Patterson v Cohen [2006] NSWSC 424

New South Wales Supreme Court

CITATION : Patterson v Cohen [2006] NSWSC 424

HEARING DATE(S) : 28/04/06 JUDGMENT OF : Gzell J

EX TEMPORE JUDGMENT DATE : 04/28/2006

DECISION : Amended notice of motion dismissed with costs.

CATCHWORDS : PROCEDURE - Supreme Court Procedure - Charging orders - Moneys in court - Application for order charging the fund to answer judgment entered under a certificate of determination of costs in other proceedings dated May 2003 - Fund had been ordered to be paid out to first defendant but stayed for a fortnight - Whether first defendant had an equitable interest in the fund for the purposes of the Civil Procedure Act 2005, s 126(1) - Whether failure to nominate costs and interest in supporting affidavit contravened the Uniform Civil Procedure Rules 2005, r 39.45(2)(a) - Judgment entered for $320 more than owing - Whether charging order should be refused on discretional grounds - Whether injunction should be granted to extend the time for assessment of the costs of the proceedings

LEGISLATION CITED : Uniform Civil Procedure Rules 2005 Civil Procedure Act 2005

Darcy Reginald Francis Patterson - Plaintiff PARTIES : Yehuda Leon Cohen - First Defendant Sir Moses Montefiore Jewish Home - Second Defendant Minter Ellison Lawyers - Third Defendant

FILE NUMBER(S) : SC 2656/05

COUNSEL : Mr T J Hancock - Plaintiff Mr M Rollinson - First Defendant

SOLICITORS : H M Symonds & Britten

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

GZELL J

28 APRIL 2006

2656/05 DARCY REGINALD FRANCIS PATTERSON v YEHUDA LEON COHEN & ORS EX TEMPORE JUDGMENT 1 The first defendant succeeded in a defamation action against the second and third defendants. Those moneys were ordered to be paid into court. The plaintiff sought a lien for his costs for acting for the first defendant. Hamilton J found the lien existed and adjourned the proceedings to enable those costs to be assessed. 2 Hamilton J subsequently ordered the amount assessed with respect to the costs of the defamation action to be paid out to the plaintiff. He ordered that the balance of moneys in court be paid out to the first defendant, but stayed that order to enable mareva orders to be considered with respect to the costs of these proceedings. Those costs have not, as yet, been assessed. 3 The plaintiff obtained a certificate of determination of costs in relation to other proceedings in May 2003. Judgment was entered in the amount of that certificate today. The affidavit that supported the entry of that judgment swore that the plaintiff had not been paid any of those costs by the first defendant. That statement was inaccurate. From other material before the court it is clear that 16 payments of $20, totalling $320, on account of those costs were paid by the first defendant and, notwithstanding the plaintiff's opposition to being paid by instalments, those moneys were retained. 4 What is sought from the court today is a charging order to apply to the moneys in court to satisfy the judgment entered today and an order that the Registrar pay those moneys out of court to the plaintiff. 5 Alternatively, until further order, an order is sought restraining the first defendant from removing, causing or permitting to be removed from the State of New South Wales, or selling, charging, mortgaging, or otherwise dealing with, or disposing of, or causing or permitting to be sold, charged, mortgaged, or otherwise dealt with, or disposed of, the balance of the funds in court after payment to the plaintiff of the amounts due to the him pursuant to the orders of Hamilton J. 6 It was submitted in opposition to that application that there was no power in the court under the Uniform Civil Procedure Rules 2005, r 39.44 to make a charging order in this case because the rule relied upon the Civil Procedure Act 2005, s 126(1) and it was restricted to the following kinds of property of a judgment debtor, namely, stock and shares in a public company, money on deposit in a financial institution and any equitable interest in property. It was submitted that the first and second categories did not apply to the moneys in court and there was no equitable interest in the moneys in court. 7 In my view, the effect of the order of Hamilton J, that the moneys in court be paid out to the first defendant, gave rise to an equitable interest. The Registrar then held the moneys for no other purpose but to pay them to the first defendant and, in my view, the proper analysis of the relationship was then one of trustee and beneficiary. There is thus a sufficient interest in the moneys in court to ground the operation of the Uniform Civil Procedure Rules 2005, r 39.44. 8 Further opposition was raised to the application, invoking the discretionary power of the court. First, the discussion of a mareva-type order that led Hamilton J to stay the order for payment out to the first defendant, was limited to the costs of these proceedings, and there was no discussion of a charging order. The first defendant objects that it was only with the filing of an amended notice of motion today that relief in the nature of a charging order was sought. Furthermore, it was sought, not in relation to the costs of these proceedings, but in relation to the earlier costs of other proceedings. 9 It was also pointed out that the Uniform Civil Procedure Rules 2005, r 39.45(2)(a) requires the supporting affidavit for a charging order to state the amount payable under the judgment, together with any costs and interest payable in relation to the judgment as at the date of the swearing of the affidavit. The affidavit swore to the amount payable under the judgment but said nothing of costs and interest. 10 In my view, the charging order sought does not claim any figure for costs or interest payable in relation to the judgment. In the absence of a claim for costs or interest, an affidavit that says nothing about either, does not fall foul of the Uniform Civil Procedure Rules 2005, r 39.45(2)(a). 11 It was pointed out that the judgment that was entered today was based upon a costs assessment and a certificate of determination issued in May 2003. It was submitted that the plaintiff had ample time to take effective action with respect to that certificate of determination, including entering a judgment long before today, and that I ought, in exercise of my discretion, refuse the relief sought. 12 Next, it was pointed out that the judgment has been entered erroneously in that credit for the $320 paid was not made. In answer to that submission it was suggested that the amount being de minimis a charging order should be made for the amount of the judgment less $320. 13 In my view, the judgment cannot be treated in that fashion. The parties and their legal advisers are duty bound to enter judgments only with respect to amounts that are owed. The failure to give credit, even for such a small amount as $320, causes me grave concern. When that concern is coupled with the change in the relief sought and a change in the costs with respect to which the relief is sought, I am of the view that it is inappropriate for me to grant an order charging the funds in court in the way that is suggested. 14 The alternative relief that is sought seeks yet a further stay of Hamilton J's orders so that the costs of these proceedings can be assessed. His Honour spoke of the plaintiff and the first defendant being in the relationship of creditor and debtor and that he would defer any order for payment of the balance of the funds to the first defendant for a week so that the plaintiff might, if so advised, apply to the court for mareva relief relating to that balance. The plaintiff chose not to take that course. Instead, in the alternative to the relief by way of charging order, the plaintiff now seeks an order restraining the first defendant from dealing with the balance of the funds in court. 15 In my view, for the reasons expressed above and for the reason that Hamilton J limited the availability of the taking of relief by way of mareva order for a limited time, I am not prepared to grant the relief, by way of injunction, which is now sought. 16 The consequence is that I dismiss the amended notice of motion. I order the plaintiff to pay the first defendant's costs.