Botha v Carter [2005] QDC 49

1 4th Floor, The Law Courts, George Street, Brisbane, Q. 4000 Telephone: (07) 3247 4360 Fax: (07) 3247 5532 WARNING: The publication of information or details likely to lead to the identification of persons in some proceedings is a criminal offence. This is so particularly in relation to the identification of children who are involved in criminal proceedings or proceedings for their protection under the Child Protection Act 1999, and complainants in criminal sexual offences, but is not limited to those categories. You may wish to seek legal advice before giving others access to the details of any person named in these proceedings. [2005] QDC 049 DISTRICT COURT CIVIL JURISDICTION JUDGE ROBIN QC No 584 of 2004 PAUL STEPHANUS BOTHA Plaintiff and ALEATHEA ANN CARTER Defendant SOUTHPORT ..DATE 25/02/2005 ORDER CATCHWORDS: Uniform Civil Procedure Rules, rule 137, rule 281, rule 283, rule 819 - application by defendant to set aside judgment in default of filing Notice of Intention to Defend - judgment entered on 28th day after date of service - set aside as premature and irregular despite parties' agreement it was regularly entered - day of service is not counted in the 28 days allowed under rule 137 - defendant's costs limited to those incurred had her application been for the setting aside of an irregularly entered judgment. -- 1 of 8 -- 25022005 T24/LLM M/T 3/2005 (Robin DCJ) 2 ORDER 1 10 20 30 40 50 60 HIS HONOUR: This is an application by a defendant for the setting aside of a default judgment given to the plaintiff by a registrar under Rule 283 on the 12th of November last year. It is a substantial judgment in the amount of $244,893.77 which included $9,731.07 interest to that day. It also includes $1,762.70 for costs. The plaintiff has been quick to embark on enforcing the judgment. He has applied for and obtained two separate warrants of execution, the doubling up attributable to a slight variation of the defendant's name in respect of one of her properties. The registration of one of those warrants in the Land Titles Office is embarrassing the defendant in completing a private sale which has already been made. The plaintiff sues in respect of a considerable number of cheques in round sum amounts which the defendant provided to him for over a period of about 10 months from November 2003. The claim was for the amounts of those cheques said in the statement of claim to have been dishonoured on presentation and interest at the nine per cent rate provided for in the Supreme Court Act. Service of the claim and statement of claim was effected by Mr Standfast on 15th of October 2004. The material used in the application for judgment was all filed on the same day on -- 2 of 8 -- 25022005 T24/LLM M/T 3/2005 (Robin DCJ) 3 ORDER 1 10 20 30 40 50 60 which the Registrar entered the judgment. Service was contentious according to the defendant's original affidavit filed on the 18th of February this year. She says in it she knew Mr Standfast because he had done work for her and that she did not recall having been served with the proceedings by him. It is not particularly reassuring to discover that having considered the matter further she now recalls telephone arrangements had been made with Mr Standfast to effect service and the actual occurrence of it in accordance with what Mr Standfast has said all along. The defendant asserts defences that might be of use to her. She says the cheques which she does not dispute writing were a way of recording substantial loans which Mr Botha made to her to cover her living expenses in circumstances where funds she otherwise would have had available had been applied to an investment which she suggests Mr Botha had some role in recommending. The cheques typically included an amount of interest to recompense Mr Botha for making his funds available. The defendant asserts that when she handed over the cheques she made it known to Mr Botha that there were not funds in her bank account to cover them. According to her that arrangement was accepted by him; he agreed not to present cheques for payment until she indicated he should. The cheques were accepted as a convenient way of recording the transactions. -- 3 of 8 -- 25022005 T24/LLM M/T 3/2005 (Robin DCJ) 4 ORDER 1 10 20 30 40 50 60 The defendant expressed doubt in her principal affidavit as to whether the cheques had actually been presented to the bank. The difficulty may have been overcome by Mr Botha's latest affidavit which, speaking generally, shows that he did present them. The presentation, however, may have been in breach of an agreement. Another complicating factor according to the defendant is that she replaced some cheques, which were becoming stale, with new ones. She considers that in that way consideration may be lacking some of the cheques within the claim. She is prepared, it seems, to concede her liability in respect of a sum between $70,000 and $80,000, there being what I took to be a suggestion in the material that the judgment might stand as to that amount and the proceeding should go ahead to a trial in respect of the rest. All of the interesting issues under the Cheques Act and otherwise that might have been gone into seemed to me irrelevant, and the common ground I was told the parties shared, that the judgment was a regularly entered one, seemed to be erroneous when reference was had to the dates of service and of the entering of judgment, and then to Rule 137 of the UCPR which provides in sub-rule (1) that in a proceeding started by a claim a notice of intention to defend must be filed within 28 days after the day the claim is served. -- 4 of 8 -- 25022005 T24/LLM M/T 3/2005 (Robin DCJ) 5 ORDER 1 10 20 30 40 50 60 Mr Barlow, appearing for Mr Botha, did not dispute that if the time allowed had been "one day after" the defendant would have had until the 16th of October. And it follows that she had until the 12th day of November to file her notice of intention to defend, and that the Registrar had no business in granting a judgment under Rule 283 on that day. The application of the relevant division in the UCPR is described in Rule 281(1) which states the division applies "if a defendant in a proceeding started by claim does not file a notice of intention to defend within the time required under Rule 137". At the time when judgment was applied for and granted, the stage had not been reached where the defendant had failed to file a notice of intention to defend. She still has not done so, but doing so would have been a pointless gesture once there was a judgment disposing of the proceeding entered against her. Somewhat unhelpfully the annotations in Butterworths Civil Procedure, Queensland in respect of Rule 137 state that "Time is computed inclusive of the day of service" citing W Lovelock and Co Pty Ltd v. Verrall [1935] Queensland Weekly Notes 22. -- 5 of 8 -- 25022005 D.1 T25/PT M/T 3/2005 (Robin DCJ) 6 ORDER 1 10 20 30 40 50 60 The annotations are hardly up to date in that they fail to notice a Full Court decision to similar effect in AGC (Advances) Limited v Mack [1989] 1 Qld Reports 482. The Lovelock case and others from other jurisdictions were followed by the Full Court there in reversing a decision of Vasta J to the effect that under a rule allowing eight days for appearance the defendant had until the eighth day after the day of service. The difficulty is that under RSC order 5 rule 9, according to the relevant parts of it, the time to be limited in the writ of summons for the appearance of any defendant shall be not less than eight days. The way in which Acts Interpretation Act provisions, or the lack of them, applied was to render included in the eight days the day of service. I think it is indisputable that the way in which rule 137 is expressed means that the day of service must be excluded. Mr Williams, I'm sure correctly, regarded his instructions and duty as requiring him to take advantage of the point which I raised. Even if he hadn't done so I'm inclined to think that particularly where the defendant is desirous of running a defence it is the Court's responsibility to cure the error of its own officer by setting aside judgement – so that it must be ordered that the default judgment entered on the 12th of November 2004 be set aside. MR WILLIAMS: Your Honour, there's also the question of the enforcement warrants. I presume that they would fall as of course----- -- 6 of 8 -- 25022005 D.1 T25/PT M/T 3/2005 (Robin DCJ) 7 ORDER 1 10 20 30 40 50 60 HIS HONOUR: I'm not sure whether it's necessary, but out of an abundance of caution. Can you set them aside under rule 800 - stay of enforcement? MR WILLIAMS: Potentially rule 668 doesn't refer to it specifically but 668 sub (2) on application, the Court may stay enforcement of the order against the person or give other appropriate relief. It depends whether or not the enforcement warrant can be treated as an order of the Court and I think it can because of the broad definition of an order. Under rule 660. I couldn't find an express provision in the sections dealing with enforcement warrants allowing for the setting aside of a enforcement warrant but I'd be amazed if there wasn't cause to do so. It's not an inherent power. MR BARLOW: Your Honour, rule 819 your Honour, might be the relevant rule. HIS HONOUR: Thank you Mr Barlow. Well, if it's necessary, out of an abundance of caution, the Court makes orders under rule 819 setting aside the enforcement warrants of the 22nd of November 2004 and the 31st of January 2005. Anything further? MR BARLOW: No, your Honour. HIS HONOUR: What about the costs? MR WILLIAMS: I would, your Honour. I just refer to the decision of White v. Western which is referred in the annotation to the effect that where a judgement has been irregularly entered it would appear that the Court should not impose any terms whatsoever on the defendant, not even contingent terms such as an order of costs in the cause. It remains that the Court has a wide discretion under this rule. I couldn't say anything more other than that the irregularly entered judgement was the, I suppose, the ultimate cause for the necessary application to set aside the judgement it being irregularly entered. The respondent should pay the costs of today on a stand basis. HIS HONOUR: Have you got anything to say about that, Mr Barlow? MR BARLOW: In my submission, your Honour, the appropriate is either that there be no order of costs of this application or that the parties costs be their costs in the cause. The reason for that submission is that while your Honour has quite, of course, quite correctly pointed out to the parties the error of both our ways in that neither of us, in fact both of us thought that it was regularly entered. It's only because of your Honour's view that my learned friend has succeeded on that point. In my respectful submission if that had been pointed, or even raised as a possibility by my learned friend's instructing solicitors as soon as the judgement came to their attention of the respondent - of the applicant. Then there would be quite - it may well have been the case that this application could've been dealt with by consent with no costs or substantial costs involved. So, in -- 7 of 8 -- 25022005 D.1 T25/PT M/T 3/2005 (Robin DCJ) 8 ORDER 1 10 20 30 40 50 60 my respectful submission it's not - this is a case where it's appropriate for your Honour to exercise your discretion not to order any costs in the applicant's favour. Sorry, your Honour, could I add just this in support of that submission, and it is that the stance that is likely to have been taken by the respondent, had it been pointed out earlier, was taken immediately by me, in answer to your Honour's suggestion. I did not seek to dissuade your Honour of your Honour's clear ruling in the light of the rule. HIS HONOUR: It does cover the justice of the case if I order that the plaintiff pay the applicant-defendant's costs of the application to be assessed on the standard basis but as if the only ground for the application were that the judgment was irregularly entered having regard to rule 137 and rule 281. ----- -- 8 of 8 --