for a subdivision of a parcel of land, the subject of the Crown Lease, into units, any unit subsidiaries and common property under s 17 of the Unit Titles Act 2001 (ACT). On approval by the Planning and Land Authority (see ss 10 and 12 of the Planning and Development Act 2007 (ACT)), the lessee may, under s 20 of the Unit Titles Act, submit under s 27 of that Act a units plan for registration. On registration the parcel is, by force of s 32 of that Act, subdivided as specified in the diagrams in the units plan and the lease of the parcel ends (s 33(1) of the Units Titles Act).

4. Further, on registration of the units plan, an owners corporation is established by force of s 8 of the Unit Titles (Management) Act 2011 (ACT), under the corporation name of "The Owners - Units Plan No [Number assigned to the Units Plan]". By s 9 of that Act, the owners corporation becomes a corporation with perpetual succession and is entitled to sue and liable to be sued in its corporate name.

5. The owners corporation also becomes, on registration of the units plan, the holder of a leasehold estate in the common property under s 33(3) of the Units Titles Act.

6. Thus The Owners of Units Plan 932, on registration of that Units Plan, became able to be plaintiff in these proceedings: Moldex Pty Ltd v Recon Ltd [1948] VicLawRp 15; [1948] VLR 59.

7. The defendant, Roubi de Andrade nee Marhaba, was the registered proprietor of a unit in the Units Plan.

8. On 7 January 2013, judgment was entered in favour of The Owners of Units Plan 932 against Ms Marhaba in the sum of $34 875.91, together with interest and costs. The Owners of Units Plan 932 have now sought to enforce that judgment. It is, of course, a judgment for the payment of money and so is relevantly termed a money order: r 2000 of the Court Procedures Rules 2006 (ACT).

9. The enforcement of orders is provided for in Pt 2.18 of the Court Procedures Rules. Applications for any form of enforcement is to be made in the original proceedings under r 202. An application for enforcement, including enforcement of a money order, is thus to be entitled as in the original proceedings. That is to say, the title to proceedings should remain the same, with the plaintiff mentioned first and the defendant mentioned second.

10. Subject to what I say below (at [11]), the title to the proceedings should only be amended by order of the Court, such as when a new party is added, though it may not be appropriate to amend the title to the proceedings when a party is dismissed; that is a matter for the discretion of the Court. As to amendment to the title of proceedings, see Brookfield v Davey Products Pty Ltd [2002] FCA 889 at [13]- [17].

11. As to the actual description of a party, as opposed to his, her or its name, r 2000 of the Court Procedures Rules provides that the person who is entitled to the benefit of a money order be described as "the enforcement creditor" and the person requiring to pay the money as "the enforcement debtor". On the taking of enforcement proceedings, the title thereupon is changed by virtue of those Rules to describe the relevant parties as "Enforcement Creditor" and "Enforcement Debtor" respectively, though they will still remain in the order in which the original title to the proceedings appeared, as enforcement action remains within the same proceedings. Thus, if a plaintiff is ordered to pay costs to a defendant or a defendant's counter-claim is successful and the plaintiff is ordered to pay money to the defendant, the defendant would, on enforcement, become described thereafter, so far as he, she or it is a party in the proceedings, as the enforcement creditor, but would still be mentioned second in the title to the proceedings, with the plaintiff mentioned first, nevertheless then described so far as he, she or it is a party in the proceedings as the enforcement debtor. This also accords generally with the prescribed forms numbered Form 2.50 to Form 2.71 (both inclusive).

12. The enforcement creditor may then take one of a number of applications to the Court for enforcement of the money order. These include that the Court:

• seize and sell so much of the enforcement debtor's property, including, for the Supreme Court only, the enforcement debtor's land, as is sufficient to satisfy the judgment;

• redirect to the enforcement creditor as payment of any debts payable to the enforcement debtor, or redirect to the enforcement creditor by regular payments from any account of the enforcement debtor with a financial institution into which is made a regular deposit;

• redirect to the enforcement creditor a portion of the enforcement debtor's wages or salary;

• impose a charging order in favour of the enforcement creditor over equitable interests of the enforcement debtor;

• impose a stop order on any money paid into Court to the benefit of the enforcement debtor in another proceeding; and

• appoint, in appropriate circumstances, a receiver of the enforcement debtor's property.

This is not to mention that there are other options in appropriate cases such as the arrest of an absconding enforcement debtor, contempt proceedings, or bankruptcy proceedings, the latter only available in the Federal Court of Australia.

13. In this case, The Owners of Units Plan 932 have sought to recover the judgment sum by seeking the seizure and sale of the Crown Lease of the unit owned by the Enforcement Debtor by the Court.

14. The recovery of money by seizing and selling the property of the enforcement debtor is effected by the Court making of a seizure and sale order under r 2200 of the Court Procedures Rules. Such an order in the Magistrates Court, however, is limited to the seizure and sale of the personal property of the enforcement debtor. An order in the Supreme Court, however, authorises an enforcement officer (that is, the sheriff, a sheriff's officer or a bailiff: r 2000 of the Court Procedures Rules) to seize and sell both the real and personal property of the enforcement debtor.

15. In this case, The Owners of Units Plan 932 wished to enforce the money order by the seizure and sale of the unexpired residue of the lease of the unit owned by the enforcement debtor. That is real property.

16. As the money order was made in the Magistrates Court, it was necessary to have the judgment registered in the Supreme Court in order that the property subject to the seizure and sale order could encompass the land of the enforcement debtor.

17. That is achieved under r 2010 of the Court Procedures Rules. Such registration is likely to be sought when, as here, the enforcement creditor wishes to use an enforcement procedure not available to the Magistrates Court, such as the seizure and sale of real property or the appointment of a receiver under r 2431 which, by r 2430, is also an enforcement remedy limited to the Supreme Court.

18. Before a seizure and sale order, and, indeed, any other enforcement order, can be made, it is necessary for a sealed copy of the money order to be served on the enforcement debtor together with a notice that sets out certain matters which ensure that the enforcement debtor is aware of the order, aware of the amount claimed, whether the order is a default judgment and, if so, that it can in certain circumstances be set aside, other options available to the enforcement debtor, such as an application for an instalment order (under r 2153 of the Court Procedures Rules), and where the enforcement debtor may be able to obtain legal or financial advice and assistance in relation to the order and the debt due under it.

19. After service of the money order, the enforcement creditor may apply under r 2201 of the Court Procedures Rules to the Court for a seizure and sale order. Such an order authorises an enforcement officer to seize and sell property of the enforcement debtor to realise the amount of the judgment debt.

20. In this case, a seizure and sale order was made on 16 March 2016 and, on 18 March 2016, the Sheriff of the ACT seized certain real property of Ms Marhaba.

21. The property the subject of these proceedings was variously described in documents in the proceedings. In the Territory, all land is, of course, Commonwealth land administered by the Territory: City Hill Pty Ltd v ACT Planning and Land Authority [2015] ACTSC 40; 207 LGERA 48 at 53; [1]. All Territory land has been divided into districts, each with a distinguishing name, and then each district has been further divided into divisions, each division into sections and each section into blocks. See ss 5 and 6 of the Districts Act 2002 (ACT). This is achieved by the means of a Deposited Plan. Once registered by the Registrar-General under s 7 of the Districts Act, these divided areas then provide a unique description for each parcel of land and, indeed, under s 9 of that Act, provide a sufficient description of the land.

22. Conventionally, in conveyancing in the Territory, the description of a parcel of land is by reference to the block, section and division. There is no general need for reference to one of the 13 districts of the Territory as none of the divisions are duplicated in any district and so reference to the block, section and division is sufficient description for a unique identification of the parcel. Sometimes, reference will also be made to the Crown Lease or Certificate of Title by volume and folio numbers as registered in the register of all Territory land by the Registrar-General: ss 43 and 47 of the Land Titles Act 1925 (ACT). In addition, the street address is often also used as an additional and helpful description, especially for non-lawyers, but is not required for unique identification.

23. While the Deposited Plan is the mechanism by which these parcels are created, it is not necessary to refer to the Deposited Plan for the purpose of identification. In this respect, the description of titles to a parcel of land is different from that in New South Wales where the reference to the Deposited Plan can be quite important.

24. When a unit is the parcel to be described, the Units Plan is not required to be mentioned, but it is very desirable to do so and, as far as I can ascertain, regularly included. It seems to me that it is an important identifier.

25. This is consistent with the ACT Land Titles Office Practice Manual (www.accesscanberra.act.gov.au/ci/fattach/get/48011/1436241916/redirect/1/filename/land%20titles%20practice%20manual.pdf) (the Manual) which is produced under the authority of the Registrar-General, who described it in the Introduction to the Manual as follows:

This Practice Manual integrates Practice Notes, Staff Notes and Procedural Manuals developed over many years and now represents the basis of Land Titles Practice in the A.C.T.

...

This Practice Manual should serve as a first point of reference in relation to land titles practice in the ACT.

26. Like Greg Stilianou et al, Baalman & Wells Land Titles Office Practice NSW (Thomson Reuters Law Book Co, 2012) looseleaf is for New South Wales conveyancing lawyers, the Manual is the "Bible" for land titles practice in the Territory.

27. In relation to the folios of the register referred to above (at [22]), the Manual provides at 1.2 as follows:

Upon registration, Crown Leases are allocated volume and folio numbers, which become the unique title identifier for Crown Leases.

28. In relation to the identification of land in the Territory, the Manual provides at 1.3 as follows:

Land in the Territory is referred to by Block/Section Division/District identifiers. Upon subdivision of a parcel under the Land Titles (Unit Titles) Act 1970 (LTUTA), a Unit Number is added.

Notes concerning parcel identifiers:

• the legal name for a parcel under the [Districts Act] is Block/Section/ Division/District;
• further subdivisions of parcels under the LTUTA are referred to by Unit Plan No, Unit No and Common Property;
• in practice, the District name is usually only referred to where the parcel is rural. For example, it has no Section number.

29. Thus, the property the subject of these proceedings can be adequately, appropriately and uniquely described as "Unit 112 on Units Plan 932, being Block 6, Section 1, Division of Dickson, contained Crown Lease being Volume 1348 Folio 22". It is conventional to add "known as Unit 112, 350/242 Northbourne Avenue, Dickson", but this is not necessary. The reference to the Deposited Plan 6291 is also unnecessary.

30. I note that under s 9 of the Civil Law (Sale of Residential Property) Act 2003 (ACT), a Deposited Plan is a required document that must be supplied with a contract of sale. That is because some easements, especially for utilities, may not be shown on certificates of title: ACTEW Corporation Ltd v Mihaljevic [2011] ACTSC 23 at [59]. A Deposited Plan may show an easement not on the Certificate of Title: s 52 of the Building Act 2004 (ACT). See also the Manual at 1.6.

31. I note, too, that s 9 of the Civil Law (Sale of Residential Property) Act requires the Units Plan to be included as a required document when the Crown Lease being sold is a unit.

32. Accordingly, it is not necessary to refer to the Deposited Plan for the purposes of identification of the relevant property, but desirable to refer to the Units Plan.

33. This is not the occasion to consider in detail the process of sale by the Sheriff or other enforcement officer of the Property. That will be undertaken in the usual way and must be conducted in a reasonable way that is fair to both the enforcement creditor and the enforcement debtor, especially as to the obtaining of a fair price: Owen v Daly [1955] VicLawRp 72; [1955] VLR 442 at 446.

34. Changes were made to the Supreme Court Rules 1937 (ACT), following problems seen in the then method of sale of property said to risk unfairness to the enforcement debtor. See Nicole Leedham "Forced sale - at any price", The Canberra Times, 15 May 1997. The changes made by the insertion of O 44 r 3A to provide leave for the issuing of a writ of venditioni exponas. These changes were incorporated into the Court Procedures Rules which, however, provided for more modern procedures with some reliance on Law Reform Commission of Western Australia, Enforcement of Judgment Debts (Perth, WA, 1977) Report No 61.

35. These changes were designed, amongst other matters, to ensure adequate notice to enforcement debtors and that a fair price is obtained on sale. There are, of course, relevant issues beyond merely the procedures of the Court. See, for example, Amy Kilpatrick, "They want to take our house": An Investigation into House Repossessions in the ACT Supreme Court (Care Inc Financial Counselling, Canberra, 2006).

36. In this case, I am asked to make orders under r 2219 of the Court Procedures Rules. That rule is as follows:

2219 Seizure and sale order - power of entry for auction of land

(1) If land is to be sold by public auction, the court may, on application by an enforcement officer, make an order -

(a) authorising entry onto the land by the enforcement officer (including entry by force if necessary) for the purpose of showing the land to prospective purchasers; and

(b) authorising entry onto the land by prospective purchasers in the presence of the enforcement officer.

(2) The order may also authorise the enforcement officer to do either or both of the following:

(a) secure entry onto the land (including by breaking or replacing locks, bars and other devices restricting entry, if necessary);

(b) take the steps necessary to prevent people from entering the land.

(3) Part 6.2 (Applications in proceedings) does not apply to an application under this rule.

(4) An application under this rule need not be served on anyone unless the court otherwise orders on its own initiative.

(5) Unless the court otherwise orders on its own initiative, an application under this rule must be dealt with without a hearing and in the absence of the parties.

(6) This rule does not affect any other power of the court to make orders.

(7) In this rule:

land includes premises on land.

37. This is an application that previously would have been described as being determined in chambers, that is usually the office of the judge (called the judge's chambers). It does not have to be so; it is, in fact, merely any room where the judge may transact business in private, rather than the judge doing so in open court: Hartmont v Foster (1881) 8 QBD 82 at 84. That is to say, the proceedings are conducted in private and, probably, more informally. There is usually no transcript of the proceedings. Clearly there must be strict limits on what can be done in private, as pointed out in R v Warby [1983] 1 NSWLR 289. Usually, such matters are of more administrative kind or require confidentiality, such as the issuing of a warrant. Similarly, uncontested adoption applications are usually conducted in the judge's chambers. See the discussion of the distinction by Toohey J in Raybos Australia Pty Ltd v Tectran Corporation Pty Ltd (1987) 76 ALR 69 at 71-2. See also Patersons Credit Pty Ltd v Credit Licensing Authority (Unreported, Supreme Court of Victoria, Beach J, 31 July 1987) at 11-12.

38. The abolition of the distinction between open court and chambers effected by s 21 of the Supreme Court Act 1933 (ACT), since repealed, is said to have meant that there is no restriction on where the court can exercise its powers, other than constitutional limitations: King Investment Solutions Pty Ltd v Hussain [2005] NSWSC 1076; 64 NSWLR 441 at 443; [147].

39. A number of judges now regularly hear applications that may formerly have been conducted in chambers in court. Among other reasons for doing so is that the proceedings are recorded and a transcript can be prepared if necessary. There is, of course, a wide range of powers to conduct proceedings in court but still in private, by, for example, closing the court: R v BR [2010] ACTSC 17 at [25]. No doubt, the inherent jurisdiction would allow that to be done in an appropriate case in any event: R v BR at [24].

40. The indicia in r 2219 of the Court Procedures Rules show that the matter is to proceed relatively informally and "on the papers", that is to say without oral argument in the absence of the parties or their lawyers and without a transcript. This seems to have been intended, for there is no notice required to be given to any of the parties, the enforcement officer who is the applicant not being a party to the proceedings, and no requirement for attendance of any party. It is, therefore, convenient for it to be determined in this way in private and not in open court.

41. This, of course, imposes on the judge a need to ensure that the matter is considered carefully, that sufficient information is provided, and that any relevant interests are respected.

42. It seemed to me that it was important that the following information was provided for proper consideration of the application:

• the making of the seizure and sale order - as that order is the order of a superior court, it is probably not necessary to have access to the original money order on which it is based, though that may be on the file presented to the judge;

• the notice of the making of the seizure and sale order given to the enforcement debtor under r 2204 of the Court Procedures Rules;

• the date of service of that notice so that the judge can be certain that the notice has been served and that the enforcement debtor has had reasonable time to seek legal or financial advice or both;

• whether there has been any response by the enforcement debtor to service of the notice such as by an indication that an application for a stay, for setting aside the money order, or for an instalment order is in contemplation; and

• if the judgment debt is a relatively small amount, it may be helpful, though not necessary, for the applicant enforcement officer to indicate why enforcement is not being made of personal property which is required to be seized and sold first: r 2212(1)(c) of the Court Procedures Rules.

43. While Pt 6.2 of the Court Procedures Rules is expressly disapplied, it is still appropriate that the application be made by Application in Proceedings, as was done in this case. That assists in the following ways:

• it articulates clearly the orders sought; that not only requires the applicant enforcement officer to give thought to the precise powers sought, but it assists the judge if he or she can simply "make the orders as sought"; and

• it sets out the grounds on which the application is made, which is helpful for the judge.

44. Of course, in a case such as this, where the judgment debt is reasonably substantial, there is not a great deal that is of concern. The obligation is to sell at a fair and reasonable price, as explained in Anderson v Liddell [1968] HCA 12; (1968) 117 CLR 36 at 46. Clearly that would require that prospective buyers be encouraged. Access to the property would be part of such encouragement.

45. I think I can rely on the fact that real estate is usually sold only after prospective purchasers have had access to the intended purchase and home inspection is a common feature of the real estate market. That is a good reason for allowing the entry permitted under court order by the rule.

46. As noted above (at [42]), the time between the service of the notice and the date of the application may be relevant so as to ensure that an enforcement debtor has a reasonable opportunity to seek professional advice, information about which it is mandated that the enforcement debtor receive under r 2015(2)(c) and (d) of the Court Procedures Rules.

47. In this case, I had access to the seizure and sale order and notice of the order together with details of service. The indication was that no response from the enforcement debtor had been received and the amount of the judgment debt justified a sale of real property.

48. In addition, I was asked to authorise an entry on the Property so that the locks could be changed. This was because the enforcement debtor had all the keys and apparently had declined to hand them over. I considered this also to be an appropriate order.

49. The Application in Proceedings was entitled as between the Sheriff as enforcement officer and the enforcement debtor. While the Sheriff is the applicant, the Application in Proceedings should still be entitled in the same way as the file is entitled; that is, it should show the proceedings between the enforcement creditor and the enforcement debtor. That error, however, did not invalidate the application. Indeed, it could, in accordance with r 2219 of the Court Procedures Rules have been made orally, though for the reasons already given (at [38]), this is not preferred. I made an appropriate order about this.

I certify that the preceding fifty [50] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Justice Refshauge.