MILLER v BONYHADY SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL SHELLER JA 9 October 1995 [1995] NSWCA 294 Sheller JA The claimant, Charles Harold Miller, applies by amended summons dated 5 October 1995 for an extension of time within which to file a notice of appeal from a decision of Master Macready given on 22 August 1995. The claimant also, by notice of motion dated 4 October 1995, seeks a stay of execution of a writ of possession of unit premises situate at 12/35 Jeffrey Street, Canterbury, pending determination of the appeal. The opponents, Eric and Vera Bonyhady, oppose both applications substantially on the basis that any appeal would be hopeless. The application is supported by an affidavit of Mr Miller filed in the Common Law Division of 21 September 1995 and an affidavit of Mr Miller filed in this Law Division of 21 September 1995 and an affidavit of Mr Miller filed in this Court of 4 October 1995. Court of 4 October 1995. The opponents rely upon an affidavit of their solicitor, Mr Schneider, filed in the Common Law Division of 22 September 1995 and an affidavit of Mr the Common Law Division of 22 September 1995 and an affidavit of Mr Schneider filed in Court of 9 October 1995. The dispute between the parties arises from a loan made by Mr and Mrs Bonyhady to Mr Miller in April 1993. The loan which was secured by way of first mortgage over the unit premises was repayable on 30 April 1995. Default occurred in interest payments. Proceedings for possession and other relief were commenced on 31 August 1994 and served on Mr Miller on 7 September 1994. commenced on 31 August 1994 and served on Mr Miller on 7 September 1994. On 21 September 1994 he filed an appearance. On 7 October 1994 judgment for possession and payment of $96,040.58 was entered by default against him. On 21 October 1994 a writ of possession issued in respect of the judgment. On 27 October 1994 a notice to vacate issued to the defendant. On 8 November 1994 Mr Miller filed a notice of motion for, inter alia, a stay of execution for the writ of possession. On 9 November 1994 this was granted up execution for the writ of possession. On 9 November 1994 this was granted up to and including 28 November 1994. On that day, a further stay was granted until 16 December 1994. On 12 December 1994 the stay was extended until further order. On the material before me, I am not entirely clear, against this background, how the matter came for hearing before Master Macready. However, on 22 August 1995 the Master indicated that he would vacate the stay on the judgment entered on 7 October 1994 and set aside that judgment. He proposed giving judgment in favour of the plaintiffs against the defendant, Mr Miller, for possession and that Mr Miller pay the plaintiffs $96,040.58 plus interest at Supreme Court rates from 7 October 1994. He said he would order interest at Supreme Court rates from 7 October 1994. He said he would order Mr Miller to pay the plaintiffs' costs on an indemnity basis. He added that in the 2 UNREPORTED JUDGMENTS circumstances of the decision he proposed to refer the papers to the Prothonotary so he might make arrangements to forward them to the Director of Public Prosecutions. The principal issue between the parties was whether or not, as Mr Miller alleged, on 4 July 1994 he caused to be repaid, or paid, to the plaintiffs the sum owing under the mortgage assessed at $92,216.25. On this factual issue Mr owing under the mortgage assessed at $92,216.25. On this factual issue Mr Miller failed before the Master. The critical player in the transaction said by Mr Miller to have occurred was Mr Allsop, a retired bank manager who had headed the New South Wales computer operations at the National Bank until he retired in 1986. For the period from 10 April to 10 July 1994 Mr and Mrs Bonyhady were overseas. As had been their practice on previous occasions when they were away, Mr Allsop looked after their affairs. The arrangement was that he and his wife would live in the opponents' house during the week and go home on the weekend. Mr Allsop collected cheques from various mortgagors and attended to some business matters. During this period some contact took place between Mr Miller and his son, Mr Damon Miller, and Mr Alisop in regard to interest payments. Mr Miller said that Mr Allsop informed him on 9 May 1994 that the amount required to pay out the mortgage was $92,216.25. Mr Damon Miller said that on 2 July 1994 he received cash from the sale of his coin and stamp collection of $96,000. On 4 July 1994, he placed the amount of $92,216.25 in a grey leather brief case which he then photographed before taking it from his home. He drove to Mr and Mrs Bonyhady's home, took the cash inside and gave it to Mr Allsop. He says he was given a receipt for the payment. There was an arrangement that Mr and Mrs Allsop would meet at the Land Titles Office to hand over the appropriate discharge and title deeds. Mr Allsop denied these arrangements, or that any payment had been made. that any payment had been made. In these transaction there were two critical documents; Exhibit B, a receipt produced by Mr Damon Miller and said to have been given by him to Mr Allsop on 9 May 1994 for a payment of $1,009 and the second Exhibit 5, a receipt said to have been handed over on 4 July 1994 by Mr Allsop to him for the alleged repayment of the principal sum. Expert evidence was given about these documents by Mr Anderson whose evidence, 'according to the Master, was not the subject of challenge. The Master said that if he were to accept the plaintiffs' case, these two documents were manufactured by Mr Miller or his plaintiffs' case, these two documents were manufactured by Mr Miller or his son or both and put forward to the Court as genuine documents. The Master who recognised how serious this charge was examined in detail various matters which he regarded as basic inherent improbabilities in the stories advanced by Mr Miller and his son. Part of this was what the Master described as an extraordinarily complicated explanation given by Mr Damon Miller of how the document of 4 July came into existence. Having examined these various matters, the Master said that there were a number of matters which indicated to him that Mr Miller senior was not a credible witness let alone a reliable witness. He set out his reasons for this conclusion. On the other hand, he said that Mr Allsop struck him as a straight forward and honest person and "apart from one matter" there was nothing in the way he honest person and "apart from one matter" there was nothing in the way he gave URJ MILLER v BONYHADY (Sheller JA) 3 his evidence which would have led the Master to disbelieve him. The one matter concerned the matter of whether Mr Allsop had ever raised the matter of his blood pressure with Mr Miller. The Master said: Ultimately I have to decide whether to accept the evidence of Mr Allsop and Mr Bonyhady in contrast to that of Mr Damon Miller and Mr Miller senior. In the result I am prepared to accept the evidence of Mr Allsop and Mr Bonyhady and on this basis it is clear that the evidence given by Mr Damon Miller and Mr Miller senior is a concoc lion. Matters which go to support it are of course the order in which the evidence came out following the expert's reports, the failure to concede photocopy documents were photocopy documents, that the original document handed over on 9 May was used in an abbreviated form without the signature in order to produce a receipt which had some semblance of authenticity and the use of the original to make a photocopy onto Exhibit 5 which became the document constructed for the purposes of alleging a repayment of the loan in full. The other matters are the basic improbabilities in the story. In these circumstances and having regard to all the evidence, some of which I have referred to in this judgment, I am satisfied that the principal sum of $90,000 was not repaid on 4 July. What happened on that occasion was that a cheque for interest and some cash were handed over as deposed to by Mr Allsop. So far as costs are concerned an application is made for indemnity costs. In the circumstances this is appropriate. Included in the material before me is a proposed form of notice of appeal by Mr Miller. In form it is inappropriate in that in large measure it seems to found Miller. In form it is inappropriate in that in large measure it seems to found upon the view that the Master's judgment can be challenged on the basis that the result was against the weight of the evidence. Counsel for the claimant accepted that the appeal would be a difficult one. In substance, its success requires that the Master's findings of fact be set aside. Nothing was brought to my attention to suggest that any of the Master's findings were glaringly my attention to suggest that any of the Master's findings were glaringly improbable. Indeed, the reverse. The amount owing at the present time under the mortgage both of principal and interest is $107,087.80. In addition, the opponents say they have paid legal costs and witnesses expenses totalling $32,000. A further $6,000 has been incurred but not yet billed. There are the further costs of the appeal. Various valuations have been placed upon the unit premises the subject of the mortgage, the highest being placed upon the unit premises the subject of the mortgage, the highest being $155,000. In the ordinary way this appeal is unlikely to come on for hearing for about two years. I should say immediately that I do not think the claimant should be years. I should say immediately that I do not think the claimant should be denied an opportunity to appeal, particularly in light of the seriousness of the findings made and I am prepared to extend the time for filing a notice of findings made and I am prepared to extend the time for filing a notice of appeal. On the stay application, there are a number of matters that have to be borne in mind. The claimant has given evidence that he is a pensioner aged 79 and has mind. The claimant has given evidence that he is a pensioner aged 79 and has no other place to live other than the premises the subject of these proceedings. He has lived there for the last 19 years. The only encumbrance on the premises He has lived there for the last 19 years. The only encumbrance on the premises is the subject mortgage. 4 UNREPORTED JUDGMENTS Subject to the leave to extend time, which I am prepared to grant, the claimant is entitled to appeal and is entitled to a stay of execution of the judgment if good reason can be shown. On the other hand the term of the loan has now expired and the opponents are entitled to repayment of the principal and interest thereon. Further, the opponents are entitled to the fruits of their victory at first instance. The claimant bears the onus of demonstrating a proper basis that will be fair to all parties if a stay is granted. (See Alexander vy Cambridge Credit Corporation (1985) 2 NSWLR 685 at 694). The courts will normally exercise their discretion in favour of granting a stay if the failure to do so gives rise to a risk that the appeal will prove abortive if the appellant succeeds. In this particular case the claimant has offered, if a stay is granted, to make quarterly interest payments at the rate of 12 percent per annum, amounting to $12,850.54 per annum to be paid into a trust account to be established and held jointly in the names of the solicitors for the parties to be distributed after the appeal has been disposed of. The first payment, it is proposed, would be made three months from today. Furthermore, the claimant is content to accept some order to deal with the position if there were a default in making these payments. Ordinarily in applications of this sort, the Court will not speculate about the prospects of the appellant's success, bearing in mind the limited nature of the argument about the dispute inherent in an application of this sort. Even so, as has been acknowledged in the cases, it is appropriate to make some preliminary assessment about whether the appellant has an arguable case. Making such an assessment in the present case, I am not satisfied that the claimant has an arguable case on appeal from the decision of Master Macready. There is nothing before me to suggest that if the writ of execution proceeds, the property is sold, the proceeds paid to Mr and Mrs Bonyhady and the appeal ultimately succeeds, they will not be in a position to repay the claimant. Taking account of the evidence and the arguments that have been put to me, I have come to the conclusion that the claimant has failed to demonstrate sufficient reasons to justify the grant of a stay. Accordingly I refuse that applications The orders that I make are as follows; 1. the time within which the claimant may file a notice of appeal is extended up to and including 16 October 1995; 2. the costs of the summons will be costs in the appeal; 3. the notice of motion for a stay is dismissed with costs. Mr Feller, who appears for the claimant, informs me that his client will probably apply to the Full Court, Court of Appeal, to review the order that I have made dismissing the application for a stay. Upon that basis, I stay have made dismissing the application for a stay. Upon that basis, I stay execution of the writ of possession up to and including 16 October 1995. 1. the time within which the claimant may file a notice of appeal is extended up to and including 16 October 1995; 2. the costs of the summons will be costs in the appeal; 3. the notice of motion for a stay is dismissed with costs.