James Woodward Neale v Bank of Western Australia Ltd; Bank of Western Australia Ltd v James Woodward Neale [2014] NSWSC 1219

Supreme Court New South Wales

Medium Neutral Citation: James Woodward Neale v Bank of Western Australia Ltd; Bank of Western Australia Ltd v James Woodward Neale [2014] NSWSC 1219 Hearing dates: 19 August 2014 Decision date: 19 August 2014 Jurisdiction: Equity Division - Commercial List Before: Hammerschlag J Decision: Application dismissed with costs Catchwords: PRACTICE AND PROCEDURE - Application for stay of execution - no issue of principle Category: Procedural and other rulings Parties: James Woodward Neale - First Plaintiff J.W. Neale Pty Ltd (Receivers and Managers appointed) - Second Plaintiff Secured Global Opportunity Limited - Fourth Defendant Representation: Counsel: JW Neale - First and Second Plaintiffs - (self-represented) P Dowdy - Fourth Defendant Solicitors: JW Neale - First and Second Plaintiffs - (self-represented) Norton Rose Fulbright - Fourth Defendant File Number(s): 2011/211735; 2011/401621 Consolidated

EX TEMPORE Judgment 1On 24 March 2014, after a 14 day hearing, I gave judgment against Mr James Woodward Neale (Mr Neale) in favour of Secured Global Opportunity Limited (SGOL), the assignee of the claims of the Commonwealth Bank (the Bank) against Mr Neale, for $31,552,497 as at 3 November 2013 (the Judgment). Final orders were made on 27 March 2014. Defined terms in the Judgment have the same meaning here. 2Mr Neale, who is self-represented, filed a Notice of Appeal on 27 June 2014. 3By a Motion filed on 13 August 2014, Mr Neale seeks an order that enforcement of the Judgment be stayed pending outcome of the appeal or until further order. 4Although the Judgment was for a significantly greater amount, as paragraph 11 of the Judgment records, Mr Neale accepted and admitted that the debt was $22,059,199. Whatever else may be said about his appeal, there is no realistic prospect of success so as to reduce his liability to a figure less than this. 5SGOL is in possession as mortgagee of Fox Valley Road. Fox Valley Road is due to be publicly auctioned on Saturday 23 August 2014. SGOL is selling pursuant to its real property security - that is, as mortgagee in possession - not pursuant to any enforcement process issued pursuant to the Judgment. In effect, Mr Neale is seeking an injunction restraining exercise by SGOL of the power of sale. 6His principal thesis is that SGOL is deliberately seeking to sell Fox Valley Road at an undervalue at the instance of the Bank so as to maintain its (SGOL's) prospects of getting business from the Bank. In turn, he says that the Bank's motivation is deliberately to destroy him in order to denude him of the resources to obtain redress against the Bank in relation to what I described in the Judgment as the "deliberate destruction strategy" and which he seeks to ventilate should he be permitted to do so in the event that his appeal succeeds. 7Again, he asserted the sale of his property at Yatala Road was at an undervalue. He also put that Avon Road had been sold at an undervalue and that the sale had been rescinded because the Bank had accepted that this was so. He put that the same is happening with respect to Fox Valley Road, except now it is SGOL doing it at the Bank's behest. No foundation of any kind for these allegations has been established by the evidence. 8Mr Neale asserts that the marketing of Fox Valley Road is intended to depress its value, that it is not being marketed at its highest and best use, that it should be sold before Avon Rd, and that it should be marketed in conjunction with an adjoining property belonging to his brother. 9As he had done during the hearing of the principal proceedings, Mr Neale continued in this application to make unfounded allegations of dishonesty on the part of various persons, including the Bank's solicitors. He put that new information has come to light through proceedings before ICAC which discloses dishonesty on the part of planning officials and others, which he says enhances the prospects of his appeal. For these allegations, there is equally no foundation in the evidence. 10Viewed as an application for a stay, the application fails because there is no real prospect of success on appeal, at least in relation to more than $20 M of the verdict. There is no suggestion that any monies recovered by SGOL will be irrecoverable in the event of the appeal succeeding, and there is no suggestion that Mr Neale will not be able to prosecute his appeal in any event. There is also no suggestion that if the sale is at an undervalue SGOL will not be in a position to pay any damages. There is no reason to displace the usual presumption that SGOL is entitled to the fruits of its victory. In the circumstances of this case, the interests of justice do not require the grant of a stay. 11Viewed as an injunction application, it fails both because Mr Neale has not established the existence of a serious issue to be tried, and the balance of convenience, far from favouring the grant of the injunction, lies against granting it. 12Mr Neale relies on an affidavit of a valuer, Mr Wheadon, who opines that Fox Valley Road should be sold as a development site for an aged care facility or nursing home, and that the sale price to be achieved on that basis will be of the order of $3.5 to $4 M more than if sold as a residence. Mr Neale says that Fox Valley Road is worth $7.75 M. Even on this basis, Fox Valley Road will not return nearly sufficient to repay the debt he owes to SGOL. Mr Neale has no resources to pay any interest on his obligations, which interest continues to accrue. The balance of convenience favours an early sale of Fox Valley Road. 13Far from establishing that the marketing of Fox Valley Road has in any way been inadequate, the material rather establishes significant efforts to achieve the best price. There is no logical or rational reason why SGOL or the Bank for that matter would act to impair the value of their own security. 14The steps which have been taken in marketing the property are set out in an affidavit of Ian Scott Chadwick, a licensed real estate agent. When SGOL took possession, Fox Valley Road was in a state of significant disrepair and some thousands of dollars have been spent to put it in a position ready for sale. The marketing campaign has been of 5 weeks duration and has included featured editorial content in the North Shore Times, Chinese print media advertising, circulation to the agent's entire database and telephone marketing. Also in evidence is a valuation dated 12 August 2013 by a registered valuer, Mr Andrew Parkinson, who opines that the market value of Fox Valley Road is $5 M, free of GST. There is an affidavit from an experienced solicitor, Felicity Jane Rourke, dealing with the environmental and planning aspects pertinent to the property. 15Mr Neale has fallen far short from establishing that the marketing campaign is in any way inadequate. No basis has been established for the existence of any requirement that it be sold before Avon Road or that it can or should be sold in conjunction with the property belonging to his brother. 16Mr Neale is in no position to offer a meaningful undertaking as to damages, nor has he offered to pay into Court any amount, let alone the very substantial verdict against him. 17The application has been brought late in the day and after what appears to be an extensive marketing campaign has been engaged in and paid for. 18The application is dismissed with costs.