FEDERAL COURT OF AUSTRALIA Coshott v Coshott [2014] FCA 1418 Citation: Coshott v Coshott [2014] FCA 1418 Parties: JAMES COSHOTT and LJILJANA COSHOTT v ROBERT GILBERT COSHOTT, A BANKRUPT and MAXWELL WILLIAM PRENTICE IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF ROBERT GILBERT COSHOTT, A BANKRUPT; MAXWELL WILLIAM PRENTICE IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF ROBERT GILBERT COSHOTT, A BANKRUPT; JAMES COSHOTT, LJILJANA COSHOTT, ROBERT GILBERT COSHOTT, A BANKRUPT and SCHLOTZSKY'S NOMINEE COMPANY PTY LIMITED File number: NSD 1412 of 2009 Judge: JACOBSON J Date of judgment: 18 December 2014 Catchwords: CONVEYANCING – Application for stay of execution of Writ of Possession – Powers of the Federal Court Sherriff and Deputy Sherriff – Requirement to provide notice pursuant to s 111 of the Conveyancing Act 1919 (NSW) – Effect of delay in commencing proceeding Legislation: Conveyancing Act 1919 (NSW) s 111 Federal Court of Australia Act 1976 (Cth) s 18N, s 18P Federal Court Rules 2011 r 40.10, r 40.41 Cases cited: ABC v O'Neill (2006) 227 CLR 57 Date of hearing: 18 December 2014 Date of last submissions: 18 December 2014 Place: Sydney Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 17 Counsel for the Applicants: Mr A Cheshire Solicitor for the Applicants: Martin Place Lawyers Counsel for the trustees for sale: Mr S Mullette Solicitor for the trustees for sale: Matthews Folbigg Pty Ltd Counsel for Mr Prentice: Ms S Nash IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1412 of 2009 BETWEEN: JAMES COSHOTT First Applicant LJILJANA COSHOTT Second Applicant MAXWELL WILLIAM PRENTICE IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF ROBERT GILBERT COSHOTT, A BANKRUPT Cross-Claimant AND: ROBERT GILBERT COSHOTT, A BANKRUPT First Respondent MAXWELL WILLIAM PRENTICE IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF ROBERT GILBERT COSHOTT, A BANKRUPT Second Respondent JAMES COSHOTT First Cross-Respondent LJILJANA COSHOTT Second Cross-Respondent ROBERT GILBERT COSHOTT, A BANKRUPT Third Cross-Respondent SCHLOTZSKY'S NOMINEE COMPANY PTY LIMITED Fourth Cross-Respondent JUDGE: JACOBSON J DATE OF ORDER: 18 DECEMBER 2014 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The interlocutory application be dismissed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1412 of 2009 BETWEEN: JAMES COSHOTT First Applicant LJILJANA COSHOTT Second Applicant MAXWELL WILLIAM PRENTICE IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF ROBERT GILBERT COSHOTT, A BANKRUPT Cross-Claimant AND: ROBERT GILBERT COSHOTT, A BANKRUPT First Respondent MAXWELL WILLIAM PRENTICE IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF ROBERT GILBERT COSHOTT, A BANKRUPT Second Respondent JAMES COSHOTT First Cross-Respondent LJILJANA COSHOTT Second Cross-Respondent ROBERT GILBERT COSHOTT, A BANKRUPT Third Cross-Respondent SCHLOTZSKY'S NOMINEE COMPANY PTY LIMITED Fourth Cross-Respondent JUDGE: JACOBSON J DATE: 18 DECEMBER 2014 PLACE: SYDNEY REASONS FOR JUDGMENT 1 This is an application for a stay of execution of a Writ of Possession (the Writ) issued by the Court on 20 November 2014. The Writ was issued following a lengthy period of litigation in this Court before Buchanan J and his Honour's judgment was followed by an appeal to a Full Court. Orders were ultimately made for possession of the property to be given to Ms Shabnam Amirbeaggi and Mr Nicholas Crouch, as statutory trustees for sale. The persons named in the Writ as liable to execution of the judgment are Mr James Coshott, Ms Ljiljana Coshott, Mr Robert Gilbert Coshott and Schlotzsky's Nominee Company Proprietary Limited. 2 The land which is the subject of the orders is a property at 1 Bunyula Road, Bellevue Hill. The Writ is directed to: "The Sheriff of New South Wales and all Sheriff's officers" 3 It is this direction which the applicant for the stay of the Writ, Fewin Pty Limited (Fewin) contends to have the effect of invalidating the Writ. Fewin is not a party to these proceedings. 4 It claims to have standing to seek the relief sought in the interlocutory application by virtue of an unregistered mortgage granted to it by Ms Coshott. Ms Coshott is the registered proprietor of a one half share as tenant in common of the property. The registered proprietor of the other undivided one half share is Mr Maxwell William Prentice. He is registered in respect of that interest by virtue of his position as trustee of the bankrupt estate of Mr Robert Coshott. Mr Prentice obtained an order for possession from Buchanan J in September last year, but after the Full Court decision, his Honour varied the order so as to provide for the Writ to be issued to Ms Amirbeaggi and Mr Crouch, as statutory trustees for sale. 5 Mr Prentice and the trustees for sale contend that Fewin has no standing to bring this application because it has no relevant connection with the property for the reasons to which I will refer later. There is some force in this submission, but it seems to me that what was said on this issue is also relevant to the issues which ordinarily arise in an application such as this, that is to say, whether Fewin has established a prima facie case and where the balance of convenience lies. See ABC v O'Neill (2006) 227 CLR 57 at [65]. 6 Mr Cheshire, who appears for Fewin, contends that there is a real issue as to the validity of the Writ by virtue of certain provisions of the Federal Court of Australia Act 1976 (the Act) and the Federal Court Rules 2011 (the Rules). His submissions turn largely upon the provisions of ss 18N and 18P of the Act. He points, in particular, to s 18P(1) under which the Sheriff of the Court is responsible for the service and execution of all processes of the Court directed to the Sheriff. Mr Cheshire also points to s 18P(3) under which a Deputy Sheriff may, subject to the directions of the Sheriff, exercise or perform any of the powers or functions of the Sheriff. In addition, Mr Cheshire relies upon r 41.10 of the Rules. He points in particular to r 41.10(2) and additionally to r 41.41. 7 Notwithstanding Mr Cheshire's able submissions on this issue of principle, it seems to me that the better course is for me to express only a preliminary view. I have taken into account the fact that Mr Mullette, who appears for the trustees for sale and Ms Nash, who appears for Mr Prentice, were not given proper notice of today's application and learnt of it only last night. They have therefore not been able to give the degree of attention to the issue, which would ordinarily be required in this application. Of course, that situation has not been brought about by anything done or omitted by them, but rather because of the way in which the matter has been brought before the Court by Fewin. 8 The substance of what Mr Cheshire says about the effect of ss 18N and 18P is that a writ of possession must be directed to the Sheriff of the Federal Court. Whilst he accepts that a Deputy Sheriff may exercise the powers of the Sheriff, Mr Cheshire submits that the Deputy Sheriff would only obtain such power provided that the Sheriff himself or herself had power conferred on the Sheriff to perform the necessary act. Mr Cheshire submits that the effect of the direction in the Writ to the Sheriff of New South Wales and all Sheriff's officers is to purport to confer the power on the Deputy Sheriff. That seems to me to be correct because the evidence establishes that the Sheriff of New South Wales is also the Deputy Sheriff of the Federal Court. 9 Nevertheless, my preliminary view is that the submission made by Mr Cheshire is not correct. It seems to me that the effect of s 18P(3) is to confer on the Deputy Sheriff the power to perform the necessary functions subject to any directions of the Sheriff. I do not see that this requires the power to be first reposed in the Sheriff and for the Sheriff to then give any necessary directions to the Deputy Sheriff. Nor do I think that this approach to the construction of the power is altered by the provisions of Federal Court Rules 41.10(2) and 41.41. 10 In any event, it seems to me that, even if I am incorrect in the view that I have expressed, the short answer to the present application is to be found in the balance of convenience, which seems to me to be all one way. It turns upon Fewin's claim to have a relevant interest by virtue of its assertion that it is in possession of the property as a mortgagee in possession. The evidence as to this is quite unsatisfactory. In my opinion, the evidence does not establish that Fewin ever took possession. 11 Moreover, there is no evidence that Fewin gave the necessary notices under the provisions of s 111 of the Conveyancing Act 1919 (NSW). Indeed, I am entitled to infer by reason of the omission of the deponent of Fewin's affidavit to refer to the steps that no such notice was given. What is more and, indeed, what is fundamental to the present application is that Fewin has no ability to enter into or take possession of the entire property. 12 At most, its equitable interest encompasses an interest as unregistered mortgagee in respect of Mrs Coshott's half share of the property. That, of itself, seems to me to be a complete answer to the present application. But this is compounded by the fact that Fewin does not point to any prejudice arising from the Writ being permitted to stand. Fewin's evidence appears to establish that it has an unpaid debt in an amount of at least $450,000. It contends that, in light of default made by Mrs Coshott, it has taken steps to enforce its security. 13 But the very act of Fewin as a mortgagee seeking to protect its interest is enhanced by the sale of the property. This is because, plainly enough, the sale of the property is to be undertaken in order to enable all of the relevant debts to be paid, including the payment of any debt which Fewin is able to establish. It follows that there is and, indeed, can be no suggestion that Fewin is being deprived of any benefit by reason of permitting the Writ to stand. There were a number of other discretionary considerations referred to on behalf of the trustees for sale and Mr Prentice. In particular, they refer to the issue of delay. 14 That issue seems to me to be subsidiary to the other matters to which I have referred and I do not see that it is necessary to address that issue. I will simply say that Mr Cheshire submits that the question of delay is to be determined from 26 November 2014 after the notice to vacate was issued, following the issue of the Writ a few days earlier. There is probably some force in this because Mr Cheshire's only point is the pure legal question of the form of the Writ to which I have referred. It would therefore seem to follow that the tortuous legal history of the present proceedings, although unfortunate, is not relevant to the issue of delay. 15 There is however one proviso to that, namely, the proceedings were initially instituted by Fewin against the New South Wales Sheriff in the Supreme Court of New South Wales. The reason that step was taken is quite unclear. The proceedings in the Supreme Court purported to raise the issue now sought to be ventilated and they did so without any notice having been given to the trustees for sale or Mr Prentice. 16 Notwithstanding what I said earlier, on further reflection it seems to me that, whilst the earlier history of the proceedings might not be of particular importance, the commencement of the proceedings in the Supreme Court without any notice to the trustees for sale or Mr Prentice as necessary parties in such an application is a matter that I am entitled to take into account again Fewin's present applications. 17 It follows from what I said that I order that the interlocutory application (wrongly described as an interim application) be dismissed. I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jacobson. Associate: Dated: 5 January 2015