Young v Jackman

In the same case, Denning LJ, at p 298, provided a formulation of the rule which would give the court a discretion in its application, in the following passage:

"... I am of opinion that the fact that a party to a cause has disobeyed an order of the court is not of itself a bar to his being heard, but if his disobedience is such that, so long as it continues, it impedes the course of justice in the cause, by making it more difficult for the court to ascertain the truth or to enforce the order which it may make, then the court may in its discretion refuse to hear him until the impediment is removed or good reason is shown why it should not be removed."

I return now to Permewan Wright. That was a decision of the Court of Appeal given in 1978 (although not reported until 1994). In that case, the applicant applied for the dissolution or stay of an injunction which restrained it from using its land in a certain manner, upon the basis that the interim development order which the court had found to prohibit the relevant use of the land had been subsequently altered in a way which made that use permissible. The dissolution or stay was opposed by the respondent on the ground that the applicant, having used its land in contravention of the injunction, was in contempt of the order of the court and should therefore be denied the relief which it sought.

Without reference to any authority, Reynolds JA at p 367 acknowledged that the court "... may properly withhold relief to which a litigant is otherwise entitled in cases where that litigant is in contempt of the court's process ..." but proceeded to hold, on discretionary grounds, that that rule "... would not be a matter which should preclude the making of the particular order sought here".

Hutley JA, after stating the rule, and referring to Hadkinson, said at p 369:

"I am of the opinion that the rule as stated by Romer LJ and concurred in by Somervell LJ is the correct one and it should be enforced in this Court as the fundamental rule to be observed in matters of this kind."

His Honour acknowledged, at p 369, that there are exceptions to the rule, and, at p 370, he agreed with the contention that changed circumstances would as a general proposition be an exception to the rule. Furthermore, again at p 370, his Honour thought it necessary to make some remarks about the nature of the contempt, "... assuming the seriousness of the contempt may be regarded as a factor in a court deciding whether it should uphold the rule ...".

The remaining judgment of the Court of Appeal was delivered by Mahoney JA. As to the issue of whether the rule should be applied, his Honour at p 374 said:

"... The Court has been referred to authorities which establish the attitude which should be adopted to an application made by a party who is in contempt: see Hadkinson v Hadkinson [1952] P 285 at 288-289. The relevant principle is subject to qualifications or exceptions."

Since the decision in Permewan Wright there has been a divergence of opinion as to its application as binding authority.

On the one hand, there is the case of Young v Jackman (1986) 7 NSWLR 97, in which Young J in the Equity Division of the Supreme Court held that Permewan Wright was binding authority upon him for the proposition that "... there is no exception to permit a judge to hear proceedings in his discretion, notwithstanding that the applicant is in contempt" (at 102).

On the other hand, there is the case of Woollahra Municipal Council v Shahani (1990) 69 LGRA 435, a decision of Bignold J in this Court. His Honour held at p 439 that "... Permewan Wright does not deny the existence of judicial discretion whether or not the Court will entertain an application made by a person who is in contempt of Court in those proceedings".

For completeness, I should note that I followed Bignold J in holding that the rule admitted the exercise of discretion in The Council of the City of Hawkesbury and Anor v Mushroom Composters Pty Ltd (31 May 1995 unreported).

Like Bignold J (see Shahani at p 439), I have found it difficult to discern the decisive principle in Permewan Wright, but I have come to the conclusion that it does not preclude the exercise of judicial discretion in the application of the rule.

Reynolds JA recognised the possibility of the exercise of judicial discretion, but did so without reference to authority. In deciding that the contempt should not preclude the making of the order which the contemnor sought, his Honour at p 367, took into account that "[T]he contempt ... is not of a serious order, and the order now sought is designed to avoid an undesirable conflict between the present state of the law and a subsisting order of this Court".

Hutley JA expressly adopted the formulation of the rule by Romer LJ, but, as I have said, his Honour recognised changed circumstances as a possible exception to the rule, and assumed, but did not decide, that the nature of the contempt was a factor to be taken into account in the application of the rule. Hutley JA was, however, not prepared to make the order sought until the contempt had been purged by means of an apology to the court.

In the judgment of Mahoney JA, the reference to specific pages in Hadkinson is a reference to pages in the judgment of Romer LJ, but that falls far short of being an express adoption of Romer LJ's formulation of the rule. On the contrary, the opening words of the passage from the judgment of Mahoney JA which I have quoted indicate that his Honour was considering submissions by counsel as to the attitude that the court in that case should adopt, and that counsel was asserting that the rule was as stated by Romer LJ in those pages. In any event, his Honour went on to decide that the rule did not restrict the court from making the order that the contemnor sought. His Honour took into account that the spirit and intendment of the order which was breached was that it should not bind the defendant's conduct after the interim development order upon which it was based had ceased to be operative. At p 374, his Honour said:

"I do not think that the (rule) should be seen as restricting what the court can or should do to make clear that its order, after the new interim development order came into force, did not continue to restrict what the defendant might do thereafter on the land."

The further reflection which has now been afforded me (since my decision in Mushroom Composters) has confirmed the view that I then held. I think that all three judges of appeal in Permewan Wright recognised that the class of exceptions to the rule are not closed and that other exceptions might be "... engrafted on the rule"... (to adopt the words of Hutley JA at p 370). Each judge looked at the circumstances of the case to determine whether or not the rule should operate to prevent an order being made in the applicant's favour. In the light of this analysis of the judgments, I think that the decision in Permewan Wright does not support, as binding principle, the application of the rule as an absolute bar subject to limited exceptions. With respect, I think that Young J's view of that decision in Young v Jackman is too narrow.

More recent authority favours the judicial discretion approach. In X Ltd and Anor v Morgan-Grampian (Publishers) Ltd and Ors (1990) 2 All ER 1, the House of Lords expressly favoured the approach of Denning LJ in Hadkinson. In that case, Lord Bridge said, at p 11:

"I cannot help thinking that the more flexible treatment of the jurisdiction as one of discretion to be exercised in accordance with the principle stated by Denning LJ better accords with contemporary judicial attitudes to the importance of ensuring procedural justice than confining its exercise within the limits of a strict rule subject to exceptions."

Lord Oliver, at p 14, expressly agreed, and said that he would not be in favour of laying down any rules for the exercise of discretion.

In Australian Securities Commission v Macleod & Ors (Federal Court of Australia, 23 November 1994, unreported), Drummond J favoured the approach of Denning LJ in Hadkinson, but expressly refrained from a final decision on the matter.

In KP Cable Investments Pty Ltd v Meltglow Pty Ltd and Ors (1995) 56 FCR 189 at p 206, Beazley J (as she then was) expressed the opinion that the court has a discretion as to whether to hear a party in contempt.

It follows from this analysis that the Court should have regard to the facts and circumstances of the case in order to determine whether or not, in the exercise of its discretion, it should hear the modification applications. Accordingly, I turn to consider the facts and circumstances in this case.

The Court is asked to assume, for the purpose of determining the preliminary question, that the facts and opinion set out in Mr Cagliata's affidavit are correct. I wish to make it quite clear (because the earlier proceedings had some notoriety) that I do not make any formal finding of contempt of the Court's order on the part of the applicant. For that reason, I prefer to refer to Mr Cagliata's observations as "discrepancies" rather than "breaches". This is not simply a pedantic point. The applicant has not had an opportunity to rebut the allegation of contempt, and the allegation may or may not be sustained against it if it had that opportunity.

I should also add that the modification applications are not concerned with those structures on the property in respect of which Mr Cagliata has observed discrepancies. The s 102 application seeks a modification of condition 2 of the development consent by providing, in short, that the fence on the northern frontage of the property to Victoria Road is to be constructed in fibre cement lined steel framing instead of rendered brick. The s 106 application seeks a similar modification as well as two other modifications. The first of those other modifications involves condition 14 which deals with balustrades/handrails, and seeks deletion of the requirement that they be designed so as not to be capable of being climbed. The second seeks the deletion of condition 1 which provides for an internal wheelchair ramp.

I turn now to Mr Cagliata's evidence. He visited the property on three occasions, and compared structures built on the property with the structures delineated on the approved plans (which were exs "J" and "K" in the previous proceedings). His observations were described in considerable detail, but it is sufficient for present purposes if I summarise them as follows:

• all the discrepancies relate to the courtyard and southern passageway area;

• timber cross beams have been erected across the pergola in the courtyard area;

• a planter box has been erected to the southern side of the southern passageway;

• the timber cross beams linking the courtyard pergola columns have increased in number from 3 to 6;

• there are approximately 14 differences (calculated in millimetres) between measurements noted on or scaled off the approved plans and measurements of structures built on the property. The dimensions of some of the structures exceed the approved dimensions, and some of them are less than the approved dimensions.

Taking into account the discrepancies observed by Mr Cagliata, I have concluded that I should exercise my discretion in the applicant's favour, and allow the modification applications to proceed to hearing. My reasons for so concluding are as follows.

First, although there may be good reasons why the discrepancies, or at least some of them, should be rectified (such as the security of Mr Raiz' premises next door, which was a major element in the previous proceedings), they are minimal. Compared to the whole extent of the works taking place upon the property, they are minor matters, and the discrepancies which relate to measurements are noted in millimetres not metres.

Secondly, the discrepancies are confined to the courtyard and the southern passageway to that courtyard. The approved plans disclose structural works upon the whole of the property, and I can assume, at least on the evidence presently before me, that no discrepancies have been revealed elsewhere.

Thirdly, the contempt is not, on the evidence before me, of a gross or flagrant kind. What has happened is that various elements of the structures in a confined area of the property have not been built precisely in accordance with the approved plans and further plans containing more detail have not been lodged. The discrepancies are minor and technical only, and I have no evidence before me of the cavalier attitude on the part of the applicant which I discerned in the previous proceedings.

For those reasons, the Court should exercise its discretion to hear the modification applications.

The conclusion that I have reached makes it unnecessary for me to deal with the question of whether, in any event, the rule does not apply to the modification applications. It is appropriate, however, that I express an opinion on that question, because it was raised and argued.

That question derives from the fact that the modification applications arise in the class 1 and class 2 proceedings, but the alleged contempt is of an order made by the Court in the class 4 proceedings. As I have earlier said, I heard and determined these proceedings (and another class 2 proceeding) together.

As Denning LJ explained in Hadkinson at p 295, the rule arose in Chancery out of an ordinance of Lord Bacon of 1618 which laid down that "... they that are in contempt are not to be heard neither in that suit, nor in any other, except the court of special grace suspend the contempt". It is to be noted that, in formulating the rule, Romer LJ at p 288-289 stated that "... no application ... will be entertained ...".

However, the weight of authority since Hadkinson establishes, in my opinion, that the rule is confined to the same proceedings in which the contempt occurs.

It was so held in 1964 in Bettinson v Bettinson (1965 1 Ch 465). In Short v Short (1973) 22 FLR 320, the Full Court of South Australia said, at p 330, (but without citing authority), that the ordinance of Lord Bacon had been relaxed, and "[I]t has been restricted to the same proceedings in which the contempt occurs".

In Australian Securities Commission v Macleod, Drummond J at p 4 expressed the same view, citing Short v Short as authority for the proposition.

In Woollahra v Shahani, Bignold J at p 441 came to the tentative conclusion, but did not finally decide, that the rule has been confined to proceedings in the same cause, and his Honour in so concluding referred to Bettinson v Bettinson.

Bignold J had been concerned in Woollahra v Shahani with contempt of the Court's orders in class 4 proceedings, but the applicant had commenced class 1 proceedings, and a question was raised as to whether the rule would apply in the latter proceedings. His Honour expressed the tentative conclusion I have referred to, stating, at p 441, that the pending class 1 proceedings were "... properly to be regarded as a separate cause from the proceedings in which the respondent has been held to be in contempt of court, even though those separate proceedings involve the same parties and the same premises".

In this case, I would regard the class 1 and class 2 proceedings each as a separate cause from the class 4 proceedings, despite the fact that all three proceedings involve the same parties and the same premises. In my opinion, the fact that all three were heard and determined together does not disturb a conclusion that the class 1 and class 2 proceedings are a separate cause.

Accordingly, my view is that the rule does not apply to the modification applications.

For the foregoing reasons, I determine the preliminary question by holding that the Court should not refuse to hear the modification applications.

The modification applications (made in proceedings nos 10243/96 and 20062/96 respectively) should proceed to hearing. I grant leave to the parties to approach the Registrar to obtain a date for that hearing.

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.