Togher & Anor v Alexander & Ors - [2019] NSWDC 337 - NSWDC 2019 case summary — Zoe

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Togher & Anor v Alexander & Ors

[2019] NSWDC 337

District Court of NSW|2019-07-19

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At a glance

Source facts

Court

District Court of NSW

Decision date

2019-07-19

Source

Original judgment source is linked above.

Judgment (18 paragraphs)

[1]

Background to the applications to set aside the orders made on 24 June 2019

[2]

Explaining the circumstances in which committee members were belatedly joined

As indicated, these applications are brought, respectively, by the committee members of the SOCIA Church and Grace Missions. Both of those entities are unincorporated, but registered charities. The monetary judgment that Mr Alexander obtained against the executive members of SOCIA Church and Grace Missions was the result of essential findings made by the Court that Mr Alexander entered into a binding agreement, in the nature of an underwriting agreement, with both SOCIA Church and Grace Missions in March 2016, which agreement was varied in May 2016; and that SOCIA Church and Grace Missions breached that agreement in January 2017.
There were many unusual procedural features of the litigation, which have given rise to the applications. Mr Alexander's claim, as originally pleaded on December 2017, was against SOCIA Church, Grace Missions, Mr Zen Harkness and Mr Malcom McClure. Mr Harkness was the 'principal officer' of both SOCIA Church and Grace Missions. He was also a member of the committees for each entity, holding the positions of vice secretary (Vic) of SOCIA Church. Mr McClure was the secretary for the SOCIA Church. At the time Mr Alexander brought his claim, there were other members of the committees for SOCIA Church and Grace Missions. In the case of SOCIA Church, they were Mr McCarthy, Mr Moyle, Ms Hancock and Mr King. In the case of Grace Missions, there was only one other committee member: Mr Peters. During the proceeding, prior to the trial, 'SOCIA Church' and 'Grace Missions' were removed as cross-defendants from Mr Alexander's claim. However, the other members of the executive committees to both entities had not been joined as cross-defendants.

[4]

The pleadings

In practical terms, the cross-claims for Mr Alexander and Mr Harkness were explicable by the competing views as to what was the true nature of arrangements entered into between Mr Alexander, Mr Harkness and Mr McClure in March 2017 and the middle of 2017. Mr Alexander contended that an underwriting agreement was entered into at the former date. Mr Harkness and Mr McClure denied this, but said that an agreement was entered into in July 2016 whereby Grace Missions provided a loan advance to Mr Alexander.
Mr Alexander's cross-claim (filed on 21 December 2017) was not strictly compliant with rules of pleading (in this State). Beyond asserting the essential factual matters necessary to sustain the cause of action he relied upon, it travelled into matters for evidence. However, at no stage was any complaint made (by Mr Harkness or Mr McClure) that it was so defective on that account that it should be struck out or was unintelligible. Mr Alexander's cross-claim contained 84 paragraphs.
For present purposes, it is sufficient to note that not one of those paragraphs identified, by name, any or all of Bronwyn Hancock, Timothy McCarthy, Andrew Moyle and Andrew King (of SOCIA Group) or Graeme Peters (of Grace Missions). Further, where 'SOCIA Church' and 'Grace Missions' were referred to at all, within the body of the pleading, they were generally referred to in the context that they were entities with which Messrs McClure and Harkness held positions of office. In other words, in substance, all of the factual matters asserted about individuals in Mr Alexander's cross-claim raised allegations of fact against only Messrs McClure and Harkness.
In their Defence (filed by their solicitors), Messrs McClure and Harkness did not refer, directly or indirectly, to any of Bronwyn Hancock, Timothy McCarthy, Andrew Moyle and Andrew King (of SOCIA Group) or Graeme Peters (of Grace Missions).
Mr Harkness' cross-claim (filed 13 April 2018) pleaded a loan agreement which he (Mr Harkness) entered into with Mr Alexander on 24 July 2016. In substance, however, there was no doubt that as the proceeding continued, the reference was intended to be made to Grace Missions.
This cross-claim contained no factual matters, directly or indirectly, identifying conduct by Mr Graeme Peters.

[5]

Affidavit evidence

In preparation for the trial, Mr Alexander swore affidavits on 23 May 2018, 23 October 2018, 28 November 2018 and 20 February 2019. All were read at the trial. He also served affidavits from Ms Christiane Hill (his wife), Mr Timothy Wilson and Mr Goran Dojcinovic. These were all read as well.
Mr McClure and Mr Harkness swore two affidavits. They also served affidavits from some of the applicants to these motions: Ms Hancock (27 November 2018 [6] ), Mr McCarthy, Mr King, Mr Moyle (and Ms Buckley - who is a third party to the proceeding). No affidavit was prepared by Mr Peters. No evidence was served at trial, by Mr McClure or Mr Harkness, which explained why he was unavailable to give evidence.
Only Ms Hancock was called to give evidence. She was cross-examined. Her evidence is summarised at paragraphs [185]-[191] of my reasons for judgment. To paraphrase, the predominant part of her affidavit evidence concerned her participation in and proof of a meeting of the SOCIA committee members that occurred on 31 July 2016. A minute was taken of that meeting and was put into evidence. The affidavit evidence of Messrs McCarthy, Hoyle and McCarthy was effectively corroborative of what occurred at the meeting on 31 July 2016. They were not called as witnesses.
It was only in his affidavit in reply (20 February 2019) that Mr Alexander made any reference to any or all of Mr Moyle or Ms Hancock. In substance, Mr Alexander responded to their affidavit evidence by saying that: 1. he believed that their evidence was inadmissible as either being irrelevant or hearsay; 2. any evidence Ms Hancock or Mr Moyle could give in relation to the events in the proceeding could only have been based upon what Messrs McClure and Harkness had informed them.
Mr Alexander did not respond to the affidavit evidence of Mr McCarthy or Mr King.
It may be seen from these events that: 1. It was no part of Mr Alexander's pleaded claim, and it was not part of any of the evidence served prior to trial on his behalf, to make assertions of fact about conduct of any of Ms Hancock, Mr McCarthy, Mr Moyle, Mr King or Mr Peters. 2. Mr McClure and Mr Harkness (when legally represented) had the opportunity to include in their respective affidavits, evidence from each of Ms Hancock, Mr McCarthy, Mr Moyle, and Mr King, in order to respond to Mr Alexander's claim against Mr McClure and Mr Harkness, based as that claim was upon the agreement that Mr Alexander contends was reached with SOCIA Church and Grace Missions in March 2016. 3. no explanation was given by Mr McClure or Mr Harkness at trial as to whether and why Mr Peters was unavailable to give evidence [7] .

[6]

The trial

Relatively early in the trial, and having regard to the circumstance that each of Mr Alexander, Mr Harkness and Mr McClure were unrepresented, I articulated (both verbally and, subsequently, by email to each of Mr Alexander, Mr Harkness and Mr McClure) my understanding as to what I saw the issues arising in the proceeding. I did so with the purpose of guiding each of these individual parties as to the scope of the evidence throughout the trial (and, particularly to try to limit or minimize evidence veering towards irrelevant matters not germane to the transactions in dispute between the parties). None of the parties suggested that the issues that I had then articulated fell outside the scope of the pleadings or were not 'triable'.
Eventually, I referred, in my reasons for judgment, to the issues that had been finally identified after the cases for the parties had closed. Those issues had been refined as the trial went on and I requested the litigants to direct their submissions to those issues (being): 1. whether I should accept Mr Alexander's account of a verbal conversation with Mr McClure and Mr Harkness in March 2016; 2. whether a verbal agreement (constituted by such conversation) was reached in March 2016 and, in particular: 1. who are the parties to the contract; 2. was there legal capacity in the parties to contract; 3. whether Mr McClure (and/or Mr Harkness) was authorised to bind SOCIA Church (through its committee of members) to an agreement with Mr Alexander 4. whether Mr Harkness was authorised to bind Grace Missions to any agreement with Mr Alexander; 5. what were the essential terms of the contract (including, without limitation, what was the consideration for any promises made on behalf of SOCIA Church or Grace Missions); 6. if such agreement was reached, was Mr Alexander authorised (by SOCIA Church or Grace Missions) to enter into contracts on their behalf the purposes of advancing the festival 1. was the said verbal agreement breached by SOCIA Church and/or Grace Missions; 2. what if any loss arises from such breach? In particular, our damages recoverable for loss of reputation? 3. Is there an issue estoppel arising from the compromise of the Partnership's claim against each of Messrs Alexander, McClure and Harkness (all on behalf of Grace Missions) that prevents Mr Alexander recovering against Messrs McClure and Harkness on his claim 4. if there was no agreement in March 2016, was an enforceable agreement reached on or about 31 July or 1 August 2016, in the terms alleged by Mr Harkness (in his cross-claim)? 5. If so: 1. was that agreement breached by Mr Alexander; 2. what, if any consequences that have in connection with Mr Alexander's claim?

[8]

The position of the added cross-defendants

At the outset of the hearing of these applications, I indicated to the added cross-defendants (and, in Mr Peters case, added cross-claimant) that I determined that the orders made on 24 June 2019 should be set aside as against the cross-defendants as they were not served, and did not appear, at the hearing. I can state my reasons for this determination briefly.
There was no proven service of the originating process (of Mr Alexander and of Mr Harkness) after the order for joinder was made, as required by the UCPR. That, I think, is dispositive of the application, since it amounts either to an irregularity (and therefore suffices to establish 'sufficient cause' for the purpose of r 36.15), or at least satisfied one threshold basis for the Court's jurisdiction to set aside orders, being that the judgment or orders is made in the absence of a party (for the purpose of r 36.16(2)(b) of the UCPR). A failure to serve a defendant with originating process is an example of an irregularity which entitles the defendant to have it set aside unconditionally: Hoskins v Van Den-Braak (1998) 43 NSWLR 290. Judgments entered contrary to a material requirement of court rules are irregular: Arnold v Forsythe [2012] NSWCA 18. The requirement to serve originating process is one such rule.
In opposition to this, Mr Alexander cites the actual wording of many of the rules, which, by their terms, confers discretion upon the Court to do certain things. He also cites a number of circumstances which suggests that the cross-defendants had the opportunity to object to joinder, were aware of the proceeding and chose to 'sit it out' in the expectation that Messrs McClure and Harkness would adequately represent the entities of which they were committee members.
In my view, however, the failure to serve originating process is an irregularity and, as the decision in Hoskins indicates, constitutes an irregularity of such nature as to suggest that orders made should be set aside as of right. In other words, the matter does not turn upon discretionary considerations (although, that said, I do consider that discretionary matters are relevant to any question of costs following the outcome of this application).
It is not, therefore, necessary, for me to consider whether any or all other provisions in the Court rules of the kind that Mr Harkness says were not complied with (rr 6.21, 6.28, 6.32, 10.1, 14.3), in relation to the position of these added cross-defendants, even if I was to assume that Mr McClure or Mr Harkness had standing to raise these rules on behalf of the other cross-defendants.

[9]

The position of Messrs McClure and Harkness

As I noted, in respect to his disqualification application, Mr Harkness complains that orders should have been made by the Court in respect to facilitating notice to the additional cross-defendants and opportunity for their participation in the proceeding. However, Mr Harkness does not say that he himself did not receive notice of Mr Alexander's claim, did not have opportunity to compile evidence, appear at trial, exercise rights of cross-examination and make submissions as to findings and orders that should follow from such findings. Patently he did.
Mr McClure did not put on evidence in support to his application to set aside of the kind given by Mr Harkness. But he was relevantly in the identical position to Mr Harkness.
Neither of the grounds in r 36.16(2)(a) or (c) of the UCPR apply to them. Mr Harkness submitted at the hearing, that the ground in r 36.12(b) was potentially available. He submitted that the wording of the provision does not preclude the possibility that a defendant (A) may have standing to apply set aside court orders where defendants (B) & (C) are absent. He cited no authority to support this proposition. He accepted that whether that was appropriate was a matter for the Court's discretion.
I would be surprised if the proposition is correct. Although in this case, it is true, there are close relationships between Messrs Harkness, McClure and the other cross-defendants who were added, such closeness in relationship or association between multiple defendants to a claim will not always be present. Further, in many cases, the actions against multiple defendants might be completely different. It would be hard to see how, for example, if defendants A and B were complete strangers, A might have standing to apply to set aside an order on the basis of B's absence even though the causes of action sued upon to judgment were unrelated. If the position was right, it might lead to the tactic of one defendant encouraging, and thereafter taking forensic advantage of, another defendant not to appear at a hearing.
Be that as it may, I do not find it necessary to consider this particular point. The real gravamen on the applications, by both Messrs Harkness and Mr McClure was their claim that they were denied procedural fairness. This is something I now consider in relation to r 36.15 of the UCPR.
As to r 36.15, an applicant who seeks to set aside a judgment or order under that provision needs to identify 'sufficient cause' on one or more of three alternative bases: 'irregularity', 'illegality' and 'good faith'. There is, in my view, any sensible suggestion that any illegality attended the making of the orders. As to 'good faith', this has been interpreted as misconduct or dishonourable conduct by the person procuring the judgment or order sought to be set aside (in this case Mr Alexander) [8] . There is nothing to suggest conduct by Mr Alexander of this kind.
That leaves the basis of 'irregularity'. It has been said that, for the purposes of r 36.15 of the UCPR, it has been held that any procedural irregularity will not itself authorise setting aside orders entered after a hearing on the merits where the parties were represented and fully heard: Perpetual Trustees Australia Ltd v Heperu Pty Ltd (No.2) (2009) 78 NSWLR 190. Mr Harkness represented himself, and he was fully heard in the sense of being able to actively participate in the hearing, in the various senses described earlier.
Nevertheless, irregularity may be established where the applicant seeking to set aside the orders has been denied procedural fairness [9] . That said, a related, but separate, point is that 'irregularity' does not extend to errors attributable to the forensic decisions of parties [10] .
The application of Mr Harkness (and Mr McClure) centres upon the assertion that because the cross-defendants belatedly joined to Mr Alexander's claim and therefore did not participate in the trial, Mr Harkness and Mr McClure were denied procedural fairness.
In the circumstances I now turn to, in my opinion, they were not. This involves consideration of the pleadings, the issues identified, the way in which the 'joinder' question was and could have been approached, and the way that Messrs McClure and Harkness conducted their cases prior to trial.

[10]

The pleadings

First, as the claimant, significant responsibility rests upon Mr Alexander for his failure to join the added cross-defendants originally to his cross-claim. He had indeed erroneously joined the unincorporated entities, SOCIA Church and Grace Missions (until they were later removed prior to the trial). At the point of their removal, viewing his position objectively, he should have then acted to join the cross-defendants at that point.
Nevertheless, I do not regard the responsibility for joining the additional cross-defendants was exclusive to Mr Alexander. It was open to Messrs McClure and Harkness to plead, as a defence, (being a matter that I consider required pleading under r 14.14 of the UCPR) that if, contrary to their primary position that no agreement was reached in March 2016, there was an agreement that they reached with Mr Alexander, it had not been authorised by SOCIA Church and Grace Missions. That was a point which would have made Mr Alexander's claim, premised as it was upon the belief, or assumption, that an agreement was entered into with SOCIA Church and Grace Missions, not maintainable. Messrs McClure and Harkness did not do so, in their pleading or their evidence.
In contrast, in their evidence, they did make it clear that, according to their version of events, an agreement that they say was entered into in late July or early August 2016 had been authorised by the SOCIA Church. That argument was eventually not accepted, not because of any absence of proof of authority, but because no agreement was actually found to have been entered into with Mr Alexander.
In my view, it should have been apparent, well before the trial, to Messrs McClure and Harkness that the opportunity was available for them to allege and seek to prove that any agreement entered into with Mr Alexander, as Mr Alexander was alleged, was unauthorised and unenforceable for want of being authorised by other committee members of SOCIA Church and/or Grace Missions.
Had they done so, Mr Alexander would have been on notice and could have done a number of things. First, he might have said something in a Reply to the Defences to his cross-claim; he might possibly have been prompted to either apply to join other cross-defendants himself or, more probably, address in his affidavit evidence in chief in support of his cross-claim their positions. He might have invoked coercive court process, such as discovery, sought leave to administer interrogatories, serve notices to produce, subpoenas to give evidence against the additional cross-defendants.

[14]

Mr Harkness' and Mr McClure's submissions

With this background in mind, Mr Harkness submitted, in writing, that if the additional cross-defendants had the opportunity to participate and appear, he may have wanted to have amend his Defence and call some evidence.
Mr McClure did not put any submissions in writing, but spoke at length at the hearing of the motion.
Prior to their making their oral submissions, I informed Messrs Harkness and McClure that I was disposed to finding that the orders of the Court should be set aside as against each of Ms Hancock, Mr McCarthy, Mr Moyle, Mr King and Mr Peters.
That being so, both Messrs Harkness and McClure both submitted that it must follow that the Court's orders against them must also be set aside as well. They argued that if there was an irregularity affecting the orders against the others, so too, there was an irregularity affecting them as well.
I disagree. No authority was put to me in support of the proposition. It depends on the nature of the irregularity as to who is affected by it. The irregularity affecting the belatedly joined cross-defendants was the absence of service upon them of the originating process, the absence of notice to them of the hearing and lack of opportunity for them to participate. None of these matters were applicable to Messrs Harkness and McClure.
The real point of the application is that Messrs McClure and Harkness contend that they have been denied procedural fairness. They say that, from the date the joinder of the additional cross-defendants, the failure to take steps to ensure the appearance and active participation of the other cross-defendants, deprived them of the opportunity of obtaining a different outcome.
A common theme, and indeed submission expressly made by Mr McClure during the hearing of the motion, was that the entire procedural history of the litigation prior to the date that the order for joinder of these additional cross-defendants was made, is irrelevant and to be disregarded.
Procedural fairness, as has been stated many times, is essentially a matter of securing practical justice. In my view, the argument of Mr McClure (embraced by Mr Harkness) is too narrow. Rather, all of the considerations, including but not limited to, the possibility of a different outcome from the date of the joinder are to be weighed. But the possibility of a different outcome is not a matter to viewed in the abstract, but must be weighed against the consideration of whether the putative steps to secure the different outcome could and should have been obtained earlier.
Mr McClure says that he was entitled to know of the identity of the other cross-defendants prior to the trial. Mr McClure and Harkness submit that the joinder of the cross-defendants would have occasioned entitlements to amend his Defence or serve new evidence; or to rely upon the evidence and arguments that the cross-defendants might muster.
As to the first aspect, whether or not a defendant has the right to know of the identity of other defendants does not, in my view, practically take the matter anywhere. The more practical question is the consequence of the joinder of multiple cross-defendants to the position of the existing ones.
As to the second aspect, Messrs McClure and Harkness had no right, but would have required leave to amend and leave to serve further evidence; and a large question for the exercise of discretion was why they could not have acquired such evidence from them earlier than the time for application for more evidence. It was a 'large' question precisely because they had, in fact, obtained affidavit evidence from the other cross-defendants earlier. More than that, they also had the opportunity himself to use court process (subpoenas) to obtain documentary evidence from them. Whether leave would be granted depended upon a range of matters, including, relevantly the size of the claim (which was modest) and, pertinently (in the context of a proceeding that would go on to occupy 10 days' of hearing time) the public interest in the prompt resolution of litigation [13] .
Mr Harkness and Mr McClure did not seek to articulate, in the light of the evidence put before the Court of the added cross-defendants in support of their applications, what new evidentiary matters or arguments arose which would or could ground any new defences: (a) which they might have sought to add to their case; and (b) which they had not been able to procure from the added cross-defendants during the proceeding prior to the trial and the later joinder.
To reiterate, one of the matters notified to all the parties prior to the hearing of these motions was to familiarise themselves with the reasons for judgment I delivered on 4 June 2009. That judgment was delivered over six weeks ago. Since then, Mr Harkness has made very detailed written submissions, some of which specify, in detail, numerous provisions of the Court rules which he says were not complied with. I infer from this that either Mr Harkness himself has, at some point, acquired developed appreciation of court rules or that he prepared his written submissions with legal assistance. Precisely which of these inferences should be drawn does not relevantly matter for present purposes. In his written submissions, Mr Harkness referred to the theoretical possibility that some new evidence might have come from the involvement of the added cross-defendants, but did not seek to say that what that evidence was or why it could not have been obtained from the cross-defendants when they prepared affidavits on behalf of Messrs Harkness and McClure prior to trial.
At the hearing of this motion, I asked Mr McClure whether he was able to identify any factual findings I made in the reasons for judgment which: (a) could have been the subject of evidence from the additional cross-defendants; and (b) which of this evidence he (or Mr McClure) were unable to obtain from these additional cross-defendants when, with the assistance of their then lawyers, affidavits had been obtained from. Mr McClure referred me to the finding in the judgment that (at 396], but there was no explanation given by him that the circumstances leading to the absence or presence of his authority to enter the agreement alleged by Mr Alexander could not have been obtained from the other cross-defendants at the time that they gave evidence to support Mr Harkness' claim centred upon a different agreement with Mr Alexander.
Mr Harkness and Mr McClure both complain about what he said was an indication I had given, in justification for the joinder of the other cross-defendants that I had said it was a "technicality" and, in this regard, Mr Harkness said he had a confused understanding of what followed from it. Mr McClure said he was 'misled' by the reference. From this, both argue that they might have acted differently had they been more accurately informed about the consequence of the joinder.
At the time of this hearing, I have not seen the transcript of the case at trial [14] . I cannot therefore vouch for whether or not I used that description or not (or the context in which I used the word). But if I did use that word, even now, I do not consider it a wholly inaccurate attempt to describe, in a shorthand way (to then unrepresented litigants), my view that all committee members of an unincorporated association should have been joined. But what follows from the circumstance that I did say that word? The Court's primary function is to resolve disputes; not to give advice about the consequences of orders; or what others should do in the execution of the requirements of Court rules. To do might the run the of jeopardising my impartiality (no small thing, considering the no doubt sincerely held belief of Mr Harkness that throughout the trial I was 'favouring' Mr Alexander). There is a distinction, if not balance to be struck between a Judge trying to assist unrepresented litigants to understand the reasons for a procedural direction, and an unrepresented litigant presuming to be informed about steps they might wish to take in consequence of a procedural direction; and then, if dissatisfied with the ultimate result, harking back to say they were misled by the explanation and thereafter acted to their detriment. As it happens, following the joinder, an obligation fell upon Mr Alexander to serve the originating process. There was no obligation upon Messrs McClure and Harkness to do anything.
In my opinion, Messrs Harkness and McClure have sought to assimilate their positions with the other cross-defendants, when their positions are qualitatively different. They submit that a denial of procedural fairness to the other cross-defendants had 'knock on' effects for their ability to present their own cases, but did not articulate how. They could not say that they had no responsibility for the prior joinder of the additional cross-defendants. They did. They could not say that they had been deprived of the opportunity to obtain evidence from the other cross-defendants. With one exception, they did and, moreover, availed themselves of that opportunity. (In Mr Peters' case, though this was not apparent at trial, it appeared he did not want to provide evidence, as he was preoccupied with personal concerns). The proposition that anything raised by the added cross-defendants in hypothetical defences (had they been served) would have entitled them to amend their own defences, or entitle them to supplement their evidence, is speculative. They could not establish that anything that these additional cross-defendants might have wanted to have said, in their own defences, could not been obtained by them at the point during the preceding where the evidence from these other cross-defendants had been served on their behalf.
I do not consider that Mr Harkness and Mr McClure have been denied procedural fairness.
There being no further ground advanced for vacation of the orders made against them, I reject the applications of Mr Harkness and Mr McClure to set aside the Court's orders made against them on 24 June 2019.

[15]

STAY APPLICATION

The Court is empowered under s 67 (and/or s 135) of the Civil Procedure Act to stay execution of a judgment. It is well-established that a stay of execution pending appeal can be granted where a successful appeal would be rendered nugatory unless a stay is granted. Relevant factors include the improbability of an appellant recovering back the judgment amount from the respondent if the appeal was successful, the likelihood of an appeal succeeding, the size of the damages awarded at first instance.
There was no evidence by Mr Harkness or Mr McClure, on affidavit, to support their stay application. As to prospective grounds of appeal, and taking a broad view of Mr Harkness' affidavit on his disqualification application, he brings a complaint of actual bias is made against me. That would be a ground of appeal, but as I have indicated in my earlier reasons, I do not regard the strength of that ground, with nothing else, as supporting a stay. To the contrary, whatever be the grievances about my 'favouring' Mr Alexander, his complaint about bias runs into the not insignificant obstacle that, at no stage during the trial itself was any application made by Messrs McClure or Harkness to recuse myself. Nothing was put before me that went to the substantive findings in the judgment to suggest an appeal indicative of reasonable prospects of success. All that was put by Mr Harkness and Mr McClure were vague complaints that I should not have accepted Mr Alexander's version of events: that I "failed to perceive the true objective facts". I took that to be a complaint specifically about a finding of fact that an agreement was entered into with Mr Alexander in March 2016. But there was no articulation as to how I erred in reaching that finding, or otherwise "failed to perceive the true objective facts".
No evidence has been put before me to indicate Mr Alexander's current financial position; and thus the prospects that a judgment may not be recovered should the appeal be successful.
Plainly, the size of damages awarded to Mr Alexander is relatively modest.
Mr Harkness and Mr McClure have not offered any terms for a stay, such as the payment of part of the monetary judgment, or payment into Court, or offer for the provision of security.
On the basis of the evidence in support of the application, or lack thereof, I am not persuaded to impose a stay of execution.

[18]

Endnotes

Separate reasons for the orders appear in Togher & Anor v Alexander & Ors (No.3) [2019] NSWDC 280).
Damjanovic v Maley (2002) 55 NSWLR 149
Vakauta v Kelly (1989) 167 CLR 568
Ebner v Official Trustee (2000) 205 CLR 337 at [19]
I note that throughout the trial and even in the directions hearing on 17 July 2019 statements were made by Mr Harkness and Mr McClure about their understanding that Mr Peters had health issues. No reference to health issues was contained in Mr Peters' affidavit in support of his application to set aside or stay the Court's orders.
A separate affidavit from Ms Hancock (29 January 2018) was also served. The subject matter of that affidavit concerned a personal complaint by Ms Hancock regarding the alleged (mis)treatment of a piano. That affidavit was not relevant to the issues relating to the two cross-claims before the Court. My recollection (unaided by transcript, which was not ordered by the parties and thereby not made available to the Court during the trial) was that if Ms Hancock sought to bring a claim in relation to this event, it would not be determined in this proceeding; but in return, Mr Alexander undertook not to raise any 'Anshun' estoppel defence from precluding her from doing so.
This led to a Jones v Dunkel inference being drawn against the executive committee of Grace Missions from its unexplained failure to call Mr Peters (at [319]).
Coles v Burke (1987) 10 NSWLR 429
Miltonbrook Pty Ltd v Westbury Holdings Kiama Pty Ltd [2008] NSWCA 38 at [85]
Dimitrovski v Australian Executor Trustees Ltd [2013] NSWSC 337 at [3]
Rajski v Scitec Corporation Pty Ltd (NSWCA, Unreported, 16 June 1986), approved in Nobarani v Mariconte [2018] HCA 36 at [47]
A notice of removal was filed on 6 May 2019.
UB SAG v Tyne [2018] HCA 45 at [46]
Reflecting the unfortunate reality in this Court that unless parties themselves request (and pay for) transcripts, they are not automatically made available for a Judge, at least in contemporaneous way.
Cachia v Hanes (1994) 179 CLR 403 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 July 2019

Parties

Applicant/Plaintiff:

Togher & Anor

Respondent/Defendant:

Alexander & Ors

Legislation Cited (1)

Civil Procedure Act 2005(NSW)

Cases Cited (20)

BACKGROUND

Before the Court are a series of notices of motion arising from my final orders in the preceding made on 24 June 2019. The principal orders were: 1. Judgment for the cross-claimant (Mr Alexander) on the first cross-claim (filed 21 December 2017) for $86,671.90; and 2. The second cross-claim (filed on 13 April 2018) be dismissed.
Those final orders follow from reasons for judgment published on 4 June 2019 (Togher & Anor v Alexander & Ors (No.2) [2019] NSWDC 221) [1] . What follows in the reasons below presupposes some familiarity with those reasons.
In sequence, the first set of applications, dated 8 July 2019, seek to set aside the above orders, pursuant to rr 36.15 and 36.16 of the Uniform Civil Procedure Rules (UCPR). If these applications are not successful, then a further application is made for a stay of execution of the judgment in Mr Alexander's favour. Notices of motion were brought, respectively, by (a) Mr Andrew Moyle and Mr Timothy McCarthy; (b) Mr Graeme Peters, Zenaan Harkness, Mr Malcolm McClure and Mr Andrew King; and (c) Ms Bronwyn Hancock.
Before me, the evidence relied upon for this first set of applications was as follows: 1. The affidavit of Mr Graeme Peters sworn 8 July 2019; 2. The affidavit of Mr Andrew Moyle sworn 8 July 2019; 3. The affidavit of Mr Timothy McCarthy sworn 8 July 2019. 4. The affidavit of Ms Bronwyn Hancock affirmed 8 July 2019
No affidavit was prepared by Mr King.
At the material times: 1. Mr McCarthy, Mr Moyle, Ms Hancock and Mr King were, along with Mr Harkness and Mr McClure, members of the executive committee of SOCIA Group. 2. Mr Peters was, along with Mr Harkness, a member of the executive committee of Grace Missions.
The second set of motions come before the Court in the following way. On 15 July 2019, email communications were sent to the Registry of the Court (and not directly to my Associate) by Mr Harkness. The substance of the email was Mr Harkness' request for my disqualification from hearing applications to set aside or stay the orders. Later on the same day, the Registry received an email from Mr Moyle supporting that particular application. Mr Moyle's email represented that Mr McCarthy supported Mr Harkness' application.
In response to this, later that day, I arranged for my Associate to send an email to Mr Harkness indicating that it was necessary for him to file and serve a notice of motion, with supporting evidence. On 16 July 2019, Mr Harkness filed a motion formalizing his request for my recusal.
In anticipation that all but one of the applicants would be unrepresented at the hearing of these motions, I instigated a pre-motion directions hearing on 17 July 2019 and otherwise conveyed (through my Associate, by email) certain messages to the parties indicating the Court's expectations for how the motions were to be considered at the hearing. These were, in summary: 1. Mr Alexander (who was overseas at the time he first received notice of the application), needed to be served with the motions and supporting evidence before any orders (to set aside or stay the orders) could be made; 2. If Mr Alexander was unable to physically attend, it would be necessary for him to avail himself of the facility, by telephone, or audio-visual means and, if even that was not possible, for him to submit in writing, evidence and submissions he may rely upon in opposition to the motions. 3. All applicants (nearly all of whom are Victorian residents) needed to attend the directions hearing and hearing of the motions (and, to that end, suggestions were made about the availability of the Court's facilities - including audio-visual facility) to enable their participation in the hearing; 4. All parties needed to familiarize themselves with the Court's reasons for judgment (made on 4 June 2019) and the reasons for orders (made on 24 June 2019). The reasons for judgment identified (at paragraph 22) the issues that had been identified. A summary of answers to those issues was also provided (at paragraph 396) in the reasons for judgment; 5. All parties (who, apart from Ms Hancock appeared to be unrepresented) were invited to consider the desirability of obtaining representation; and were informed (and, in the case of Messrs Alexander, McClure and Harkness, reminded) of the facilities (at least in this state) for ascertaining whether pro bono assistance might be received from the Bar Association or Law Society; if not also other entities such as the Arts Law Centre.
At the directions hearing of 17 July 2019, I indicated to those parties that attended that I would not countenance some of the applicants purporting to represent the interests and views of other applicants. This was consistent with my understanding [2] of r 7.1 of the Uniform Civil Procedure Rules. Mr Alexander did not appear at the directions hearing of 17 July. The Court had received an email communication from him beforehand, indicating that whilst overseas, he was unable to attend by telephone or audio-visual facility. On 16 July, Mr Alexander did, however, supply extensive written submissions responding to all of the applications to set aside orders and my disqualification. Mr King and Mr Peters did not appear.
Following the Court's specific (and special) request, I arranged for a transcript of the directions hearing of 17 July 2019 to be sent to the email addresses of the applicants to the motions and Mr Alexander.
On 18 July 2019, I saw an email message from Mr Alexander (sent from him from overseas, the previous night (Sydney time)). The message indicated that Mr Alexander was unable to attend the hearing of the motions. Mr Alexander added that he expressly doubted whether there was anything more he could add to his written submissions. On 18 July, I arranged for a further email message to be sent to him indicating, relevantly, that I had read his written submissions but warning him that, in the circumstances, it would be necessary to proceed with the motions in his absence, reiterated that it would be in his interests to do his utmost to appear, or procure representation and warned him that orders might be made which were contrary to that which he submitted should be made, which would affect his interests.
After (Court) hours on 18 July 2019, Messrs McCarthy and Moyle filed applications for my disqualification. Mr Alexander sent to my Associate written submissions in opposition to that application.
At the date of the hearing of these motions, appearances were made by Mr McClure, Mr Harkness, Mr Hollo of Counsel (for Ms Hancock), Mr McCarthy, Mr Moyle (by telephone), Mr King (by telephone) and Mr Peters (by telephone). The matter was called outside the Court and the Court officer indicated no (other) appearance. Mr Alexander did not attend the hearing of the motions.

Principles for applications to disqualify for bias

The most serious of the above complaints is the accusation of bias. Bias connotes the absence of impartiality: Ebner v Official Trustee (2000) 205 CLR 337 at [23].
Bias can come in two forms: actual bias and apprehended bias. In Mr McClure's email to the Registrar, for example, it was said that through publication of my reasons for judgment I had "weaved a fiction to fit" the story of Mr Alexander and had "recklessly" exercised judicial power. Mr Harkness accused me of 'blatant bias' and 'acting on behalf of Mr Alexander'. No suggestion was made in any of the email communications received from Mr McClure and Mr Harkness, or Mr Harkness' motion, that any reliance was placed upon apprehended bias.
As to the principles specifically applicable to such application for recusal for actual bias, the High Court in Michael Wilson & Partners Ltd v Nicholls (2011) 244 CLR 427 at [33] said for this form of bias, assessment is required of the judicial officer's state of mind, mainly based upon what the judicial officer had said and done. Cogent evidence is required to sustain a high probability (R v Australian Stevedoring Industry Board; Ex parte Melbourne Stevedoring Co Pty Ltd (1953) 88 CLR 100 at 116).
In Reid v Commercial Club (Albury) Ltd [2014] NSWCA 98 at [68]-[73], the Court of Appeal said (omitting citations and immaterial parts relating to apprehended bias): "[68] A finding of actual bias is a grave matter. Authority requires that an allegation of actual bias must be distinctly made and clearly proved; that such finding should not be made lightly; and that cogent evidence is required... [69] Where the issue is actual bias in the form of prejudgement, the appellant had to establish that the primary judge was "so committed to a conclusion already formed as to be incapable of alteration, whatever evidence or arguments may be presented" [70] … "The question is not whether the decision-makers mind is blank; it is whether it is open to persuasion" [71] ... (there are) several distinct elements underlying the assertion that a decision maker has prejudged or will prejudge an issue … (This is based upon) the contention that the decision maker has an opinion on a relevant aspect of the matter in issue in the particular case. The second is the contention that the decision-maker will apply that opinion to the matter in issue. The third is the contention that a decision-maker will do so without giving the matter fresh consideration in light of whatever may be the facts and arguments relevant to the particular case" [72] … Allegations of actual bias through prejudgement often fail at the third step... This is because notwithstanding whatever expression or preconceived opinions by the decision-maker, it does not follow that the evidence will be disregarded" [73] the test of actual bias in the form of prejudgement requires an assessment of the state of mind of the judge in question.. However actual bias need not be confined to an intentional state of mind. Bias maybe subconscious, provided it is real… "The wrong involved is the failure to decide a case impartially. Whether that failure was deliberate or not should be beside the point insofar as the validity of the decision is concerned."

(1992) 26 NSWLR 411

(1994) 179 CLR 403

(1987) 10 NSWLR 429

(2002) 55 NSWLR 149

(2000) 205 CLR 337

(1991) 24 NSWLR 45

(1998) 43 NSWLR 290

(2011) 244 CLR 427

(2009) 78 NSWLR 190

(1953) 88 CLR 100

(1989) 167 CLR 568