Jones v Riley [2022] NSWDC 323

District Court New South Wales

Medium Neutral Citation: Jones v Riley [2022] NSWDC 323 Hearing dates: 4 August 2022 (with supplementary submissions from both parties on 5 August 2022) Date of orders: 9 August 2022 Decision date: 09 August 2022 Jurisdiction: Civil Before: Abadee DCJ Decision: See paragraph 82 Catchwords: CIVIL PROCEDURE – application to set aside default judgment – whether bona fide arguable defence – adequacy of explanation for default – significance of delay Legislation Cited: Civil Procedure Act 2005 (NSW) ss 56 – 60 Evidence Act 1995 (NSW) s 136 Uniform Civil Procedure Rules 2005 (NSW) r 36.16 Cases Cited: Dai v Zhu [2013] NSWCA 412 Hans Pet Constructions Pty Limited v Cassar [2009] NSWCA 230 J & M McNamee Holdings Pty Ltd v Mungerie Vale Pty Ltd t/as Greenwood Group Realtors [2019] NSWCA 283 Pham v Gall [2020] NSWCA 116 R T & Co Pty Ltd v Minister of State for the Interior (1957) 98 CLR 168 Category: Principal judgment Parties: Mr M Riley (applicant) Ms A Jones (respondent) Representation: Mr L Shohmelian for the applicant Ms N Bailey for the respondent File Number(s): 2019/00340904 Publication restriction: Nil

JUDGMENT

Background 1. Before the Court is an application to set aside a default judgment entered on 27 April 2020. 2. This proceeding commenced on 30 October 2019. Alyce Jones, a judgment creditor and respondent to the current application, sued the judgment debtor and applicant on the motion, Michael Riley on an oral loan agreement said to be entered into on 9 November 2017. A 'Loan Deed' was said to have been executed on that day and Ms Jones pleaded essential terms of the loan reflecting what was contained in the Loan Deed. Ms Jones alleged that the loan was for a principal sum of $150,000, that it was an interest-free loan and repayable in fortnightly instalments of $380, commencing on the first fortnight after the 'principal sum' was advanced, until the principal sum was repaid. She alleged that this was to be disbursed through paying $100,000 to him whilst retaining $50,000 for "her own purposes". As to the term for repayment it was to be paid advanced through the month of November 2017 and was repayable in fortnightly instalments; but no repayments had been made since 3 July 2019. 3. Although at the hearing of the present application the applicant disputed this, Ms Jones persuaded the Registrar who determined the application for default judgment that Mr Riley was personally served with the originating process on 16 March 2020. 4. After default judgment was entered, in June 2020, the respondent retrieved a sum of money from the applicant's bank account pursuant to a garnishee order issued to the ANZ Bank. 5. On 23 April 2021, the Court made an Examination Order against the applicant, but there were problems with the service of that order. Since then, there were various adjournments of his examination. 6. On 11 May 2022, the respondent caused a bankruptcy notice to be issued against the applicant. 7. On 3 June 2022, the applicant filed a notice of motion to set aside the judgment entered in this Court and, on that basis and on the same date, he filed an application in the Federal Court of Australia to set aside the bankruptcy notice. 8. On 7 June 2022, the Examination Order was adjourned to 10 June 2022. This process of enforcement has, however, been overtaken by the current motion. 9. On the application, the applicant relied upon his affidavits sworn on 3 June 2022 (Exhibit A) and 9 June 2022 (Exhibit B). The respondent relied upon her affidavit sworn on 8 July 2022 (Exhibit 1) and an exhibit to that affidavit (Exhibit 2). In accordance with Court directions, both parties relied upon written submissions (MFI 1 & 2).