Trust Co. Fiduciary Services Ltd v Hassarati

Judgment 1On 24 October 2012 I published my reasons for judgment in respect (inter alia) of an application by George Hassarati and Josephine Hassarati to be joined to the present proceedings: Trust Co. Fiduciary Services Ltd v Hassarati (No. 3) [2012] NSWSC 979. 2I held that that Applicants were not entitled to be joined to the proceedings because any rights which the Applicants had in respect of the land were subject to the rights of the Plaintiffs - see at [102]. 3On 7 November 2012 the Applicants by Notice of Motion sought that I should vary my judgment pursuant to r 36.16 UCPR. However, the Notice of Motion made clear that, so far from a variation being sought, the Applicants were seeking that I reverse the judgment I gave and that I grant their application to be joined as parties to the proceedings. 4Rule 36.16 provides: 36.16 Further power to set aside or vary judgment or order (cf SCR Part 40, rule 9) (1) The court may set aside or vary a judgment or order if notice of motion for the setting aside or variation is filed before entry of the judgment or order. (2) The court may set aside or vary a judgment or order after it has been entered if: (a) it is a default judgment (other than a default judgment given in open court), or (b) it has been given or made in the absence of a party, whether or not the absent party had notice of the relevant hearing or of the application for the judgment or order, or (c) in the case of proceedings for possession of land, it has been given or made in the absence of a person whom the court has ordered to be added as a defendant, whether or not the absent person had notice of the relevant hearing or of the application for the judgment or order. (3) In addition to its powers under subrules (1) and (2), the court may set aside or vary any judgment or order except so far as it: (a) determines any claim for relief, or determines any question (whether of fact or law or both) arising on any claim for relief, or (b) dismisses proceedings, or dismisses proceedings so far as concerns the whole or any part of any claim for relief. (3A) If notice of motion for the setting aside or variation of a judgment or order is filed within 14 days after the judgment or order is entered, the court may determine the matter, and (if appropriate) set aside or vary the judgment or order under subrule (1), as if the judgment or order had not been entered. ... 5The power being invoked is pursuant to sub-rule (3A). The jurisdiction to act under this Rule to vary a judgment is only to be exercised in exceptional cases. It is not be exercised unless the Applicants show either that by accident, without fault on his or her part, they had not been heard or that there is some error in the Court's reasoning because of a misapprehension of the facts and/or a misapprehension of the relevant law: Wentworth v Woollahra Municipal Council (1982) 149 CLR 672 at 684; Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300 at 302. 6In Autodesk Mason CJ said at 303: [I]t must be emphasized that the jurisdiction is not to be exercised for the purpose of re-agitating arguments already considered by the Court; nor is it to be exercised simply because the party seeking a rehearing has failed to present the argument in all its aspects or as well as it might have been put. What must emerge, in order to enliven the exercise of the jurisdiction, is that the Court has apparently proceeded according to some misapprehension of the facts or the relevant law and that this misapprehension cannot be attributed solely to the neglect or default of the party seeking the rehearing. The purpose of the jurisdiction is not to provide a backdoor method by which unsuccessful litigants can seek to re-argue their cases. 7The reason for this is the public interest in the finality of litigation: Autodesk at 302; R v Nitin Geri (No. 2) [2001] NSWCCA 234 at [17]. 8In the present case the judgment was given after a full hearing where the Applicants made both written and oral submissions to the Court. 9However, it was submitted on the present Motion that I have misapprehended both facts and law when dealing with the matter of the rights that the Applicants might have under the Contracts Review Act 1980. I dealt with those matters at [98] - [102] of my judgment. 10The misapprehension of the law that I was supposed to have made was identified as concerning the difference between direct actions and derivative actions by beneficiaries of a trust. In particular it was submitted that I did not have proper regard to the basis for a derivative action which was said not to be limited to cases where the trustee does not sue but rather to include cases where the trustee cannot properly protect the interests of the beneficiary because, for example, of the conflict between the interests of the trustee and the duty of the trustee to the beneficiaries. 11The submissions made reference to paragraph 28.1 in Scott & Ascher on Trusts (5th Ed) and to Alexander v Perpetual Trustees (2004) 216 CLR 109 at [55]-[56]. 12Two things should be said about these submissions. First, I dealt in my judgment at [101] with the question of whether Alvera was effectively defending the proceedings in a way that would protect any interests of the Applicants. Secondly, the detail of the submissions put forward on the present Motion went considerably beyond what had been put to me at the hearing of the Motion which resulted in my judgment of 24 October 2012. A comparison of the Applicant's written submissions on each occasion makes that abundantly clear. In particular, the lengthy discussion of the difference between direct and derivative actions by beneficiaries of a trust was not argued at the hearing of the earlier Motion. 13If I have misapprehended the law by not drawing a clear distinction between direct and derivative actions then that misapprehension was brought about by the failure of the Applicants to argue the matter in this way at the hearing of the earlier Motion - see Autodesk at 303 in the passage set out above. 14The Applicant's written submissions suggested that I misapprehended the law concerning my conclusion about constructive knowledge on the Plaintiffs' part and its significance in relation to the defence based upon personal equities. These were matters argued at the hearing of the first Motion and which (as the Applicants acknowledge) I dealt with in paragraphs [89] to [97] of my judgment. If I am wrong about those matters the appropriate course of action for the Applicants is an appeal. It is not further argument to persuade me to change my mind. The written submissions at paragraphs 39 to 47 are clearly designed to persuade me to reconsider matters contained in my earlier judgment because the Applicants do not agree with those reasons. 15My misapprehension of factual matters was not identified either in the written or oral submissions. 16In my opinion, the purpose of r 36.16 is not to enable a party to reargue matters whether on the same or a different basis on a second occasion. 17The misapprehension with which the Rule is concerned is a misapprehension more in the nature of a slip that can be readily corrected when the true position is brought to the attention of the Court. For example, a mistaken belief that a particular statute was in force at a time when it was not might be dealt with. Similarly, a case where a court's reasons for judgment inadvertently did not deal with something argued by counsel at the hearing would be an appropriate use of the Rule: Twenty First Australia Inc v Shade (Unreported - Young J, Supreme Court of NSW - 31 July 1998). Mason CJ provides some further examples in Autodesk at 302 as do the learned authors of Ritchie's Uniform Civil Procedure NSW at [36.16.50]. 18In contradistinction to what happened in Shade where the Judge considered that he had overlooked two matters that had been argued, in the present case the Applicants are really asking me to reconsider the whole of my judgment partly because they assert I came to the wrong view of the law in the matters I dealt with concerning the Contracts Review Act and partly on the basis of arguments that were put on the present Motion that were not articulated at the hearing of the first Motion. 19In those circumstances if, as the Applicants submit, I have fallen into error in the way I have dealt with the Contracts Review Act the appropriate course is for the Applicants to take the matter to the Court of Appeal. Although for the purposes of appeal the orders I made may be regarded as interlocutory the orders have the practical effect of finally deciding the rights of the Applicants. The use of r 36.16 to seek a variation or reversal of those orders may involve an impermissible attempt to appeal against the orders I made: Woodcroft v DPP [2000] NSWCA 128 at [52]. 20I do not consider that the present Motion is appropriately brought. 21Accordingly, I make the following orders: