Stewart Pastoral Company Pty Ltd v Cleary
[2000] QDC 156
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- Stewart Pastoral Company Pty Ltd v Cleary[2000] QDC 156
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Stewart Pastoral Company Pty Ltd v Cleary[2000] QDC 156
Stewart Pastoral Company Pty Ltd v Cleary[2000] QDC 156
DISTRICT COURT | No 1706 of 2000 |
CIVIL JURISDICTION
JUDGE FORDE
STEWART PASTORAL COMPANY PTY LTD
(ACN 009 774 618)Plaintiff
and
GRAHAM WILLIAM CLEARY
and ROBIN GRACE CLEARYDefendants
BRISBANE
DATE 11/05/2000
JUDGMENT
HIS HONOUR: This is an application to set aside a judgment entered on 2 September 1999. The applicants/defendants hereinafter referred to as the defendants apply under Rule 290 of the Uniform Civil Procedure Rules to set aside the judgment in default of appearance in the sum of $236,352.35.
That Rule provides as follows:
“That the Court may set aside or amend a judgment by default under this division and any enforcement of it on terms including terms about costs and the giving of security, the Court considers appropriate.”
In determining whether a regularly entered judgment ought to be set aside reliance is placed upon the decision of National Australia Bank v. Singh [1995] 1 QdR 377 where the following test was laid down:
“Even proceeding on the basis if there was reason to think that the explanation given was dubious, I am, with respect of the opinion that the circumstances do not warrant the course his Honour took. ‘It is not often the defendant who has an apparently good ground of defence would be refused the opportunity of defending even though a lengthy interval of time has elapsed provided that no reparable prejudice is thereby done to the plaintiff.’”
And the decision of Justice McPherson in National Mutual Life Association of Australasia Limited v. Oasis Developments Pty Ltd [1983] 2 QdR 441 at 449 is referred to.
The reasons given by the defendants were that it was assumed that their solicitor would attend to the matter and that they believed that the original defence filed in another matter would be relied upon. There is good reason to criticise the conduct of the defendants in failing to act but the delay in this instance from late September to when this application was filed is not necessarily fatal to the application.
Good Ground of Defence
The main ground relied upon in the pleadings relates to a claim based upon an acknowledgment of debt which is Exhibit DET2 to the affidavit of Miss Turner. In that acknowledgment, which is signed only by the male defendant as the female defendant contests that she knew about it, an acknowledgment is made in relation to a debt which had been previously incurred by the parties in or about October 1995. The female defendant was present on that occasion but not at the time of the acknowledgment.
For the purposes of this application it is that part of the pleading which refers to the acknowledgment which is relied upon. Two principal defences have been put forward by the defendants, namely that the male defendant was under duress at the time that he signed the document and, secondly, that he believed that the debt was payable personally to Mr Stewart not to the company.
The facts relied upon in relation to the former defence are to be found in paragraph 36 of the affidavit of Graham William Cleary, the male defendant, which was sworn in March 2000.
Paragraph 36 reads as follows:
“In early 1999 Stewart approached me in relation to action number 7 of 1998. He put a considerable amount of pressure on me to pay out Stewart Pastoral's claim in the action. He threatened to take action against me if I did not acknowledge the outstanding amounts. I also had Roger Matherson's letter of 19 October 1998 in mind. That letter threatens notification to police if I fail to pay the alleged amount outstanding to Stewart.
Because of the pressure applied by Stewart to me, I felt that I had no choice but to sign the acknowledgment on 2 February 1999.”
It could not be said that there was any physical violence offered to the male defendant. If one therefore looks at economic duress the principles are referred to in Wardley Australia Limited v. MacFarlin (1984) Butterworths Property Reports 97214 at 9500 particularly at 9502:
“Firstly it was submitted that the plaintiff sought to impose its will on the defendant by a threat of immediate action without prior compliance with any of the procedures necessary for the enforcement of securities.
Secondly, reliance was placed on the threat not to discount the D F Johnston Syndicate Mortgage. Economic duress is an evolving principle of law and it is quite inappropriate to seek to lay down the principles which may work to avoid a transaction on the grounds of economic duress where that is not necessary.
On any view to make out such a contention, there must be an exercise of some improper pressure.”
When one looks further at the Exhibit GWC16 which is the letter from the solicitors dated 19 October 1998 it only refers to the fact that the police be notified if circumstances warrant and it also refers to the fact that the financier or any other financier would be notified. It does not fall within the category of threats referred to in Scolio Proprietary Limited v. Cote (1992) 6 Western Australian Reports 475 at 479. In referring to Halsbury's Laws of England Fourth Edition Volume 9 paragraph 297 Rowland J quotes the learned authors as follows:
“A threat of a criminal prosecution for which there is a sufficient ground is not such duress as will vitiate a contract made in consequence thereof provided that there is valuable consideration for the contract and that there is no agreement to stifle a prosecution.”
There is a further quote from paragraph 398 of Halsbury:
“Notwithstanding the probable survival of the common law rule as to compromises of offences of a public nature there is nothing to prevent a creditor from taking a security from his debtor for the payment of a debt due to him even if the debtor is induced to give the security by the threat of prosecution so long as there is no agreement either expressed or necessarily implied not to prosecute.”
The latter is certainly not the position in the present case.
There was also a reference in the argument to the decision of Equicorp Financial Services (in liquidation) v. Bank of New Zealand (1993) 32 NSWLR 50 at 106B and thereafter in relation to the economic duress aspect.
On the material before me I am not satisfied that duress of any nature was placed upon the male defendant when he signed this acknowledgment.
The other argument advanced is that the wrong plaintiff is suing for the debt. That is notwithstanding the acknowledgments referred to the company namely the plaintiff Stewart Pastoral Company Proprietary Limited. What is sworn to in the affidavit material by both the defendants is that the loan was from Stewart personally. There is no basis set out in that affidavit material which “descends to the particulars” to warrant a finding in their favour. See General Credits Finance Pty Ltd v. Grimm [1978] QdR 449 at 459. More than “a bald allegation” is required.
For that defence to be raised it would seem that particulars ought to be provided as to the belief, not just a bland statement. In defending other proceedings related to the loan the defence at no stage relied upon that defence. In fact the first mention that the moneys were owing to the individual Mr Stewart and not the company was in the affidavit of Mr Cleary which was filed in this Court on 1 March 2000.
The correspondence between the solicitors throughout at no stage challenged the indebtedness of the defendants to the company in relation to matters which were discussed in that correspondence.
It is submitted that this is really a question of credit and ought to be sent to trial. The documents point in one direction as far as that aspect is concerned and the failure to set out the belief does not satisfy me. The failure to set out the grounds of the belief therefore fails to comply with the requirement that there be some basis laid for asserting matters on a summary application. The male plaintiff has failed to establish any prima facie defence on the merits: Aboyne Pty Ltd v. Dixon Homes Pty Ltd [1980] QdR 142.
It is also quite clear that in relation to the sum of $68,172 no attempt has been made to challenge the indebtedness of that amount. I refer to the affidavit of Mr Cleary, paragraph 27(e), his second paragraph 46, and Mr Stewart's affidavit at paragraph 23(d). These matters were not contested. In that event at least the sum of $68,172 has not been contested on this application to warrant setting aside at least that sum.
It is asserted by the female defendant Mrs Cleary through counsel that she at no stage deposed to the fact that she agreed to the acknowledgment even though she was present at the time that the debt was incurred.
In relation to the repayment of loan money she left these matters to her husband, her co-defendant. It is asserted throughout the material that Mrs Cleary left these matters to her husband but it is another step then to find that she is bound by the acknowledgment. There is no evidence that she has ratified that particular acknowledgment. Therefore, in so far as she is concerned that defence is certainly a valid one at this point and, perhaps, is a matter which would be explored further at trial.
Conclusions
On the material before me the principal defences have not been made out in so far as the male defendant is concerned and I refuse to set aside the judgment in relation to him.
In relation to the female defendant the only issue for determination for hearing as far as she is concerned is whether she is bound by the acknowledgement signed by her husband. The order in a case of this nature even where there has been a mixed result for the defendants is that the defendants do pay the plaintiff's costs of and incidental to the application.
In so far as the male defendant, Graham William Cleary, is concerned it is ordered that he do pay the costs of and incidental to the action in so far as those matters are assessed and referable to his action.
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HIS HONOUR: The application to set aside judgment is refused in relation to Graham William Cleary. Leave to defend is given to Robin Grace Cleary.
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