FEATURE ARTICLE -
Issue 28 Articles, Issue 28: June 2008
UCPR 668 lays down two [2] quite separate, bases for an Application for a stay or setting aside of an Order and for the grant of alternative relief.
- Sub-rule (1) (a) deals with … “ facts” … “arising” … after the Order was made, and
- Sub-rule (1) (b) deals with fresh evidence.
The setting aside of Judgments and Orders obtained by conduct sui generis fraudulent is dealt with discreetly by and under UCPR 667(2) (b)
r 668 of the Uniform Civil Procedure Rules 1999 (Qld) (“UCPR”). provides:
“668 – This rule applies if —
(1)
(a) facts arise after an order is made entitling the person against the whom the order is made to be relieved from it; or
(b) facts are discovered after an order is made that, if discovered in time, would have entitled the person against whom the order is made to an order or decision in the person’s favour or to a different order.
(2) On application by the person mentioned in subrule (1), the court may stay enforcement of the order against the person or give other appropriate relief.
(3) Without limiting subrule (2), the court may do one or more of the following —
(a) direct the proceedings to be taken, and the questions or issue of fact to be tried or decided, and the inquiries to be made, as the court considers just;
(b) set aside or vary the order;
(c) make an order directing entry of satisfaction of the judgment to be made.”
The History of r. 668
In Rockett & Anor v The Proprietors “The Sands” BUP No. 82 [2002].1 Qd R 307; [2001] QCA 99; his Honour Justice McPherson JA .
Rule 668 is, in all material respects, a re-enactment of O 45 r 1 of the Rules of the Supreme Court 1900.
His Honour continued and respectfully adopted the views expressed by Sir Samuel Griffith in Woods v Sheriff of Queensland (1895) 6 QLJ 163,:
“His careful observations [ upon Or 45 r.1 ] in Woods v Sheriff of Queensland drew a firm distinction between a claim to relief from a judgment or order that was challenged as erroneous as distinct from one that was accepted as being correct at the time it was made. It is only in the latter case that the relief may be sought under r. 668(1)(a) by reason of facts arising after the order was made or the judgment was given. Otherwise it is the procedure by way of appeal that must be resorted to. In saying this I leave out of account the possibility that r 668(1)(b) may have some operation in relation to applications for new trials on the basis of the discovery of fresh evidence”. (emphases are all mine)
Five years after Rockett a different Court of Appeal (Jerrard JA, Mackenzie and Wilson JJ) in IVI Pty Ltd v Baycrown P/L [2006] QCA 461 considered the terms and operation of r. 668. Her Honour Justice Wilson said (and again, all emphases are mine):
[74] In Breen v Lambert[28] Thomas J dealt with an application to stay a judgment pursuant to Or 45 r 1 based on the discovery of further facts ante-dating the trial. His Honour reviewed the old procedures in chancery and at common law. Speaking of the chancery practice and then of the common law he said at pp 22 – 23 —
“Clearly then the principles protecting the finality of judgments and the refusal by courts to interfere by reason of evidence available but undiscovered before action unless such evidence could not by reasonable diligence have been discovered in time, and other related principles, are of long-standing. They are based upon the requirements of public policy which include the desirability of there being an end to litigation. Jessel M.R.’s remarks show that these principles were not swept away by the Judicature Act. Nor have they have been undermined by the rules introduced by the Judicature Act (see the schedule to the Judicature Act 1876, including O. XLII r. 22). The same may be said with respect to the abolition of the common law writs of audita querela.[29] The abolition of the writs by O. LVII r. 11 in 1876 was accompanied by recognition of the court’s power to relieve against judgments on the ground of discovery of further facts, as Griffith C.J. observed in Woods v. Sheriff of Queensland.[30] The similarity between those rules and O 45 r 1 as introduced in the Rules of the Supreme Court 1900 (at least in the operative part that deals with the discovery of facts after judgment) and the general discretion entrusted to the court in such a situation is significant.”
Later he said at p 24 —
“The power is however one that is not likely to be exercised, or to be used without regard to factors which have traditionally concerned the minds of judges. I acknowledge the breadth of the power, but consider that an appropriate exercise of discretion requires account to be taken of factors of the kind that influence courts of appeal in deciding whether or not to interfere with a judgment when it is alleged that relevant evidence exists which was available but not discovered before trial. The principles applied in such cases are expressed in Fredericks v. May[31]; Clarke v. Japan Machines Australia Pty Ltd.[32]; Hawkins v. Pender Bros. Pty. Ltd.[33]
Although the application is couched in terms of an application for stay, or for ‘other relief’ it is one which, in substance, seeks the invalidation of a judgment and such applications always require careful scrutiny. I agree with the following general observation made in A.M.I.E.U. v. Mudginberri.[34]
‘The principle that there must be an end to litigation is a powerful one. Courts should not be ready to permit unsuccessful parties to attempt to overturn judgments by raising new considerations. For that reason, it is essential that a party seeking to overturn a judgment demonstrates that he or she does so only upon the footing of matters discovered since the judgment was entered. Plainly, such evidence must be weighty …’”
The quotes extracted from the Court Appeal decision in IVI v Baycrown of course focus on application under r. 668 (1) (b) ( which deals with of “ fresh “ evidence in the technical sense of that terms and not merely “ new “ evidence ) Having said that, the broader policy observations made by Her Honour remain central to the intended operation of the whole of r. 668.
Just shortly after IVI v Baycrown was decided, r. 668 was again considered by another Court of Appeal (McMurdo P, Williams JA and Jerrard JA) in Mbuzi v. Favell [2007] QCA 393. The Court said (and again, all emphases are mine):
[3] The circumstances in which it is appropriate to exercise the powers given by that rule are discussed in three cases to which this Court has been referred, by counsel for the respondent, Woods v Sheriff of Queensland [1895] QLJR 163; KGK Constructions Pty Ltd v East Coast Earthmoving [1985] 2 Qd R 13; and IVI Pty Ltd v Baycrown Pty Ltd [2006] QCA 461.
[4] In the first of those ( Woods v Sheriff of Queensland ) Griffith CJ wrote that:
“An application for such relief is not in the nature of an appeal or re-hearing; each of these is founded on the contention that the order appealed from ought not to have been made. An application for a new order which has the effect of suspending in whole or in part the operation of a previous order starts with the assumption that that order was rightly made. …[I]f it should turn out that the application is based upon the assumption that the order, the operation of which it is desired to modify, was wrongly made, it must fail.”
[5] In Rockett & Anor v The Proprietors “The Sands” Building Unit Plan No. 82 [2001] QCA 99; [2002] 1 Qd R 307, McPherson JA wrote (at page 312), of Sir Samuel Griffith’s views in Woods v Sheriff of Queensland, that Griffiths CJ:
“drew a firm distinction between a claim to relief from a judgment or order that was challenged as erroneous as distinct from one that was accepted as being correct at the time it was made. It is only in the latter case that the release may be sought under Rule 668(1)(a) by reason of facts arising after the order was made or the judgment was given. Otherwise it is the procedure by way of appeal that must be resorted to. In saying this I leave out of account the possibility that Rule 668(1)(b) may have some operation in relation to applications for new trials on the basis of the discovery of fresh evidence. This is not a question that arises here.” …[5] …
[6] That approach to the power given in UCPR 668 was reflected in the judgments of two members of this Court in IVI v Baycrown, at [13]-[14] per Jerrard JA and [43] per Mackenzie J. It results in recourse to UCPR r 668 being inappropriate when the applicant party in fact contends that the decision originally made was wrong when made, and when that party’s position is really that of an appellant challenging the validity of the original order.
What is “a fact arising after an Order is made“ and who is “a person entitled“ are both matters dealt with in the cases cited above and also by the learned authors of the current Civil Procedure texts – I do not propose repeating those thorough expositions here
New concerns arise as to the sufficiency of grounds for relief under r.668(1) (a)
In a recent decision, C v G [2008] QDC 40 ( Dodds DCJ, 14 March, 2008 -Maroochydore), the above principles were tested on an Application to set aside Consent Orders made before a District Court Registrar in a de facto property matter under Part 19 of the Property Law Act. The facts were:
Following a quite short relationship of about 3 years duration the parties separated and the female partner sought an Order for division of the parties property — After chattels were divided, the only remaining asset was a house in joint names.
Both parties took legal advice and at the conclusion of that process, which included the obtaining of a formal Valuation of a well known firm of Registered Valuers, the female agreed to accept the sum of $40,000 — ( the settlement sum )
The settlement sum was arrived at upon a largely commercial basis — There were no children. In fact, the female’s sole contribution to the real property asset was her execution of a First Home Owner’s Grant Application and as a, purely nominal, supporter of the mortgage — All monetary contributions were made by the male, as were improvements.
Consent Orders were entered in terms which required the male to pay the female the settlement sum within a month of the Order being made — He found he could not raise the necessary finance.
After the expiration of the month allowed by the Order, the female, (still independently advised by qualified and experienced family lawyers) did not seek to enforce the Order: Instead, she entered into agreement with the male under which the parties would put the property to Auction — In reaching that agreement the female did not reserve her rights in the event the Auction produced more than the Valuation obtained about 5 weeks earlier — The agreement to auction was wholly purposive in the sense that the parties sought to give effect to the Consent Order by placing the male in a position where the female could be paid out.
The property was passed in at auction, but in post-auction negotiations a price of nearly $80,000 more than the Valuation was agreed. Still advised by her lawyers, and with full knowledge of the higher-than-Valuation price, the female signed the auction sale contract.
At this point it is submitted the female has made certainly one, if not two, binding elections — Leaving aside her decision not to enforce the Order and instead agreeing to an auction on the basis that she was to be paid the agreed settlement sum from the net proceeds, she has made a clear and uncontroversial election by her unqualified execution of the post Auction Sale Contract. Sargent v ASL Developments Pty Ltd (1974) 131 CLR 634; HCA 40 [28]-[33];
Through no fault of the vendors the contract was lost — At this point the female commenced proceedings seeking to set aside the Consent order — Her Application was
That the Consent Order made on … [date ] … be set aside 1
At the Hearing the female Applicant revealed that her Application was brought under UCPR r. 668 (1) (a). That was problematic because ( the question of her elections left aside entirely), she directly challenged the correctness of the Order at the time it had been made. The ground she took in her sworn material, in respect of the single agreed expert Valuation obtained prior to the Consent Order being entered was …
“ That valuation was clearly incorrect “ ( my emphasis )
Her own Counsel took up that unequivocal ground and Submitted …
“ the true value of the property is a fact discovered after the order was made “
It is implicit in both quoted assertions that the real foundation of the female’s complaint was that the Consent Order was made wrongly: More particularly, because
(a) the Valuation was in a significantly understated amount; and accordingly
(b) she was “ entitled “ ( [sic] and which was not conceded ) to more at the time that Order was made and accordingly a new Order should be made ). 2
The female also sought to proceed in a way which seemed an attempt to amalgamate the two [2] separate bases of relief which are provided by r.668 (1) (a) and (b) — She complained:
Because a price was offered on the property in an amount higher than the sum appointed under the single agreed expert valuation that higher price should be received and accepted by this Court as a “ fact “ which amounts to fresh ( not new ) evidence of the proper [sic] value to be placed on the property “
The first problem with this formulation is that it challenges the correctness of the valuation at the time it was obtained. It is implicit in the assertion that the “ proper “ [sic] value was ( past tense ), in fact, higher. Of course, the corollary is the Consent Order was wrongly made
The second problem was that the Applicant’s position confused the concepts of price and valuation— a position which was patently misconceived and bad in point of Law.3 The post auction price is not “ fresh “ evidence ( properly so-called ), neither is it evidence of the “proper value” [sic] of the property at all, or at the time the parties entered into their Consent Order.
The third problem is that, her challenge to the correctness of the Order at the time it was made was held up to support the non-sequitur that the higher post auction price was “ fresh “ evidence of the kind contemplated by r.668(1)(b). All else besides, this merely emphasized her core contention was the original single expert Valuation was, quite simply, wrong.
Further, and with the greatest of respect, the attempt to “ mix up “ or amalgamate the two separate limbs of r. 668 (1) misconceives the clear intent of r. 668. The relief allowed by r. 668 is framed by quite distinct circumstances and those separate grounds have their origins in two separate, albeit closely related, lines of Common Law principle of long standing and high authority.
If a higher valuation was in fact available, then, it is ex hypothesi, that such a Valuation was available when the Consent Order was made. That stands, a fortiori, if the higher “ proper “ valuation was substantially higher – Such a higher Valuation therefore could and should have been published by a competent Valuer or obtained, ( including by way of an up-date Valuation ) through and by the exercise of due diligence on the part of solicitors.
That another higher ( or up-date ) Valuation was not obtained might well open to other avenues of relief, but it does not open the door to relief under either rr.668 (1) (a) or (b).
His Honour Dodd DCJ rejected all those Submissions and found for the Applicant female, allowing her Application and set aside the Consent Order. The Respondent male was not funded to conduct an Appeal and time for Appeal has now run.
It is submitted that the decision in C v G exposes clients and practitioners to grave and very serious uncertainty about the finality of Consent Orders in the area of de facto property Law
The decision is extremely regrettable, most especially in the context of either a rising or falling property, or investment market — Even short delays in meeting the terms of Orders, including Consent Orders, have seen, and, in the future, will very likely see, significant fluctuations in prices. In a context of fluctuating market returns, inevitably and unavoidably, there will always be winners and losers. Responsible practitioners and sensible clients generally have been pragmatic about real-world problems associated with refinancing debt in order to make payments due under Orders — This decision legitimises a departure from those sensible practises, and worse, potentially encourages a complete re-opening of expensive litigation. That should not be permitted for the soundest policy reasons: The maxim is :
interest rei publicae ut sit finis litium” 4
On that topic and in closing, it is apposite to recall the words of his Honour, Justice Brennan, (the rest of the High Court concurring in the result ) in Harris v Caladine (1991) 172 CLR 84; [1991] HCA 9; at [8]: His Honour said:
… Consent orders finally disposing of the issues between parties to proceedings in a court have always been regarded as a judicial determination of those issues and nonetheless so because they are made in accordance with a contract between the parties: Huddersfield Banking Company, Limited v. Henry Lister and Son, Limited (1895) 2 Ch 273; Ainsworth v. Wilding (1896) 1 Ch 673, at p 676; Kinch v. Walcott (1929) AC 482; Permanent Trustee Co. (Canberra) Ltd. v. Stocks and Holdings (Canberra) Pty.Ltd. (1976) 28 FLR 195, at p 199. Moreover, as a judicial order of a superior court affords protection to a person executing it (Howard v. Gosset (1845) 10 QB 359, at pp 453-454 (116 ER 139, at p 173); Williams v. Smith (1863) 14 CB(NS) 596, at pp 620-621,623,625 (143 ER 579, at pp 588,589,590); Williams v. Williams and Nathan (1937) 2 All ER 559, at pp 562-563), the very purpose of procuring the making of orders by consent is to ensure that the terms agreed are susceptible of enforcement as a curial order
David R.L. Laws
Endnotes
- Experienced practitioners will observe the clear non-compliance with UCPR r.149. I also note that relief under Section 267 of Part 19 of the Property Law Act was closed to the Applicant since a Consent Order as defined by UCPR r. 666 is not a :” recognised agreement “ within the definition of s. 266 of Part 19.
- She also complained that having been out of the use of her money for so long has seen the property rise in value such that she should excused her original bargain and permitted to re-open her property settlement. That is all well and good: But she failed to enforce the Order as was her right and instead elected to take a different fork in the road by (1) authorizing an auction sale and then (2) signing off on a post-auction contract for sale without ever suggesting she thought had a claim to a bigger slice of the cake.
- Spencer v Commonwealth (1907) 5 CLR 418 and the careful analysis of his Honour Justice Mc Laughlin in Jacqueline Sand’s Case [ 2007] NSWSC 1200 at [31] — [39]
- ‘ The public interest requires the end of law suits ‘ or as it is also commonly construed ‘ It is in the public interest that litigation be final ‘—
see also Fullagar J in Jackson v Goldsmith [1950] HCA 22; (1950) 81 CLR 446 at 466 468 where his Honour observed
The rule as to res judicata can be stated sufficiently for present purposes by saying that, where an action has been brought and judgment has been entered in that action, no other proceedings can thereafter be maintained on the same cause of action. This rule is not, to my mind, correctly classified under the heading of estoppel at all. It is a broad rule of public policy based on the principles expressed in the maxims “interest reipublicae ut sit finis litium” and “nemo debet bis vexari pro eadem causa.”
